CTS Corp. v. Waldburger

PETITIONER: CTS Corp.
RESPONDENT: Peter Waldberger, et al.
LOCATION: Mills Gap Road Electroplating Facility

DOCKET NO.: 13-339
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT:

CITATION: 573 US (2014)
GRANTED: Jan 10, 2014
ARGUED: Apr 23, 2014
DECIDED: Jun 09, 2014

Facts of the case

In 1980, in response to concerns about the repercussions of toxic waste dumping, Congress passed the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), which was designed to establish a comprehensive response mechanism and to shift the cost of the clean-up to the parties responsible. In 1986, Congress amended CERCLA by adding a section stating that, if a state statute of limitations allows the period in which action may be brought to begin before the plaintiff has knowledge of the harm, CERCLA preempts the state statute and allows the period to begin only from the point at which the plaintiff has knowledge.

CTS Corporation (CTS) manufactures and disposes of electronics and electronic parts. From 1959 to 1985, CTS operated the Mills Gap Road Facility (Facility) in Asheville, North Carolina, where notable quantities of carcinogenic solvents were stored. In 1987, CTS sold the Facility and promised the realtors that the property was environmentally safe and clean. Subsequently, the land was sold to David Bradley, Renee Richardson, and others (landowners), who learned that the land was contaminated and that their well water contained concentrated levels of carcinogenic solvents in 2009. The landowners sued CTS in federal district court and argued that CTS should be required to remove the toxic contaminants as well as pay monetary damages. CTS moved to dismiss the case by arguing that North Carolina's ten-year statute of limitations on real property actions resulting from physical damage to a claimant's property prevented the suit from going forward. Although the landowners argued that CERCLA preempted the limitation, the district court held that the ten-year limitation was actually a statute of repose, which limits legal action to a particular timeframe regardless of when the harm becomes apparent. The district court granted the motion to dismiss. The U.S. Court of Appeals for the Fourth Circuit reversed and held that CERCLA's preemption applied to both statutes of repose, in which a plaintiff's knowledge of the harm is not relevant to when the time period begins, as well as to statutes of limitation, in which a plaintiff's knowledge of the harm is relevant.

Question

Did the U.S. Court of Appeals for the Fourth Circuit correctly interpret CERCLA to apply to statutes of repose as well as to statutes of limitations?

Media for CTS Corp. v. Waldburger

Audio Transcription for Oral Argument - April 23, 2014 in CTS Corp. v. Waldburger

Audio Transcription for Opinion Announcement - June 09, 2014 in CTS Corp. v. Waldburger

Justice Kennedy has our opinion this morning in Case 13-339 CTS Corporation versus Waldburger.

Lawsuits for injuries from chemical toxics can be brought in State Court under state law.

But Congress was concerned that many States had statutes of limitations with time limits that are far too short for those suits, when a number of years elapse before the injury becomes apparent.

When a toxic contaminant is spilled or released, it can take many years before an injured person knows of the injury and before the person knows or should know what caused it.

Congress directed an expert group to study the problem.

The opinion for the -- for the Court discusses what that study group reported back to the Congress.

The report recommended that all States that have not already done so clearly adopt the rule that statute of limitations begins to run only when the plaintiff discovers or should have discovered the injury and it's cause.

Congress responded by adding the provision to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 and that law is generally referred to as CERCLA.

And the provision Congress added to CERCLA is called Section 9658.

That's the section that's involved here.

Section 9658 pre-empts statutes of limitations applicable to state-law tort actions in certain circumstances.

Section 9658 adopts the study group's recommendation for statutes of limitations and the rule is known as the discovery rule.

It provides statutes of limitations and actions like this alleged toxic contaminant case begins to run when a plaintiff discovers or reasonably should have discovered that the injury have occurred and then it was caused by the contaminant.

But this case arose in North Carolina.

CTS Corporation with the petitioner here ran an electronics plant in Ashville, North Carolina from 1959 to 1985.

In 1987, it sold the property.

CTS represented that the site was environmentally sound.

The buyer who bought from CTS eventually sold portions of the property to individuals.

And those persons along with adjacent land owners brought this suit against CTS.

They alleged damages from contaminants on land and it took some years for them, according to the cases we've taken, to realize that this injury was caused by the contaminants.

All agreed and that even had the injury.

All agreed that the discovery rule in Section 9658 pre-empts State's statutes of limitations that are in conflict with its term.

But North Carolina also has a so-called statute of repose.

That statute would bar the plaintiff's suits against CTS.

So this case terms on whether the preemption command of Section 9658, the federal discovery rule applies both to statute of limitations and to statutes of repose.

There is a substantial overlap between the policies of the two types of statutes.

But each has a distinct purpose and each is targeted at a different actor.

Statutes of limitations require plaintiffs to pursue diligent prosecutions of known claims.

But the rationale for statutes of repose has a different emphasis.

Statutes of repose were enacted so a defendant is free from liability after a legislatively determined period of time.