Ninth Circuit Addresses Standards for Approval of CERCLA Settlements

August 11, 2014
Suzanne I lene Schiller
MGKF Litigation Blog

On August 1, 2014, the Ninth Circuit Court of Appeals handed down a decision in Arizona v. Raytheon Co., No. 12-15691 (9th Cir. Aug. 1, 2014), that may give trial courts some pause before approving future CERCLA settlements. At issue was whether the trial court failed to adequately scrutinize consent decrees entered into between the Arizona Department of Environmental Quality (the “ADEQ”) and twenty-two Potentially Responsible Parties (“PRPs”) allegedly liable under CERCLA for contamination at the Broadway-Patano Landfill Site. The majority opinion held that the trial court’s deference to the AQED’s judgment that the settlements were fair and reasonable was impermissible, and sent the case back down for a more thorough fairness hearing.   However, the more important aspect of the decision may be that, in dicta, the Court concluded that “[e]ven if EPA had been a party to the proposed consent decrees in this case, the district court would have failed to fulfill its duty to independently scrutinize the parties’ agreements.”  Id. at 21.  Read the full blog post.