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Borge Development, Inc. v. City of Chico

April 21, 2009



Borge Development, Inc. ("Borge") brought this action against the City of Chico, California ("Chico"), Butte County, California ("Butte County"), and Baldwin Contracting Company ("Baldwin") for cost recovery under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9607, contribution under CERCLA, 42 U.S.C. § 9613, and other state law violations. Butte County brought a Motion for Judgment on the Pleadings, or, in the Alternative, for Summary Judgment or Summary Adjudication. Borge opposed the motion. Both Chico and Baldwin partially joined in Butte County's Motion. For the reasons stated below, Butte County's Motion is GRANTED in part and DENIED in part.*fn1


Borge owns two parcels of real property, APN 002-180-086 and APN 002-180-084, located in Chico, California ("Borge Property"). Borge obtained title to APN 002-180-086 on November 3, 2004. Borge obtained title to APN 002-180-084 on July 19, 2005. Both of these parcels are located within an area referred to as the Humboldt Road Burn Dump Area ("HRBD"). Statement of Undisputed Facts ("SUF") ¶ 1. Private and public disposal of waste occurred within the HRBD from the late 1800s through 1965. Id. One of the parcels within the HRBD contained the Chico Burn Dump, which was in operation until 1965. Id. ¶ 2.

In 1954, Butte County entered into a year-to-year agreement with Chico, wherein Chico allowed Butte County residents to use the Chico Burn Dump, located within the HRBD. Id. ¶ 5. The lease continued until 1964, when Chico leased the Chico Burn Dump to Butte County for a year. Id. In 1980, Chico sold the Chico Burn Dump Property to George Scott. Id. ¶ 8.


Butte County filed its Motion to: 1.) Dismiss Borge's Complaint under Rule 12(c) for lack of standing; 2.) Grant summary judgment on Borge's CERCLA claims because Butte County was not an owner, arranger, or transporter; and 3.) Grant summary judgment on Borge's state law claims because they are time barred, barred by law, or lack the requisite evidence to bring a claim.*fn2 Butte County concedes in its Reply Brief that Borge has the requisite standing to bring suit. Therefore the Court only need consider Butte County's request for summary judgment.

A. Standard for Summary Judgment

Summary judgment is appropriate if "the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Where the nonmoving party will have the burden of proof on an issue at trial, the movant's burden may be discharged by pointing out to the district court that there is an absence of evidence to support the nonmoving party's case. See id. at 325. Summary judgment for a defendant is appropriate when the plaintiff fails to make a showing sufficient to establish the existence of an element essential to its case, and on which [he] will bear the burden of proof at trial. Id. at 322.

If the moving party sustains its burden, the burden then shifts to the nonmoving party to go beyond the pleadings and by his or her own affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial. See Celotex, 477 U.S. at 324 (citing Fed.R.Civ.P. 56(e)). "If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion for summary judgment." Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1103 (9th Cir. 2000). Summary judgment is appropriate if, viewing the evidence and the inferences therefrom in the light most favorable to the nonmoving party, there are no genuine issues of material fact in dispute and the moving party is entitled to judgment as a matter of law. Valandingham v. Bojorquez, 866 F.2d 1135, 1137 (9th Cir. 1989).

B. Borge's CERCLA Claims

Butte County argues that it should not be held liable under CERCLA because it is not an owner, arranger, or transporter as defined by CERCLA Section 107(a), 42 U.S.C. § 9607(a). CERCLA Section 107(a) includes in the definition of covered persons:*fn3

(2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of,

(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances Butte County argues that it does not qualify as an operator under Section 107(a)(2) because Borge has not shown that any hazardous materials were disposed of at the Chico Burn Dump during the year-long period when Butte County operated it. However, "courts have not hesitated to look beyond a defendant's characterizations to determine whether a transaction in fact involved an arrangement for the disposal of a hazardous substance."

Transportation Leasing Co. v. California, 861 F.Supp. 931, 941 (C.D. Cal. 1993). In Transportation Leasing Co., the District Court found that although the defendant cities did not specifically use the term "hazardous substances" in their contracts, they "contracted with disposal companies to transport residential, commercial, and governmental waste for disposal." The court found that this was sufficient to categorize the defendant cities as covered persons under CERCLA Section 107(a). Similarly, although Borge has not produced a specific agreement that uses the term hazardous substances, it has shown that Butte County contracted to operate a burn dump in ...

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