The opinion of the court was delivered by: Mishler, District Judge.
Memorandum Of Decision And Order
This is an action, brought by the State of New York (the
"State") under the Comprehensive Environmental Response,
Compensation and Liability Act ("CERCLA"), to hold National
Service Indus., Inc. ("NSI") liable for cleanup costs incurred
by the State at the Town of Islip municipal landfill on
Blydenburgh Road in Islip, New York (the "Blydenburgh
Landfill"). Presently before the Court are NSI's and the State's
cross-motions for summary judgement. NSI requests that the Court
grant summary judgment in its favor and dismiss the claims
against it. The State cross-moves for partial summary judgement,
requesting that NSI's fifth
affirmative defense be dismissed,*fn1 and seeking a
declaratory judgment that NSI is the legal successor to Serv-All
Uniform Rental Corporation ("Serv-All") for purposes of CERCLA
liability. For the following reasons, NSI's motion is denied,
and the State's cross-motion is granted.
From 1962 until 1988, Serv-All operated an industrial garment
rental service out of a facility located in the Town of
Bayshore, New York. Serv-All rented uniforms and other
industrial garments to commercial customers. As part of its
service, Serv-All dry-cleaned the rented uniforms using the
solvent perchloroehtylene ("PCE"). PCE is a hazardous substance
within the meaning of Section 101(14) of CERCLA.
On or about June 1978, Serv-All arranged with Hicky Carting
Co., Inc. ("Hicky") for the disposal or transport for disposal
of several 55 gallon drums of liquid waste which contained
PCE.*fn2 Hickey was not a "certified waste hauler." Serv-All
had been provided with a list of "certified waste haulers" by
the Suffolk County Department of Environmental Control, however,
Serv-All chose to employ Hicky instead, allegedly because the
approved waste haulers were more expensive.
In 1988 Ralph Colantuoni and William Lepido, Serve-All's two
principals, decided to retire from the garment industry. On or
about October 18, 1988, Initial Service Investments ("Initial")
entered into an "Asset Sale Agreement", whereby it agreed to
purchase certain assets, including customer contracts, customer
lists, all of Serv-All's trucks, and the right to use or retire
Serv-All's name. The purchase price was approximately
$2,229,000.00. As part of the Asset Sale Agreement, Mr. Lepido
and Mr. Colantuoni entered into covenants not to compete with
NSI. These covenants required them not to use the Serv-All name
and not to compete for seven years with NSI in the garment
rental service business. On November 6, 1992, NSI acquired all
shares in Initial, and on August 31, 1995 Initial merged into
The Blydenburgh Landfill was listed in the New York Registry
of Hazardous Waste Sites in 1983, and the listing states that
there was confirmed disposal of oil, trichlorethylene and vinyl
chloride beginning in 1978, the date of the illegal disposal of
wastes generated by Serv-All. The Blydenburgh Landfill was
proposed for listing on the U.S. Environmental Protection
Agency's Priority List in January 1987, and has since been
listed on the federal National Priority List of the most
contaminated hazardous waste sites in the United States.
NSI is not Serv-All Uniform Rental Corp.'s
("Serv-All") legal successor. Consequently, NSI bears
no legal responsibility for the acts of Serv-All and
cannot be liable for cleanup costs resulting from
The State responds to this affirmative defense by asserting that
NSI purchased Serv-All as an ongoing business and acquired all
or substantially all of Serv-All's assets, and thus, is
Serv-All's legal successor for CERCLA liability purposes.
A court should grant summary judgment if, when viewing the
evidence in the light most favorable to the nonmovant, the court
determines that there is no genuine issue of material fact and
the movant is entitled to judgment as a matter of law.
Fed.R.Civ.P. 56(c): Eastman Kodak Co. v. Image Technical Serv.,
Inc., 504 U.S. 451, 456, 112 S.Ct. 2072, 119 L.Ed.2d 265
(1992). A party seeking summary judgment must demonstrate the
absence of a genuine issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265
(1986). If the movant demonstrates an absence of material issues
of fact, a limited burden of production shifts to the nonmovant,
which must "demonstrate more than `some metaphysical doubt as to
the material facts . . . [and] must come forward with specific
facts showing that there is a genuine issue for trial.'"
Aslanidis v. United States Lines, Inc., 7 F.3d 1067, 1072 (2d
Cir. 1993) (citations and emphasis omitted). If the nonmovant
fails to meet this burden, summary judgment should be granted.
Both NSI and the State agree that there are no genuine issues
of material fact concerning the issue of successor liability.
Accordingly, the parties have conceded that ...