CERCLA Preempts State-Law Claims Arising Out Of Petroleum Contamination

In what appears to be a first, a federal district court has held that the "Petroleum Exclusion" under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") preempts state-law contribution claims for costs incurred remediating petroleum-contaminated soil at a CERCLA site. The case is Members of the Beede Site Group v. Federal Home Loan, Mortgage Corp., No. 09-370(WES), 2013 WL 4778570 (D.N.H. Sept. 5, 2013).

The plaintiff asserted claims against other potentially responsible parties for contribution under CERCLA and, alternatively, under state law. The district court characterized the plaintiff as contending that, "if it loses its argument on the applicability of the Petroleum Exclusion, state law gives back an avenue for recovery that Congress took away." Id. at *5. The court rejected the plaintiff's attempt to use state law to "gap fill" its CERCLA claim, holding that CERCLA's Petroleum Exclusion reflected "a political determination" by Congress that would be "undermine[d]" if plaintiffs were allowed to use state law to recover the "response costs it incurred under CERCLA" to remediate petroleum contamination. Id. at *6.

When Congress enacted CERCLA in 1980, it excluded qualifying "petroleum" substances from the broad universe of substances that may give rise to liability under the statute, except for those that are otherwise specifically listed as hazardous substances under the statute. 42 U.S.C. § 9601(14). The scope of the Petroleum Exclusion has been heavily litigated over the years and it is not always clear whether the exclusion applies to the contamination at a given site. Accordingly, plaintiffs typically assert state-law claims in addition to their CERCLA claims, provided that state law does not contain a similar exclusion for petroleum contamination.

This strategy has been successful in the past; previous court decisions addressing the preemption issue have concluded that CERCLA does not preempt state-law claims to recover costs incurred remediating petroleum contamination. See, e.g., New Mexico v. Gen. Elec. Co., 335 F. Supp. 2d 1185, 1226-27 (D.N.M. 2004) ("If the Plaintiffs now seek damages only...