Legal Update: The US Supreme Court rules on triggers for CERCLA Statute of Limitations. By Ilene Munk

The US Supreme Court rules on triggers for CERCLA Statute of Limitations
The Territory of Guam v. United States
Decision by the U.S. Supreme Court
(May 24, 2021)

The Supreme Court has issued a decisive and clear message on the issue of statute of limitations calculations under CERCLA, 42 U.S.C. § 9601 et seq.. Clarence Thomas, writing for a unanimous court made clear; the trigger for the running of the statute of limitations under CERCLA (a/k/a Superfund) allowing performing parties to recoup cleanup costs from other liable parties begins to run only after settling a CERCLA specific matter, and not upon settling matters related to other environmental laws. Justice Thomas wrote: “The most natural reading of [Section] 113(f)(3)(B) is that a party may seek contribution under CERCLA only after settling a CERCLA-specific liability, as opposed to resolving environmental liability under some other law.”

The Guam case is fascinating: The Ordot Dump site, a “28-foot mountain of trash” constructed by the US Navy in the 1940s, and was used to dump allegedly toxic military waste for decades. The Territory of Guam also used the site for trash disposal. In 2004 EPA entered into a Consent Decree with the Territory of Guam to take certain environmental actions pursuant to the Clean Water Act. 10 years after the settlement the Territory of Guam sought contribution protection from the US Navy. The Navy responded by arguing the statute of limitations had run and Guam was stuck with all response costs. The wrinkle in the analysis was that the 2004 Consent Decree arose out of the Clean Water Act, (CWA) and not CERCLA. Although the DC circuit seemed to agree with the US Navy, the Supreme Court was unanimous in their rejection of that analysis.

The court’s ruling brings much needed clarity to an issue which has been the source of a great deal of angst and argument in other appellate courts over the years. The 9th circuit, the DC circuit, as well as the 3rd and 7th circuits had all previous ruled that an environmental settlement initiated under a different environmental statute such as the Clean Water Act, (CWA) or Resource Conservation and Recovery Act, (RCRA), was the triggering event for the running of the three-year clock for commencement of a contribution claim under Section 113 (f)(3)(B). The 2nd circuit was of the opinion, ultimately reached by the Supreme Court, that only settlements under CERCLA trigger the statute of limitations for contribution protection.