AARST_Radon_Reporter_Q32022_FINAL

THE RADON REPORTER | 17 VAPOR INTRUSION The U.S. Court of Appeals for the Seventh Circuit recently provided a cogent analysis of what constitutes RCRA’s “imminent and substantial endangerment” for a site in northern Indiana with vapor intrusion and preferential pathways. See Schmucker v. Johnson Controls, Inc., 477 F. Supp. 3d 791 (N.D. Ind. 2020), aff'd 9 F.4th 560 (7th Cir. 2021) In this case, the court confirmed that no imminent and substantial endangerment to human health or the environment existed. This is an important legal decision on hotly contested exposure and assessment principles related to vapor intrusion. CERCLA created legal mechanisms to encourage cleanup and continued stewardship of contaminated property. The statute provides a vehicle for private parties to invest in environmental response, including remediation, and then recover at least part of those response costs from other potentially responsible parties (PRPs). The U.S. Congress defined PRPs to include four entities: 1) current owners and operators, 2) past owners or operators at the time of the release, 3) persons who arranged for disposal of a hazardous substance at a site, and 4) parties who transported a hazardous substance to a site. See 42 U.S.C. § 9607(a)(1)–(4). CERCLA’s liability scheme is strict, retroactive, and has very limited defenses. In response to CERCLA’s draconian liability scheme, Congress amended CERCLA in 2002 to provide an affirmative defense to remediation liability to PRPs who did not release hazardous materials themselves but remain potentially liable by virtue of being a current owner of a site where a prior release occurred. Congress called this defense the “bona fide prospective purchaser” (BFPP) defense. See 42 U.S.C. § 9607(q)(1)(C). To qualify, a PRP must, in connection with the original purchase (or lease) of the property in question, and among other things, make “all appropriate inquiries into the previous ownership and uses of the facility in accordance with generally accepted good commercial and customary standards and practices.” 42 U.S.C. § 9601(40). In that way, the BFPP defense shields from CERCLA liability those who invest in contaminated lands and exercise diligence, do not impede cleanup efforts, and meet ongoing obligations. The Seventh Circuit recently issued a nationally significant decision regarding CERCLA liability and the BFPP defense. See Von Duprin LLC v. Major Holdings, LLC, 12 F.4th 751, 773 (7th Cir. 2021) . The court made it crystal clear that this affirmative defense requires “full compliance with all requirements in the all appropriate inquiry regulation” as opposed to partial or substantial compliance. All practitioners should consider carefully reviewing this court decision when establishing its BFPP defense to CERCLA liability. Toxic Tort Actions There has been a perfect storm centered on the vapor intrusion pathway, which has intensified and fostered a significant increase in new toxic tort litigation over the last decade. During this same decade, U.S. EPA released new controversial studies suggesting that the widely used industrial degreaser, trichloroethylene (TCE), can be toxic at very low concentrations. These studies sparked a revolution with divergent national standards. The vapor intrusion pathway can transport toxic vapors from residual contamination directly into overlying structures, just like the transport of radon gas. In resulting toxic tort actions that courts have seen, a plaintiff alleges that toxic vapors from residual soil and groundwater contamination, in particular chlorinated solvents like trichloroethylene or TCE, have migrated and entered overlying structures through vapor intrusion. The plaintiff will then request monetary relief, including punitive damages, to address such things as wrongful death of a loved one, interference with the comfortable enjoyment, reduced property value, and that the vapors caused a wide array of bodily and emotional injuries. These cases are fact specific and can be very costly to litigate. Contractual Claims Legal liability can spring from various representations and warranties buried in purchase and sale agreements. For example, there is a growing number of alleged breaches of contractual obligations, fraud, malpractice, and for indemnification related to the VI pathway. It is important to carefully review and draft such representations and warranties and to limit any release and/or indemnity to minimize future claims. The VI pathway can be complex and the science continues to evolve at a rapid pace, but with counsel from legal and environmental professionals, you can successfully redevelop contaminated sites, secure and maintain closure, and minimize legal risk and liability. This article should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your lawyer on any specific legal questions you may have concerning your situation. David R. Gillay, Esq., is a Partner in the Environmental Department of Barnes & Thornburg LLP’s Indianapolis Office and may be reached at 317.946.9267 or david.gillay@btlaw.com.