Reference no: EM132258594

In 1978, Dead Head Lead Co. (“DHL”), with the help of a 30-year mortgage from Sand Bank (“Bank”), bought a parcel of land with an industrial building from Slobbo Industries, a plumbing supply company that used lead in its manufacturing process from 1950 to 1973. From 1978 to 1998, DHL operated a lead-acid battery recovery plant on the site. DHL purchased used automobile batteries for the scrap value of the lead; it paid $500 per ton of lead contained in the batteries, a price considerably higher than that paid by other battery reprocessers in the area, and was able to sell the reprocessed lead for $1000 per ton. For a time, DHL was able to make a profit despite paying more than others for batteries because it spent little on environmental control. DHL’s president and sole shareholder, “Big Lee” Bruner, instructed employees simply to crack open the used batteries, allow the sulfuric acid in them to drain into a large vat, then wash out the casings (which resulted in the washing out of some lead), dumping the wash water in the vat with the acid, and remove and reprocess the remaining lead. At the end of each day, employees (as directed by Bruner) dumped the vat on the ground behind the reprocessing building. DHL did not have any sort of permit for its business. DHL bought used batteries from Plumb Crazy Battery Co. (which collected them from its customers when it sold them new batteries) and sold the reprocessed lead back to Plumb Crazy. Plumb Crazy hired Weir Truckin’ to transport the batteries to the DHL facility. In the early 1990s, faced with a declining market for reprocessed lead, DHL began accepting spent sulfuric acid for disposal from Acid Rain Co., which uses sulfuric acid to produce rayon. Although DHL assured Acid Rain that it had all required permits and was properly disposing of the acid, in fact DHL simply dumped the acid on the ground. DHL also accepted waste cooling emulsion from Uncle John’s Bandsaw Co. Uncle John’s circulated the emulsion through its saw-manufacturing machines, a process which caused the emulsion to acquire a high concentration of lead and chromium fragments. The emulsion was then filtered to reduce its metal content below levels where it would be deemed a hazardous waste under RCRA. The removed metals were sent to a properly permitted hazardous waste disposal facility, and the emulsion was sent to DHL. Demand for lead continued to fall. Having lost its market, DHL closed in 1998. “Big Lee” died shortly thereafter, leaving a penniless estate and no heirs. Bank foreclosed on the mortgage. In 2000, Bank undertook a site inspection together with Acme Widget Co., which was considering purchasing the site. The investigation revealed contamination of the soil with lead and of the groundwater with sulfuric acid. Bank alerted EPA, which, after investigation, listed both properties on the National Priorities List and undertook to clean them up. Remediation of the soil is expected to cost some $50 million with remediation of the groundwater estimated to cost $100 million.

Are any of the parties described above liable to EPA for any of its response costs under CERCLA, and if so, for what costs? For your information, lead, sulfuric acid, and chromium are all listed as hazardous wastes under RCRA.