United States v. General Electric Co.

General Electric Co. (GE) (defendant) owned plants in upstate New York that manufactured Pyranol from polychlorinated biphenyls (PCBs). Scrap Pyranol that did not meet a certain purity requirement was stored in 55-gallon drums for many years. GE considered various disposal methods, including sending it to landfills, discharging it into a river, and giving it away. GE then entered into a contract with Fletcher, a paint manufacturer that used PCBs as a plasticizer in its paints, to sell Fletcher the scrap Pyranol. GE never considered using the scrap as a plasticizer in its own paint manufacturing. Fletcher initially tested drums to ensure they were usable before taking them to its site. After some time, the procedure changed. GE began to load the trucks without any prior testing, and the frequency of shipments increased. There was no indication that Fletcher requested or needed the additional supply. Eventually, Fletcher notified GE that a large number of the drums were not usable, that Fletcher had not consciously accepted the large quantities of useless scrap Pyranol, and that it expected GE’s assistance in cleaning it up. After testing the drums, GE forgave Fletcher’s debt for the amount GE had charged for the unusable material. Despite this, GE made no effort to assist in any cleanup of the scrap Pyranol. Later, the EPA found leaking drums of Pyranol and hazardous substances at the Fletcher site. The Fletcher site was added to the “superfund” list under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The United States (plaintiff), on behalf of the EPA, filed suit against GE, and the district court held that GE had disposed of hazardous waste by selling it to Fletcher and was therefore liable for response costs under CERCLA.