In Chevron Mining Inc. v. United States, No. 15-2209, 2017 WL 3045887 (10th Cir. July 19, 2017), the 10th Circuit recently held that the United States was liable under CERCLA, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§ 9601 et seq as an “owner” of property used for mining.

Nearly a century of mining for molybdenum, a mineral used in the production of military-grade steel, left a considerable amount of contamination at a government-owned site near Questa, N.M. In 2011, the United States Environmental Protection Agency placed the site on its Superfund National Priorities List. Chevron acknowledged that it was a potentially responsible party (“PRP”) and began remediation efforts (which could exceed $1 billion in total) but sued the government for contributions to those clean-up costs.

Whether the government would be forced to contribute to those costs depended on how the courts would harmonize two separate laws: CERCLA’s ownership provisions and the General Mining Act of 1872, which provides that “all valuable mineral deposits in lands belonging to the United States, both surveyed and unsurveyed, shall be free and open to exploration and purchase, and the lands in which they are found to occupation and purchase, by citizens of the United States.” 30 U.S.C. § 22.

The district court initially held that the U.S. government was not liable under CERCLA for past and future clean-up costs. See Chevron Mining, Inc. v. United States, 139 F. Supp. 3d 1261, 1276 (D.N.M. 2015). Relying on United States v. Friedland, 152 F. Supp. 2d 1234 (D. Colo. 2001), the court concluded that the government did not qualify as an “owner” for CERCLA purposes when it merely held bare legal title to unpatented mining claims.

The 10th Circuit disagreed, however, concluding that the government was an “owner” for CERCLA purposes, regardless of the General Mining Act’s mechanisms for claiming mining rights on public lands. Rejecting Friedland, the 10th Circuit explained that ownership includes anyone with bare legal title, which, in this case, meant the government, and did not require immediate control over the property. The 10th Circuit further recognized that the General Mining Act encouraged mining — the very activity that contaminated the site.

The 10th Circuit further held that the U.S. government did not qualify as an “arranger” under CERCLA because it did not own or possess the hazardous waste at issue, agreeing with the district court on that issue. But this holding was a hollow victory for the government as the ownership finding is sufficient to make the U.S. government liable for a share of the cleanup costs.

For more information, please contact a member of Taft’s Environmental group.