Supreme Court Hears Superfund Liability Case

The Supreme Court will hear arguments this week in an appeal from Shell Oil and two railroads about whether a federal appeals court erred in finding the companies responsible under the federal Superfund law for all cleanup costs at a chemical distribution facility near Bakersfield, Calif. EPA sued insolvent chemical distributor Brown & Bryant (B&B), along with Shell, which made one of the chemicals that contaminated the site, and the railroads, which leased the land to B&B. A district court found that Shell, Burlington Northern & Santa Fe Railway, and Union Pacific Railroad were responsible only for their share of the total liability. But the U.S. Court of Appeals for the 9th Circuit in San Francisco overturned that decision in 2007 and ruled that the three companies could be held liable for the entire cost of the $8 million cleanup. Shell argues that it was not responsible for "B&B's operations or sloppy handling of chemicals" and that liability was being imposed for the "mere sale" of a commercial product. In a joint brief asking the justices to hear the case, trade groups representing the chemical and petroleum industries maintained that the appeals court ruling would "impose substantial and unwarranted burdens" on chemical manufacturers and suppliers.