United States v. Northeastern Pharmaceutical & Chemical Co. (NEPACCO)

Edwin Michaels (defendant) formed Northeastern Pharmaceutical & Chemical Company (NEPACCO) (defendant) and served as its president. NEPACCO manufactured hexachlorophene, a disinfectant. A large amount of toxic-waste byproduct accumulated. Some of the waste was stored in 55-gallon drums at the plant. Ronald Mills (defendant), shift manager at the plant, sought to dispose of the waste at James Denney’s nearby farm. John Lee (defendant), NEPACCO’s vice president, approved this plan and helped arrange the disposal. Later, the United States Environmental Protection Agency (EPA) received a tip that hazardous wastes had been disposed of at the farm site. The EPA undertook cleanup operations at the site. The EPA then brought an action against NEPACCO, Michaels, Lee, and Mills in federal district court, seeking reimbursement of response costs pursuant to the Resource Conservation and Recovery Act (RCRA). The EPA also sought to impose liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The court found NEPACCO, Michaels, Lee, and Mills jointly and severally liable under CERCLA but declined to impose liability under RCRA. NEPACCO, Michaels, and Lee appealed to the United States Court of Appeals for the Eighth Circuit, arguing in part that Michaels and Lee could not be found individually liable under CERCLA or RCRA.