Union Station Associates v. Puget Sound Energy, 01-CV-298P.

238 F.Supp.2d 1226

UNION STATION ASSOCIATES LLC, Plaintiff, v. PUGET SOUND ENERGY, INC., Defendant.

No. 01-CV-298P.

United States District Court, W.D. Washington at Seattle.

December 6, 2002.

Parker C Folse, III, Susman Godfrey, L.L.P., Seattle, for Union Station Associates LLC, plaintiff.

Michael Pierson, Megan E McCloskey, Riddell Williams, P.S., Seattle, for Puget Sound Energy Inc, defendant.

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS REMAINING FEDERAL CLAIMS

PECHMAN, District Judge.

This matter comes before the Court on defendant Puget Sound Energy, Inc.'s ("PSE") motion to dismiss Union Station Associates LLC's ("Union") remaining claims in this litigation. (Dkt. No. 96) Those claims include: (1) claims for contribution related to environmental response costs by Union after having entered into a Consent Decree with the Washington State Department of Ecology, (2) two declaratory judgment causes of action, and (3) remaining state law claims. Having reviewed the pleadings and papers submitted by the parties, and having heard oral argument on the issues, the Court finds that the Consent Decree constitutes a "judicially approved settlement" as contemplated by CERCLA's statute of limitations provision. That settlement triggers a three-year limitations period. Because Union filed this suit nearly four years after entry of the Consent Decree, Union's contribution claim under CERCLA is time-barred, and that claim is DISMISSED. Because both cost recovery and CERCLA contribution claims are now dismissed, the two declaratory judgment causes of action premised on those claims are likewise DISMISSED. Finally, the Court elects to retain jurisdiction over the state law claims for contribution.

BACKGROUND

The facts of this case were set forth in detail in this Court's prior order, and will not be repeated here. Union originally sought cost recovery and contribution from PSE under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq., and the Washington State Model Toxics Control Act ("MTCA"), RCW 70.105D.010 et seq., for remedial work done at and near Union Station in downtown Seattle. Union claimed that PSE should pay full cost recovery and/or contribution for contamination of the site by its alleged corporate predecessors. The Court granted partial summary judgment in favor of the defendant on the cost recovery claims, limiting Union's remedy to one for contribution, both under CERCLA and under MTCA.

PSE now moves to dismiss Union's contribution claim under CERCLA, arguing that the statute of limitations has run. According to PSE, the three-year limitations period for contribution actions was triggered by Union's entry into a judicially approved settlement with the Washington State Department of Ecology. Because Union filed this lawsuit nearly four years after entry of the settlement, the limitations period has run and Union's contribution action cannot stand. Union argues that the statute of limitations should be six years, primarily because the consent decree does not qualify as a judicially approved settlement within the meaning of the act. Both parties use statutory construction to reach different conclusions.

PSE next argues that with the grant of summary judgment on the cost recovery claims, and dismissal of the CERCLA contribution claim, that Union's declaratory judgment claims cannot stand. Finally, the parties now agree that the state law claims should not be dismissed and that the Court should retain supplemental jurisdiction over them pursuant to 28 U.S.C. § 1367.

ANALYSIS

1. Union's Claim for Contribution

Section 113(g) of CERCLA is entitled "[p]eriod in which action may be brought," and identifies limitations periods for various types of actions brought under CERCLA. Relevant to the present motion are those provisions establishing limitations periods for cost recovery actions and contribution actions. 42 U.S.C. § 9613(g)(2) and (3) (CERCLA sections 113(g)(2) and (3)).

Section 113(g)(2) states in relevant part:

(2) Actions for recovery of costs

An initial action for recovery of the costs referred to in section 9607 of this title must be commenced -

(A) for a removal action, within 3 years after completion of the removal action, except that such cost recovery action must be brought within 6 years after a determination to grant a waiver . . . for continued response action; and

(B) for a remedial action, within 6 years after initiation of physical on-site construction of the remedial action, except that, if the remedial action is initiated within 3 years after the completion of the removal action, costs incurred in the removal action may be recovered in the cost recovery action brought under this subparagraph.

In any such action described in this subsection the court shall enter a declaratory judgment on liability for response costs or damages . . . Except as otherwise provided in this paragraph, an action may be commenced under 9607 of this title for recovery of costs at any time after such costs have been incurred.

42 U.S.C. § 9613(g)(2). In contribution actions, section 113(g)(3) provides:

(3) Contribution

No action for contribution for any response costs or damages may be commenced more than 3 years after -

(A) the date of judgment in any action under this chapter for recovery of such costs or damages, or

(B) the date of an administrative order under section 9622(g) or this title (relating to de minimis settlements) or 9622(h) of this title (relating to cost recovery settlements) or entry of a judicially approved settlement with respect to such costs or damages.

42 U.S.C § 9613(g)(3).

Although there appears to be a sharp distinction between cost recovery actions and contribution actions, courts have held, and the parties appear to agree, that actions for contribution might be subject to the longer, 6-year statute of limitations of § 113(g)(2) if none of the four "triggering events" listed in § 113(g)(3) occurs. Geraghty and Miller, Inc. v. Conoco, Inc., 234 F.3d 917, 923-24 (5th Cir.2000); City of Wichita v. Aero Holdings, Inc., 177 F.Supp.2d 1153, 1175 (D.Kan.2000). Application of the six-year statute of limitations in such situations helps to avoid the problem of an indeterminable limitations period for contribution actions in which no triggering event has occurred. Geraghty, 234 F.3d at 924-925.

The issue in the present case therefore becomes whether one of the triggering events detailed in § 113(g)(3) has occurred. PSE asserts that the consent decree entered by Union and the Washington State Department of Ecology ("Ecology") constitutes a "judicially approved settlement," and therefore § 113(g)(3)'s three-year limitations period applies. Union counters that the consent decree is not a judicially approved settlement within the meaning of the act, so the longer, six-year period of § 113(g)(2) applies. Specifically Union argues (1) that the phrase "such costs or damages" in subparagraph (B) refers to those in subparagraph (A) that are the subject of a "judgment," and (2) that because there is no judgment or pre-existing claims against Union in this case, and because there was never any action brought against Union, this is not a "settlement" referred to in § 113(g)(3)(B).

The Court notes that the determination of which statute of limitations applies is a purely legal question of statutory interpretation. Summary judgment is therefore appropriate. Matsushita Electric Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The Court finds that the Consent Decree entered by Union Station and Ecology is a judicially approved settlement as contemplated by § 113(g)(3)(B). Therefore, Union's CERCLA contribution claims are time-barred and must be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6).

First, as a matter of grammatical construction, the phrase "such costs or damages" in subparagraph (B) refers to the initial clause "[n]o action for contribution for any response costs or damages may be commenced more than 3 years after . . ." As PSE states in its reply, Section 113(g)(3), when read as a whole, is a single sentence with two distinct and independent subsections separated by the word "or." Subsections A and B are prepositional clauses modifying the body of the sentence, describing distinct events three years after which a party is prohibited from pursuing an action for contribution "for any response costs or damages." (emphasis added) Each subsection is independent of the other; the sentence would be logically and grammatically complete if either subsection A or subsection B were removed in its entirety. In addition, both dependent clauses contain the phrase "such costs or damages," logically referring back to the modified clause above. Therefore, a grammatical construction of the section supports the conclusion that a judicially approved settlement need not be limited to actions or settlements under CERCLA.

Next, as a matter of statutory construction, "if the language of a statute is clear, we look no further than that language in determining the statute's meaning." United States v. Lewis, 67 F.3d 225, 228 (9th Cir.1995). The Court finds that the plain language of the statute indicates that the Consent Decree entered into by Union is a judicially approved settlement as envisioned by Congress. Section 113(g)(3) sets forth four events triggering a three-year limitations period, three of which directly refer to sections of CERCLA or the act as a whole. Yet the clause referring to a "judicially approved settlement" contains no such limiting language. Therefore, because the Court presumes that Congress acts intentionally when it includes language in one section but omits it in another, Oregon Natural Resources Council, Inc. v. Kantor, 99 F.3d 334, 339 (9th Cir. 1996), the Court concludes that any judicially approved settlement with respect to costs or damages for which...