Dealing with the Complexity of Settling Private CERCLA Claims: Due Process, Article III, and Sovereign Immunity

Abstract

The inaugural issue of the St. Thomas Law School’s Journal on Complex Litigation, provides an opportunity to describe in a more comprehensive way the complex constitutional and practical problems with CERCLA’s private cause of action. Part I explains the evolution of the EPA and the DOJ’s position regarding the private cause of action under CERCLA Section 107, the right of contribution under CERCLA Section 113(f), and the effects of a settlement between the Government and potentially responsible parties (“PRPs”) on those rights of action. Part II elaborates constitutional difficulties with the Government’s positions regarding CERCLA’s private cause of action in light of Atlantic Research. First, the article explains how the Government’s position that it can extinguish private party claims constitutes a “protection racket,” because its interpretation of the “contribution protection” provisions of the statute is erroneous and violates Due Process. Second, it explains constitutional difficulties associated with contribution protection arising from the administrative nature of many CERCLA settlements. The constitutionality of Congress’s assignment of possible resolution of a dispute to a non-Article III tribunal is limited to situations where the dispute is “closely integrated into a public regulatory scheme.” While the resolution of the Government’s own cost recovery claims and the extinguishment of related contribution claims clearly involves “public rights,” administrative (i.e. non-judicial) resolution of private CERCLA claims remains questionable. Where a private CERCLA plaintiff is unwilling to submit his response costs claim against other PRPs to the EPA for resolution, the EPA’s administrative extinction of such claim may fall outside of the “public rights” exception to the requirement for Article III-court adjudication of claims. Finally, the article explains why the Eleventh Amendment poses a constitutional obstacle to the resolution of CERCLA claims, whether the resolution is administrative or judicial. Since states are not liable under CERCLA where the plaintiff is not the Government or a state, whether a state is liable and therefore must participate in a CERCLA settlement depends on the prosecutorial discretion of the United States. Part III discusses practical and strategic considerations in litigating CERCLA cases in light of the complexities caused by the private cause of action and these constitutional limitations. Finally, the article offers the EPA some advice in how to settle or resolve CERCLA cases in light of these complexities.

Keywords: CERCLA, due process, Article III, sovereign immunity, Eleventh Amendment, contribution, settlement