On June 9, 2014, the Supreme Court decided CTS Corp. v. Waldburger, holding that a North Carolina statute of repose was not preempted by Section 9658 of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

From 1959 until 1985, CTS Corporation manufactured electronics on a piece of property in North Carolina.  CTS sold the property in 1987.  Owners of both the former CTS property and adjacent property filed state-law nuisance claims in 2011, alleging that they had learned from the United States Environmental Protection Agency (USEPA) in 2009 that their groundwater was contaminated.  A district court relied on N. C. Gen. Stat. §1-52(16), a North Carolina statute which bars property damage claims made “more than 10 years from the last act or omission of the defendant giving rise to the cause of action,” to dismiss the claims, finding that CTS’s last act occurred in 1987, when the property was sold.  Relying on CERCLA Section 9658, the Fourth Circuit re-instated the nuisance claims because it concluded that CERCLA pre-empted the North Carolina statute.

The Supreme Court reversed the Fourth Circuit, holding that the North Carolina statute was not pre-empted and that CERCLA Section 9658 was limited to “statutes of limitations.”  While noting that there is common ground between “statutes of limitations,” which create “time limit[s] for suing in a civil case, based on the date when the claim accrued,” and “statutes of repose,” which “put[] an outer limit on the right to bring a civil action,” “each has a distinct purpose and each is targeted at a different actor.”  The Court found that, when Congress passed Section 9658, the language it chose limited the provision to statutes of limitations.  Additionally, the Court found that CERCLA expressed neither any intent to provide “a general cause of action for all harm caused by toxic contamination” nor a clear intent to supersede traditional police powers of the states.

Two points are worth mention:

First, the CTS decision is not the “usual” CERCLA decision.  The decision does not alter the mechanism under which federal or state agencies investigate, characterize, and remediate properties.  Indeed, based on the case history, the groundwater contamination alleged in the CTS litigation was discovered by EPA in 2009, two years before CTS suit was filed.  In 2012, the involved property was added to EPA’s National Priorities List, a designation reserved for sites EPA has identified as being among its priorities.  Similarly, it does not alter the federal causes of action parties may use to recover costs related to their remediation activities.

Second, the CTS decision appears to be based on a straightforward reading of CERCLA.  The Court held that CERCLA does not preclude a state’s choice to have legislative statutes of repose which apply to certain categories of tort cases.  While a few states have these, the majority of states do not.[1]  Each of the federal environmental statutes – to a degree – seeks to shape state action.  There is no indication in CERCLA that it intended to “trump” state ability to form independent tort-related law for any situation related to contamination.  Had it been Congress’s intent to supersede all state statutes of repose related to actions related to contamination, Congress could have done so.  In the Court’s view anyway, the language Congress chose did not do so here.

[1] States with statutes of repose which were identified in the course of the CTS litigation include Connecticut, see Conn. Gen. Stat. § 52-584; Kansas, see Kan. Stat. § 60-513(b); North Carolinia, see N.C. Gen. Stat. § 1-52(16); and Oregon, see Or. Rev. Stat. § 12.115(1).  Alabama has a 20-year common-law statute of repose.  See, e.g., Abrams v. Ciba Specialty Chems. Corp., 659 F. Supp. 2d 1225) (S.D. Ala. 2009).