APPROVAL DATE: • 6/21/891

  LEVEtOEDRA
     'Sfcs^raw

       B;£r Signed by,0ffice Director
       D'sps^' ii"*'
       ,C'^- Revi
REFERENCE (other documents)

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             United States
              Office of
              Solid Waste and
              Emergency Response
 4>EPA
DIRECTIVE NUMBER:  9835.11-1

TITLE:  Model Litigation Report for CERCLA Sections 106
      and 107 and RCRA Section 7003


APPROVAL DATE: -6/21/89

EFFECTIVE DATE: 6/21/89

ORIGINATING OFFICE: Office of Enforcement and
Compliance Monitoring Waste
S FINAL

D DRAFT

  LEVEL OF DRAFT
                   — Signed by.AA or OAA
                 D B — Signed by Office Director
                 DC — Review & Comment

             REFERENCE (other documents):
SWER        OSWER       OSWER
  DIRECTIVE    DIRECTIVE    Dl

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                                        Ocft
^ ^m^^ A ~ United States Environmental Protection Aaencv
JebPPA Washington. DC 20460
<"crM OSWER Directive Initiation Reauest
1. Directive Number
9835.11-1
2. Originator Information
Name of Contact Person
David Van Slyke
Mail Code Office
LE-134S OECM-Waste
Telephone Code
FTS 382-3050
3'£odel Litigation Report for CERCLA Sections 106 and 107 and RCRA
Section 7003
4. Surnmflty of Directive (include bnef statement of Qufpose) .. . * •*•*_• *. • ._... «*•*.<§? siv-w-a i »»^irv^r^f* Q "f r^T"
Guidance on prepration of civil judicial litigation referral reports ™*
cases to be referred to the Department of Justice under CERCLA Sections 106
and 107 and RCRA section 7003.
5. Keywords _
Referrals, Cost recovery Judicial Referrals, CERCLA, RCRA, Enfo^

6a. Does This Directive Supersede Previous Directive(s)? i i LJl "-"c"1^^*-"
X No 1 | Yes What directive (number, title)
b. Does K Supplement Previous Directivefs)?
Q No Yes What directive (number. (Me)
^^_^_J
7. Dran Level
|^J A-SJgnedbyAA/DAA | | B - Signed by Offlce Director } ] C - For Review & Con

•ntjiil I 1 U - U DlPrVPe^rnCnl
        8. Document to be distributed to States by Headquarters? LJ Yn
This Request Meets OSWER Directives System Format Standards.
9. Signature of Lead Office Directives Coordinator
1 0. Name and Title of Approving Official
Date
Date
    EPA Form 1315-17 (Rev. 5-»7) Previous editions are obsolete.
  OSWER       OSWER          OSWER          O
VE   DIRECTIVE       DIRECTIVE     DIRECTIVE

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3 UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                WASHINGTON. DC. 20460
                      JUN 2 1  1989
                      J
                                                              A
                                                    9835.11-1
                                                        off ic.t a*
MEMORANDUM

SUBJECT:  Model Litigation Report for CERCLA Sections 106
          and 107 and RCRA Section 7003

FROM:     Edward E. Reich
          Acting Assistant

TO:       Regional Administrators
          Regional Counsel


     I have attached the Model Litigation Report for
CERCLA Sections 106 and 107 and RCRA Section 7003.  This model
supplements previous Agency guidance entitled "Model Litigation
Report Outline and Guidance" (OECM, August 23, 1984), which
addressed the preparation of a litigation package under most
statutes, but excluded, among others, packages to be prepared
for prosecution of civil judicial actions under CERCLA
Sections 106 and 107 and RCRA Section 7003.

     The model is intended for use in all civil judicial cases
referred to the Department of Justice for prosecution under
CERCLA Sections 106 and 107 and RCRA Section 7003.  For those
actions referred in conjunction with a settlement, a full
litigation report is not required.  Rather, the Regions should
follow soon-to-be-issued guidance on pre-referral negotiations
and current policy governing the preparation of settlement
analyses accompanying the referral of consent decrees.  See, 52
Fed, "seer. 2034 ("Interim CERCLA Settlement Policy").  This
document also does not specifically address preparation of
litigation reports for prosecution of penalty actions under
CERCLA Sections 106(b), 109 or 122(1), although many sections of
this document may be applicable to the preparation of such
litigation-reports.

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                                                     9835J1-/
                           - 2 -


     I would like to express my appreciation to you and to  the
members of your staffs that have reviewed and commented on  the
drafts of the document.  If you have any questions regarding  this
guidance,, please call Glenn Unterberger or David Van Slyke  of my
     ' "at "382 -3 050.
Attachment

cc:  Jonathan 2. Cannon, Acting Assistant Administrator,  OSWER
     Donald A. Carr, Acting Assistant Attorney General,  Land and
        Natural Resources Division, Department of Justice
     David T. Buente, Chief, EES, Department of Justice
     Bruce M. Diamond, Director, OWPE
     Waste Management Division Directors, Regions I-X
     Regional Counsel Waste Branch Chiefs, Regions I-X
     CERCLA Program Branch Chiefs, Regions I-X
     OECM-Waste Attorneys

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                                                       9835,11-1
                     MODEL LITIGATION REPORT



        CERCLA SS 106 and 107 and RCRA S  7003 Actions
This  guidance   and


              .  are
           Environmental  Protec

Procedures, do not constiti£e

be  relied upon to  create  a

procedural, enforceable  a-  1 a

                            "
i-i-
i— ernal implementing proces-
                                                         f°r  its
                                                     e-ployees of


                                      gwlcy'    Sucn  guidance  and

                                        *Z the Agency and ^ not

                                         benefit'  substantive or
                                                 guidance  and  its

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                                                         9835.1'M
                      MODEL LITIGATION REPORT

         CERCIA SS  106 and  107  and RCRA  S 7003 Actions



                         TABLE  OF CONTENTS


 I.     Cover  Page	1

 II.    Table  of. Contents	1

 III.   Synopsis of  the Case (Executive Summary)  .  .  . 	 1

 IV.    Significance of Referral  	 2

       Statutory Bases of Referral/Legal Theory  of Case  .... 2

       Description  and History  of the Site	  .  . 3

 VII.   status of Cleanup  Process	 4

 Vlil.  National Resource  Damage Claims   	 7

 IX.    Prima Facie  Case,  Liability and Description of
         Proposed Defendant(s)  and Miscellaneous
         Issues -Regarding Liability  and  Cost Recovery 	 8

 X.     Enforcement  History/Contacts  with Potential
         Defendants	13

 XI.    Cost Recovery	21

 XII.   Penalties and Punitive Damages	25

 XIII.  Injunctive Relief	•	26

 XIV.   other Legal  Issues	.29

 XV.    Litigation/Settlement Strategy  .  .  .	3C

 XVI.   Other Imminent  Hazard Provisions  	 31

 XVII.  Witnesses/Litigation Support  	 33
APPENDIX I - RCRA § 7003 Prima Facie Case	A-l .

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                                                       9635.11-1
                     MODEL LITIGATION REPORT

         CERCIA SS 106 and 107 and RCRA 8 7003  Actions
I. Cover
   A. Region, statute (s) involved and judicial district.

   B. Name of defendant(s)  by category (e.g.,  owners,  operators,
      generators, transporters) .

        Include names, addresses and telephone numbers of all
        proposed defendants in an appendix to the litigation
        report.  The list of all other potential defendants, with
        addresses and telephone numbers (where available) also
        should be attached as an addendum.

   C. Name, address and EPA ID Number of facility or facilities.

          Include name, address and telephone number of all
          facilities/sites subject to the referral.

   D. Regional contacts.

          Include names, addresses and telephone numbers of
          regional program (technical) and legal contacts who
          prepared the report.

   E. Stamp date of referral on cover page.


II. Table of Contents

          Include headings, subheadings and page numbers.


III. Synopsis of the Case  (Executive Summary)

          This should be a concise narrative summary statement
          briefly describing the site, the environmental problem,
          cleanup/enforcement to date, projected future  removal/
     1   The cover page should be in addition to the "Data Form"
         prepared as a one to two page fact sheet on the case.  •

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          remedial efforts,  past/future response  costs,  the
          proposed defendants and the relief sought.


IV. Significance of Referral

        Indicate if the case is part of a special Agency
        initiative or may present issues of national
        significance.


V. Statutory Bases of Referral/Legal Theory of Case

   A.  Applicable statutes.

        Reference briefly all applicable Federal  statutes by
        United States Code (U.S.C.)  citation and  by section  of
        the Act.

   B.  Enforcement authority; jurisdiction and venue-       .

       ' Summarize briefly the enforcement authority .and the
        jurisdiction and venue provisions of applicable statutes.
        If there is reason to file the action in  a district  other
        than where the site is located, note each .available.
        district and indicate the reasons for filing there..
        (Note that CERCLA. §§ 106 and 113(b) contain specific
        statements of available venues for CERCLA actions, but
        that RCRA § 7003 and other imminent and substantial
        endangerment causes of action typically do not.   Venue
        for cases involving such counts may need  to depend upon
        the general Federal venue provisions of 28 U.S.C.
        §  1391.)

   c.  Bankruptcy petitions.

        If the referral is for the filing of a bankruptcy claim,
        describe the status of bankruptcy petition, including (1)
        whether Chapter 7, 11, or 13, (2) whether reorganization
        plan filed, and (3)  bar date for proof of claim.  See.
        "Guidance Regarding CERCLA Enforcement Against Bankrupt
        Parties"  (OECM, May 24, 1987); "Revised  Hazardous Waste
        Bankruptcy Guidance" (OECM,  May 23, 1986).  If the case
        involves a PRP that has filed for bankruptcy, obtain and
        attach schedule and any other court documents previously
        filed.   Discuss the significance of the bankruptcy to the
        overall enforcement or cost recovery action and the
        likelihood of obtaining the relief sought.

        NOTE;  :it is important to inform DOJ of a bankruptcy
        filing or a pending bankruptcy action as  soon as the

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                                                           5835.1)-/
      ''' Region becomes aware of such action.  See. "Coordination
        of Agency Involvement in Bankruptcy Proceedings Affecting
        RCRA or CERCLA Enforcement" (OECM, June 10, 1988)

   D.  Cross-media coordination

        State whether coordination across media has occurred.
        Cross-media regional review should ensure that
        consideration has been given to including all available
        causes of action pertaining to that particular
        owner/operator and site.2  Discuss reasons for including
        or omitting cross-media claims.  Where the secondary
        cause of action is minor, or where the case development
        will take an inordinate amount of time, the case should
        be referred with the excluded secondary cause of action
        clearly identified.  However, if the secondary cause of
        action is major, and if development will not unreasonably
        delay the referral, all such causes of action that are
        appropriate for filing should generally be referred
        together.  This is particularly true for endangerment
        cases that may be brought under several environmental
        statutes simultaneously, if considerations such as
        defenses, scope of liability and record review warrant
        it.  See discussion regarding other imminent and
        substantial endangerment provisions of Federal statutes
        in. Section XVI, below.


VI. Description and History of the Site

   A.  Site location (include here, or as attachments to Litigation
        I'.eport (e.g., in ROD), appropriate maps).  See
        Section IX.A.2. (Page 10, infra).

   B.  Facility processes - Describe the manufacturing, recycling
        or disposal processes that are pertinent.  See
        Section IX.A.2. (Page 10, infra).

   C.  Sita description  (photographs, diagrams, etc., as
        appropriate).  See Section IX.A.2.  (Page  10, infra).
     2    Review of other potential causes of  action  is
          particularly important  in cases involving. RCRA
facilities that were in operation after November  19,  1980  and  .
facilities involving PCS contamination that may be  regulated under
TSCA.  In addition, review and coordination is critical under
those exceptional circumstances where the Agency  might
contemplate a release from liability under several  statutes/media.

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   D. JfPL status

        Include status of NPL listing.  If not on the NPL,  state
        status of HRS scoring, whether the site has been proposed
        for the NPL and, if so, the date the site made (or  is
        expected to make) the final NPL.  Include appropriate
        Federal Register cite(s).  Also indicate whether State,
        PRPs or citizens object to the proposed listing.

   E. General description of environmental problem posed by the
      site.
VII. Status of Cleanup Process

   A. Cleanup activities by parties other than EPA prior to or
      contemporaneous with EPA involvement.

        Describe, chronologically,  all response efforts
        undertaken at the site by PRPs, or state or local
        governments,  that have occurred prior to EPA involvement
        or outside the scope of EPA oversight.

   B. EPA cleanup actions.

        The referral  must clearly identify each of the Agency
        responses undertaken at the site, including each removal
        and remedial  operable unit, and, if the action seeks to
        compel PRP response under § 106, the proposed response
        action.   If the site involves multiple operable units
        (and multiple RI/FSs and RD/RAs), discuss those .operable
        units that are the subject of the referral and generally
        describe any  planned investigations and studies.  ;The
        action must have been sanctioned (e.g., action memo or
        record of decision), there must be an adequate
        administrative record for each response action decision,
        and the actual action must be documented.

   1.  Removals

        a.    Identify and include the authorizing document
             (Action  Memo).

        b.    Describe the status of the Administrative Record
             supporting the removal decision.  See Section
             VII.C.,  below.

        c.    Describe the major community relations activities
             relating to the removal, including any public
             comment  periods held (how long and what for) ,and
             public meetings held.   Identify and describe any
             particular portion of the response action in which

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                                                        9835J1-/
          the public (including PRPs)  has expressed  interest.
          Include responsiveness summaries published following
          any public comment period.

     d.   Identify and describe each  activity completed, when
          those activities were completed and the  status of
          activities underway or planned.  Include a
          discussion of the entity that performed  the activity
          (e.g., name of contractor and primary contractor
          contact) or the Agency personnel or office that
          undertook the activity.  Also identify each OSC that
          worked on the project.

2.    Remedial Investigation/Feasibility Study through Record
     of Decision

     a.   Identify and describe each  RI/FS completed, when
          those activities were completed and the  status of
          activities underway or planned.  Include a
          discussion of the entity that performed  the RI/FS
          (e.g., name of contractor (and any r^jor
          subcontractors) and primary contractor contact) or
          the Agency personnel or office that undertook the
          activity.  Also identify each RPM that worked on the
         .project.

     b.   Describe the major community relations activities
          relating to the each RI/FS,  including public comment
          periods held (how long and  what for) and public
          meetings held.   Identify and describe any  particular
          portion of the RI/FS in which the public (including
          PRPs)  has expressed interest.  Include
          responsiveness summaries published following any
          public comment period. .

     c.   Discuss and include the authorizing document (Record
          of Decision (ROD)).  Discuss any significant issues
          likely to be raised by defendants regarding adequacy
          of the ROD.

     d.   Describe the status of the  Administrative  Record
          supporting the remedial decision.  See Section
          VII.c., below.

   .  e.   ATSDR Evaluation - Discuss  ATSDR evaluation and
          any potential litigation problems raised by
          differences between EPA and ATSDR evaluations.
          Identify who at ATSDR did the evaluation.

     f..   Posture of State regarding ROD and Participation  in
          Settlement - Describe any contacts with the state
          regarding concurrence in the remedy selected.

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                                                         9835,11-1
                                   o
      *
             Identify any EPA/State enforcement issues, such as
             whether the State has indicated interest in inter-
             vening in any potential Federal action/settlement.
             Attach pertinent correspondence.

        g.   A risk assessment/endangerment assessment, typically
             part of an RI/FS, is generally performed to support
             remedial action selection decisions.  Such an
             assessment will be the vehicle normally used to
             establish the imminent hazard portion of a CERCLA
             § 106 or RCRA § 7003 claim.  Such an assessment
             should be undertaken pursuant to the Superfund
             Public Health Evaluation Manual (OSWER, October
             1986) .  See also, "Risk Assessment Guidance for
             Superfund — Environmental Evaluation Manual"
             (Interim Final, OSWER March 1989).  .Discussion of
             the risk assessment/endangerment assessment should
             take place in conjunction with Sections IX and XIII,
             below.

             Appendix Two of the RCRA/CERCLA Case Management     --. :•
             Handbook (August 1984) contains a checklist of facts
             necessary for CERCLA imminent and substantial
             endangerment cases.  Appendix I hereto discusses the
             RCRA Section 7003 prima facie case.

        h.   Discuss and include any CERCLA § lll(k) Inspector
             General audits of the RI/FS.

   3.   Remedial Actionfs)

        a.   Identify and describe each operable unit RD/RA,3 -
             when those activities were started and  (if
             appropriate) completed, and the status of activities
             underway or planned.  Include a discussion of the
             entity that performed each operable unit RD/RA
             (e.g., name of contractor  (U.S. Army Corps of
             Engineers, XYZ Environmental Removal, etc.)),
             important subcontractors and primary contractor
             contacts) or the Agency personnel or office that
             -undertook the activity.  Also identify each RPM that
             worked on each operable unit.

        b.   Describe the major community relations activities
             during the RD/RA, notices of significant differences
     3     While remedial design  (RD)  is technically  a  "removal"
           action under the terms of the statute  (See CERCLA
Sections 101(23) and 101(24)), it is appropriate  to discuss RD in
conjunction with remedial action, given the  nature of the  remedial
design and remedial action process.

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                                                         9835,1 I-/
              (§ 117(c)), revisions to the ROD including public
             comment periods held (how long and what for)  and
             public meetings held.  Identify and describe any
             particular portion of the response action in which
             the public (including PRPs) has expressed interest.
             Include responsiveness summaries published following
             any public comment period.

   C. Administrative Record For Each Removal/Operable Unit

             Judicial review of the adequacy of response action
        selection decisions in the context of CERCLA Section 106
        and 107 actions will be based upon the administrative
        record supporting the decision.  Thus, it is essential
        that the administrative record in support of all
        pertinent Agency response decisions be completed prior to
        referral.  See. "National Oil and Hazardous Substances
        Contingency Plan: Proposed Rule." 53 Fed. Reg. 51394
        (December 21, 1988) ; "Interim Guidance on Administrative
        Records for Selection of CERCLA Response Actions"
        (Porter, March  1, 1989); "Guidance on CERCLA Section 106
        Judicial Actions (Reich/Porter 2/24/89).  A list  (index)
        of all documents in the record must be included in the
        referral package.  The record itself must be compiled,
        collated and stored in a secure location in the Region by
        the time of the referral.4  Any outstanding issues
        regarding compilation of the administrative record should
        be noted and the plan for resolution of those issues
        should be identified.
VIII.  Natural Resource Damage Claims

   A.   Identify potentially interested Federal and/or State
        natural resource trustees.  See. Memoranda of
        Understanding with NOAA and Department of Interior,5 and
        40 C.F.R. 300.72 - 300.74  (Trustees for Natural
        Resources).
     4     In those exceptional circumstances where statute of
           limitations concerns indicate it may be appropriate
(consistent with Agency guidance) to file as soon as possible, a
case can be referred without an index to or final compilation of
the administrative record.


     5     These Memoranda of Understanding have been  transmitted
           to the Regional Counsel Branch Chief's under
separate cover.

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                                   8
                                                            9835.11-1
             -Summarize contacts, if any, with each trustee, and
             identify lead trustee representatives and telephone
             numbers.

     B. Briefly describe natural resources that may have been
        affected by contamination at or from the site as
        identified by the trustee agency.

     C. Status of site survey/damage assessment by trustee(s).

             Briefly describe status of trustees' efforts to
             determine whether significant injury to natural
             resources has occurred at the site and, if
             applicable, to evaluate measures to restore or
             replace injured resources and assess damages
             resulting from the injury.

     D. Participation by trustee(s) in selection of remedy or
        negotiations.

             Briefly describe the role, if any, natural resources .
             trustees have played in the RI/FS process,       .  -
             consideration given to trustee comments in the ROD,..
             and the trustee's participation or expressed  level
             of interest in participating in negotiations  with
             PRPs.          .                             ...


IX.  Prima Facie Case. Liability and Description of Proposed
     Defendantfs). and Miscellaneous Issues Regarding  Liability
     and Cost Recovery

     A. Prir^a Facie Case

        There are three core elements6 to the prima facie  case for
   cost recovery or injuncti've relief under CERCLA:

               o  There is a- release or threat of release  of  a
                    hazardous substance;

               o  the release or threat of release is  from a
                   .facility;
     6    To complete a CERCLA prima  facie case,  additional
          elements include: an imminent and substantial
endangerment (for CERCLA section 106  injunctive relief),  or  that
the government incurred response costs  (for CERCLA  Section 107
recovery).   See. Sections XI and XIII, infra.

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                                   9                   9835.11-1

               o  the Defendant is in one of those categories  of
                    liable parties in CERCLA § 107(a).7

   This section of the litigation report should focus on  the
   first two elements8 of the core of the CERCLA prima facie
   case:

   1.   Release or threat of release of a hazardous
        substance.

             Often, this element will be established by
             on/off-site sampling showing that there has  been  an
             actual release.  Such sampling results may need to
             be supplemented by an evaluation of the physical
             conditions on or around the site that suggest the
             threat of release.  A summary of each different
             sampling program undertaken with regard to the site
             should be included here (along with a discussion  of
             any chain of custody or QA/QC issues/problems) and
             any witnesses that may be needed to testify  about
             these procedures should be identified.

             It is critical that all materials justifying the
             response activity be identified and that each is
             shown to be a hazardous substance.9 . Much of this
             evidence should be gathered as part of the
             Preliminary Assessment and Site Inspection (See 40
     7    It should be noted that, under particular
          circumstances, a CERCLA Section 106 action may lie
against parties other than those identified in Section 107.  For
example, a Section 106 action may be available to compel a state
cr local entity to remove unwarranted procedural barriers to site
cleanup.  See, e.g., United States v. Town of Moreau. No. 88-.CV-
S34.(N.D.N.Y.  Sept. 6, 1988).

     8    As noted in Section XI, infra (See, footnote 11 and
          accompanying text), the evidence to establish these
first two elements should be based on documents in the
administrative record.

     9    A list of substances that are hazardous substances
          under CEKCLA is contained in 40 C.F.R. Part 302.  That
regulation designates under CERCLA § 102 (a) those substances in
the statutes referred to in CERCLA Section 101(14).  It should
also be noted that a RCRA solid waste, as defined in 40 C.F.R.
261.2, which is not excluded from regulation as a hazardous waste
under 40 C.F.R. 261c4(b), is a hazardous substance under CERCLA
j 101(14) (as w«ll as a hazardous waste under RCRA) if it exhibits
any of the characteristics identified in 40 C.F.R. 261.20 through
261.24.

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                     10                     ''*

C.F.R. § 300.64,  40 C.F.R.  §  300.66  and  CERCLA
104(b)) and in the RI/FS (40  C.F.R.  §  300.68).
                                                         3fJH
 2.    From a  facility.

           CERCLA §  101(9) describes in broad terms what is
           included  in  the definition of a "facility."
           Describe  the evidence indicating that a "facility"
           exists.

           When  the  site is on or proposed for NPL listing, one
           must  be conscious of the manner the facility is
           defined in the litigation vis-a-vis the parallel
           discussion of the "facility" in the NPL listing.
           Any deviation from the NPL listing should be
           discussed.

           If the proposed litigation involves multiple sites
           or a  remote  sites theory, discuss each site/facility
           and the theory of liability with regard to each
           site.  In those discussions, describe, as
           appropriate,  the impact of multiple sites on the  -
           allocation of costs and the allocation of harm.

 The next  section of the litigation report should focus on the
 third core element  of  the prima facie case — liability o'f the
 proposed  defendants.

 B.   Liability  and  Description of Proposed Defendants

     Much of the basis  for the liability case against all PRPs
 will be established during the EPA PRP search.  Procedures for
 conducting PRP  searches and the type of information that
 should be obtained  are  included in "Potentially Responsible
 Party Search Manual" (OSWER Directive 9834.6, August 1987).
 Pertinent information  also may be contained in responses to
 CERCLA §  104(e)/RCRA §  3007 letters and CERCLA § 122(e)
 subpoenas.

     As a general matter, the litigation-report should
describe  the basis  for  asserting liability against each
proposed  defendant  and  explain why EPA does not propose to sue
certain potentially responsible parties at"this time.
However,  the complete package of information described below
in Sections  B.I., B.2.  and B.3. is not required at this time
for those  PRPs  EPA  does not propose to sue as a result of this
referral.  In addition,  some of the information required below
may be available in the PRP Search Report for the site, which
should be  included  as an attachment to the litigation report,
if available.   If the  PRP Search Report covers "the material
needed in particular sections of the litigation' report,

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attaching the PRP Search Report and citing to the appropriate
pages may be appropriate.

     The report should include names of all PRPs, the volume
and nature of substances contributed by each PRP and a ranking
by volume, to the extent available, as done under
§ 122(e)(l) of CERCLA.  Especially difficult issues of
liability, such as individual corporate officer liability,
corporate parent/subsidiary liability and successor
corporation liability, should be highlighted in this section
of the litigation report.

     Information regarding liability of PRPs generally is net
included in the administrative record for selection of the
response action except to the extent that PRP-specific
(typically, substance-specific) information is needed for
response selection decisions.  However, all PRP liability
documents must be collated, separated by PRP to the extent
possible, and available in the Regional office at the time of
referral.  The format for discussing PRP liability and
describing the proposed defendants is noted below.

1.   Owner or Operator and Former Owner or Operator.
     (CERCLA §§ 107(a)(l) and  (2))

     a.   Description of facility and activities undertaken at
          facility during period of ownership.

               Briefly discuss the business of the defendant,
               providing details about the facility in
               question.  When the defendant is a
               manufacturer, describe what is produced.
               Describe the plant and processes used.
               Emphasis should be on the source of the
               release/threatened release that necessitates
               the response action.  Legal description of the
               property must be in the title search done
               during the PRP  search.

               Past owners are responsible if they owned the
               property when hazardous substances were
               disposed of.  Title search will establish
               ownership; documents  (business records,
               permits, manifests, etc.) and witnesses  (names
               of employees,-neighbors should be  included)
               will establish  disposal at time of ownership.

     b.  State of incorporation/principal place  of business.

               If there is a question whether the corporation
               has been dissolved  or subsumed into  a  different
               entity, discuss, the issue, ascertain  status of

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                                                 9835.1 H
           corporation and attach a Dun and Bradstreet
           report and corporation papers from the
           Secretary of State's office (if not too
           voluminous).

           Give a brief synopsis of any name changes and
           changes  in corporate form of the proposed
           defendant(s) .  Include dates during which the
           corporation managed the business responsible
           for the  problem.

 c.  Agent  for service of process.

           Include  name, address, and telephone number, if
           known.

 d.  Legal  counsel.

           Include  name, address and telephone number.
           Note if  there are liaison counsel, separate
           negotiation and litigation counsel or a .
        .   steering committee involved and include-•   —
           pertinent names and affiliations.

 e.  .Identity of any parent or successor corporation(s).

           Discuss  evidence available or needed to show
           corporate control or assumption of liabilities.
           Merger,  acquisition and divestiture papers
           should be attached, if available and not too
        •   voluminous.

 f.  Deed/purchase  agreement with former owner.

           This may be part of the title search completed
           during the PRP search.

g.  Lease Agreements.

           If the property is or has been leased, include
           a copy of -the lease agreement(s), if not too
          voluminous:.

h.  Financial viability/insurance information.

          Where financial viability of a potential
          defendant is an issue, financial and insurance
           information will be important.  Discuss the
           issue and attach prior 10K, 10Q or other SEC
           filings,  Dun and Bradstreet or other similar
          report, and recent bank loan applications,  if
          not too voluminous.  See. "PRP Search Manual"

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                                                  9835.1H
          and "Guidance on Use and Enforcement of
          Information Requests and Administrative
          Subpoenas" (OECM, 08/25/88).

          Where insurance coverage may be available,
          describe and attach, if available,  any current
          or previous potentially applicable insurance
          policies.  If the case is a multi-generator
          case, insurance information is not needed  in
          the referral package itself.   See.  "Guidance on
          Use and Enforcement of Information Requests and
          Administrative Subpoenas" and "Procedural
          Guidance on Treatment of Insurers Under CERCLA"
          (OECM, 11/21/85).

i.  Personal liability issues.

          If proposed defendants include corporate
          officers or managers, discuss facts surrounding
          corporate officers'/managers' personal
          involvement in the activities resulting in
          liability and the degree of their personal
          direction of corporate affairs.

j.  Potential CERCLA § 107(b) defenses.

          The only defenses available to liability under
          CERCLA § 107(a) for owner/operators are set
          forth in § 107(b).  The defendant must
          demonstrate by a preponderance of the evidence
          that the release was caused solely by  (1)  an
          act of God, (2) an act of war, (3) a third
          party (under certain conditions), or  (4) any
          combination of the above.  Discuss any
          potential § 107(b) defenses associated with the
          potential actions and include documents that
          may tend to support or negate such defenses.

          In general, the third-party defense in CERCLA §
          107(b)(3) is available if the PRP can
          establish, by a preponderance of the evidence,
          that an entity, not related to the PRP by
          contract, agency or otherwise, was solely
          responsible for the release, and the PRP
          exercised due care concerning disposal at the
          site in light of the circumstances and took
          precautions against foreseeable acts or
          omissions of such third parties.

          The litigation report should identify  and
          address any events or circumstances that may
          show "sole cause," "due care" or

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                                14
983 5,1 H
               "foreseeability."  Discussion of the
               availability of the third-party defense in
               light of those facts should also be included in
               the report.

               Discuss fully whether the "innocent landowner"
               defense may be available based upon the
               parameters set forth in CERCLA Section 101(35).
               Review "Guidance on Landowner Liability under
               Section 107 (a) (1)  of CERCLA, Dje Minimis
               Settlements Under Section 122(g)(l)(b) of
               CERCLA and Settlements with Prospective
               Purchasers of Contaminated Property" (OECM/OSWER
               6/6/89) and SARA Conference Report.  Discuss
               how factors relating to the landowner fit
               within the guidance.  Include all
               administrative discovery and documents from the
               landowner which may tend to support or negate
               this defense.   The referral should also assess
               the nature and weight of available evidence  .   .
               regarding the defense as it may apply to each-;..
               owner/operator.

2•    Generators and Other Persons Who Arranged for Disposal
     (CERCLA § 107(a) (3) )

          The following information should be provided for
     those parties that.the' Region recommends as defendants.
     A lesser amount of information regarding other potential
     generator-type PRPs that are not proposed defendants at
     this time should be provided as well, along with a short
     explanation of the determination net to include those
     parties as proposed defendants in this referral package.
     See Section IX.B.,  page 10,  supra.
                                                  «-
     a.    As a starting point,  the referral must contain a
          list of amount and types of wastes generated by and
          contributed to the site by each generator, to the
          extent known,  ranked by volume.  The list should
          include an indication of whether the material is a
          RCRA hazardous waste or other CERCLA hazardous
          substance and the source of that'determination
          (e.g.,  it is a listed waste, it fails the Extraction
          Procedure (EP)  Toxicity Test, etc.).  See. Section
          IX.A.1.,  below.   If ATSDR is or will be writing a
          report,  so note (and attach copy if appropriate and
          not too voluminous).

     b.    Identification of generator's facility and
          description  of and  evidence documenting amount and
          type of hazardous substances sent to the site (e.g.,
          manifests.,  §  104(e)/§  3007 letter responses,

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                                                9835.1
                           15
     subpoenas, interviews, etc.).   Such information
     should be organized, summarized and collated
     separately for each defendant.   If such documentary
     information is not available or is somewhat
     equivocal (assuming, of course, a good faith basis
     to proceed), the litigation report must identify the
     reasons for including the party as a proposed
     defendant and the strategy for linking the defendant
     to the site (e.g., proposed discovery strategy or
     use of process chemistry).

c.   Indication of the current level(s) at the site of
     each contaminant sent to the site by the proposed
     defendant(s), if available.  It is important that
     the hazardous substances at the site be identified,
     to the extent possible, with each potential
     defendant.

d.   Description of the transporter of and the method of
     transporting the material for disposal.

          Facts should be included detailing whether the
          company used an independent contractor, company
          owned vehicles, etc. for delivering the waste
          material.

e.   State of  incorporation.

          See, Section IX.B.l.b. above.

f.   Agent for service of process.

          See. Section IX.B.I.e., above.

g.   Legal counsel.

          See, Section IX.B.l.b., above.

h.   Identity  of any parent or successor corporation(s).

          Where financial viability of a subsidiary  is
          questionable or when a PRP has been acquired  by
          another entity subsequent to disposal  of the
          hazardous substances, discuss evidence
          available or needed to show corporate  control
          or assumptions of liability.  Merger,
          acquisition and divestiture papers should  be
          attached, if available and not too voluminous..

i.   Description and evidence of financial viability.

          See. Section IX.B.l.h., above.

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                           16


j.   Potential CERCLA § 107(b) defenses.

          See, Section IX.B.l.j., above.

Transporters - CERCLA § 107(a)(4)

a.   Description of transporter's business.

b.   .List of generators each transporter worked for.

c.   List of amount and types of waste transported and
     destination.

d.   Description of evidence documenting pickup point and
     destination point, and amount and type of hazardous
     wastes or hazardous substances transported.

e.   Discussion of evidence to be used in showing that
     the transporter selected the site.  See. "Policy for
     Enforcement Actions against Transporters under
     CERCLA" (OECM/OWPE, December 23, 1985).

f.   Description of any potential trans-shipments beyond
     disposal facility in question.  See also, discussion
     at Section IX.B.2.J., above.

g.   State of incorporation.

          See. Section IX.B.l.b., above.

h. '  Agent for service of process..

          See, Section IX.B.I.e., above.

i.   Legal counsel.

          See. Section IX.B.l.d., above.

j.   Identity of any parent or successor corporation.

          See. Section IX.B.2.h., above.

k.   Description and evidence of financial viability.

          See. Section IX.B.l.h., above.

1.   Potential CERCLA § 107(b) defenses.

          See. Section IX.B.2.J., above.  Also'note  "ICC"
          defenses in CERCLA § 101(20).

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                               17
C.  • Miscellaneous Issues Regarding Liability
     and Cost Recovery

1.   Special Defendants

          Identify and discuss any issues regarding special
          defendants (e.g., municipal or State agency
          defendants).  Include here any discussion of Federal
          PRPs involved with the site.

2.   Divisibility of Harm

          Discuss any divisibility issues presented by
          separate sites or potentially segregable harms
          presented at a single site.  Discuss any proposed
          allocation of costs that is based upon such
          potential divisibility.

3.   Exemption from Liability Issues - Discuss if applicable?

     a.   Federally permitted release (CERCLA § 101(10)).
          See. "Reporting Exemptions for Federally Permitted
          Releases of Hazardous Substances; Proposed Rule" 53
          Fed. Rea. 27268  (July 19, 1988).

     b.   Petroleum, natural gas, synthetic gas, and crude oil
          exclusions (CERCLA §§ 101(10), 101(14), 101(33)).

               For cases involving waste oil, used oil or
               other petroleum based materials, set forth a
               preliminary determination of why the parties
               dealing with such materials should be sued and
               the bases for this determination.

               Review "Scope of the CERCLA Petroleum
               Exclusion"  (OGC, July 31, 1987) and state how
               .analysis in this case complies with that
               guidance.  Once promulgated, RCRA § 3014
               regulations should be discussed, if relevant.

     c.   Nuclear materials (CERCLA § 101(22)).

     d.   Fertilizers - Normal application is not a "release"
          (CERCLA § 101(22)) .

     e.   Pesticides - Cost recovery may not be available
          for response to releases of pesticides registered
          under FIFRA.  See CERCLA Section 107((i).  Discuss
          any "pesticide reformulation facility" issues  that  •
          may be relevant.

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                                                       9835,? |-
                                   18

         f.    Consumer products - Products for consumer use not
              included in definition  of "facility" in CERCLA
              §  101(9).

    4.    Equitable  Considerations10

         In  certain circumstances, the Region may be able to
         anticipate additional arguments that will be asserted by
         certain PRPs.  Such arguments may include equitable
         defenses,  negligent permitting of a site by a State or
         Federal agency, etc.  Any such potential issues known to
         the Region should be identified and addressed in the
         litigation report.

    5.    Ability to Recover Costs/NCP Issues

         Discuss any potential arguments that may be asserted by
         defendants regarding costs,  including such things as
         gross errors in implementing the remedy and inconsistency
         of  the  response with statutory or NCP provisions.  This
         discussion may be deferred to Section XI.D., below, if
         appropriate.

    6.    Potential  Criminal Liability

         The referral memo should briefly describe if there is a
         State or Federal criminal investigation ongoing,
         contemplated or completed and relationship to current
         Agency  guidance on parallel  proceedings.


X.  Enforcement History; Contacts with the Potential Defendants

     To  ensure  that the Department of Justice has a complete
history  of  ZPA's course of dealings  with the site and the
potential defendants, the following  information should be
discussed if  applicable.

   A.    Pertinent  contacts with potential defendants.  Indicate
         dates,  duration, nature of contact and any conclusions
         drawn,  including evidence of recalcitrance or
         cooperation."  Initial contact may be made during the PRP
         search.  The following is a  partial list of the types of
     10  .  The government has consistently taken the position
           that, aside from proving that they are not one of the
parties that may be held-liable under CERCLA Section 107(a), a
PRP's only possible defenses in a CERCLA action are those
delineated in CERCLA Section 107(b).  It should be noted, however,
that certain courts have held that equitable defenses are
available under CERCLA.

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                                                       9835.1
                                19

   *• contacts that should be discussed in the litigation
     report.

     1.   Information requests, subpoenaed documents/
          testimony.

               See. "Guidance on Use and Enforcement of CERCLA
               Information Requests and Administrative
               Subpoenas" (OECM 08/25/88).

     2.   Interviews with site or generator employees, truck
          drivers, etc.

     3.   FOIA requests.

     4.   Demand letters  (CERCLA § 107 actions only).

     5.   Warrants, access orders or agreements.

     6.   Administrative order(s)

               Describe any State or Federal AOs that have
               been issued to anyone involved at the site a'nd
               the current status of the order(s).  If the
               case involves enforcement of a Federal AO under
               RCRA or CERCLA, the AO should be attached to
               the report and the basis for and the facts
               surrounding any claim for penalties or treble
               damages  (CERCLA only) need to be discussed.

     7.   Permit(s) (State or Federal) and permit applications
          relevant to the referral.

               List all permits issued to the facility or site
               and discuss, those that are relevant to this
               referral and any actions required to enforce
               the conditions of the permit.

     8.   Federal lien - See. "Guidance on Federal Superfund
               Liens" (OECM 9/22/87). .  -

B. Involvement of State, local agencies.and citizens.

     Identify pertinent contacts or actions taken or
     anticipated, by State or local agencies and citizens.  In
     particular, discuss local or State- civil or criminal
     enforcement actions taken or pending and describe any
     role the State anticipates playing in an ongoing action.
     Any notable positions that the State has taken regarding
     this site or other CERCLA sites in the area of State
    . involvement in remedy selection or implementation
     decisions, or ARAR selection should specifically be

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                                20                 9835.1 H

     noted.  Media coverage regarding the site should also be
     noted and print media articles should be attached, if
     available.

C. Citizen suits filed.

     Identify any relevant citizen suits.  Identify plaintiffs
     and defendants.  Summarize claims asserted.  Indicate date
     case was filed and in what court.  Describe case status.

D. Administrative or judicial actions (regarding the site
   only) filed by State or filed or referred by Federal
   government under environmental statutes other than RCRA,
   CERCLA or State counterparts thereof should be discussed.

     Include recent actions in all media and under all
     statutes.  Include any related or pending administrative
     enforcement proceedings  (e.g., CAA § 113/120, TSCA §
     16 (a), RCRA § 3008, FIFRA §§ 13 or 14(a), CWA § 309, and
     MPRSA § 105(a) proceedings).  Generally discuss
     defendant's responses.  Also indicate recent contacts
     by/with program office permits staff.

E. RCRA facilities.

     Where the site/facility is a RCRA facility or former RCRA
     facility (e.g., LOIS, WOIS, or protective filers of a
     RCRA Part A permit), the rationale must be given for the
     decision to pursue § 7003 or § 106 injunctive relief for
     site remediation, instead of corrective action or closure
     pursuant to RCRA § 3008(h) or, if appropriate, §§ 3004(u)
     or (v), where permitted.  IMPORTANT; See. NPL deferred
     listing policy for RCRA sites, as described at 51 Fed.
     Reg.  21057 (June 10, 1986) and 53 Fed. Reg. 30002
     (August 9, 1988).  See also. "National Oil and Hazardous
     Substances Contingency Plan; Proposed Rule." 53 Fed. Reg.
     51394, 51415 (December 21, 1988).

F. Prior Orders or Consent Decree(s)

     Certain facilities or sites may have been subject to
     prior administrative orders or consent decrees addressing
     other cleanup actions or access.  The litigation report
     should include a general description of the terms of the
     decree,  whether the facility or site owner complied with
     the terms of the decree and what statute and claims were
     involved.

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                                   2i                 9835,1 H

XI.  Cost Recovery

        There are four elements to the orima facie case for
cost recovery relief under CERCLA:

          o  There  is a release or threat of release of a
              hazardous substance;

          o  The release or threat of release is from a
             facility;

          o  The release or threat of release caused the
             United States to incur response costs,

          o  The Defendant is in one of those categories of
             liable parties in CERCLA § 107(a).

   Elements 1, 2, and 4 have been discussed in Section IX,
   above.11  The third element (expenditure of response costs),
   as described below, has several facets to it.12

        There are two general types of evidence that must be
   available to prove costs: "work" evidence and "cost" evidence.
   The "work" evidence typically will be in the form of documents
   and testimony detailing the activities undertaken.  The "cost"
   evidence will primarily involve documents detailing the cost
   of those activities.  The major guidance documents
   discussing CERCLA costs and cost documentation requirements
   are:                                              '

        o    "Procedures for Documenting Costs for CERCLA
             § 107 Actions"  (OWPE January   . 1985)
     11    These three elements are typically part of the
           government's  "liability" case and should be
established, in most cases, through summary judgment.  The
evidence to establish the  "release/threat" and "facility" elements
should be based on documents in the administrative record for the
selection of the response  action.

     12    To the extent that this element of the Section
           107 prima facie case involves review of remedy
selection decisions, Section 113 (j) requires that review be on the
administrative record.   It is EPA's view that under Section 107
of CERCLA, judicial review of costs incurred by EPA is confined to
proof that the implemented cleanup was consistent with the
response action selected by EPA, that the response action was
performed and that the claimed costs were actually incurred.

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                                22

     o    "Financial Management Procedures for Documenting
          Superfund Costs"  (FMD September 1986)

     o    "Cost Documentation Requirements for Superfund
          Cooperative Agreements, Appendix U"  (OSWER Directive
          9375.14u)

     o    "Resource Management Directive 2550D - Financial
          Management of the Superfund Program" (Comptroller
          July 25, 1988)

     o    "Superfund Cost Recovery Strategy" (OSWER Directive
          No. 9832.13, July 25, 1988)

     Work and cost documents must be available for each of the
cost areas in a cost recovery case.  In addition, official
determinations regarding- expenditures of money should be
discussed in the litigation report and the corresponding
documents included in the appendices (e.g., approval memo for
removals exceeding $2.0M).  The referral should also indicate
whether the Region has redacted the cost documents.for
confidential business information  (CBI) and, if.not, a date by-
which it will do so.

A. Past cost summary (by category of costs).

     As noted in prior guidance, the cost summary (but not the
     entire cost documentation package) must be included in
     the litigation report.  Nonetheless, the complete cost
     documentation package must be compiled in the Region at
     the time of the referral and supplemented thereafter on a
     timely basis.

B. Response action cost elements and documentation.

     The referral must clearly identify each of the Agency
     responses undertaken at the site  (i.e., Removal(s),
     RI/FS,  RD, and RA) and each operable unit of each
     response.
                                             *
     Each phase of a response action7will have certain types
     of documentation required for proof of the costs for that
     phase of response.  Some of the. documentation may be .
     similar to that used in proof of other phases of an
     overall response to a site. ' Fbr each of the response
     actions at a site, the following information and documents
     must be gathered, organized and available in .the Region at
     the time of referral.  Definitive guidance on the
     documents necessary for cost recovery is contained in the
     manuals noted above.

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                                   23                98 3 5.1 H

            Each Federal contractor  used and tasks performed.

             a.   Work done  (e.g^, contracts, subcontracts,
                  letter reports, Technical Directive Documents
                   (TDDs), work assignments, scopes of work, work
                  progress reports,  TDD Acknowledgement of
                  Completion);

             b.   cost of that work  (e.g., invoices, vouchers);
                  and

             c.   that payment was made  (e.g., paid/processed
                  invoices,  contract status notifications, and
                  Treasury Schedules).

             Each Interagency Agreement  (IAG) employed and tasks
             performed.

             a.   Work done  (e.g., each IAG, contracts entered
                  into by the other  Agency, work assignments,
                  scope of work, work progress reports, and  ack-
                  nowledgements of completion);

             b.   cost of that work  (e.g., invoices, vouchers,
                  drawdown vouchers  and the pertinent reports to
                  the agency).;

             c.   that payment was made  (e.g., paid/processed
                  invoices).

             Each cooperative agreement signed, tasks performed
             and contractors hired by the State.13

             a.   Work done  (e.g., each cooperative agreement and
                  all amendments thereto, contracts entered  into
                  by the State, work assignments, scope of work,
                  work progress reports, and acknowledgements of
                  completion);
     13    CERCLA Section  lll(k)  requires  an Inspector General
           audit of the Hazardous Substances Superfund and random
audits of cooperative agreements  and  State Superfund contracts..
EPA's Inspector General also  does periodic site-specific general
audits.  The results of any site-specific  audits pertinent to the-
referral should be described  and,  if  not too voluminous, attached.
Copies of audit reports may be  obtained from the Inspector General
Division of the Office of  General Counsel.

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                              24
                                                98 3 5,1 I-/
 '-      b.   cost of that work  (e.g., invoices, vouchers,
             drawdown vouchers  and the pertinent reports to
             the Agency);

        c.   that payment was made  (e.g., paid/processed
             invoices).

    4.   Agency personnel activities performed at the site.

        a.   Work done  (e.g., timesheets, travel
             authorizations);

        b.   cost of that work  (e.g., Agency financial
             management  (SPUR)  report, Travel Vouchers,
             etc.) ;

        c.   that payment was made  (Treasury Schedules).

    5.   EPA .indirect costs - Indirect cost calculation
             worksheets and summary sheet 'should be included
             in the litigation  report.  See. "Superfund
             Indirect Cost Manual for Cost Recovery
             Purposes: FY 1983  through FY 1986" (OARM March.
             1986) ; "Superfund  Indirect Cost Rates for
             Fiscal Years 1985  and 1986" (OARM 12/17/87).

    6.   Interest

        a.   Identify date of demand and include copy of
             demand letter or other document indicating
             initiation date used for calculation of
             prejudgment interest.

        b.   Include spreadsheet or other documents showing
             prejudgment interest calculations.

        See. CERCLA Section 107(a); Comptroller Policy
        Announcement 87-17: "Interest Rates for Debts
        Recoverable Under the Superfund Amendments and
        Reauthorization Act of  1986" (09/30/87); "Interest
        Rates for Superfund Related Debts" (Comptroller
        6/15/88)

C.  Projected future costs.

   1.   An estimate of the types, amounts and basis of
        future expenditures, if they are planned or can
        reasonably be projected, should be included.

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                                                     -9*3511
    6
    '• 2.   Future costs (or even a declaratory judgment
           concerning liability for future costs14)  are,  for
           tactical reasons, not always sought in each case.
           If they are not sought (i.e.,  no potential statute
           of limitations problem, an explanation why not
           should be included.

   D. Potential problems with costs.  (See also,  IX.C.5., above)

      1.   The referral should describe and include any
           documents discussing or criticizing any cost  figures
           or. activities undertaken, including the On-Scene
           Coordinator's Report (40 C.F.R. 300.40) or any
           Congressional investigations or Inspector General
           audits not described previously that refer  to or
           directly discuss the site cleanup activities  or
           costs.

      2.   Any-potential problems regarding consistency
           with the National Contingency Plan should also be
           discussed.

   E. Statute of Limitations  (CERCLA Section 113(g)(2)j

      Discuss any potential statute of limitations  issues.
      See, "Timing of Cost Recovery Actions"  (OWPE,
      October 7, 1985).  See also. "Cost Recovery Actions/
      Statute of Limitations"  (OWPE, June 12, 1987).  Indicate
      relevant dates.

  F. Identify any prior proceeds  received.

      1.   Ten percent state share

      2.   Prior settlement proceeds  (received and  expected)

      3.   Bankruptcy proceeds


XII.   Penalties and Punitive  Damages

 A.   Section 106(b) - State whether defendant has  violated an.
           order issued under  Section  106.  The  referral must
           describe all evidence  showing  that defendant
           willfully violated  or  failed or  refused  to comply
           with the order,  without  sufficient cause.  Discuss
           all arguments that  defendant may raise justifying
           failure to comply with the  order (e.g.,  not  a
           responsible party,  terms of order  were arbitrary)..
        See. CERCLA Section  113(g)(2)

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                                   26                  9835.1 1-

             Set forth calculation of penalties.  Discuss all
             opportunities defendant had to meet with Agency
             prior to issuance of the order.  Note the
             possibility that, under Tull v. United States.  481
             U.S. 	, 107 S.Ct. 	, 95 L.Ed. 2d 365 (1987), the
             case may involve a jury trial.^5  Any referral  that
             proposes civil penalties must contain some analysis
             of the penalty aspects of the case in light of  Tull.

   B.   Section 107 - Defendant may be liable for punitive
             damages in an amount equal to and not more than
             three times the amount of costs incurred by the
             Hazardous Substances Superfund if defendant failed
             without sufficient cause to properly carry out
             removal or remedial action under a CERCLA §§ 104 or
             106 order.  Discuss the nature of and evidence
             supporting proof of defendants' violations, the
             amount and basis for damages sought under this
             authority, and any justifications defendant may have
             for failing to  :erform the action.


XIII.  In-iunctive Relief

     Under this section of the litigation report, the substantive
requirements of the relevant portions of the applicable statute
should be presented.  Applicable case law should be .cited and
analyzed.  If a novel theory is proposed, support for that theory
should be included.  In addition, any determinations that are
required by statute or regulation  (e.g., that an imminent and
substantial endangerment exists at the site) should be described
and documented in the administrative record.

A. CERCLA Section 10616

        CERCLA Section 113(j) clearly provides  that CERCLA remedy
   selection decisions are-entitled  to review based upon, the
     15    Under Tull. the Supreme Court held that the Seventh
           Amendment to the Constitution may guarantee a jury
trial to determine liability in Clean Water Act civil enforcement
cases seeking civil penalties.  Under that ruling, however, a jury
does not assess the amount of penalties, nor is a jury required in
an action brought solely for injunctive relief. The government's
position -is that a jury trial is not available to decide liability
issues where a court can decide the case through summary judgment
(e.g., where no issues of material fact are present).

     16     See. "Guidance on CERCLA Section 106 Judicial Actions"
            (Reich/Porter, 2/29/89) for factors considered  in
selecting and initiating Section 106 actions.

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                                   27                9835-1
   administrative record.17  That decision will be based on,
   among other things, evidence of two of the three core elements
   of the CERCLA prima facie case  (noted in detail in  Section
   IX.A., above): (1) the release or threat of release of
   hazardous substances, (2) from a facility.

        The key additional element for a Section 106 action,
   aside from liability, is that there be a condition  which
   presents or may present an imminent and substantial
   endangerment to public health or welfare or the environment.
   Evidence on this subject generally will be available through
   the results of activities undertaken pursuant to Subpart F -
   Hazardous Substance Response of the NCP (40 C.F.R.  Part 300 et
   seq.).  The endangerment assessment/risk assessment typically
   contained in the RI, or as a separate document, is  the
   critical piece of information.

        The evidence to support these three elements of the
   Section 106 prima facie case should be addressed in and be
   part of the RI and FS and will be documented in the ROD as
   part of the Agency's remedy selection decision.  The remedy
   selection decision .in the ROD itself should define the
   injunctive relief EPA will seek and should be upheld if it is
   supported by the administrative record and is not arbitrary
   and capricious.18

        Of course, to complete the CERCLA Section  106 prima facie
   case, the United States will still.have to present evidence on
   liability (i.e., that the party is a responsible party
   (including but not limited to these classes of  persons liable
   under CERCLA Section 107(a))) and may have to present evidence
   showing that any alleged affirmative defenses under Section
   107(b) are inapplicable,19 both of which might  be reviewed by
   the-court de novo.  See. Section IX., above.
     17   To assist in ensuring record review of the remedy
          selection decision, the Region also should typically
issue a unilateral administrative order under CERCLA § 106 after
the ROD is signed.

     18   The case law on the standard of review for remedy
          selection decisions in the context of CERCLA Section
106 actions that were filed pre-SARA has been split.  However, it
is the Agency's position that record review with an arbitrary and
capricious standard is applicable.

     19   The Section 107(b) defenses to liability typically are
          available in Section 106(a) actions for injunctive relief

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                                   28               9835J1-1

 B.  RCRA  Section  7003  (See Appendix I)

         The prima  facie case  for RCRA Section 7003 is slightly
    different  than  that for CERCLA Section 106.  Success on the
    merits under  RCRA  Section  7003 requires proof of the following
    elements:

         o     Fast  or  present  handling, storage, treatment,
              transportation20 or disposal,

         o     of  a  hazardous or solid waste,

         o     may present an imminent and substantial endangerment
              to  health or the environment, and

         o     the party has contributed or is contributing to such
              handling, storage, treatment, transportation or
              disposal.

    If a  RCRA  § 7003 count (or other non-CERCLA statutory
    "endangerment"  claim) is proposed, causation and record review
    of remedy  selection will probably be raised by defendants."
    Since RCRA does not on its face provide for record review, and
    the reach  of  CERCLA Section 106 and RCRA Section 7003  is
    generally  coextensive,21 the referral should identify  the
    specific reason for inclusion of the RCRA  § 7Q03  (or other
  ."endangerment") claims.

    These RCRA §  7003  prir.a facie case elements are discussed
    briefly below and  mere extensively in Appendix I:

    1.    Past,  or  present handling, storage, .treatment,
         transportation or disposal.

              Describe the facility or PRP activities that come
              within the meanings of these terms.   (^'Treatment",
              "storage" and "disposal" are all defined in  RCRA
              § 1004.)

    2.    Hazardous  or  solid waste.

              Each  material that is the subject of the referral
              for which liability is sought to be imposed  must be
     20     Note that RCRA § 7003 contains an exemption  from
            liability for certain transporters,  similar  to the
exemption in CERCLA § 101(20).

     21     RCRA Section 7003 applies to  "solid 'or,*hazardous
          .  wastes," which is a'broader universe of. materials than
"hazardous substances."

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                                  29
                                                     9835,1 1-
    ,  '.       identified as a hazardous waste or a solid  waste.
             See. RCRA §§ 1004(5)  and 1004(27),  respectively.
             See also. 40 C.F.R. 261.3 and 40 C.F.R.  261.2,
             which, while not directly governing Section 7003
             actions, also delineate materials as hazardous
             wastes due to their characteristics or because  they
             are specifically listed as such in the regulations.

   3.    May present an imminent and substantial endangerment to
        health or the environment.

             Although we will argue for record review in these
             cases, additional evidence may need to be adduced.
             A discussion of the types of evidence that  may  be
             needed to support this element of the RCRA
             § 7003 case is included in Appendix I.

   4.    The party has contributed or is contributing to such .
        handling, storage, treatment, transportation or disposal.•

             This aspect of the RCRA §7003 prima facie case  may
             be an additional, different burden than faced under
             CERCLA.  The referral must discuss the available •
             documentary and testimonial evidence that will  be
             used to show that a particular generator's waste  (or
             at least the same type of waste when the wastes have
             commingled), or an owner/operator's actions "has
             contributed or is contributing to" a situation  that
             may present an imminent and substantial
             endangerment.
XIV.  Other Legal Issues

    A.  Potential defenses/exclusions (other than those noted
        in Sections IX.B.I.}., IX.B.2.J. and IX.C., above).

    B.  Statute of limitations

             See. Section XI.E. , above, regarding the CERCLA
             statute of limitations.  Since RCRA contains no
             specific statute of limitations, underlying facts
             relating to the timing of any'action under RCRA,
             including any potential limitations, should be
             included.

    C.  Applicability of prior consent decree or A.O. entered
        for this site.  See. Section X.F., above.

    D.  Res judicata/collateral estoppel/equitable estoppel.

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                                                       9835JH

XV. 'Litigation/Settlement Strategy

   A.   Case Management Planning

        1.    A preliminary draft case management plan should be
             prepared.   See "Case Management  Plans"  (Adams/
             Marzulla 3/11/88).   Availability of and proposed
             assignments for Regional legal and technical
             personnel  should be noted in the draft plan.

    B.   Settlement Negotiations

        1.   Prior efforts to settle.

             Describe history or attempts to  settle by  way of
             notice/demand/special notice letters, PRP  meeting,
            . etc.

        2.   Special notice

             Discuss whether special  notice was sent and the
             results.  See.  "Interim  Guidance on Notice Letters,
             Negotiations,  and Information Exchange"  (OWPE,
             10/19/87)

        3.   History of'negotiations.

             Describe'nature,  extent  and duration  of prior or
             ongoing settlement  discussions regarding subject  of
             this referral,  or negotiations concerning  other
             pending environmental civil or administrative
             actions.  (When available,  include discussions and
             attempts to settle  by State.)  Describe attempts  at
             compromise and why  process  failed.  Attach a copy of
             latest version of AO or  CD  discussed  with  PRPs
             before negotiations were terminated.

        4.   Planned Future Negotiations

             If additional negotiations  are to be  pursued
             immediately after filing, include a brief  settlement
             evaluation (See.  Interim CERCLA  Settlement Policy,
             50 Fed.  Reg.  5034),  recommending a bottom  line and  a
             suggested  negotiation strategy.   See  also. "DRAFT
             CERCLA RD/RA Settlement  Negotiations  Checklist"
             (OECM,  01/26/88).

             a.    State  whether  this  case may be appropriate
                  for.mixed funding.   See. "Evaluating  Mixed
                  Funding Settlements under CERCLA"  (OECM/OSWER,
                  10/20/87).

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                                                     983S1 1-
                                  ii

             b.   State whether this case has the potential  for
                  de minimis settlements.  See.  "Interim Guidance
                  On Settlements with De Minimis Waste  Con-
                  tributors under SARA Section 122(g)"
                  (OECM/OSWER 06/19/87)(52 Fed.  Reg.  24333,
                  06/30/87) .

         5.  Include discussion of and a copy of any Non-Binding
             Preliminary Allocation of Responsibility (NEAR)  and
             responses by PRPs.

                  See. "Interim Guidelines for Preparing
                  Preliminary Non-Binding Allocations of
                  Responsibility" (OSWER, 5/16/87)(52 Fed.  Reg.
                  19919, 5/28/87).

    C.  Litigation Strategy

         1.  Discovery22

             Indicate general need for obtaining evidence
             (especially for critical facts) by discovery
             (interrogatories, depositions and requests for
             admissions) on issues of. liability and, in certain
             instances, response costs.   (Include names and
             addresses, if available, of potential witnesses and
             the evidence to be sought from such persons.)

             Discuss the approach to be taken in managing
             discovery and document production if the action
             involves multiple parties or massive numbers! of
             documents.

        2.  Summary Judgment

             Indicate if case has potential for  summary judgment
             or partial summary judgment and on  what issues.
             Explain briefly.


XVI.  Other imminent Hazard Provisions

   The referral should carefully consider whether claims exist
   under the imminent hazard provisions  of the  other Federal  .
   statutes listed below.  The Appendices to the RCRA/CERCLA  Case
   Management Handbook describe and discuss each element of
     22     Despite the availability of record  review  fcr
            issues regarding the-adequacy of  remedy  sel€:Ction,
discovery will be available for certain other aspects  ol:  CERCTA
cases, such as for issues regarding liability.

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                               32                     9835.1 ]-/
pro'of, listed below, for these other statutes and should be
consulted.

  A. Clean Air Act § 303. 42  U.S.C. § 7603

     1.   A pollution source or combination of sources
          (including moving sources) [See,  42 U.S.C.
          §§ 7521-7574; 42 U.S.C.  § 7602(j)],

     2.   is presenting an imminent and substantial
          endangerment to the health of persons.

     3.   State and local authorities have  not acted  to
          abate such sources.

     4.   Defendant is a person causing or  contributing to the
          alleged pollution.

     5.   EPA has confirmed the correctness of its
          information.

  B. Clean Water Act § 504. 33 U.S.C. S 1364

     The Administrator may seek injunctive  action to  stop
     the discharge of pollutants or take such other action as
     may be necessary (See. CWA §§ 504 (a),  502(12), (6) ,.' (7) ,
     (9), (10), (14))  where the Administrator receives
     evidence that:

     1.   A pollution source or combination of sources [See,
          CWA § 504(a), 502(19), (12), (6),  (7),  (14), (9),
          (10) , 306(a) (3)],

     2.   is presenting an imminent and substantial
          endangerment to  (1) the health of persons or (2)
          to the welfare of persons where such endangerment is
          to the livelihood of such persons, such as
          inability to market shellfish [504(a)].

     3.   Defendant is a person causing or contributing to
         . the. alleged pollution [504 (a), 502(19)].  See also.
          discussion on RCRA § 7003, Section XIII.B., above.

  C. Safe Drinking Water Act S 1431. 42 U.S.C. S 300i

     The Administrator may seek appropriate  relief to protect
     health of- affected persons, including injunctive relief,
     when the Administrator is in receipt of evidence that:

     1.   A contaminant or contaminants [§ 300i(a),
          §  300f(6)],

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                                   33                      9 &3 5.1 H
        2.   present in or likely to enter [§ 300i(a)],
        3.   a Public Water System [§ 300i(a), §300f (4)]  or
             an underground source of drinking water,
        4.   may present an imminent and substantial
             endangerment to the health of persons, and
        5.   appropriate State and local authorities have not
             acted to protect the health of such persons.
        6.   Where practicable, EPA consulted with State and
             local authorities.
        7.   Information on State or local action taken, if
             any.  (Note:  This provision is silent as to
             definition of responsible parties.)

XVII.  Witnesses/Litigation Support
     A. Witnesses
        1.   For fact witnesses identified in .the litigation
             report that have potentially relevant information,
             the following should be referenced in the referral
             package:
              o    Present place of employment
              o    Home and business phone
              o    Substance of testimony
              o    Whether statement is on file.
         2.  For potential expert witnesses, the following are
             required in addition:
              o   Field of expertise (include resume and any
                  reports generated by expert regarding this site
                  or facility)
              o   Whether individual is under EPA contract, and
                  if so through what contracting mechanism.
              o   Other cases where the expert has testified,
                  been deposed or otherwise been retained in the
                  past.

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                                                   9835.1 1-1
                               34

      3.  Potential adverse witnesses (fact or expert)  should
          also be identified, to the extent known,  and  the
          substance.of their potentially adverse testimony
          should be indicated.

B. Litigation Support

      1.  Identify any contractor resources necessary and
          present plans for procuring such resources.

      2.  Provide an'estimate of the relative resource  demands
          that the Region anticipates will be required  for  the
          proposed litigation and indicate any specific
          workload model projections attributed to this case.

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                                                               98 3 5,1 H
                               PRIMA FACIE CASE
                                RCRA  §  7003;
                              (42 U.S.C. § 6973)
                                                This document was prepared
                                                as suggestion and guidance
                                                only.
   FACTS TO BE PROVEN
STATUTORY BASIS
     COMMENTS
   I. Administrator must
      present  evidence  of:

   A. i. Handling,
      2. Storage,
      3. Treatment,
      4. Transportation,
           or
      5. Disposal
  1004(33)1/
  1004(34)
  1004(3)2/
   B. Of either:

      1. Solid Waste,
         or
  1004(27)
  40 C.F.R.
      261.2
     2. Hazardous Waste
 1004(5)
  40 C.F.R.
   261.3
Disposal includes when waste is
first deposited, dumped, spilled,
or placed onto the ground and also
when wastes later migrate.  It
includes leaking (i.e.,
discharging and "repositioning")
as well as "reposing" wastes.
See. U.S. v. CCC. 619 F. Supp.
162, 199-200.
Very broad definition of solid
waste, but note specific
exceptions.  See also. American
Mining Congress v. EPA. 824 F.2d
1177  (D.C.-Cir. 1987) holding that
EPA exceeded its authority under
RCRA  in seeking to regulate as
"solid wastes" secondary materials
reused in an ongoing manufacturing
process.  See also, 53 Fed. Reg.
519 (January 8, 1988), for EPA's
interpretation of that decision.

The definition states that a waste
is hazardous if it "may...cause,
or significantly contribute to an
increase in illness or mortality,
or if it "may...pose a substantial
present or potential hazard to
human health or environment" when
managed.  These terms indicate a
scope broader than the strict,
conventional "causation."
Listing in RCRA regulations  (4C
I/ 42 U.S.C. § 6903 is the definitions  section of RCRA.
2/ See also Hazardous Materials  Transportation Act,
   49 U.S.C. §§ 1801, 1802(6-, 1809,  1810.

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                                   -  2  -
    FACTS TO  BE  PROVEN    STATUTORY  BASIS
     COMMENTS
   C. May present
                                         C.F.R.  Part  261)  or  e
                                         it  is  a "characterist
                                         under  Part 261  is sui
                                         .establish that  a  mate
                                         "hazardous waste."
   D. An imminent and
Imminence applies to
threat rather than t
identification of th
'the endangerment act
materialized.3/  An.
is imminent if factc
to it are present, e
harm may not be real
years.  U.S. v. CCC.
162, 193 (W.D. Mo. J
      substantial endangerment
An endangerment is i
an actual harm but :
from threatened or ;
no actual injury ne
Evidence must show
harm.  See. CCC at
Corp. v. EPA. 541,
Cir. 1976), cert, d
941  (19.76) ; United
Reserve Mining. 514
Cir., 1975); United
Vertac, 489 F. Supp
(E.D. Ark.  1980).
U.S. need not quant
establish endanger?
endangerment is sul
there is reasonabl*
3/ H.R.. Committee Print  (96-IFC 31,  96th Cong.  1st Sess. 3

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                                   -  3
                     9835J H
FACTS TO BE PROVEN    STATUTORY  BASIS
    COMMENTS
E. To
        1. Health, "or

        2. The environment
                                       concern that someone or something
                                       may be exposed to risk of harm by a
                                       release or threat of release if
                                       response action is not taken.  CCC
                                       at 191-197.

                                       See also legislative history and
                                       case law interpreting other
                                       "endangerment" provisions of Federal
                                       law, including §§ 504(a) and 311(e)
                                       of the Clean Water Act, § 1431 of
                                       the Safe Drinking Water Act, §
                                       303(a) of the Clean Air Act, § 7 of
                                       the Toxic Substances Control Act; §
                                       6(c) of the Federal Insecticide,
                                       Fungicide and Rodenticide Act; §
                                       2601 of the Consumer Product Safety
                                       Act; § 662 of the Occupational
                                       Safety and Health Act;  § 1810(b) of
                                       Hazardous Materials Transportation
                                       Act; § 15.11 (b) of the Deep Water
                                       Ports Act; § 1415 of the Marine
                                       Protection, Research and
                                       Sanctuaries Act, and  §  355(e) of
                                       Federal Food, Drug and  Cosmetic
The term incorporates surface water,
groundwater, soil, and air, and
probably includes fish, mammals,
biota, and plant life.

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                                                            9835'1

 FACTS  TO .5E»PROVEN    STATUTORY  BASIS
    COMMENTS
 II.  Liable  Persons
III.  Relief:
     A.  To restrain liable
        persons fron:

        1.   Handling
        2.   Storage    1004(33)
        3.   Treatment  1004(34)
        4.   Transportation
        5.   Disposal   1004(3)
Any person  (including any past or
present generator, past or present
transporter, or past or present
owner or operator of a treatment,
storage or disposal facility) who
has contributed or who is
contributing to the alleged
handling, storage, treatment,
transporation or disposal of a
solid or hazardous waste that may
present an imminent and substantial
endangerment to health and
environment.  Such liable persons
may include owners or operators of
the site, former owners or
operators, (both of which may
include landowners or lessors),
corporate officers and directors
(in their official and, in
appropriate circumstances,
individual capacities) waste
generators, and (unless exempted by
§ 7003)  waste transporters.  See.
e.g.,  U.S. v. Aceto Agricultural
Chemicals Corp.. No. 88-1580  (8th
Cir. April 25, 1989),  U.S. v.
NEPACCO. 810 F.2d at 740, 745 (8th
Cir. 1986), cert, denied 108 S.Cr.
146 (1987) ; U.S. v. CCC. 619 F.
Supp.  at 198.
Included in relief granted by
courts in § 7003 actions are:
restraint of continued leaking,
requirement to undertake
investigative activities (Price.
688 F.2d 204 (3rd Cir. 1982));
preparation and implementation of
plans for removal of wastes
(Midwest Solvents Recovery.484 F.
Supp. 138 (N.D. Ind. 1980));
injunction against further
activities on site, formulation of
plans for security and removal of

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                                  - 5 -
                  98 3 5.1 H
FACTS TO BE PROVEN   STATUTORY BASIS
  COMMENTS
   B. To order such other
      action as may be
      necessary
wastes (Ottati and Goss. civil N
C80-225-L (D. N.H.)(Memorandum
opinion December 2,  1980)).  See
also, U.S. v. Diamond Shamrock,
Civil No. C80-1857 (N.D.
Ohio)(Memorandum Opinion, May 29,
1981).

Authorizes affirmative equitable
relief to extent necessary to
clean up-site.  See.  Price. 688
F.2d at 213-14; CCC,  619 F. Supp.
162, 201.
   C. To recover U.S.
      expenditures
A right to recovery Federal funds
has been implied since Section
7003 does not contain any express
authority to seek cost recovery.
See. U.S. v. NEPACCO. 810 F.2d at
747;  U.S. v. Price. 688 F.2d 214;
U.S. v. CCC. 619 F. Supp. at 201.
See also, Wyandotte Trans. Co. v.
U.S. 389 U.S. 191  (1967)(Clean
Water Act); U.S. v. Moran Towing
and Transportation Co.,  409 F.2d
961 (4th Cir. 1969)(Clean Water
Act); Restatement. Torts § 919(1).

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