United States v. Cannons Engineering Corp.

The United States Environmental Protection Agency (EPA) (plaintiff) brought suit in federal district court against several potentially responsible parties (PRPs) (defendants) for emitting hazardous waste in violation of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The EPA treated parties that attributed less than 1 percent of the volume of hazardous waste as de minimis parties. Those that emitted more than 1 percent were treated as major parties that were subject to a greater penalty. Cannons Engineering Corp. (Cannons) (defendant) emitted just under 1 percent of the volume of hazardous waste and was thus classified as a de minimis party. Cannons was invited to participate in an administrative settlement with the EPA but declined to do so. The EPA had engaged in settlement negotiations with the major parties and produced a majority-party consent decree. Cannons was subsequently excluded from the majority-party consent decree that was more favorable than the consent decree for de minimis parties. Cannons argued that the settlement was invalid because it lacked procedural integrity by not allowing Cannons to join the majority party or informing Cannons that it would be excluded from the majority-party decree. Cannons appealed the district court’s approval of the consent decree.