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David Berg v David Popham (05/20/2005) sp-5896
David Berg v David Popham (05/20/2005) sp-5896
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
DAVID BERG and MARGE BERG, )
) Supreme Court No. S-10815
Appellants, )
) U.S. District Court No. CV-00-00151 JWS
v. ) Ninth Circuit No. 01-35807
)
DAVID and TSUKIKO POPHAM, ) O P I N I O N
d/b/a ALLADIN CLEANERS, and )
NORGE CORPORATION, and its ) [No. 5896 - May 20, 2005]
successors in interest MAGIC CHEF )
CORPORATION, MAYTAG )
CORPORATION, ABC INC., )
ABC CO., and ABC CORP., )
)
Appellees. )
)
Certified Question from the United States
Court of Appeals for the Ninth Circuit on
Appeal from the United States District Court
for the District of Alaska, John W. Sedwick,
Judge.
Appearances: Michael W. Flanigan, Walther &
Flanigan, Anchorage, for Appellants. Joseph
R.D. Loescher, Hughes Thorsness Powell,
Anchorage, and I. Franklin Hunsaker and
Christopher Angius, Bullivant Houser Bailey,
Portland, Oregon, for Appellees.
Before: Bryner, Chief Justice, Matthews,
Eastaugh, Fabe, and Carpeneti, Justices.
CARPENETI, Justice.
I. INTRODUCTION
The Ninth Circuit has certified the following two
questions to this court:
1. Alaska Statute section 46.03.822(a)(4), in
contrast to 42 U.S.C. 9607(a)(3), contains
the word or preceding the phrase by any other
party or entity. In light of the inclusion
of the word or, does section 46.03.822(a)(4)
require that a person own, possess, have
authority to control, or have a duty to
dispose of the hazardous substance that is
released, before that entity can be subject
to arranger liability as is required under 42
U.S.C. 9607(a)(3)?
2. If the answer to Question 1 is no, may an
entity be subject to arranger liability under
Alaska Statute section 46.03.822(a)(4) if it
manufactures, sells, and installs a useful
product that, when used as designed, directs
a hazardous substance into the city sewer
system?[1]
Because we find that AS 46.03.822(a)(4) was intended to be more
inclusive than its federal counterpart, we hold that the answer
to the first question is no, and the answer to the second
question is yes.
II. FACTS AND PROCEEDINGS
David and Marge Berg owned and operated the Boni-Park
laundry and dry cleaning business in Anchorage from 1972 until
1978. David and Tsukiko Popham purchased the business in 1978
and operated it until they resold the company to the Bergs in
1980. The Bergs owned and operated the business again until
1983, when they sold the business to the Jaeger family.
From the pleadings, it appears that Boni-Park was part
of a franchise arrangement with the Norge Corporation, a
manufacturer of dry cleaning equipment. According to the Bergs,
a Norge dealer in Anchorage designed the layout of the equipment
and installed the equipment in accordance with Norge manuals and
installation materials. The Bergs claim that Norge personnel
visited Boni-Park several times to check whether the facility was
being run in accordance with Norge practices and procedures and
that these personnel assured them that the Norge equipment,
including the dry cleaning facilities, had been correctly
installed and were being correctly operated.
The Norge dry cleaning equipment at Boni-Park used the
hazardous substance Perchlorethylene (PCE or Perc) as a cleaning
solvent that was mixed with water during the dry cleaning
process. A water/Perc separator was then used to recapture the
PCE while the separated water was flushed through a drainage
system into the local sewer lines. A vaporization process was
also used periodically to cleanse any oil and dirt residue that
had accumulated during recycling of the PCE. This vaporization
process yielded a PCE-contaminated sludge, which was also flushed
into the sewer lines. There is no allegation that the defendants
provided PCE to Boni-Park, but only that they arranged for the
disposal of waste byproducts generated by the dry cleaning
process.
At some point, PCE escaped into the environment from
Boni-Parks premises or from the sewer pipes leading from the
property, perhaps through underground leaks. The Bergs assert
that, throughout the time they owned and operated Boni-Park, they
used and maintained the dry cleaning equipment exactly as
specified by Norge, and that they never spilled PCE. Because we
do not address factual disputes in answering a certified
question, we assume for the purposes of this decision that the
Bergs are correct when they contend that the release of PCE could
only have been through the factory-designed, approved, and
installed drain lines.
In 1987 or 1988 the State of Alaska discovered the
presence of PCE in the soil near Boni-Park. The state notified
the Bergs that they were potentially responsible persons (PRPs)
under AS 46.03.822 (section .822), Alaskas version of the federal
Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA).2 Alaska Statute 46.03.822 makes the owners of a
facility from which there is a release of a hazardous substance a
class of PRPs, strictly liable to the state for the costs of
cleanup and remediation.3 The Bergs were compelled to pay into a
cleanup fund with other PRPs as part of the remediation effort
for this site. The Bergs sued their insurer to obtain these
funds. Section .822 also allows PRPs to obtain damages or
contribution from other parties who contributed to the release of
the hazardous substance.4 The Bergs settlement with their
insurer allowed the insurer to seek contribution, indemnity, or
similar relief from any responsible parties.
After allegedly incurring over $1 million in costs
associated with the PCE cleanup, the Bergs sought contribution
from the Maytag Corporation and Norges other successors-in-
interest (hereinafter referred to collectively as Maytag). They
sued under a theory of so-called arranger liability under AS
46.03.822(a)(4) or U.S.C. 9607(a)(3). Maytag removed the case
to the federal district court, which granted in part Maytags
motion to dismiss because it held that arranger liability was
inapplicable to Maytag under CERCLA or section .822.5 On appeal
to the Ninth Circuit, the Bergs did not contest the dismissal of
their CERCLA claim, but they argued that the district court
erroneously interpreted section .822s arranger liability
provision.6 The Ninth Circuit certified the two questions above
to clarify Alaska law on this issue.7
III. STANDARD OF REVIEW
In deciding a question of law upon certification from
another court under Appellate Rule 407(a), we must stand in the
shoes of the certifying court, yet exercise our independent
judgment.8 A certified question necessarily involves
determinative questions of Alaska law for which there is no
controlling precedent.9 Therefore, we must select the rule of
law that is most persuasive in light of precedent, reason, and
policy.10
IV. DISCUSSION
A. The First Certified Question
The first certified question asks whether, considering
the slight difference between the language of section .822 and
CERCLA, a person or entity must own, possess, have authority to
control, or have a duty to dispose of a hazardous substance in
order to be susceptible to arranger liability under AS
46.03.822(a)(4). The meaning of this provision is a question of
first impression.
CERCLA imposes strict liability on:
any person who by contract, agreement, or
otherwise arranged for disposal or treatment,
or arranged with a transporter for transport
for disposal or treatment, of hazardous
substances owned or possessed by such person,
by any other party or entity, at any facility
or incineration vessel owned or operated by
another party or entity and containing such
hazardous substances, and . . .[11] from which
there is a release, or a threatened release
which causes the incurrence of response
costs, of a hazardous substance[.][12]
By contrast, AS 46.03.822(a)(4) imposes strict liability on:
any person who by contract, agreement, or
otherwise arranged for disposal or treatment,
or arranged with a transporter for transport
for disposal or treatment, of hazardous
substances owned or possessed by the person,
other than domestic sewage, or by any other
party or entity, at any facility or vessel
owned or operated by another party or entity
and containing hazardous substances, from
which there is a release, or a threatened
release that causes the incurrence of
response costs, of a hazardous substance[.]
(Emphasis added.)
Both parties acknowledge that CERCLA is the source of
section .822s so-called arranger liability provision, but they
differ on how closely section .822s meaning was meant to track
that of CERCLA. While 42 U.S.C. 9607(a)(3) and AS
46.03.822(a)(4) contain nearly identical wording, the Ninth
Circuit has noted a small but potentially pivotal difference
between the two provisions. Alaskas legislature added the word
or to section .822 before by any other party or entity.
The parties devoted much of their briefing to debating
the significance of this difference. Maytag argues that the
missing or in CERCLA is merely the result of sloppy drafting, and
should be read into the provision by common sense. As the words
of the two provisions are nearly identical, Maytag urges us to
interpret subsection .822(a)(4) as imposing the same thing as
subsection 9607(a)(3): strict liability for anyone who arranged
for disposal or treatment of a hazardous substance that he owned
or possessed. By arguing that the arranger liability provisions
of CERCLA and section .822 are worded essentially identically,
Maytag implies that federal CERCLA case law should be strong
persuasive authority as to the interpretation of section .822s
arranger liability. Maytag then points to federal cases that it
believes would not support arranger liability here.
The Bergs argue that federal law is essentially
different from state law because of their linguistic
dissimilarities, and that Alaskas statute is broader than CERCLA,
creating arranger liability for any person who . . . arranged . .
. for . . . treatment of hazardous substances, owned or possessed
by the person . . . or by any other party or entity . . . .
(Emphasis added.) The Bergs contend that federal cases are of
little help in interpreting section .822.
While federal case law interpreting a federal statute
does not control our decision in interpreting a state statute,
the Alaska legislature intended that CERCLA be used as a
framework for interpreting section .822.13 Accordingly, we look
first to the federal cases for guidance. Although CERCLA does
not define the term arranged, federal courts have established
basic rules for determining arranger liability. The Supreme
Court has noted that Congress intended that CERCLA contain a
sweeping remedy for hazardous waste contamination.14 Other
federal courts have noted that a broad construction of CERCLAs
arranged for clause is consistent with Congresss overall purpose
in enacting CERCLA15 or have interpreted arranger liability
liberally, in light of CERCLAs overwhelmingly remedial scheme. 16
The all-inclusive phrase, by contract, agreement, or otherwise,
following the word arranged further indicates the broad potential
scope of this provision.17 In determining arranger liability,
federal courts look beyond the defendants characterization of the
transaction at issue,18 and instead examine the facts of each
individual case.19
Our review of the federal cases,20 however, has
disclosed no federal decision involving facts truly analogous to
those of the present case.21 And while Alaska law is generally
modeled on CERCLA, it is clear that there are differences between
the two statutes in several respects. We thus turn to a closer
inspection of the two statutory schemes,22 with special attention
to the text and legislative history of section .822.
Neither AS 46.03.822(a)(4) nor CERCLA defines the
phrase arranged for. However, there is an important difference
between section .822 and CERCLA. While CERCLA lists four classes
of persons potentially responsible for the release of hazardous
substances, subsection .822(a) lists five. Those potentially
responsible under 9607(a) are: (1) the owner and operator of a
vessel or a facility from which hazardous substances were
released; (2) the owner or operator of a facility where hazardous
substances were disposed of, at the time of disposal; (3)
arrangers; and (4) transporters of hazardous substances.23
Subsection .822(a)(1) adds to CERCLAs classes of PRPs the owner
of, and the person having control over, the hazardous substance
at the time of the release. Our principles of statutory
construction militate against interpreting a statute in a manner
that renders other provisions meaningless. 24 Thus, in
interpreting subsection .822(a)(4), we cannot disregard
subsection .822(a)(1) or render it redundant. Because Alaska
treats as PRPs those who have ownership and control of a
hazardous substance as well as those who arrange for its
disposal, these classifications cannot be synonymous.
This difference between Alaska and federal law reflects
our legislatures intent to expand liability beyond CERCLAs
standards, even if section .822s legislative history is silent as
to the interpretation and application of arranger liability
specifically. While section .822 was modeled on CERCLA
generally, it was revised in the months following the Exxon
Valdez catastrophe, so its scope would be broader than that of
its forebear.25 One commentator noted that, under the revised
section .822, persons merely responsible for managing or handling
a hazardous substance could face liability for its release even
after the substance has left their control.26
In light of the textual distinctions between the
federal and state statutes, and based upon our review of the
legislative history of section .822, we adopt a standard of
arranger liability that is broader than that of the Ninth
Circuit. Like most courts assigning arranger liability under
CERCLA, we hold that arranger liability under AS 46.03.822(a)(4)
requires some actual involvement in the decision to dispose of
waste27 that was substantial or integral. However, we note that
actual involvement in a decision to dispose of waste can
encompass involvement in deciding how to dispose of waste or in
facilitating such disposal. Involvement in deciding how to
dispose of waste can, in turn, include actions such as designing,
installing, or connecting a system that disposes of waste on
behalf of a third party.
Our interpretation of AS 46.03.822(a)(4) finds support
in a state case with facts similar to this one, R.R. Street &
Co., Inc. v. Pilgrim Enterprises, Inc.28 Pilgrim was a dry
cleaner seeking to recover PCE cleanup costs from Street, its dry-
cleaning equipment supplier.29 The Texas appellate court held
that Street was an arranger under the Texas equivalent of CERCLA.30
The court noted that the federal circuit courts agree that there
must be a nexus between the potentially responsible party and the
disposal of the hazardous substance, and that, [g]enerally, the
nexus must be premised on the conduct of the party in respect to
the disposal of the hazardous waste.31 As the court summarized,
[a]lmost all courts that have held defendants liable as arrangers
have found that the defendant had some actual involvement in the
decision to dispose of waste.32 Because the defendant gave direct
advice . . . as to how to dispose of waste containing PCE, it
thus had some actual involvement in the decision to dispose of
the waste.33
We find the reasoning of the Texas court to be
persuasive, particularly since the facts of this case are very
similar. Like the supplier in R.R. Street, Norge visited and
inspected the Bergs business and provided service and technical
advice.34 While Norge did not actually conduct tests involving
PCE, it did connect the dry cleaning equipment to the plumbing
system. We apply the actual involvement standard articulated in
R.R. Street because this standard conforms with the intent of the
Alaska legislature when it revised section .822 and broadened
arranger liability.
B. The Second Certified Question
Having decided that a person need not own, possess,
have authority to control, or have a duty to dispose of a
hazardous substance in order to be subject to arranger liability
under section .822, we turn next to the second certified
question. This question asks whether a person or entity lacking
ownership, possession, authority, or a duty to dispose can be
liable for making, selling, or installing a useful product that
purposely directs hazardous substances into the environment.35
Federal courts have limited arranger liability by
reading arranged in the context of for disposal or treatment.
They have consistently held that a manufacturer who does nothing
more than sell a useful, albeit hazardous, product to an end user
has not arranged for disposal of a hazardous substance.36 Under
this useful product exception, even a company distributing a
hazardous chemical that later causes environmental harm can avoid
liability as an arranger under CERCLA.37 In classifying useful
products, federal courts have recognized several basic standards.
A newly manufactured chemical incorporated into other downstream
products is considered useful; thus, [s]elling hazardous
substances as part of a complete, useful product does not
generally make a party a responsible person.38 Similarly, used
substances or products containing hazardous materials are
considered useful and are not disposed of when sold for reuse.39
Even arranging the sale of hazardous byproducts of other
manufacturing processes can fall within the useful exception to
CERCLA liability if such substances are themselves intended for
other productive uses.40 The key inquiry is often whether the
alleged arrangers intent was to dispose of waste or to sell a
product.41
Essentially, the second certified question asks whether
AS 46.03.822(a)(4) includes CERCLAs useful product exception to
arranger liability. We have never addressed that doctrine,
either in reference to CERCLA or in applying this states own
environmental laws. But the Alaska legislature clearly intended
section .822 to contain some exception from arranger liability
for useful products. Legislators voiced concern that if section
.822 was too broad, it would lead to exorbitant insurance costs
and deter commerce, particularly the supply of goods and services
to rural communities.42 The legislature enacted a law
specifically designed to avoid imposing liability on virtually
everyone in the chain of commerce who had ever handled [a
released hazardous] substance, even if that person had absolutely
nothing to do with the release.43 Thus, section .822 represents a
compromise between the goal of controlling hazardous waste and
the desire to ensure that useful products are available to
consumers.44
While many federal cases discuss the useful product
exception, none of the cases cited by Maytag, nor any that we
could find, applied the doctrine to shield a party whose products
or services were known to facilitate another partys disposal of
hazardous materials; instead, most federal cases apply the
exception to shield suppliers of tangible physical goods put to
further productive use by their recipients.45 But this case deals
with machines and services specifically designed to release
hazardous substances as part of their essential function. As we
noted above, the water/Perc separator flushed waste water into
sewer lines, and post-vaporization PCE-contaminated sludge was
also flushed into sewer lines. Thus, we are not persuaded that
the useful product exception to section .822 liability is
applicable in this case.
Furthermore, the history of section .822 shows that
Alaskas useful product exception is narrower than CERCLAs. The
legislature noted that it would not go nearly as far as CERCLA in
limiting the liability of persons dealing in useful substances.46
Specifically, section .822s sponsors noted that, while CERCLA was
the model for section .822 generally, CERCLA is directed only at
wastes, while section .822 was drafted in such a way that all
harmful substances are treated the same.47
Thus, while we recognize a useful product exception to
arranger liability under section .822, this exception does not
protect from arranger liability under AS 46.03.822(a)(4) an
entity manufacturing, selling, or installing a useful product
that is intended to direct a hazardous substance into a city
sewer system.
B. The Bergs Other Contribution Claims Need Not Be Addressed.
The Bergs also argue that the overriding issue in this
case is whether they can maintain a state contribution claim
under AS 46.03.828, AS 09.16.010-040, or AS 09.17.080 in addition
to section .822. Because we were asked by the Ninth Circuit to
resolve only two questions concerning the proper interpretation
of AS 46.03.822, we decline the invitation to determine whether
the Bergs have a claim for contribution under other sections of
the Alaska Statutes. While we may reformulate a question as we
see fit,48 we decline to address issues not raised by the
certifying court.49
V. CONCLUSION
1. Alaska Statute 46.03.822(a)(4) does not require
that a person own, possess, have authority to control, or a duty
to dispose of a hazardous substance for that person to face
arranger liability for the release of that substance. Rather,
under AS 46.03.822(a)(4), any person who was actually involved in
a decision to dispose of, or a decision on how to dispose of, a
hazardous substance may be liable.
2. The provider of a useful product is not
automatically liable under AS 46.03.822(a)(4) for the subsequent
release of a hazardous substance related to that product. But an
entity may be liable if it manufactures, sells, or installs a
useful product that is intended to direct, and when used as
designed, directs a hazardous substance into a city sewer system.
In the Supreme Court of the State of Alaska
David Berg and Marge Berg, )
) Supreme Court No. S-10815
Appellants, )
v. ) Order
) Petition for Rehearing
David and Tsukiko Popham, et al., )
)
Appellees. ) Date of
Order: 5/20/05
U.S. District Court No. CV-00-00151JWS
Ninth Circuit No. 01-35807
Before: Bryner, Chief Justice, Matthews, Eastaugh, Fabe, and
Carpeneti, Justices.
On consideration of the motion to correct clerical
mistake/petition for rehearing, filed on 04/01/05, and the
opposition filed on 04/11/05,
It is Ordered:
1. The Petition for Rehearing is Granted.
2. Opinion No. 5879, issued on March 18, 2005, is
Withdrawn and Opinion No. 5896 is issued on this date in its
place.
Entered by direction of the court.
Clerk of the Appellate Courts
Marilyn May
cc: Supreme Court Justices
Judge John W. Sedwick
West Publishing
Other Publishers
Distribution:
Michael W
Flanigan
Walther &
Flanigan
1029 W. 3rd
Avenue Suite 250
Anchorage AK
99501
Christopher Angius
Holland & Knight
LLP
2300 US Bancorp
Tower
Portland OR 97204
Joseph R D
Loescher
Spencer &
Loescher, LLC
1326 Tacoma Ave.
S. Suite 101
Tacoma WA 98402
_______________________________
1 Berg v. Popham, 307 F.3d 1028, 1029 (9th Cir. 2002).
2 42 U.S.C. 9601-9675 (West 2004).
3 AS 46.03.822 states in relevant part:
(a) . . . the following persons are strictly
liable, jointly and severally, for damages,
for the costs of response, containment,
removal, or remedial action incurred by the
state, a municipality, or a village, and for
the additional costs of a function or
service, including administrative expenses
for the incremental costs of providing the
function or service, that are incurred by the
state, a municipality, or a village, and the
costs of projects or activities that are
delayed or lost because of the efforts of the
state, the municipality, or the village,
resulting from an unpermitted release of a
hazardous substance or, with respect to
response costs, the substantial threat of an
unpermitted release of a hazardous substance:
. . . .
(2) the owner and the operator of a
vessel or facility, from which there is a
release, or a threatened release that causes
the incurrence of response costs, of a
hazardous substance[.]
4 AS 46.03.822(j) provides:
A person may seek contribution from any other
person who is liable under (a) of this
section during or after a civil action under
(a) of this section. Actions under this
subsection shall be brought under the Alaska
Rules of Civil Procedure and are governed by
state law. In resolving claims for
contribution under this section, the court
may allocate damages and costs among liable
parties using equitable factors determined to
be appropriate by the court. This subsection
does not diminish the right of a person to
bring an action for contribution in the
absence of a civil action under (a) of this
section.
5 Berg, 307 F.3d at 1029-30.
6 Id. at 1030.
7 Id. at 1029, 1031-32.
8 FDIC v. Laidlaw Transit, Inc., 21 P.3d 344, 346 (Alaska
2001).
9 Id.
10 Kallstrom v. U.S., 43 P.3d 162, 165 (Alaska 2002).
11 42 U.S.C. 9607(a)(3).
12 42 U.S.C. 9607(a)(4).
13 See Bill Review letter from Douglas B. Baily, Attorney
General, to Governor Steve Cowper on H.B. 68 (May 11, 1989), in
Alaska State Archives, Series 1185, Record Group 91, Box No.
7892, File No. 883-89-0039.
14 Pennsylvania v. Union Gas Co., 491 U.S. 1, 21 (1989)
(plurality opinion) (overruled on other grounds by Seminole
Tribe of Florida v. Florida, 517 U.S. 44 (1996)).
15 Morton Intl, Inc. v. A.E. Staley Mfg. Co., 343 F.3d
669, 676 (3d Cir. 2003).
16 U.S. v. Vertac Chem. Corp., 966 F. Supp. 1491, 1501
(E.D. Ark. 1997) (quoting U.S. v. Aceto Agric. Chems. Corp., 872
F.2d 1373, 1381 (8th Cir. 1989)).
17 See Morton, 343 F.3d at 676.
18 Id. at 677.
19 Concrete Sales & Servs., Inc. v. Blue Bird Body Co.,
211 F.3d 1333, 1336 (11th Cir. 2000).
20 The Ninth Circuit demands actual exercise of control by
someone within a defendant entity, U.S. v. Shell Oil Co., 294
F.3d 1045, 1058 (9th Cir. 2002), because [n]o court has imposed
arranger liability on a party who never owned or possessed, and
never had any authority to control or duty to dispose of, the
hazardous materials at issue. Id. at 1058 (quoting U.S. v. Iron
Mountain Mines, Inc., 881 F. Supp. 1432, 1451 (E.D. Cal. 1995)).
The Second Circuit has suggested that actual involvement in the
decision to dispose of waste, Gen. Elec. Co. v. AAMCO
Transmissions, Inc., 962 F.2d 281, 286 (2d Cir. 1992), is
sufficient. Id. at 286-87. The Seventh Circuit imposes liability
if a defendant intended to arrange for the disposal or treatment
of the harmful substance, Amcast Indus. Corp. v. Detrex Corp., 2
F.3d 746, 751 (7th Cir. 1993), while the Sixth Circuit looks at
whether there is a contract or agreement or if the defendant has
taken any affirmative acts to dispose of the hazardous substance.
U.S. v. Cello-Foil Prods., Inc., 100 F.3d 1227 (6th Cir. 1996).
The Sixth Circuit explained that an intent-based standard of
liability does not contradict CERCLAs strict liability. Id. at
1232. The defendants state of mind only determines whether he
arranged for disposal or treatment. Id. Once the intent to
arrange is determined, that arranger is strictly liable for any
harms resulting from the arrangement. Id. The Eleventh Circuit
is flexible and will consider several factors, none of which is
dispositive, including the intent to dispose of the substance at
the time of the transaction, whether the defendant made the
crucial decision to place hazardous substances in the hands of a
particular facility, and whether the defendant knew of the
disposal. Concrete Sales & Servs., Inc., 211 F.3d at 1336-37
(internal citations omitted).
21 The cases cited by Maytag involve factual settings
substantially different from the instant dispute: Iron Mountain
Mines, Inc., 881 F. Supp. at 1435-37, 1449, 1451-52 (governments
construction and management of dams regulating flow of waterways
polluted by mining runoff does not constitute arranging for the
disposal of runoff); Gen. Elec. Co. v. AAMCO Transmissions, Inc.,
962 F.2d 281, 283-88 (2d Cir. 1992) (oil companies did not
arrange for disposal of waste oil from affiliated service
stations, where oil companies had supplied fresh oil, equipment,
and inspection services, but did not require service stations to
collect and resell waste oil); Edward Hines Lumber Co. v. Vulcan
Materials Co., 685 F. Supp. 651, 652-56 (N.D. Ill. 1988)
(defendant who designed, constructed, and installed chemical
system in wood treatment plant but did not decide how the
hazardous substance would be disposed of after its use did not
arrange for disposal of chemicals).
22 See Flisock v. State, Div. of Ret. & Benefits, 818 P.2d
640, 643 (Alaska 1991) (holding that statutory interpretation
begins with language of statute).
23 42 U.S.C. 9607(a) (West 2004).
24 Rollins v. State, Dept of Revenue, Alcoholic Beverage
Control Bd., 991 P.2d 202, 208 (Alaska 1999) (quoting M.R.S. v.
State, 897 P.2d 63, 66 (Alaska 1995)).
25 See Bill Review letter, supra, n.14.
26 Committee Minutes, Senate Judiciary Committee hearing
on H.B. 68 (May 2, 1989) (comments of Dennis Kelso, Commissioner
of Department of Environmental Conservation).
27 See Gen. Elec. Co. v. AAMCO Transmissions, Inc., 962
F.2d 281, 286 (2d. Cir. 1992) (noting that almost all courts
assigning arranger liability require actual involvement in
decision to dispose of waste).
28 81 S.W.3d 276 (Tex. App. 2001). In addition to relying
on R.R. Street, the Bergs also attempt to argue that Cipri v.
Bellingham Frozen Foods, Inc., 596 N.W.2d 620 (Mich. Ct. App.
1999), weighs in their favor as well. However, Cipri does not
significantly widen CERCLA-type arranger liability beyond the
federal case law. Instead, it seems to follow the federal cases
looking at the intent and primary purpose behind a transaction to
determine if it was an arrangement for disposal of hazardous
substances. Cipri, 596 N.W.2d at 626-27. More importantly,
Cipris facts are not analogous to the present case. The
defendant in Cipri not only arranged for the disposal of the
physical substances that damaged the plaintiffs property, but it
actually produced, owned, and disposed of the substances. Cipri
v. Bellingham Frozen Foods, Inc., 539 N.W.2d 526, 527-28 (Mich.
Ct. App. 1995).
29 Street, 81 S.W.3d at 284-85.
30 The court noted that no prior Texas case had discussed
arranger liability under that states version of CERCLA. Because
the Texas statute had wording that was substantially similar to
CERCLA, the court stated it would presume, absent some indication
to the contrary, that the legislature intended to adopt the
construction placed on that wording by the federal courts. R.R.
Street & Co., Inc., 81 S.W.3d at 290.
31 Id. at 291.
32 Id. (quoting Gen. Elec. Co., 962 F.2d at 286).
33 Id. at 295.
34 Street, 81 S.W.3d at 284.
35 The parties did not brief this issue, but instead
devoted their attention to the first certified question and other
issues not raised by the Ninth Circuit.
36 See, e.g., City of Merced v. Fields, 997 F. Supp. 1326,
1332 (E.D. Cal. 1998) (citing 3550 Stevens Creek Assocs. v.
Barclays Bank of California, 915 F.2d 1355, 1361-62 (9th Cir.
1990)) (noting that the Second, Fifth, Seventh, and Eleventh
Circuits have ruled similarly). See also U.S. v. Union Corp.,
277 F. Supp.2d 478, 490 (E.D. Pa. 2003) (noting that the Fourth,
Sixth, Ninth, and Eleventh Circuits are in agreement).
37 In City of Merced the court indicated that the sale of
PCE alone was insufficient to impose liability under 42 U.S.C.
9607(a). 997 F. Supp. at 1332.
38 U.S. v. Petersen Sand & Gravel, Inc., 806 F. Supp.
1346, 1354 (N.D. Ill. 1992).
39 Pneumo Abex Corp. v. High Point, Thomasville & Denton
R. Co., 142 F.3d 769, 775 (4th Cir. 1998) (sale of used wheel
bearings to foundry for recycling was sale of useful product, not
disposal).
40 See, e.g., Petersen Sand & Gravel, Inc., 806 F. Supp.
at 1354-55 (applying useful product exception to sale of fly ash
for use in road construction).
41 New York v. Solvent Chem. Co., Inc., 225 F. Supp. 2d
270, 281-82 (W.D.N.Y. 2002). See also Florida Power & Light Co.
v. Allis Chalmers Corp., 893 F.2d 1313, 1319 (11th Cir. 1990)
(upholding summary judgment for defendant transformer
manufacturers where plaintiff failed to show sale of transformers
was attempt to dispose of hazardous chemicals contained within
transformers).
42 Committee Minutes, Senate Special Committee on Oil and
Gas hearing on H.B. 68 (April 12, 1989); Committee Minutes,
Senate Judiciary Committee hearing on H.B. 68 (May 2, 1989).
43 Floor Memo for H.B. 68, Senate Judiciary Committee
(undated), in Alaska State Archives, Box #17568.
44 Committee Minutes, Senate Judiciary Committee hearing
on H.B. 68 (May 2 & 4, 1989).
45 See e.g., Florida Power & Light Co., 893 F.2d at 1319
(upholding summary judgment for defendant transformer
manufacturers where plaintiff failed to show sale of transformers
was attempt to dispose of hazardous chemicals contained within
transformers); U.S. v. Consol. Rail Corp., 729 F. Supp. 1461,
1469-73 (D. Del. 1990) (no arranger liability for defendant who
shipped waste coal tar to be used for pressure treating wood
where defendants did not make crucial decision to dispose of
hazardous substances or allow third parties to do so in their
stead); City of Merced v. Fields, 997 F. Supp. 1326, 1332 (E.D.
Cal. 1998) (manufacturer cannot be liable under CERCLA for mere
sale of useful chemical to user).
46 Floor Memo for H.B. 68, Senate Judiciary Committee
(undated), in Alaska State Archives, Box #17568.
47 See comments of Senator Jan Faiks, Committee Minutes,
Senate Judiciary Committee hearing on H.B. 68 (May 2, 1989).
48 Victor v. State Farm Fire & Cas. Co., 908 P.2d 1043,
1044 n.2 (Alaska 1996) (citing 17A Charles A. Wright et al.,
Federal Practice & Procedure 4248, at 177-178 (1988).
49 See FDIC v. Laidlaw Transit Inc., 21 P.3d 344, 349 n.19
(Alaska 2001) (declining to address issues not raised by
certifying court).
