UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON D C 20460
APR 10 1991
MEMORANDUM
SUBJECT: Interim Agency Policy on Contribution Protection
Clauses in CERCLA Settlements
FROM: William A. White
Acting Associate
Bruce Diamond, Director
Office of Waste Program Enforcement
TO: Regional Counsel, Regions I-X
Waste Management Division Directors
Regions I-X
In recent years, the negotiation of contribution protection
clauses has become a sticking point in settlement discussions
under the Comprehensive Environmental Response, Compensation and
Liability Act (CERCLA). To avoid any problems that may result
from inconsistent application of CERCLA's contribution protection
provisions, this memorandum delineates interim Agency policy on
the content of contribution protection clauses in administrative
and judicial settlements.
Section 113(f)(2) of CERCLA provides that:
A person who has resolved its liability to the United
States or a State in an administrative or judicially
approved settlement shall not be liable for claims for
contribution regarding matters addressed in the
settlement, (emphasis added).
CERCLA Sections 122(g)(5) and 122(h)(4), which respectively
address de minimis and administrative cost recovery settlements,
have very similar contribution protection language.
In some settlement agreements, the phrase "matters
addressed," which delimits the scope of contribution protection
afforded by the statute to settling parties, has been equated
with the phrase "covered matters," which typically defines the
reach of the United States' covenants not to sue. Use of these
similar phrases has the potential of confusing the scope of
contribution protection that will be afforded settling parties.
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In certain circumstances, the scope of the "matters addressed"
may not be the same as "covered matters."1
Keeping these concepts distinct is particularly important in
cases where sequential settlements are contemplated. Hence, in
the future, these two phrases should not be used interchangeably
in CERCLA administrative or judicial settlements, whether they
are embodied in orders or consent decrees. All administrative
and judicial CERCLA settlements that include contribution
protection language must distinguish these terms. Until a final
contribution protection policy is issued by the agency, whether
and how contribution protection relates to a covenant not to sue
will largely be a question of law to be determined by the courts.
The Agency may at its discretion choose to include language
in settlements restating the right as provided in CERCLA.
Standard contribution protection settlement language to be used
in such circumstances is attached.2 Except as provided above,
under no circumstances should government personnel provide, any
oral or written statements to potentially responsible parties
regarding the scope of contribution protection. If you have any
questions regarding this matter, please contact James Handley
(FTS 382-3060), or Leonard Shen (FTS 382-3107).
cc: Regional Counsel Branch Chiefs, Regions I-X
Superfund Program Branch Chiefs, Regions I-X
John C. Cruden, Chief, Environmental Enforcement Section,
Environment and Natural Resources Division, U.S.
Department of Justice
1 The draft CERCLA Model RD/RA Consent Decree (forthcoming)
does not use the concept of "covered matters" so as to avoid any
confusion between these two concepts.
2 Given the underlying intent of Congress in enacting
Section 122(g), it is possible that different language may be
appropriate for de minimis parties.
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OSWER Directive =
Standard Settlement Language - November, 1990
Contribution Protection
With regard to claims for contribution against
[Settling Defendants] for matters addressed in this
[Order on Consent or Consent Decree], the Parties
hereto agree that the [Settling Defendants] are
entitled, as of the effective date of this [Order on
Consent or Consent Decree], to such protection from
contribution actions or claims as is provided in CERCLA
section [ "Standard" AO or Consent Decree — 113 (f)(2),
42 U.S.c. § 96l3(f)(2)]. [De Minimis AO or Consent
Decree — 122(g)(5), 42 U.S.C. § 9622(g)(5)].
[Administrative Cost Recovery Settlement — 122(h)(4),
42 U.S.C. § 9622(h)(4)].
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