Arizona v. City of Tucson

Pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and its state counterpart, the Arizona Department of Environmental Quality (the state) (plaintiff) investigated the hazardous-waste clean-up costs for a landfill site in Tucson, Arizona. Several parties that were potentially responsible for the site’s contamination approached the state, seeking to enter into early settlement agreements. The state agreed to settle with 22 parties (defendants). The settling parties agreed to pay specified amounts in exchange for a full release of liability and any obligation to make further contributions. The state initiated an action against the settling parties to obtain judicial approval of the settlement agreements and entry of associated consent decrees. The state’s motion to the court indicated that the total estimated cost of remediation was $75 million. The state did not provide evidentiary support for the figure. Further, the state calculated the liability of the settling parties to range between 0.01 and 0.2 percent without corresponding evidence of the settling parties’ comparative fault. A group of nonsettling parties intervened, objecting to entry of the proposed consent decrees. The district court approved the settlements, relying on the state’s representation that the terms of the agreements were fair, reasonable, and consistent with CERCLA’s objectives. The court deferred to the state’s judgment that entry of the proposed consent decrees would best serve the public interest. The nonsettling parties appealed.