Court: Shell Not Liable For Superfund Site
The Supreme Court says Shell Oil Co. cannot be held responsible for cleanup of a contaminated site owned by a defunct company simply because it delivered chemicals to the site.
The court, in an 8-1 decision announced Monday, also decided that railroad companies that leased the defunct company part of the land would have to pay for a small part of the cleanup.
Brown & Bryant used a site in Arvin, Calif. to store and sell agriculture chemicals like weed killers and pesticides - some of which were delivered there by Shell - before going out of business in 1988. Burlington Northern and Santa Fe Railroad Co. and Omaha, Neb.-based Union Pacific Railroad leased a parcel to Brown & Bryant starting in 1975 until the company went out of business.
The government was forced to clean up the 4.7 acres of land after Brown & Bryant went out of business, and wanted Shell and the railroads to help pay the cost of the cleanup. A trial court judge ruled, however, that the railroads were responsible for only a minuscule part of the cleanup costs and Shell was responsible for part as an "arranger," since it arranged for the sale and transfer of chemicals.
The 9th U.S. Circuit Court of Appeals in San Francisco, however, overturned the judge's decision that the railroads were only responsible for a small part of the cleanup and upheld Shell's liability.
Shell took steps to encourage Brown & Bryant to stop leaks of the chemicals it was delivering, said Justice John Paul Stevens. "Although Shell's efforts were less than wholly successful, given these facts, Shell's mere knowledge that spills and leaks continued to occur is insufficient grounds for concluding Shell 'arranged for' the disposal," Stevens said.
The high court also said the trial judge's decision to make the railroads pay 9 percent of the cost was correct.
Justice Ruth Bader Ginsburg dissented from the decision, saying she would have made Shell pay for part of the cleanup.
"The deliveries, Shell was well aware, directly and routinely resulted in disposals of hazardous substances (through spills and leaks) for more than 20 years," she said.
The case is Burlington Northern & Santa Fe Railway Co., v United States, 07-1601.
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