New Superfund Ruling: Supreme Court Holds that CERCLA Section 9658 Does Not Preempt State Statutes of Repose


The Supreme Court has issued its decision in the case of CTS Corp. v. Waldburger, et al., __ S. Ct. __ (June 9, 2014), argued April 23, 2014.

The Court (Justice Kennedy) reversed the Fourth Circuit, which had held that CERCLA Section 9658 also preempted state “statutes of repose” as well as state statutes of limitations. Section 9658 was added to CERCLA in 1986. CTS operated an electronics manufacturing plant in North Carolina until 1987, when it was sold as being “environmentally sound”. In 2011, the plaintiffs in this case filed a lawsuit in federal court alleging that CTS’ operations had released hazardous substances that contaminated the property they had more recently purchased. CTS argued before the district court that North Carolina’s 10 year statute of repose required the dismissal of their lawsuit, and the court agreed. However, the Fourth Circuit disagreed, holding CERCLA Section 9658 also preempted this North Carolina law.

The Court granted a petition for certiorari because there were some conflicting interpretations of Section 9658 by the courts of appeal. In reversing the court of appeals (the vote was 7 to 2, with Justices Ginsberg and Breyer dissenting), the Court subjected Section 9658 to a thorough textual analysis and determined that Congress had not clearly provided that state statutes of repose were preempted by CERCLA, and so the majority concluded that state statutes of repose were not included in the preemptive effect of Section 9658. This was particularly important because, as the Court noted a few years ago, the states were “independent sovereigns in our federal system” and “the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.” The dissenters stated that the Court’s decision gives “contaminators an incentive to conceal the hazards they have created until the repose period has run its full course”.

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