Driller May Be Liable As CERCLA Operator

In KFD Enterprises v City of Eureka, 2010 U.S.Dist. LEXIS 125135 (N.D.Ca11/12/10 ), a consultant was retained to install five monitoring wells. Two of the wells were installed in upper and lower water-bearing zones that were separated by an aquitard or low-permeability layer. Apparently, the driller installed well screens in a manner that allowed PCE to migrate from the upper water zone to the more permeable lower zone which allowed the contamination to become more wodespread.

The plaintiff filed lawsuit against the driller alleging it was liable under CERCLA as an operator and transporter. The consultant argued it could not be liable as an operator because it did not control the initial activity that caused the pollution. However, the court found that the plaintiff had sufficiently pled that the driller had control over the drilling and extraction procedures which was the activity that exacerbated the  contamination and allowed it to spread to previously non-contaminated areas. Therefore, the court denied the driller's motion to dismiss on the operator claim.

On the CERCLA transporter claim, the court said that transporter liability was not predicated on moving hazardous substances across a boundry but could be imposed for moving pollutants from a contaminated area to a non-contaminated area within a single site. However, the court found that the plaintiff did not allege that the driller had picked up contaminants for transport but simply allowed the contaminants to seep through the well. The court said this was similar to the situation in Southern California Water Co v. Aerojet-General Corp, 2003 U.S.D.st. LEXIS 26534 (C.D. Ca. 4/1/03) where a party was not liable for as transporter for pumping groundwater contaminated water for treatment. Accordingly, the motion to dismiss the transporter claim was granted with leave to amend the complaint.

Likewise, the court dismissed the City of Eureka's CERCLA arranger claim against the driller because the complaint failed to plead any intentional steps to dispose the hazardous substances that is required in the wake of the US Supreme Court decision in Burlington Northern v US, 129 S.CT. 1870 (2009).