a former prospective purchaser of the Site ("the GZA Phase II
Report"). That Report revealed the presence of petroleum
contamination in subsurface soil and groundwater on Parcels A and
B, and isolated toxic chemicals on Parcel B.
VOA agreed to perform investigative work pending preliminary
consideration by the State and County Departments of Health
("DOH's") as to whether the Site could be used for VOA's
contemplated uses. The DOH's made certain recommendations
(including, inter alia, installation of a separate air
ventilation system for the day care center, capping the
contamination area with two feet of clean soil, and completing
remediation work). VOA contracted with GZA to perform a
Supplemental Phase II Report, testing soil and groundwater. That
investigation revealed further contamination by heavy lube oil
and various other chemical compounds.
Nonetheless, VOA remained interested in purchasing and
developing the Site due to the availability of the DEC's
"Voluntary Cleanup Program" ("VCP"), which allows "volunteers"
(parties not responsible for the contamination) who redevelop a
contaminated site, to receive an assignable liability release to
run with the land.
From January, 1997 to November, 1997, VOA engaged in
negotiations with Bill Gordon for acquisition of the Site and
with the City of Rochester for approvals for the project. The
City required VOA to enter into a PILOT Agreement to pay taxes
and requested an option on Parcel B, which VOA granted.
On October 30, 1997, VOA submitted an application to the DEC
for the VCP. Before receiving any indication as to whether it
would be eligible for the VCP, VOA nonetheless purchased the Site
on November 19, 1997. Several days later, VOA representatives met
with the DEC to make a presentation regarding the Site. The DEC
suggested that VOA undertake limited remedial activities prior to
preparation of a formal Remedial Action Plan.
On December 5, 1997, DEC determined that VOA was eligible to
participate in the VCP. VOA began remediation activities —
installation of geoprobe boreholes and groundwater monitoring
wells, removal of underground storage tanks, removal of floor
drains, and remediation of soil. However, the DEC staff
previously assigned to the project were reassigned and the new
staff determined that much more extensive work, including
drilling bedrock wells, would be necessary. DEC did eventually
agree to pay for the bedrock wells.
On August 26, 1998, VOA executed a Warranty Deed, conveying the
Site to the County of Monroe Industrial Development Agency
("COMIDA"), and leased the property back from COMIDA. VOA was
never able to negotiate an agreement with the DEC to make VOA a
VCP. VOA has completed its redevelopment of the Site and some
remediation activities, including replacing the soil to a depth
of approximately 15 feet and remediation of the groundwater
plume. Plaintiff claims that the Site's value has been diminished
by approximately $1.8 million and that the cost of further
remediation will be substantial.
Plaintiff alleges the following causes of action: (1) strict
liability under CERCLA § 107 against all defendants as past
"owners" or "operators" of the facility for past and future
response costs; (2) for contribution under CERCLA § 113(f)(1)
against all defendants for contribution of their individual
shares of the response costs; (3) to "abate an imminent and
substantial endangerment" pursuant to RCRA § 7002(a)(1)(B),
seeking an Order of this Court directing all defendants to
remediate the contamination; (4) strict liability pursuant to New
York Navigation Law § 181(5) for response costs relating to
petroleum contamination; (5) for indemnification or contribution
and declaratory judgment under Navigation Law Article 12; (6)
common law negligence; (7) common law claim for strict liability
for abnormally hazardous activities; (8) common law claim for
public nuisance; (9) common law
claim for indemnification and contribution relating to costs
incurred pursuant to the New York State Superfund Law; (10)
common law claim for equitable or implied indemnification; (11)
equitable restitution; and (12) a claim against the insurance
company defendants under the New York Navigation Law § 190 to
recover the costs of clean-up regarding the petroleum
Defendants' Joint Motion to Dismiss
The Heinrich Defendants, Bill Gordon, RG & E, and Kaplan
jointly move to dismiss portions of the Complaint pursuant to
Fed.R.Civ.Pro. 12(b)(6) for failure to state a cause of action.
Defendants seek dismissal of Count 1 (the CERCLA strict liability
claim), arguing that plaintiff is a "potentially responsible
party" under CERCLA and, therefore, is limited to a claim for
contribution under CERCLA § 113 and not a strict liability claim
under § 107. Defendants seek dismissal of Counts 6 through 11
(common law causes of action) on the basis that those claims are
preempted by CERCLA. Defendants seek dismissal of Count 3 (the
RCRA claim) on the basis that (a) plaintiff failed to give
defendants 90-days notice of this claim as required by RCRA, and
(b) plaintiff has failed to allege any "imminent and substantial
endangerment" to health or the environment. Defendants seek
dismissal of Count 5, arguing that Article 12, § 176(8), of the
Navigation Law does not provide a private cause of action.
Defendants seek dismissal of Count 7, arguing that, as a matter
of law, storage of petroleum does not constitute an
ultra-hazardous activity under New York law. Finally, defendants
seek dismissal of Count 9, arguing that the New York Superfund
Law does not provide for any private cause of action.
Motion to Dismiss Standard
Rule 12(b)(6) of the Federal Rules of Civil Procedure provides
for dismissal of the complaint where the plaintiff has failed to
state a claim upon which relief can be granted. When evaluating a
Rule 12(b)(6) motion, the court must ascertain, after presuming
all factual allegations in the pleading to be true and viewing
them in the light most favorable to the plaintiff, whether or not
the plaintiff has stated any valid ground for relief. Ferran v.
Town of Nassau, 11 F.3d 21, 22 (2d Cir. 1993), cert. denied,
513 U.S. 1014, 115 S.Ct. 572, 130 L.Ed.2d 489 (1994). The court
may grant a Rule 12(b)(6) motion only where "`it appears beyond
doubt that the plaintiff can prove no set of facts in support of
his claim which would entitle him to relief.'" Allen v.
WestPoint-Pepperell, Inc., 945 F.2d 40, 44 (2d Cir. 1991)
(quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2
L.Ed.2d 80 (1957)).
Count 1 — Strict Liability under CERCLA § 107(a)
Defendants move to dismiss Count 1 of plaintiff's complaint,
which alleges that defendants are strictly liable under CERCLA §
107(a). CERCLA § 107(a) establishes four classes of potentially
responsible parties for response costs associated with the
clean-up of hazardous substances: (1) present owners and
operators of facilities that accepted hazardous substances; (2)
past owners and operators of such facilities; (3) generators of
hazardous substances; and (4) certain transporters of hazardous
substances. 42 U.S.C. § 9607(a). Liability in a § 107 "cost
action" is strict as well as joint and several where the harm is
not divisible. CERCLA § 113 provides for a contribution action,
stating that "any person may seek contribution from any other
person who is liable or potentially liable under § 107(a)".
42 U.S.C. § 9613(f)(1). Liability under § 113 is several.
Defendants argue that plaintiff is a "potentially responsible
party" under CERCLA as a former owner and current operator of the
Site. Accordingly, defendants argue that plaintiff is limited to
an action for contribution under CERCLA § 113
and cannot bring a cost recover action under CERCLA § 107. In
support of this argument, defendants point to two Second Circuit
Court of Appeals cases, Bedford Affiliates v. Sills,
156 F.3d 416 (2nd Cir. 1998) and Prisco v. A & D Carting Corp.,
168 F.3d 593 (2nd Cir. 1999), which hold that a potentially responsible
party may not bring a CERCLA § 107(a) cost recovery claim against
other responsible parties, but is limited to a CERCLA § 113
Defendants also point to Seneca Meadows v. ECI Liquidating,
Inc., 16 F. Supp.2d 255 (W.D.N.Y. 1998), in which Chief Judge
Larimer held that a potentially responsible party is limited to a
§ 113 contribution claim, in order to
eliminate the ancillary and piecemeal litigation that
would otherwise result if a potentially responsible
party was allowed to recover all of its response
costs under § 107 from the defendants and then those
same defendants would be required to prosecute a
contribution claim under § 113 against plaintiff in
order to collect plaintiff's pro rata share.
Id. at 259.
Plaintiff argues that it is not limited to § 113 contribution
claim as a "potentially responsible party" because it will be
entitled to assert a defense to § 107(a) liability. Specifically,
plaintiff argues that, as a landowner which did not pollute the
Site in any way, VOA will qualify for the CERCLA "third party"
and "innocent purchaser" defenses under CERCLA § 107(b).
Defendants dispute the availability of these defenses to VOA.
I need not decide the issue of whether VOA is entitled to
assert the § 107(b) defenses at this stage of the litigation. For
purposes of a Rule 12(b)(6) motion, it is sufficient that VOA
alleges facts supporting the possibility that they are
available to VOA. If plaintiff ultimately proves that it is
protected by one of the § 107(b) defenses, then it could maintain
a cause of action under § 107(a) against the defendants, since
the Bedford court specifically limited its holding to
potentially responsible persons who are not entitled to any of
the § 107(b) defenses. See Bedford, 156 F.3d at 425 ["we hold
that a potentially responsible person under § 107(a) that is not
entitled to any of the defenses enumerated under § 107(b) — like
Bedford — cannot maintain a § 107(a) action against another
potentially responsible person" (emphasis supplied)]. If
plaintiff is not ultimately entitled to any of the § 107(b)
defenses, then plaintiff would be limited to a § 113 contribution
claim under CERCLA.
Accordingly, defendant's motion to dismiss Count 1 of the
Complaint is denied.
Counts 6 through 11 — CERCLA Preemption of Common Law Claims
Defendants also move to dismiss Counts 6 through 11 of the
Complaint (alleging various common law causes of action) on the
basis that those claims are preempted by CERCLA as claims for
reimbursement for CERCLA response costs. Plaintiff argues that
CERCLA preempts only common law claims for contribution or
restitution, not all common law claims. Plaintiff further argues
that Counts 6 through 11 state claims for damages other than
restitution or contribution and are, therefore, not preempted.
The Second Circuit Court of Appeals in Bedford Affiliates v.
Sills, 156 F.3d 416, 426 (2nd Cir. 1998) specifically held that
"CERCLA preempts the state law remedies of restitution and
indemnification." The Bedford court noted that CERCLA does not
preempt all state law claims. However, due to the
carefully-crafted statutory settlement scheme found in CERCLA as
a result of the SARA Amendments (Superfund Amendments and
Reauthorization Act of 1986), the court determined that Congress
intended to preempt any state law claim which seeks as a remedy
contribution or indemnification for the same damages that would
be available under CERCLA. CERCLA does not prevent a plaintiff
from recovering damages under state law that are not duplicative
the damages it recovers under CERCLA. Minyard Enterprises, Inc.
v. Southeastern Chemical & Solvent Co., 184 F.3d 373 (4th Cir.
Accordingly, while plaintiff cannot recover indemnification or
contribution for CERCLA damages by alleging alternative state law
causes of action, CERCLA does not completely preempt plaintiff's
state law claims to the extent those claims seek damages which
are not available under CERCLA. Plaintiff argues that certain
items of damages which have been alleged in this case, such as
clean-up costs of petroleum spills, are not available under
CERCLA. Defendants concede in their reply memorandum of law that
certain petroleum spills are not covered by CERCLA, although they
argue that the petroleum exclusion is narrower than plaintiff
contends. (Defendants' Joint Reply Memorandum of Law, p. 7).
Because plaintiff has alleged conduct which may fall under
CERCLA's "petroleum exclusion" (such as releases of unadulterated
gasoline), I find that the plaintiff may have claims for damages
which are not identical to the damages available under CERCLA.
Therefore, to the extent that plaintiff's common law causes of
action seek recovery for damages that are different than the
damages available under CERCLA, the common law claims are not
Accordingly, defendant's motion to dismiss Counts 6 through 11
on the basis of CERCLA preemption is denied.
Count 3 — RCRA Claim
Defendants move to dismiss Count 3 of the Complaint (which
alleges a violation of RCRA), on the alternative grounds that (a)
plaintiff failed to provide the parties with the requisite
90-days notice prior to filing suit, and (b) plaintiff has failed
to allege any "imminent and substantial endangerment to health or
the environment," as required for a claim under RCRA §
7002(a)(1)(B). Defendants argue that a mere showing of
contamination is not sufficient. Rather, plaintiff must show a
present or threatened risk of serious harm to human health or the
ecology. Defendants argue that plaintiff's use of the Site as a
daycare center (with the approval of the state and county
Departments of Health) belies the plaintiff's allegations of
"imminent and serious endangerment."
I decline to reach such a factual conclusion as a matter of law
on a Rule 12(b)(6) motion. The plaintiff has sufficiently alleged
that toxic contamination is present on the site and is creating
the threat of serious harm to the ecology through migration into
the deep bedrock and possibly groundwater. These allegations are
sufficient to state a valid citizen's suit cause of action under
However, plaintiff has admittedly failed to serve some of the
defendants with the requisite notice 90 days prior to filing
suit, as required by RCRA. See 42 U.S.C. § 6972(b)(2)(A)(iii).
Plaintiff alleges in the Complaint that prior notice was provided
on January 25, 1999 to defendants Jonathan Heinrich and Heinrich
Motors, Inc., but that notice to the other defendants was not
sent until June 4, 1999. (Complaint, ¶ 112). The suit was
commenced on June 7, 1999. Plaintiff has therefore failed to
comply with the RCRA statutory requirements as to all defendants
except Jonathan Heinrich and Heinrich Motors, Inc. The prior
notice requirement is jurisdictional and cannot be disregarded at
the Court's discretion. Hallstrom v. Tillamook County,
493 U.S. 20, 110 S.Ct. 304, 107 L.Ed.2d 237 (1989). Accordingly,
plaintiff's RCRA cause of action (Count 3) is hereby dismissed
for lack of subject matter jurisdiction as against all defendants
except Jonathan Heinrich and Heinrich Motors, Inc.
Count 5 — New York Navigation Law, Article 12 ("The Oil Spill
Defendants move to dismiss Count 5 of plaintiff's Complaint
(alleging a claim under Article 12 of the New York State
Navigation Law) for failure to state a
claim, arguing that Article 12 does not provide any private cause
of action, except under § 181(5).
Plaintiff argues that a private cause of action is available
under Navigation Law § 176 for contribution, as well as a direct
damages suit under § 181(5). Indeed, New York Navigation Law §
176(8) provides that
[n]otwithstanding any other provision of law to the
contrary, including but not limited to section 15-108
of the general obligations law, every person
providing cleanup, removal of discharge of petroleum
or relocation of persons pursuant to this section
shall be entitled to contribution from any other
N Y Navigation Law § 176(8) (McKinney's 1989 and Supp.
By the plain language of the statute, plaintiff does have the
right to seek contribution from any other responsible party for
costs incurred in providing clean-up or removal of discharge of
petroleum pursuant to Navigation Law § 176(8). Accordingly,
defendants' motion to dismiss Count 5 is denied.
Count 7 — Strict Liability for Ultra-hazardous Activities
Defendants move to dismiss Count 7 of plaintiff's complaint (a
claim under the common law for strict liability for
ultra-hazardous activities). Defendants argue that, as a matter
of law, the storage of gasoline does not constitute an
ultra-hazardous activity for which strict liability for
contamination will attach. 750 Old Country Road Realty Corp. v.
Exxon Corp., 229 A.D.2d 1034, 645 N.Y.S.2d 186 (4th Dept. 1996).
Plaintiff acknowledges in its Memorandum of Law that "VOA has
not alleged that the Petroleum Contamination is an ultrahazardous
activity included in its strict liability cause of action, since
its attorneys are well aware of the holding in 750 Old Country
Road . . ." (Plaintiff's Memorandum of Law in Opposition, p.
20). Rather, VOA claims that storage (in potentially leaky tanks)
or dumping of "toxic chemicals" constitutes an ultra-hazardous
However, as discussed infra, common law claims which seek
indemnification or contribution for CERCLA damages are preempted
by CERCLA. See Bedford Affiliates v. Sills, 156 F.3d 416 (2nd
Cir. 1998). Since plaintiff acknowledges that the damages sought
in Count 7 are not for petroleum spills, but rather for toxic
chemical contamination, the damages recoverable under Count 7 are
identical to those sought under CERCLA and the claim is,
Accordingly, defendants' motion to dismiss Count 7 is granted
and that claim is hereby dismissed.
Count 9 — Claim for Indemnification under New York Superfund
Finally, defendants move to dismiss Count 9 of plaintiff's
complaint which purports to seek indemnification under the New
York Superfund Law, Article 27, Title 13 of the New York State
Environmental Conservation Law ("ECL"). Defendants argue that no
private cause of action is available under the ECL, which
explicitly authorizes only the New York State Department of
Environmental Conservation and the Attorney General to enforce
ECL Article 27.
Plaintiff concedes in its Memorandum of Law that no private
cause of action exists under the New York Superfund Law, but
argues that its claim in Count 9 is actually a claim for common
law indemnification or contribution to recover any amounts VOA
may be obligated to pay under the Superfund Law (including the
Voluntary Cleanup Program).
Again, to the extent that plaintiff seeks common law
contribution or indemnification for damages which are available
under CERCLA, the common law claim is preempted. See Bedford
Affiliates, supra. However, to the extent plaintiff seeks common
law indemnification or contribution
for damages not recoverable under CERCLA (such as response costs
for contamination which may be characterized as a "hazardous
waste" by New York State under ECL § 27-0901 which is not
classified by the EPA as a "hazardous waste" under CERCLA), the
claim for indemnification is not preempted.
Accordingly, defendants' motion to dismiss plaintiff's Count
Nine of the Complaint is denied.
For the aforestated reasons, defendants' joint motion to
dismiss is granted in part and denied in part.
Plaintiff's RCRA cause of action (Count 3) is hereby dismissed
for lack of subject matter jurisdiction as against all defendants
except Jonathan Heinrich and Heinrich Motors, Inc.
Plaintiff's common law causes of action (Counts 6 - 11) are
preempted by CERCLA to the extent that they seek indemnification
or contribution for damages which are available under CERCLA.
However, since CERCLA specifically excludes from coverage certain
damages, including petroleum contamination (which is alleged in
this case), plaintiff has properly alleged state common law
claims to recover damages which are not available under CERCLA.
Plaintiff's 7th Cause of Action (strict liability for
ultrahazardous activities) is hereby dismissed as preempted by
CERCLA, since plaintiff concedes that Count 7 relates not to
petroleum, but rather only to "toxic chemicals," which, as
discussed infra, are covered by CERCLA.
The remainder of the defendants' joint motion to dismiss is
ALL OF THE ABOVE IS SO ORDERED.