The Board of Trustees of the Leland Stanford Junior University v. Agilent…

Background

This was the third order addressing cross-motions for summary judgment filed by Stanford and HP/Agilent. Summary judgment is a ruling issued when a party argues that the evidence requires judgment without a trial. The court addressed the issues that remained after the parties limited their motions during oral argument.

The cross-motions between HP and Nokia were moot because those parties had settled. The court denied Stanford’s motion on the issues discussed in Part I and denied HP’s motion on the issues discussed in Part II. The court stated that the motions concerning issues not discussed were denied as moot.

Stanford’s CERCLA motion

Stanford sought summary judgment on HP’s liability under the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, for assessment and evaluation costs related to hazardous substances on the property.

The court identified two requirements relevant to Stanford’s motion. Stanford had to show that HP engaged in a “disposal” while controlling the property, and it could recover private-party response costs only if those costs were necessary and consistent with the national contingency plan.

The court found a genuine dispute of material fact—a disagreement over important facts that must be resolved by a fact-finder—about whether HP spread polychlorinated biphenyls, or PCBs, into uncontaminated areas. The parties agreed that HP dug a trench for a storm drain in 1987 and removed dirt, but disputed whether HP merely stockpiled the dirt beside the trench and returned it or redistributed hazardous soil elsewhere. Competing expert evaluations prevented resolution of that issue on summary judgment.

The court rejected Stanford’s argument that temporarily removing soil, stacking it beside the trench, and using the same soil to refill the trench necessarily constituted a disposal. It stated that CERCLA’s statutory terms require at least some movement of contamination. The court also found a factual dispute about whether HP disposed of trichloroethylene, or TCE. Stanford relied on evidence that HP used TCE and that TCE was found near the chemical storage area, while HP offered admissible evidence attributing the contamination to a prior occupant.

The court additionally held that Stanford had not shown that its assessment and evaluation costs were consistent with the national contingency plan. The court read CERCLA as requiring that consistency for assessment and evaluation costs as well as cleanup costs. It noted that the plan includes provisions related to removal-site evaluation and public comment. Because Stanford had not provided evidence of compliance at this stage, it was not entitled to summary judgment on this issue even if HP’s disposal had been established.

HP’s cross-motion

Necessity of Stanford’s removal costs. The court denied HP’s motion concerning whether Stanford’s removal costs were necessary. Under CERCLA, the key question is whether there was an actual threat to human health or the environment, not whether Stanford also had a business reason for cleaning up the property. The court rejected HP’s proposed rule that cleanup costs are categorically unrecoverable when an owner changes the property’s use. Stanford’s plan to convert the property into residential homes was within the normal range of property uses, although the court noted that there may be limits on unusually excessive cleanup costs.

Consent to disposal. The court denied HP’s motion for summary judgment on Stanford’s state-law claims based on consent. HP argued that Stanford consented by approving excavation activities and failing to act immediately after learning about contamination. The court held that approving use of the property for manufacturing did not, as a matter of law, establish consent to the disposal of hazardous materials. It also found the cited California lead-paint cases distinguishable because Stanford did not bring the contaminants onto its own property. Stanford’s knowledge of HP’s activities could still support a factual finding of consent, but that issue could not be resolved on the basis HP presented.

Attorney fees. The court denied HP’s motion seeking to bar Stanford from recovering attorney fees. The court stated that it was unclear how Stanford would seek fees under California law and that the issue could be addressed after trial if Stanford prevailed.

Disposition

Stanford’s summary-judgment motion was denied on the addressed issues. HP’s cross-motion was denied on each of the three addressed issues: the necessity of Stanford’s removal costs, Stanford’s alleged consent to disposal, and attorney-fee recovery. The HP-Nokia cross-motions were moot because of settlement, and motions concerning issues not discussed were denied as moot.