The United States Supreme Court today ruled that the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), enacted in 1980 to "promote the timely cleanup of hazardous waste sites," does not pre-empt a state statue of repose. CTS Corp. v. Waldburger involved a North Carolina state-law nuisance action brought by property owners against the former owner of an electronics plant for contamination of the landowner's well water from stored chemicals at the plant. The suit was filed in the United States District Court for the Western District of North Carolina in 2011 -- 24 years after CTS had sold the property. The property owners claimed that they first learned in 2009 that their well water had been allegedly contaminated by chemicals maintained and stored at the electronics plant.
CERCLA includes a provision (42 U.S.C. §9658), allowing for federal pre-emption of state statutes of limitation in cases where the state statute of limitations provides for a commencement date which is earlier than the CERCLA commencement date. In those situations, the limitations period for a CERCLA claim commences at the federally required commencement date rather than at an earlier state commencement date. However, the Waldburger Court concluded that, because §9658 makes a distinction between state-enacted statutes of limitations (which bars an injured party from bringing an already accrued claim after an established period of time) and statutes of repose (which terminates a right of action after an established time period, regardless of whether an injury has occurred), CERCLA only pre-empts the former and does not enlarge the latter. The Court noted that "although there is substantial overlap between the policies of the two types of statute, each has a distinct purpose and each is targeted at a different actor."
Pursuant to a North Carolina statute of repose [N.C. Gen. Stat. §1-52(16)], "no cause of action shall accrue more than 10 years from the last act or omission of the defendant giving rise to the cause of action." CTS argued that because its last act with respect to the real property at issue took place in 1987 when it sold the property -- more than 24 years before the nuisance suit was filed -- the state court case was barred by North Carolina's 10-year statute of repose and CERCLA did not pre-empt that state statute. The U.S. Supreme Court agreed, finding that the "text and structure of §9658 resolve the case." For example, the term "statute of limitations" appears four times in §9658, while the term "statute of repose" does not appear at all. The Court concluded that the historical development of the difference between a statute of limitation and a statute of repose, as well as other textual features of §9658, support the conclusion that CERCLA does not pre-empt a state statue of repose. The Waldburger Court ultimately concluded that "under a proper interpretation of §9658, statutes of repose are not within Congress' pre-emption mandate."
For More Information
If you find yourself facing a state-law nuisance case filed under CERCLA, there are several factors that may help you avoid litigation altogether. Consult with an attorney to determine if there exists a statute of repose in the state where the lawsuit was filed that applies to the type of claim or claims being asserted, and if the CERCLA case was first filed beyond the time set forth in that statute. If you have questions about how this ruling may affect you or what further steps might be necessary, contact one of Polsinelli's Environmental attorneys.