COMMENTS

Key Tronic Corporation v. United States: A New Standard Narrows the Scope of the American Rule as Applied to CERCLA Private Contribution Recovery Actions

  Introduction

In 1980, Congress responded to the growing national problem⁽¹⁾ of environmental contamination caused by improper handling of hazardous waste⁽²⁾ when it enacted the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).⁽³⁾ CERCLA calls for the prompt cleanup of environmental contamination, and imposes the cost of that cleanup on the parties responsible for the contamination.⁽⁴⁾ CERCLA was designed to protect public health and welfare and to preserve the environment by requiring parties potentially responsible⁽⁵⁾ for contamination to assume the financial burden of costly hazardous waste cleanup.⁽⁶⁾ To achieve its purpose, CERCLA mandates a response action⁽⁷⁾ consistent⁽⁸⁾ with the National Contingency Plan (NCP).⁽⁹⁾ To prevent future exposure of improperly-handled waste to the public and the environment, this program⁽¹⁰⁾ requires those parties responsible for the environmental contamination to bear the burden, including cost, of removal⁽¹¹⁾ and remedial actions.⁽¹²⁾

Responsible parties are often reluctant to initiate clean up of hazardous waste because it "typically require[s] private parties to incur substantial costs in removing hazardous wastes and responding to hazardous conditions."⁽¹³⁾ For this reason, under CERCLA §§ 9604 and 9606,⁽¹⁴⁾ Congress granted broad powers to the President to command any private party or government entity to clean up environmental contamination.⁽¹⁵⁾ This may be done through a framework of federal abatement and enforcement activities⁽¹⁶⁾ that may be prosecuted by private citizens,⁽¹⁷⁾ the Environmental Protection Agency (EPA) or the United States Attorney General.⁽¹⁸⁾ Section 9607 of the Act "sets forth the scope of the liabilities⁽¹⁹⁾ that may be imposed on private parties and the defenses⁽²⁰⁾ that these parties may assert."⁽²¹⁾ In general, "CERCLA is a strict liability statute"⁽²²⁾ that requires virtually any party connected with the site of contamination, or the hazardous material that caused the contamination, to pay its fair share of the necessary costs of response and removal.⁽²³⁾

This Comment addresses the widely disputed question⁽²⁴⁾ of whether the necessary costs of response⁽²⁵⁾ that may be recovered in private contribution recovery actions under CERCLA includes, as part of its definition embodied in the words "enforcement activities,"⁽²⁶⁾ explicit congressional authorization for private parties to recover attorneys' fees in such actions. Part II discusses private actions under CERCLA. It first focuses on the purpose of private contribution recovery actions under CERCLA⁽²⁷⁾ followed by a general discussion of fee-shifting,⁽²⁸⁾ and finally, an exploration of fee-shifting in private contribution recovery actions in the various federal circuits.⁽²⁹⁾ In light of these issues, Part III examines the recent United States Supreme Court case Key Tronic Corp. v. United States,⁽³⁰⁾ including a discussion of Justice Scalia's strong dissent.⁽³¹⁾ Part IV then identifies the standard used by the Supreme Court in Key Tronic, and analyzes its future application to fee-shifting questions presented in CERCLA private contribution recovery actions.⁽³²⁾

  Background

A.  Private Contribution Recovery Actions Under CERCLA

Originally "CERCLA contained no express provision authorizing a private party . . . to seek contribution from other potentially responsible parties" through the medium of a private contribution recovery action.⁽³³⁾ With the Superfund Amendment and Reauthorization Act (SARA) amendments,⁽³⁴⁾ however, Congress "expressly created a cause of action for contribution" of another responsible party's apportioned liability for the necessary costs of response.⁽³⁵⁾ In addition to this express provision, Congress's amendments to § 9607, such as one referring to "amounts recoverable in an action under this section,"⁽³⁶⁾ together with a reference to a "civil action under . . . section 9607"⁽³⁷⁾ illustrates its endorsement of judicial decisions⁽³⁸⁾ which have held § 9607 to allow private contribution recovery actions for the recovery of private response costs.⁽³⁹⁾

As already discussed, CERCLA was designed to impose liability on virtually all parties associated with the contaminated site and the contaminants.⁽⁴⁰⁾ Although CERCLA does not explicitly impose joint and several liability on responsible parties,⁽⁴¹⁾ the courts have almost exclusively allowed recovery actions based on a theory of shared liability.⁽⁴²⁾

A private contribution recovery action may be brought by any private party that incurred response costs for a cleanup conducted under CERCLA (pursuant to §§ 9607⁽⁴³⁾ and 9613⁽⁴⁴⁾) in order to recover that portion of its private response costs constituting another potentially responsible party's (PRP)⁽⁴⁵⁾ proportional share of the cleanup.⁽⁴⁶⁾ The courts have held that private contribution recovery actions may be brought either while the responsible plaintiff is engaged in the response action, or after the cleanup has been completed.⁽⁴⁷⁾ Authorization of such private contribution recovery actions for recovery of necessary costs of response was granted by Congress "to encourage timely cleanup of hazardous waste sites."⁽⁴⁸⁾

If a party that undertakes the cleaning of a site can prove that other parties were partially responsible for the contamination, it may recover apportioned cleanup response costs from such parties.⁽⁴⁹⁾ The basic elements required to establish a prima facie case for shared responsible party liability in CERCLA private recovery actions are that, (1) the site is a facility,⁽⁵⁰⁾ (2) the defendant is a responsible party,⁽⁵¹⁾ (3) a hazardous substance has been released, and (4) the plaintiff has incurred cleanup response costs.⁽⁵²⁾

There is general agreement among the federal courts as to the meanings of the CERCLA sections which address recoverable necessary costs of response and enforcement costs.⁽⁵³⁾ However, the federal circuits are divided with respect to their interpretation of the statute as it applies to awarding attorneys' fees to prevailing private litigants.⁽⁵⁴⁾

B.  Attorneys' Fees and Fee-Shifting

In order to mount a meaningful exploration of the various views held by the federal circuits and the United States Supreme Court regarding congressional authorization to award attorneys' fees to prevailing parties in private CERCLA litigation, a discussion of the deeply-rooted⁽⁵⁵⁾ American Rule,⁽⁵⁶⁾ as it contrasts with the British Rule,⁽⁵⁷⁾ is necessary.

1.  Fee-Shifting: The American Rule vs. The British Rule

In the first years of the federal court system in the United States, pursuant to the Federal Judiciary Act of 1789, the British Rule was followed.⁽⁵⁸⁾ Under this Act, attorneys' fees were awarded to prevailing parties in litigation.⁽⁵⁹⁾ This Act and its progeny, however, expired in 1796.⁽⁶⁰⁾ That same year, in the case Arcambel v. Wiseman,⁽⁶¹⁾ the Court decided against creating a general rule awarding attorneys' fees to prevailing parties, and first articulated the American Rule, calling upon Congress to explicitly authorize fee-shifting⁽⁶²⁾ where it determined that such a policy was warranted.⁽⁶³⁾ Seeking to standardize costs, Congress made specific provisions allowing fee-shifting under certain statutes.⁽⁶⁴⁾ Congress recognized that there was "great diversity in practice among the courts and that losing litigants were being unfairly saddled with exorbitant fees for the victor's attorney."⁽⁶⁵⁾ Congress, therefore, set limits on recoverable fees.⁽⁶⁶⁾ Exercising its exclusive authority, Congress has since made other specific and explicit provisions for the awarding of attorneys' fees, and has not extended any authority to the courts to allow such fees unless there exists statutory authority.⁽⁶⁷⁾ "[I]t would be difficult, indeed, for the court, without legislative guidance, to consider some statutes important and others unimportant and to allow attorneys' fees only in connection with the former."⁽⁶⁸⁾ Because of such difficulty, it has been held, determination of whether to award attorneys' fees in certain litigation is best left to the legislature.⁽⁶⁹⁾

Despite criticism in recent years, the American Rule persists, and was, in fact, reaffirmed in Alyeska Pipeline Service Co. v. Wilderness Society⁽⁷⁰⁾ by the Supreme Court.⁽⁷¹⁾ In a later case, Runyon v. McCrary,⁽⁷²⁾ the Court stated that it is well-settled that each party to civil litigation in the United States pays its own attorneys' fees absent a recognized ground in equity or explicit congressional authorization to the contrary.⁽⁷³⁾ The law in the United States has always been that, absent explicit congressional authorization, attorneys' fees are not a recoverable cost of litigation, but must be borne by the parties themselves.⁽⁷⁴⁾ The rule is based on the theory that costs should be paid by the party using the judicial system to settle its disputes.⁽⁷⁵⁾

Some urge the courts to find exceptions to the American Rule because they see it as at odds with the fundamental purpose of the legal system, which is to make an injured party whole again.⁽⁷⁶⁾ As the Supreme Court has established, however, the judiciary is not free to fashion new rules with respect to fee-shifting absent congressional authorization.⁽⁷⁷⁾ The Supreme Court has stated that mere desirability for fee-shifting cannot be substituted for explicit congressional authority.⁽⁷⁸⁾ It has been consistently held, under the American Rule, that Congress has the sole authority to carve out specific exceptions to the rule depending on its assessment of the importance of public policy considerations involved in a particular type of litigation.⁽⁷⁹⁾ It must be noted, therefore, that for a court to recognize any exception to the American Rule, Congress's authorization must be explicit.⁽⁸⁰⁾ Although legislative history may be considered, authorization must be embodied in a clear expression of Congress's actual intent, and will not be implied from mere "generalized commands."⁽⁸¹⁾ The rule as set forth in Alyeska precludes implication of congressional intent to authorize fee-shifting in private litigation; rather it requires that authorization be in the text of the statute.⁽⁸²⁾

2.  Explicit Authorization for Fee-Shifting Pursuant to the American Rule Has Been Recognized in CERCLA

Congress has repeatedly shown that it is capable of expressing an intention to create exceptions to the American Rule with regard to recovery of attorneys' fees for prevailing parties in civil litigation.⁽⁸³⁾ In fact, attorneys' fees are regularly awarded to the government when it prevails in actions brought pursuant to certain sections of CERCLA.⁽⁸⁴⁾

For example, § 9604(b) has been interpreted by the courts to explicitly authorize the government to recover, among other things, attorneys' fees related to planning and direct response on the part of the President or agents under CERCLA.⁽⁸⁵⁾ The words "may undertake such . . . legal . . . actions [and] recover the costs thereof" as used by Congress in § 9604(b)⁽⁸⁶⁾ have been interpreted to explicitly authorize the courts to award attorneys' fees to the government if it prevails in litigation under that section.⁽⁸⁷⁾ Similarly, an amendment to § 9606, which allows the Attorney General to bring abatement actions, specifically authorizes the courts to award attorneys' fees to any party erroneously ordered to pay response costs.⁽⁸⁸⁾ In addition, under § 9610(c),⁽⁸⁹⁾ the courts have interpreted the words "all costs and expenses" to mean that a prevailing employee-whistleblower may recover attorneys' fees in CERCLA litigation.⁽⁹⁰⁾ Similarly, § 9659(f)'s⁽⁹¹⁾ express language allowing recovery of litigation costs "including reasonable attorney and expert witness fees" explicitly authorizes awards of attorneys' fees to prevailing parties in private citizen suits brought under CERCLA.⁽⁹²⁾

Because Congress so explicitly authorizes recovery of attorneys' fees in these and other sections of CERCLA, many courts have refused to stretch the meaning of other less explicit provisions.⁽⁹³⁾ Such courts have concluded that where explicit language to that effect is absent, Congress must have elected not to authorize recovery of attorneys' fees.⁽⁹⁴⁾ Other courts have taken a more liberal view, and are willing to award attorneys' fees absent explicit statutory text.⁽⁹⁵⁾

3.  The Federal Split

There is a tripartite split in the federal courts as to whether attorneys' fees awards to prevailing parties in contribution recovery actions are authorized by Congress.⁽⁹⁶⁾ Specifically at issue is the question of whether private party attorneys' fees are recoverable in contribution recovery actions brought under CERCLA §§ 9607 and 9613 as "necessary costs of response" or as "enforcement costs."⁽⁹⁷⁾ Three distinct interpretations of these sections, as they pertain to possible explicit congressional authorization to award attorneys' fees to the prevailing party in private contribution recovery actions brought under CERCLA, have arisen in the federal circuits.⁽⁹⁸⁾ Some courts have interpreted the terms in CERCLA loosely and have held that Congress manifested its intent to authorize awards of attorneys' fees as recoverable costs of response under § 9607 by its use of the words "enforcement activities."⁽⁹⁹⁾ Other courts, however, have held that the absence of the specific phrase "attorneys' fees" clearly indicates that Congress did not intend to authorize judges to award attorneys' fees to the prevailing party in private recovery actions.⁽¹⁰⁰⁾ Rather, it has been held in those courts refusing to imply authorizations, Congress must have specifically intended to bar such recovery as evidenced by this omission.⁽¹⁰¹⁾ Finally, a third view taken by some courts bars recovery of litigation-related attorneys' fees, while allowing awards of those attorneys' fees directly related to the cleanup as a "necessary cost of response" under CERCLA.⁽¹⁰²⁾ What follows is an analysis of the leading cases which advocate the three prominent views on this issue.

a.  Congress Authorized the Courts to Award All Related Attorneys' Fees in Private Contribution Recovery Actions Under CERCLA

In General Electric Co. v. Litton Industrial Automation Systems, Inc.,⁽¹⁰³⁾ the Eighth Circuit Court of Appeals concluded that Congress had intended to authorize recovery of attorneys' fees by private parties in contribution recovery actions under CERCLA.⁽¹⁰⁴⁾ From 1959 until 1962, Litton Industrial Automation Systems (Litton) released into the environment cyanide-based pollutants which spread over a forty-acre tract in the state of Missouri.⁽¹⁰⁵⁾ General Electric (GE) bought the contaminated tract and, in 1984, sold it.⁽¹⁰⁶⁾ In 1985, the Missouri Department of Natural Resources and the Environmental Protection Agency (EPA) discovered the contamination and determined that a response was required under CERCLA.⁽¹⁰⁷⁾ The new owner, indemnified by GE, settled the CERCLA enforcement action brought by the EPA.⁽¹⁰⁸⁾ GE then cleaned the site consistent with the NCP and filed an action against Litton under CERCLA § 9607, to recover response costs, including attorneys' fees.⁽¹⁰⁹⁾ The district court⁽¹¹⁰⁾ held that Litton was responsible for the release of the hazardous substances and the resulting contamination.⁽¹¹¹⁾ In addition to awarding cleanup costs to GE, the court awarded it attorneys' fees.⁽¹¹²⁾

Litton appealed, inter alia, the district court's order allowing GE to recover its attorneys' fees.⁽¹¹³⁾ In support of its appeal, Litton argued that the court was barred from awarding attorneys' fees to GE because Congress did not explicitly allow "private parties to recover litigation expenses" in private contribution recovery actions under § 9607.⁽¹¹⁴⁾ Litton argued that, pursuant to the well-settled American Rule, the parties must pay their own attorneys' fees.⁽¹¹⁵⁾

The circuit court recognized the long-standing requirement that it follow the American Rule, and, citing the Supreme Court's decisions in Alyeska Pipeline Service Co. v. Wilderness Society⁽¹¹⁶⁾ and Runyon v. McCrary,⁽¹¹⁷⁾ acknowledged the Rule's requirement that Congress's intent to authorize awards of attorneys' fees to prevailing parties must be explicitly expressed in the language of the statute.⁽¹¹⁸⁾

The court read Congress's definition of recoverable costs under CERCLA § 9607(a)(4)(B)⁽¹¹⁹⁾ as an "enforcement activity" within the meaning of § 9601(25).⁽¹²⁰⁾ Following that reasoning, the court further concluded that attorneys' fees are necessarily incurred in any enforcement activity and certainly fall within Congress's definition of recoverable costs.⁽¹²¹⁾ The court also stated that such an award was consistent with Congress's purpose in the enactment of CERCLA.⁽¹²²⁾ Based on this reasoning, the Litton court held that the district court's award of attorneys' fees to GE was explicitly authorized by the statute and, therefore, was not in error.⁽¹²³⁾

b.  Congress's Failure to Use the Term "Attorneys' Fees" to Describe Those Costs Recoverable Under § 9607 Bars Courts from Awarding Attorneys' Fees to the Prevailing Party in Contribution Recovery Actions

The premier circuit court holding that espouses the view that courts are not authorized to award attorneys' fees to the prevailing party in CERCLA contribution recovery actions is Stanton Road Associates v. Lohrey Enterprises.⁽¹²⁴⁾ In Stanton the defendant, Lohrey Enterprises (Lohrey), allowed hazardous chemicals to spill onto Stanton Road Associates' (Stanton's) property.⁽¹²⁵⁾ During the cleanup, Stanton brought a private contribution recovery action under § 9607 in the district court, and sought to recover attorneys' fees as part of those costs.⁽¹²⁶⁾ After finding Lohrey liable for the contamination, the district court ordered Lohrey to establish a cleanup fund and to pay Stanton's other response costs, including attorneys' fees, under the CERCLA claim.⁽¹²⁷⁾

On appeal, Lohrey contended that the district court had erred in awarding attorneys' fees as response costs under § 9607.⁽¹²⁸⁾ Lohrey argued that CERCLA § 9607 does not explicitly authorize the awarding of attorneys' fees as a necessary cost of response in private contribution recovery actions.⁽¹²⁹⁾ According to Lohrey, the absence of specific language in that section explicitly authorizing the awarding of attorneys' fees bars such recovery under the long-standing American Rule.⁽¹³⁰⁾

In response, Stanton argued that a contribution recovery action under § 9607 is an "enforcement activity" under CERCLA.⁽¹³¹⁾ Relying on the reasoning in Litton, Stanton argued that private parties are authorized by CERCLA to recover enforcement costs, including attorneys' fees, under the definition of "costs of response" in § 9601(25).⁽¹³²⁾

Ultimately the Stanton court rejected the reasoning used by the Eighth Circuit in Litton⁽¹³³⁾ and reversed the award of attorneys' fees.⁽¹³⁴⁾ The majority stated that "the words `necessary cost of response' do not expressly authorize an award of attorneys' fees for legal expenses incurred" in § 9607 actions.⁽¹³⁵⁾ Moreover, the court found that the phrase "enforcement activities" was not sufficiently explicit for it to conclude that CERCLA authorized an award of attorneys' fees.⁽¹³⁶⁾

In support of its holding, the Stanton court noted that Congress had, in explicit terminology, provided for recovery of attorneys' fees and legal expenses in other sections of CERCLA.⁽¹³⁷⁾ From that fact, the court concluded that Congress's failure to use such words in the text of § 9607 was a clear indication that it intended to withhold authorization for the award of attorneys' fees to private litigants as recoverable costs of response.⁽¹³⁸⁾ In further support of its conclusion that § 9607 contains no specific authorization to award attorneys' fees, the majority pointed to the considerable amount of disagreement among the circuits with regard to Congress's intent.⁽¹³⁹⁾

In its opinion, the Stanton majority stated that it did not have the authority to, in response to public policy arguments, read words into CERCLA that would imply authority to award attorneys' fees.⁽¹⁴⁰⁾ The Stanton court maintained that public policy considerations are to be taken into account only by Congress.⁽¹⁴¹⁾ The majority stated that when Congress decides that an exception to the American Rule is necessary for public policy or other reasons, it must do so in explicit and unambiguous language.⁽¹⁴²⁾ Based on the above reasoning, the court held that it lacked the authority to award attorneys' fees to the prevailing party in CERCLA contribution actions.⁽¹⁴³⁾

c.  Nonlitigation Attorneys' Fees May be Awarded in Private Contribution Actions Under CERCLA if They are Necessary Costs of Response

In FMC Corp. v. Aero Industries, Inc.,⁽¹⁴⁴⁾ the United States Court of Appeals for the Tenth Circuit concluded that, although Congress did not explicitly authorize awards of litigation-related attorneys' fees in CERCLA contribution actions, the courts are free to award nonlitigation-related attorneys' fees if these fees are deemed to be necessary costs of response under §§ 9601 and 9607.⁽¹⁴⁵⁾ In FMC, FMC Corporation sued Aero Industries, Inc. (Aero) for response costs that were incurred pursuant to a CERCLA order directing the removal of hazardous waste and contaminated soil from a site owned by Aero.⁽¹⁴⁶⁾ Although Aero agreed to participate in the site cleanup, lack of available funds prevented Aero from doing so.⁽¹⁴⁷⁾ FMC, consistent with the NCP requirements, conducted the cleanup and incurred substantial costs, including attorneys' fees, which it sought to recover through a contribution recovery action brought against Aero.⁽¹⁴⁸⁾ The district court held Aero jointly and severally liable for twenty-five percent of FMC's total response costs.⁽¹⁴⁹⁾ The district court concluded, however, that attorneys' fees, as a matter of law, were not recoverable as necessary costs of response.⁽¹⁵⁰⁾

FMC appealed the district court's denial, as a matter of law, of both litigation and nonlitigation attorneys' fees.⁽¹⁵¹⁾ The plaintiffs argued that the district court erred by holding that attorneys' fees are not explicitly recoverable under CERCLA as response costs.⁽¹⁵²⁾ According to FMC, the language "a private party may recover the `necessary costs of response[,]'" defined to include "enforcement activities" in §§ 9607 and 9601, authorizes an award of attorneys' fees.⁽¹⁵³⁾ The circuit court distinguished between attorneys' fees incurred in recovery action litigation and those incurred in nonlitigation response and removal activities.⁽¹⁵⁴⁾ The circuit court stated that, under the American Rule, litigation-related fees are not recoverable absent explicit congressional authorization to the contrary.⁽¹⁵⁵⁾

The court took a different view, however, with respect to nonlitigation-related attorneys' fees, and concluded that such fees "do not fall under the American rule . . . because they are not incurred in pursuing litigation."⁽¹⁵⁶⁾

The court of appeals found that the district court had erred in holding that nonlitigation attorneys' fees were barred as a matter of law.⁽¹⁵⁷⁾ Rather, the court considered the issue to be whether "necessary response costs" recoverable under § 9607 includes recovery of nonlitigation fees.⁽¹⁵⁸⁾ Based on its holding in United States v. Hardage,⁽¹⁵⁹⁾ the United States Court of Appeals for the Tenth Circuit concluded that there was a possibility that nonlitigation-related attorneys' fees could constitute necessary response costs.⁽¹⁶⁰⁾ In so holding, the court directed that the nonlitigation attorneys' fees would be recoverable as necessary costs of response if the district court, on remand, determined that these costs were "generated in designing and negotiating . . . and in preparing and carrying out [the removal action]."⁽¹⁶¹⁾

  Key Tronic Corporation v. United States⁽¹⁶²⁾

A.  Facts and Procedural History

In the latter half of the 1970s, Key Tronic Corporation (Key Tronic), the United States Air Force (Air Force), and a number of other parties, disposed of hazardous chemicals in a landfill in the eastern part of Washington State.⁽¹⁶³⁾ In 1980, the Washington Department of Ecology (WDOE) determined that the local ground water supply had been contaminated by the chemicals dumped by these parties.⁽¹⁶⁴⁾ WDOE and the EPA instituted formal proceedings against Potentially Responsible Parties (PRP) seeking contribution for the cleanup response consistent with the NCP⁽¹⁶⁵⁾ under CERCLA.⁽¹⁶⁶⁾ Key Tronic entered into a consent decree with the WDOE and the EPA, in which it agreed to contribute $4.2 million in response costs for the cleanup of the contamination.⁽¹⁶⁷⁾ In a separate settlement, the Air Force agreed to contribute $1.45 million in response costs as its share of the cleanup.⁽¹⁶⁸⁾ As part of the Air Force's settlement, the EPA released the Air Force from additional liability by giving it "contribution protection."⁽¹⁶⁹⁾ Despite this release of liability granted to the Air Force, Key Tronic subsequently brought a contribution action against the Air Force and other PRPs.⁽¹⁷⁰⁾ In addition to seeking recovery of its contribution under § 9613, Key Tronic sought, under § 9607(a)(4)(b), to recover $1.2 million in response costs.⁽¹⁷¹⁾

1.  District Court Treatment

Although the district court dismissed Key Tronic's claim for contribution as barred by the Air Force's "contribution protection" under § 9622, the court allowed Key Tronic to pursue its § 9607 response cost claim because it, according to the court, "related to matters not covered by the Air Force's settlement with the EPA."⁽¹⁷²⁾ Seeking to recover its cost-recovery-action-related attorneys' fees, Key Tronic asserted that such fees should be classified as enforcement costs and awarded as necessary costs of response.⁽¹⁷³⁾

The Air Force argued in response that the court lacked authority to award attorneys' fees under § 9670 absent explicit congressional authority.⁽¹⁷⁴⁾ Furthermore, the Air Force argued in the alternative that the statute, taken as a whole, only authorizes the government to bring enforcement actions to compel cleanup under CERCLA; therefore, Key Tronic was barred from recovery under its theory of a private enforcement action.⁽¹⁷⁵⁾ Although the district court recognized the limitations of the American Rule, it rejected both of the Air Force's arguments and found that a "private party may incur enforcement costs, and, therefore, may recover attorneys' fees for bringing a cost recovery action under § [9607]."⁽¹⁷⁶⁾ Reading CERCLA broadly, the district court held that Congress's intent behind the definition in § 9601(25) was not to restrict enforcement activities and costs to the government, but for those costs and activities to be recoverable by private parties as well.⁽¹⁷⁷⁾ Consistent with that reading, the district court held that Key Tronic was entitled to recover the costs of prosecuting its "enforcement action" against the Air Force.⁽¹⁷⁸⁾

Based on the private enforcement action theory espoused by the district court in the above discussion, the court further held that Key Tronic was entitled to recover its PRP search costs, including attorneys' fees, as enforcement costs.⁽¹⁷⁹⁾ In addition, the court, with little elaboration, held that Key Tronic's attorneys' fees related to its investigation of the hazardous waste site, and the costs incurred negotiating with the EPA were also recoverable as necessary costs of response.⁽¹⁸⁰⁾

2.  Treatment by the Ninth Circuit Court of Appeals

Following the district court's holding granting Key Tronic all of its attorneys' fees either as private enforcement costs, or as response costs, the Air Force appealed.⁽¹⁸¹⁾ Relying on its arguments in the district court,⁽¹⁸²⁾ the Air Force contended that the district court had erred in awarding Key Tronic its attorneys' fees incurred while prosecuting the recovery action, searching for PRPs, and negotiating its settlement with the EPA, as costs recoverable under § 9607 of CERCLA.⁽¹⁸³⁾ The Ninth Circuit majority agreed that no explicit congressional authorization, as required by the American Rule, is evident in language of CERCLA with respect to awards of attorneys' fees to the prevailing party whether "incurred in connection with the cleanup activities or in prosecuting a response cost recovery action."⁽¹⁸⁴⁾ The majority, relying on its 1993 opinion in Stanton,⁽¹⁸⁵⁾ concluded that the district court had erred in awarding any attorneys' fees to Key Tronic,⁽¹⁸⁶⁾ regardless of how such fees were classified.⁽¹⁸⁷⁾

B.  Supreme Court Holding and Reasoning

In its relatively short opinion, the Supreme Court considered the issue of whether attorneys' fees may be awarded to the prevailing party as "necessary costs of response" defined by the phrase "enforcement activities" in private contribution recovery actions without offending the long-standing American Rule.⁽¹⁸⁸⁾ For ease of analysis, the Supreme Court separated attorneys' fees into the following categories: (1) fees incurred while prosecuting recovery actions, (2) fees incurred in nonlitigation response-related activities, and (3) fees incurred during negotiations with the EPA.⁽¹⁸⁹⁾

1.  Attorneys' Fees Incurred While Prosecuting Recovery Actions

On its appeal to the Supreme Court, Key Tronic argued that its private contribution recovery action against the Air Force was an enforcement activity under § 9607 and, therefore, an award of its related attorneys' fees would be consistent with the American Rule.⁽¹⁹⁰⁾ In its analysis of this question, the Supreme Court found it necessary to determine "whether the `enforcement activities' included in § [9601](25)'s definition of `response'" grant, the courts explicit authorization to award attorneys' fees as "`necessary costs of response' within § [9607](a)(4)(B)."<sup>(191)</sup> Keeping in mind the purpose of the statute--to encourage cleanup of hazardous waste<sup>(192)</sup>--the Court explored various provisions of the statute and identified those that explicitly authorized recovery of attorneys' fees.<sup>(193)</sup> Although the Court recognized a number of explicit provisions authorizing recovery of attorneys' fees by CERCLA litigants, the Court rejected Key Tronic's argument that a private contribution recovery action is covered by one of those provisions.<sup>(194)</sup> The Court based its refusal to "stretch the plain terms of the phrase `enforcement activities'" to imply authorization to award attorneys' fees on three rationales.⁽¹⁹⁵⁾ First, the Court observed that private contribution recovery actions are merely implied in § 9607.⁽¹⁹⁶⁾ Therefore, the Court maintained, to conclude that such an implied provision explicitly embodies authorization for recovery of "attorney's fees with the clarity required by [the American Rule] would be unusual if not unprecedented."⁽¹⁹⁷⁾ The Court was unwilling to be so bold.⁽¹⁹⁸⁾

The second rationale that the Court used to support its conclusion regarding litigation-related attorneys' fees centered around Congress's omission of express language regarding fee-shifting in contribution actions.⁽¹⁹⁹⁾ The Court reasoned that because Congress had made other express provisions authorizing fee-shifting, but had not made such an express provision for private recovery actions, there was a strong indication that Congress had made a "deliberate decision not to authorize such awards."⁽²⁰⁰⁾ Finally, the last rationale used by the Court for rejecting Key Tronic's argument was based on its application of the plain meaning rule.⁽²⁰¹⁾ The Court stated that the plain meaning of the phrase "`enforcement activit[ies]' is not sufficiently explicit to embody a private action under § [9607]" as a basis for recovery of attorneys' fees.⁽²⁰²⁾ Thus, the Court held, § 9607 "does not provide for the award of private litigants' attorney's fees associated with bringing a cost recovery action" with sufficient explicitness to satisfy the American Rule.⁽²⁰³⁾

2.  Nonlitigation-related Attorneys' Fees May Be Recoverable as Necessary Costs of Response

Although the Court was unwilling to recognize explicit authorization to award litigation-related attorneys' fees to private CERCLA litigants, it reached a different conclusion concerning nonlitigation legal fees.⁽²⁰⁴⁾ The Supreme Court followed the Tenth Circuit's observation in FMC Corp. v. Aero Industries, Inc.⁽²⁰⁵⁾ that the American Rule does not apply to nonlitigation fees.⁽²⁰⁶⁾ Based on this exception, the Court held that it had the authority to award those fees for legal work "closely tied to the actual cleanup" as costs of response under § 9607.⁽²⁰⁷⁾ The Supreme Court accepted Key Tronic's argument that a private litigant's attorneys' fees incurred in search of PRPs should be recoverable costs of response because they "benefited the entire cleanup effort."⁽²⁰⁸⁾ Recognizing this contribution to the cleanup, the Court held that since the PRP searching might be done by a variety of professionals (including attorneys),⁽²⁰⁹⁾ the fees for such services which are "clearly distinguishable from litigation expenses" are recoverable costs of response.⁽²¹⁰⁾

3.  Attorneys' Fees Related to Negotiations With the EPA Are Not Recoverable

The Court refused to extend the above reasoning to attorneys' fees for legal services incurred in negotiating a consent decree with the government.⁽²¹¹⁾ Key Tronic argued in vain that the attorneys' fees it had incurred during negotiations with the EPA for various studies that were subsequently used in the cleanup should be recoverable as response costs "closely tied to the actual cleanup."⁽²¹²⁾ Unmoved by this altruistic characterization, the Court found that the studies were not prepared to "benefit[] the entire cleanup" but rather were self-serving and designed to define and limit the scope of Key Tronic's liability.⁽²¹³⁾ It is not surprising that the Supreme Court ultimately held that the attorneys' fees related to negotiating the consent decree were akin to litigation costs and were not recoverable costs of response under CERCLA.⁽²¹⁴⁾

4.  Justice Scalia Dissenting in Part: Congress is Not Required to Use the "Magic Words" "Attorneys' Fees" to Satisfy the American Rule⁽²¹⁵⁾

Although Justice Scalia concurred with the majority opinion to the extent that it held that nonlitigation-related attorneys' fees may be recovered as necessary costs of response,⁽²¹⁶⁾ he dissented from the majority's conclusion that attorneys' fees incurred by private parties in contribution recovery actions are not recoverable as "enforcement activities."⁽²¹⁷⁾ Justice Scalia attacked on all fronts the majority's reasoning and conclusion as to recovery of attorneys' fees as enforcement costs.⁽²¹⁸⁾ In rejecting the majority's initial contention that "[t]o conclude that a provision that only impliedly authorizes [private recovery actions] nonetheless provides for attorney's fees with the clarity required by [the American Rule] would be . . . unprecedented,"⁽²¹⁹⁾ Justice Scalia attacked the majority's premise as a mistaken reading of § 9607 and stated that a correct reading of the section reveals an express provision for private contribution recovery actions.⁽²²⁰⁾ Justice Scalia further maligned and criticized the majority for its interpretation of the requirement of explicit authorization under the American Rule with his reading of § 9607 as a basis.⁽²²¹⁾ He declared that "explicit" does not connote a "password" requirement that Congress must "incant the magic phrase `attorney's fees.'"⁽²²²⁾ Rather, Justice Scalia maintained that the American Rule may be satisfied merely by looking to Congress's use of the phrase "enforcement activity" which, according to him, "naturally (and indeed primarily) include[s] attorney's fees."⁽²²³⁾

Justice Scalia further attacked the majority's reasoning that Congress's express provisions for recovery of attorneys' fees in other sections of CERCLA combined with its failure to do so in § 9607 was a clear indication that Congress had made a "deliberate decision not to authorize such awards."⁽²²⁴⁾ Bolstered by his interpretation of "enforcement activities" as sufficiently explicit to authorize attorneys' fees, Justice Scalia discounted the majority's second argument as "a watered-down version of the `magic words' argument."⁽²²⁵⁾

Finally, Justice Scalia addressed what he considered to be the core issue of the debate: whether "it would stretch the plain terms of the phrase `enforcement activities' too far to construe it as encompassing" explicit congressional authority of recovery of attorneys' fees in private contribution recovery actions.⁽²²⁶⁾ Despite the majority's conclusion that to include recovery of a private litigant's attorneys' fees as enforcement costs would stretch the plain terms too far, Justice Scalia stated that he would read CERCLA to include attorneys' fees incurred by both government and private litigants in cost-recovery actions under CERCLA.⁽²²⁷⁾

  Analysis

A.  Litigation-related Attorneys' Fees: The Court Took a Hard Line

In Key Tronic, the Supreme Court's refusal to award attorneys' fees to the prevailing private plaintiff in CERCLA contribution recovery actions was consistent with the treatment of this question by a majority of the lower courts.⁽²²⁸⁾ The Supreme Court's application of the plain meaning rule is its strongest and best reasoned argument against awarding attorneys' fees in private contribution actions. As the Court noted at the outset of its opinion, the American Rule requires clear and explicit statutory language evidencing explicit congressional authority granting leave to courts to award attorneys' fees to prevailing litigants.⁽²²⁹⁾ Notwithstanding Justice Scalia's urging to the contrary, the Court correctly held that it could not reasonably read "`enforcement activities' . . . to cover attorney's fees incurred [in litigation and negotiations] by . . . private plaintiffs successfully seeking cost recovery under § 9607 of CERCLA."<sup>(230)</sup> The majority decided that to do so would have "stretch[ed] the plain terms of the phrase `enforcement activities' too far."⁽²³¹⁾

Further buttressing the Court's decision against stretching the meaning of "enforcement activities" to imply explicit congressional authorization to award attorneys' fees, was the majority's "negative inference" argument which Justice Scalia hastily discarded in his dissent.⁽²³²⁾ By application of this test, the Court determined that Congress's omission of the words "attorneys' fees" in conjunction with private actions under § 9607 "suggest[ed] a deliberate decision not to authorize such awards."⁽²³³⁾ Thus, the Court appropriately held that awards of attorneys' fees to private litigants were not authorized by Congress under § 9607 and, therefore, were not recoverable by Key Tronic without offending the American Rule.⁽²³⁴⁾

B.  Nonlitigation-related Attorneys' Fees: The Court Made an End Run Around the American Rule

As the Supreme Court discussed in Key Tronic, pursuant to the American Rule, "attorney's fees generally are not a recoverable cost of litigation `absent explicit congressional authorization.'"<sup>(235)</sup> Despite its holding that litigation-related attorneys' fees were not recoverable under § 9607 because of a lack of "explicit congressional authorization," the Supreme Court concluded that the American Rule was not a bar to recovery of other, nonlitigation attorneys' fees.<sup>(236)</sup> By a strict reading of its articulation of the American Rule in Alyeska, the Court excepted those fees "`not incurred in pursuing litigation'" from the restrictions of the American Rule.⁽²³⁷⁾ Recognizing that attorneys' fees are incurred by private parties outside of litigation, and that these fees, if for "work that is closely tied to the actual cleanup may constitute a necessary cost of response . . . under the terms of § [9607](a)(4)(B),"⁽²³⁸⁾ the Court opened the door to recovery of certain attorneys' fees. According to the Court, fees for "lawyers' work that is closely tied to the actual cleanup are recoverable as a cost of response."⁽²³⁹⁾ Based on this premise, the Court held that those attorneys' fees related to "[t]racking down other responsible . . . polluters" would be recoverable as necessary costs of response if "such efforts significantly benefited the entire cleanup effort and served a statutory purpose apart from the reallocation of costs."⁽²⁴⁰⁾

It appears that the Court created a three-part standard for determining which, if any, private party attorneys' fees are recoverable as necessary costs of response under § 9607.⁽²⁴¹⁾ A careful reading of the opinion reveals that the Court required the fees to be (1) for nonlitigation-related work that (2) significantly benefited the entire cleanup and (3) served a statutory purpose apart from [and in addition to] reallocation of costs.⁽²⁴²⁾

Unfortunately, though the Court created this coherent three-part test, it seems to have misapplied it.⁽²⁴³⁾ The Court's refusal to award attorneys' fees for studies prepared by Key Tronic's attorneys during negotiations with the EPA, even though they aided the EPA and were used in designing the "ultimate scope and form of the cleanup," was illustrative of misapplication of the standard which had emerged.⁽²⁴⁴⁾ The Court's stated reason for its refusal to award fees for these studies was that the fees' primary purpose was to "establish[] the extent of [Key Tronic's] liability" (arguably synonymous with "reallocation of funds").⁽²⁴⁵⁾ The standard recited in the case, however, merely requires the fees to be for work that serves a statutory purpose apart from the reallocation of costs; it does not bar other self-serving purposes as well.⁽²⁴⁶⁾ It is important to note that the primary goals of both the responsible party search and the site studies prepared by Key Tronic's attorneys were, no doubt, to limit liability and facilitate reallocation of costs--any "benefit[] [to] the entire cleanup" or "serv[ice to] a statutory purpose apart from [and in addition to] the reallocation of costs" was arguably entirely incidental.⁽²⁴⁷⁾ For this reason, a proper and consistent application of the recited standard would require the Supreme Court to allow recovery of Key Tronic's attorneys' fees for both responsible party searching and surveys prepared for use in negotiations with the EPA that also, apart from the purpose of reallocating costs, were used to benefit the cleanup.

  Conclusion

Clearly, the Supreme Court is unwilling to stretch the statutory meaning of the phrase "enforcement costs" to include attorneys' fees and, therefore, under the American Rule, will not allow recovery of such fees incurred in private actions under CERCLA § 9607, absent a congressional alteration to the statute explicitly authorizing such awards.⁽²⁴⁸⁾ The Court is, however, willing to distinguish between litigation-related attorneys' fees which are restricted by the American Rule, and nonlitigation-related fees which are not so restricted.⁽²⁴⁹⁾ The Court has fashioned a standard for determining which nonlitigation-related fees are recoverable under CERCLA.⁽²⁵⁰⁾ As illustrated by its use in Key Tronic, this standard is far from clear even to its creators who themselves misapplied it immediately after its formulation.⁽²⁵¹⁾ Unfortunately, this realization means that the question of which attorneys' fees are recoverable in § 9607 actions has not been settled, thus perpetuating the necessity for more litigation on this point in the lower courts until the Supreme Court revisits this question and clarifies its standard.

John R. Casciano^*

1. See H.R. Rep. No. 253, 99th Cong., 1st Sess. 66 (1985), reprinted in 1986 U.S.C.C.A.N. 2836-37. In 1980, when the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. §§ 9601-9675 (1988), was enacted, Congress and the Environmental Protection Agency (EPA) believed that there was a limited, yet pressing problem consisting of 400 hazardous waste sites in need of an appropriate response. Id., reprinted in 1986 U.S.C.C.A.N., at 2836. By 1986, the EPA and Congress recognized that the problem was much greater as evidenced by the identification of nearly 10,000 hazardous waste sites around the country. Id., reprinted in 1986 U.S.C.C.A.N. at 2837.

2. "Hazardous waste" is defined by 42 U.S.C. § 9601(14) (1988) as:

(A) any substance designated pursuant to section 1321(b)(2)(A) of title 33 [the Federal Water Pollution Control Act], (B) any element, compound, mixture, solution, or substance design pursuant to section 9602 of this title, (C) any hazardous waste having the characteristics identified under or listed pursuant to section 3001 of the Solid Waste Disposal Act . . . (D) any toxic pollutant listed under section 1317(a) of title 33 . . . . The term does not include petroleum, including crude oil or any fraction thereof which is not otherwise specifically listed or designated as a hazardous substance under subparagraphs (A) through (F) of this paragraph, and the term does not include natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas).

42 U.S.C. § 9601(14) (1988).

3. 42 U.S.C. §§ 9601-9675 (1988). See S. Rep. No. 848, 96th Cong., 2d Sess. 2 (1980), reprinted in 1980 U.S.C.C.A.N. 6119, for the CERCLA legislative history. Editor's Note: All CERCLA section numbers referred to in this Comment are the numbers as they appear in 42 U.S.C. (1988).

4. General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415, 1422 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991). See infra notes 103-23 and accompanying text for a full discussion of the facts of this case and its holding.

5. "Responsible party" is defined by 42 U.S.C. § 9607(a)(1) (1988) "as any owner or operator of a facility." 42 U.S.C. § 9607(a)(1) (1988). "An owner or operator is defined as a person who participates in the management of a facility who is not merely a stockholder." FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 846 (10th Cir. 1993) (citing 42 U.S.C. § 9601(20)(A) (1988)).

6. Key Tronic Corp. v. United States, 766 F. Supp. 865, 871 (E.D. Wash. 1991) [hereinafter short citation as Key Tronic I], rev'd, 984 F.2d 1025 (9th Cir. 1993), aff'd in part and rev'd in part, 114 S. Ct. 1960 (1994).

7. "Response action" is defined in 42 U.S.C. § 9601(25) (1988) with the use of the terms "`respond' or `response' mean[ing] remove, removal, remedy, and remedial action; all such terms (including the terms `removal' and `remedial action') includ[ing] enforcement activities related thereto." 42 U.S.C. § 9601(25) (1988).

8. "It is not necessary that every factor mentioned by the NCP [National Contingency Plan] be dealt with explicitly . . . failure to consider explicitly . . . [a] factor is not fatal to an evaluation's consistency with the NCP." Litton, 920 F.2d at 1420.

9. See 42 U.S.C. § 9607(a)(4)(B) (1988); General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415, 1422 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991).

10. Congress's stated goal was to "establish a program for appropriate environmental response action to protect public health and the environment from the dangers posed by such [hazardous waste] sites." H.R. Rep. No. 1016(I), 96th Cong., 2d Sess. 2 (1980), reprinted in 1980 U.S.C.C.A.N. 6119.

11. The term "removal action" is defined in 42 U.S.C. § 9601(23) (1988) as follows:

The terms "remove" or "removal" means [sic] the cleanup or removal of released hazardous substances from the environment, such actions as may be necessary taken in the event of the threat of release of hazardous substances into the environment, such actions as may be necessary to monitor, assess, and evaluate the release or threat of release of hazardous substances, the disposal of removed material, or the taking of such other actions as may be necessary to prevent, minimize, or mitigate damage to the public health or welfare or to the environment, which may otherwise result from release or threat of release. The term includes, in addition, without being limited to security fencing or other measures to limit access, provision of alternative water supplies, temporary evacuation and housing of threatened individuals not otherwise provided for, action taken under section 9604(b) of this title, and any emergency assistance which may be provided under the Disaster Relief and Emergency Assistance Act [42 U.S.C. 5121 et seq.].42 U.S.C. § 9601(23) (1988) (footnote omitted) (second alteration in original).

12. Litton, 920 F.2d at 1423. Under 42 U.S.C. § 9601(24) (1988), "remedial action" is defined as follows:

"[R]emedial action" means those actions consistent with permanent remedy taken instead of or in addition to removal actions in the event of a release or threatened release of a hazardous substance into the environment, to prevent or minimize the release of hazardous substances so that they do not migrate to cause substantial danger to present or future public health or welfare or the environment. The term includes, but is not limited to such actions at the location of the release as storage, confinement . . . neutralization, cleanup of released hazardous substances and associated contaminated materials . . . onsite treatment or incineration . . . and any monitoring reasonably required to assure that such actions protect the public health and welfare and the environment. The term includes the costs of permanent relocation of residents and businesses and community facilities where the President determines that, alone or in combination with other measures, such relocation is more cost-effective than and environmentally preferable to the transportation, storage, treatment, destruction, or secure disposition offsite of hazardous substances, or may otherwise be necessary to protect the public health or welfare . . . .42 U.S.C. § 9601(24) (1988) (footnote omitted).

13. Key Tronic Corp. v. United States, 114 S. Ct. 1960, 1964 (1994) [hereinafter short citation as Key Tronic III].

14. 42 U.S.C. §§ 9604, 9606 (1988).

15. 42 U.S.C. §§ 9604, 9606 (1988).

16. Key Tronic III, 114 S. Ct. at 1965; see also id. at 1966 n.10 ("[Section 9601(25)'s] modification of the definition of `response action' to include related enforcement activities `will confirm the EPA's authority to recover costs for enforcement actions taken against responsible parties.'" (quoting H.R. Rep. No. 253, 99th Cong., 1st Sess. 66-67 (1985))).

17. Section 9607 impliedly authorizes such actions by private citizens. See infra note 196.

18. Key Tronic III, 114 S. Ct. at 1964 (citing 42 U.S.C. §§ 9604, 9606 (1988)).

19. According to 42 U.S.C. § 9607(a)(4)(A)-(D) (1988), a potentially responsible party shall be liable for the following:

(A) all costs of removal and remedial action incurred by the United States Government or a State . . . not inconsistent with the national contingency plan;

(B) any other necessary costs of response incurred by any other person . . .

(C) damages for injury to, destruction of, or loss of natural resources . . . ; and

(D) the costs of any health assessment or health effects study carried out under section 9604(i) of [CERCLA].42 U.S.C. § 9607(a)(4)(A)-(D) (1988).

20. A potentially responsible party (PRP) may escape liability under § 9607(a) if it can "establish by a preponderance of the evidence" that the damages caused by the release or threat of release of a hazardous substance resulted from: "(1) an act of God[,] (2) an act of war[,] or (3) an act or omission of a third party" not under the control of or in privy of contract with the party attempting to avoid liability. 42 U.S.C. § 9607(b) (1988).

21. Key Tronic III, 114 S. Ct. at 1964.

22. Litton, 920 F.2d at 1418.

23. Id. See Key Tronic I, 766 F. Supp. at 871. For the statutory definitions of "removal costs" and "response costs," see supra note 11 and accompanying text.

24. See infra note 96 and accompanying text.

25. Necessary costs of response include "`any . . . necessary costs of response incurred by any . . . person consistent with the national contingency plan.'" Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1017 (9th Cir. 1993) (quoting 42 U.S.C. § 9607(a)(4)(B) (1988)).

26. See infra note 97 and accompanying text.

27. See infra notes 33-48 and accompanying text.

28. See infra notes 58-82 and accompanying text.

29. See infra notes 83-161 and accompanying text.

30. Key Tronic Corp. v. United States, 114 S. Ct. 1960 (1994). See infra notes 162-251 and accompanying text.

31. Id. at 1968-69 (Scalia, J., dissenting).

32. See infra notes 227-47 and accompanying text.

33. Key Tronic III, 114 S. Ct. at 1965.

34. Congress clarified and reorganized CERCLA with the passing of the Superfund Amendment and Reauthorization Act (SARA) in 1986. 100 Stat. 1613 (1986).

35. Key Tronic III, 114 S. Ct. at 1965 (citing CERCLA, 42 U.S.C. § 9613(f) (1988)). "Any person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action under section 9606 of this title or under section 9607(a) of this title." 42 U.S.C. § 9613(f)(1) (1988).

36. 42 U.S.C. § 9607(a)(4) (1988).

37. 42 U.S.C. § 9613(f)(1) (1988).

38. Walls v. Waste Resource Corp., 761 F.2d 311 (6th Cir. 1985) (noting that § 9607 gives private parties a right of action to recover necessary response costs); see also Pinole Point Properties, Inc. v. Bethlehem Steel Corp., 596 F. Supp. 283, 293 (N.D. Cal. 1984); Bulk Distribution Centers, Inc. v. Monsanto Co., 589 F. Supp. 1437, 1442-44 (S.D. Fla. 1984); Jones v. Inmont Corp., 584 F. Supp. 1425, 1428 (S.D. Ohio 1984); Philadelphia v. Stepan Chem. Co., 544 F. Supp. 1135 (E.D. Pa. 1982).

39. Key Tronic III, 114 S. Ct. at 1965. See Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1018 (9th Cir. 1993) ("[A] private litigant may initiate an action pursuant to [§] 107(a) [42 U.S.C. § 9607(a)] to recover the . . . [necessary costs of response pursuant to the National Contingency Plan]."); see also Cadillac Fairview/California, Inc. v. Dow Chem. Co., 840 F.2d 691, 694 (9th Cir. 1988) (holding that § 9607 authorizes private response actions).

40. See supra notes 5-12 and accompanying text.

41. Explicit mention of joint and several liability was deleted from CERCLA in 1980 to allow courts to establish the scope of liability through a case-by-case application of "traditional and evolving principles of common law" and pre-existing statutory law. See 126 Cong. Rec. H11787 (daily ed. Dec. 3, 1980) (statement of Rep. Florio). For a discussion of the uniform federal rule of joint and several liability which Congress has embraced, see U.S. v. Chem-Dyne, 572 F. Supp. 802, 808 (S.D. Ohio 1983).

42. Stanton, 984 F.2d at 1017; see also Frank F. Skillern, Environmental Protection: The Legal Framework § 5A.19 (1st ed. Supp. 1994) (discussing joint and several liability in the context of CERCLA litigation).

43. 42 U.S.C. § 9607 (1988).

44. 42 U.S.C. § 9613 (1988).

45. Potentially Responsible Parties (PRP) are those parties who are potentially liable under CERCLA § 9601(a)(1)-(4). See 42 U.S.C. § 9613(f)(1) (1988).

46. 42 U.S.C. § 9613(f)(1) (1988).

47. 42 U.S.C. § 9613 (1988).

48. General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415, 1418 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991).

49. § 9613(f)(1) states: "Any person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action under section 9606 of this title or under section 9607(a) of this title." 42 U.S.C. § 9613(f)(1) (1988).

50. § 9601 defines "facility" in the following manner: "(A) any building, structure, installation, equipment, pipe or pipeline . . . well, pit, pond, lagoon, impoundment, . . . or (B) any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located; but does not include any consumer product in consumer use . . . ." 42 U.S.C. § 9601(9) (1988).

51. Under CERCLA, "Responsible Party" is defined as:

(1) the owner and operator of a vessel or a facility,

(2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of,

(3) any person who by contract, agreement, or otherwise arranged for disposal . . . of hazardous substances . . . by any other party . . . and

(4) any person who accepts or accepted any hazardous substances . . . from which there is a release, or a threatened release . . . .42 U.S.C. § 9607(a)(1)-(4) (1988).

52. FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 845 (10th Cir. 1993) (citing Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 668 (5th Cir. 1989)).

53. Key Tronic Corp. v. United States, 114 S. Ct. 1960, 1964 (1994) (citing FMC Corp. v. Aero Indus., Inc., 998 F.2d 842 (10th Cir. 1993); In re Hemingway Transp., Inc., 993 F.2d 915, 933 (1st Cir.), cert. denied, 114 S. Ct. 303 (1993); Donaley v. Boyle, 987 F.2d 1250, 1256 (6th Cir.), cert. denied, 114 S. Ct. 636 (1993), cert. granted and judgment vacated, 114 S. Ct. 2668 (1994); General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991)).

54. FMC, 998 F.2d at 847. For a discussion of the split among the federal circuits, see infra notes 96-102 and accompanying text.

55. "It is deeply rooted in our history and in congressional policy; and it is not for us to invade the legislature's province by redistributing litigation costs . . . ." Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 271 (1975).

56. For a discussion of the American Rule, see infra notes 58-82.

57. In England, fee-shifting (awards of attorneys' fees to prevailing parties in litigation) is authorized at the discretion of the court by statute. Fleischmann Distilling Corp. v. Maier Brewing Co., 386 U.S. 714, 717 (1967). Consequently, fee-shifting has been consistently and freely allowed in favor of prevailing parties since the year 1278. Id. Originally, at common law, attorneys' fees were not awarded to the prevailing party in litigation. Id. The British Rule, as it will be referred to in this Comment, has been called the "rest-of-the-world rule" because virtually every legal system in the world consistently awards attorneys' fees to prevailing parties. See generally Walter K. Olson, The Litigation Explosion (1991).

58. See Federal Judiciary Act of Sept. 29, 1789, § 2, 1 Stat. 93, which provided that "rates and fees, except fees to judges, in the circuit and district courts, in suits at common law, shall be . . . allowed." Id. Later, in March of 1793, Congress enacted a provision "[t]hat there be allowed and taxed in the supreme [sic], circuit and district courts of the United States, in favour of the parties obtaining judgments therein, such compensation for their . . . attornies [sic] and counsellors' fees." Federal Judiciary Act of Mar. 1, 1793 § 4, 1 Stat. 333. This provision expired after two years. See Alyeska, 421 U.S. at 248-49.

59. For a discussion of the British Rule, which gives courts in many countries great discretion to award attorneys' fees to prevailing litigants, see supra notes 57-59 and accompanying text.

60. Alyeska, 421 U.S. at 249; see also supra note 55.

61. Arcambel v. Wiseman, 3 U.S. (3 Dall.) 306 (1796).

In Arcambel v. Wiseman, 3 Dall. 306, the inclusion of attorneys' fees as damages was overturned on the ground that "[t]he general practice of the United States is in oposition [sic] to [fee shifting]; and even if that practice were not strictly correct in principle, it is entitled to the respect of the court [sic], till it is changed, or modified, by statute."Alyeska, 421 U.S. at 249-50 (footnote omitted) (first alteration in original) (quoting Arcambel, 3 U.S. (3 Dall.) at 306).

62. Fee-shifting refers to the awarding of attorneys' fees to a prevailing litigant. Fleischmann Distilling Corp. v. Maier Brewing Co., 386 U.S. 714, 717 (1967). See generally Symposium, Attorney Fee Shifting, Law & Contemp. Probs., Winter 1984, at 1.

63. Alyeska, 421 U.S. at 249-50. The American Rule, which requires explicit congressional authorization for fee-shifting, as articulated in Arcambel's holding, has been followed consistently by the United States Supreme Court. See Runyon v. McCrary, 427 U.S. 160 (1976); Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240 (1975); F.D. Rich Co. v. United States ex rel. Indus. Lumber Co., 417 U.S. 116 (1974); Fleischmann Distilling Corp. v. Maier Brewing Co., 386 U.S. 714 (1967); Stewart v. Sonneborn, 98 U.S. 187 (1878); Flanders v. Tweed, 82 U.S. (15 Wall.) 450 (1872); Oelrichs v. Spain, 82 U.S. (15 Wall.) 211 (1872); Day v. Woodworth, 54 U.S. (13 How.) 363 (1851).

64. Alyeska, 421 U.S. at 251. For example, 28 U.S.C. § 1923 (1970) provided that attorneys' fees may be awarded to prevailing parties in certain situations within specified limits. Alyeska, 421 U.S. at 257.

65. Alyeska, 421 U.S. at 251. "The result was a far-reaching Act specifying in detail the nature and amount of the taxable items of cost in the federal courts. One of its purposes was to limit allowances for attorneys' fees that were to be charged to the losing parties." Id. at 251-52. "Congress has made specific provision[s] for attorneys' fees under certain federal statutes, it has not changed the general statutory rule" limiting awards of fees to prevailing parties. Id. at 254-55.

66. Id. at 251.

67. Id. at 260.

68. In re Hemingway Transp., Inc., 993 F.2d 915, 935 (1st Cir. 1993) (citing Alyeska, 421 U.S. at 263-64).

69. Id.

70. Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240 (1975).

71. Id. at 269.

72. Runyon v. McCrary, 427 U.S. 160, 185 (1976).

73. Id. "Our cases establish that attorney's fees generally are not a recoverable cost of litigation `absent explicit congressional authorization.'" Key Tronic Corp. v. United States, 114 S. Ct. 1960, 1965 (1994) (quoting Runyon, 427 U.S. at 185 (citing Alyeska, 421 U.S. at 247)).

74. Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1018-19 (9th Cir. 1993).

75. Scott J. Jordan, Awarding Attorney's Fees to Environmental Plaintiffs Under a Private Attorney General Theory, 14 B.C. Envtl. Aff. L. Rev. 287, 290 (1987).

76. Alyeska, 421 U.S. at 270.

77. Id. at 271. The Court stated that "it is apparent that the circumstances under which attorneys' fees are to be awarded and the range of discretion of the courts in making those awards are matters for Congress to determine." Id. at 262.

78. FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 847 (10th Cir. 1993).

79. Stanton, 984 F.2d at 1079; see also Alyeska, 421 U.S. at 262; In re Hemingway Transp., Inc., 993 F.2d at 934.

80. Runyon, 427 U.S. at 185-86.

81. Id. "[T]he Court[, however,] has recognized the `inherent power' of the federal courts to assess attorneys' fees when the losing party has `acted in bad faith, vexatiously, wantonly or for oppressive reasons . . . .'" Id. at 183 (quoting F.D. Rich Co. v. United States ex rel. Indus. Lumber Co., 417 U.S. 116, 129 (1974)).

82. Stanton, 984 F.2d at 1019.

83. See id. at 1015.

84. Id. at 1019. Case law establishes that the United States can, as a party in a CERCLA action, recover its attorneys' fees. See, e.g., United States v. Northeastern Pharmaceutical & Chem. Co., 579 F. Supp. 823, 851 (W.D. Mo. 1984), aff'd in part and rev'd in part, 810 F.2d 726 (7th Cir. 1986), cert. denied, 484 U.S. 848 (1987).

85. Stanton, 984 F.2d at 1019.

86. 42 U.S.C. § 9604(b) (1988).

87. Stanton, 984 F.2d at 1019. The Stanton court noted that "section [9604](b) of CERCLA provides that the `President . . . may undertake such planning, legal, fiscal, [or] economic . . . to plan and direct response actions [and] recover the costs thereof.'" Id. (second and third alterations in original) (omissions in original) (quoting 42 U.S.C. § 9604(b) (1988)).

88. Key Tronic III, 114 S. Ct. at 1966. "[T]he reimbursement that a court awards `may include appropriate costs, fees, and other expenses' in accordance with 28 U.S.C. §§ 2412(a) and (d) . . . ." Id. at 1966 n.8 (quoting 42 U.S.C. § 9606(b)(2)(E) (1988)). "Section 2412(d)(2)(A) [of 28 U.S.C.] . . . defines `fees and other expenses' to include reasonable attorney's fees." Id.

89. 42 U.S.C. § 9610(c) (1988).

90. In re Hemingway Transp., Inc., 993 F.2d 915, 934 (1st Cir. 1993); see also Key Tronic III, 114 S. Ct. at 1966.

91. 42 U.S.C. § 9659(f) (1988).

92. In re Hemingway Transp., Inc., 993 F.2d at 934; see also Stanton, 984 F.2d at 1019.

93. See, e.g., In re Hemingway Transp., Inc., 993 F.2d at 934; Stanton, 984 F.2d at 1020. Congress's failure to use the phrase "attorneys' fees" to describe those costs recoverable under § 9607 bars courts from awarding such fees to the prevailing party in contribution recovery actions. Id.; see also infra notes 133-43 and accompanying text.

94. In re Hemingway Transp., Inc., 993 F.2d at 934.

95. See, e.g., General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415 (8th Cir. 1990), cert. denied, 500 U.S. 911 (1991). Congress intended to authorize recovery of attorneys' fees by private parties in contribution recovery actions under § 9607. Id.; see also infra notes 103-23 and accompanying text.

96. See, e.g., Litton, 920 F.2d at 1422 n.10. Courts are divided on the issue of fee-shifting for private parties under CERCLA. Id.; see also FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 847 (10th Cir. 1993) ("The circuits have split on whether the statutory language [of CERCLA] contains the requisite explicit authority to award litigation fees.").

97. Stanton, 984 F.2d at 1019.

98. See supra notes 95-96 and accompanying text; see also infra notes 99-102 and accompanying text.

99. See, e.g., Litton, 920 F.2d at 1422; see also infra notes 103-23 and accompanying text.

100. See, e.g., Stanton., 984 F.2d at 1020; see also infra notes 124-43 and accompanying text.

101. See, e.g., Stanton, 984 F.2d at 1019-20; see also infra notes 124-43 and accompanying text.

102. See, e.g., FMC, 998 F.2d at 847-48; see also infra notes 144-61 and accompanying text.

103. See General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415 (8th Cir. 1990), cert. denied, 500 U.S. 911 (1991).

104. Id. at 1422. The Litton court stated that "CERCLA authorizes, with a sufficient degree of explicitness, the recovery by private parties of attorney fees and expenses." Id.

105. Id. at 1416-17. In 1970, General Electric (GE) bought the factory and a 40-acre tract from Litton. Id. Litton's predecessor had contaminated the land between 1959 and 1962. Id. Ten years later, in 1980, the Missouri Department of Natural Resources (MDNR) discovered the contamination, but decided that a response was not necessary at that time. Id. In 1985, after GE had sold the vacant property, MDNR put the land on the Registry of Abandoned and Uncontrolled Hazardous Waste Sites. Id. MDNR determined that the contamination posed a significant health risk and that a response action was necessary. Id. At the EPA's request, MDNR instituted an enforcement action against the owner of the tract who, indemnified by GE, had entered into a settlement agreement. Id. GE removed the hazardous waste and the contaminated soil from the site in accordance with the NCP and subsequently filed suit against Litton under § 9607 to recover its response costs, including attorneys' fees. Id. at 1417.

106. Id. at 1417.

107. Id. at 1416-17.

108. Litton, 920 F.2d at 1416-17.

109. Id.

110. General Elec. Co. v. Litton Business Sys., Inc., 715 F. Supp. 949 (W.D. Mo. 1989), aff'd, 920 F.2d 1415 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991).

111. Litton, 920 F.2d at 1417.

112. Id. Litton was ordered by the district court to pay GE nearly $1 million as reimbursement for the entire response costs, in addition to more than $419,000 in attorneys' fees and expenses. Id. The court "ruled that attorney fees were recoverable [costs of response], and ordered Litton to pay GE['s] . . . attorney fees and expenses." Id.

113. Id. On appeal, Litton claimed that "GE's response was not consistent with the NCP," that "the District Court erred in not apportioning some of the response costs to GE," and that "in allowing GE to recover its attorney fees," the district court had also erred. Id.

114. Id. at 1421. For a discussion of Contribution Recovery Actions, see supra notes 33-54 and accompanying text.

115. Litton, 920 F.2d at 1421. For a discussion of the American Rule, see supra notes 58-82 and accompanying text.

116. Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240 (1975).

117. Runyon v. McCrary, 427 U.S. 160 (1976).

118. Litton, 920 F.2d at 1421. The court stated that it "must find more than `generalized commands,'" and that there "must be a clear expression of Congress' intent." Id. (quoting Runyon, 427 U.S. at 186).

119. 42 U.S.C. 9607(a)(4)(B) (1988).

120. Litton, 920 F.2d at 1421-22 (citing 42 U.S.C. § 9601(25) (1988)).

121. Id. The court maintained that "it would strain the statutory language to the breaking point to read [attorneys' fees] out of the `necessary costs' that section 9607(a)(4)(B) allows private parties to recover." Id.; see also Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1018 (9th Cir. 1993) (citing General Elec. Co. v. Litton Indus. Automation Sys., Inc., 920 F.2d 1415 (8th Cir. 1990), cert. denied, 499 U.S. 937 (1991)).

122. Litton, 920 F.2d at 1421-22. For a complete discussion of the purposes of CERCLA, see supra notes 1-12 and accompanying text.

123. Litton, 920 F.2d at 1421-22. The holding in Litton has been followed in a number of jurisdictions. See Chesapeake & Potomac Tel. Co. v. Peck Iron & Metal Co., 814 F. Supp. 1281, 1283 (E.D. Va. 1993) (holding that enforcement activities include attorneys' fees and satisfy the requirements of the American Rule); Gopher Oil Co. v. Union Oil Co., 757 F. Supp. 998 (D. Minn. 1991) (same). Additionally, in his dissenting opinion in Stanton, Justice Canby recited his support for the Eighth Circuit's holding by criticizing the Stanton majority. Stanton, 984 F.2d at 1023 (Canby, J., dissenting). Justice Canby stated that "[i]n the scheme of CERCLA, [the] language must mean that private plaintiffs can recover the attorneys' fees expended in enforcing" CERCLA liability. Id. (Canby, J., dissenting). Litton has also been widely criticized. See Alloy Briquetting Co. v. Niagara Vest Inc., 802 F. Supp. 943, 946 (W.D.N.Y. 1992) (noting that statutory language falls short of explicitly referring to congressional authority for attorneys' fees); Hatco Corp. v. W.R. Grace & Co., 801 F. Supp. 1309 (D.N.J. 1992) (same); Fallowfield Dev. Corp. v. Strunk, 766 F. Supp. 335, 337 (E.D. Pa. 1991) (noting that Litton cites no explicit language evidencing Congress's intent).

124. Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015 (9th Cir. 1993).

125. Id. at 1016. Lohrey was the owner and operator of a dry cleaning plant on land that bordered Stanton's property. Id. While operating its plant, Lohrey allowed the hazardous chemical perchlorethelene to spill onto and contaminate Stanton's property. Id.

126. Id. Although cleanup of the site had not been completed, Stanton brought this action seeking declaratory relief under CERCLA and seeking damages under certain state laws. (The state claims will not be addressed by this Comment.). Id. Stanton introduced evidence at trial that the cleanup would cost a minimum of $1,100,000. Id. at 1017. Stanton claimed that more than $125,000 in attorneys' fees constituted its necessary cost of response. Id.

127. Id. The court awarded Stanton $77,374 in response costs and $126,198 in attorneys' fees for the CERCLA claim. Id. In addition, Lohrey was ordered to establish a cleanup escrow account to fund the cleanup of Stanton's property. Id.

128. Id. at 1017. In addition to appealing the award of attorneys' fees, Lohrey unsuccessfully challenged the district court's establishment of the cleanup escrow fund, the validity of the award of future response costs, and the validity of the award of damages under state law. Id. at 1020-21.

129. Stanton, 984 F.2d at 1017-18.

130. Id. See supra notes 58-82 and accompanying text for a discussion of the American Rule.

131. Stanton, 984 F.2d at 1017-18.

132. Id. at 1018. The Litton court reasoned that "[a] private party cost-recovery action . . . is an enforcement activity within the meaning of [§ 9607 of] the statute." Litton, 920 F.2d at 1422. See supra notes 103-23 and accompanying text for a complete discussion of Litton.

133. Stanton, 984 F.2d at 1020. The Stanton majority rejected the Eighth Circuit's reasoning in Litton that since attorneys' fees are ordinarily expended in private contribution actions, the phrase "necessary costs of response" as defined with the term "enforcement activities" constitutes explicit congressional authority for fee-shifting. Id.

134. Id. at 1019.

135. Id.

136. Id. The court stated: "the words `enforcement activities' do not explicitly signal, with any persuasive degree of clarity, that Congress intended to provide for an award of attorneys' fees to private litigants." Id. (citing Litton, 920 F.2d at 1422 n.10).

137. Id. For a discussion of the specific provisions discussed by the court, see supra notes 83-95 and accompanying text.

138. Stanton, 984 F.2d at 1019. The majority continued: "When compared to the[se] express provisions for attorneys' fees in . . . CERCLA, the term `enforcement activities' would appear to be `outside even the most exhaustive lexicon of customary fee shifting language.'" Id. (quoting Santa Fe Pac. Realty Corp. v. United States, 780 F. Supp. 687, 695 (E.D. Cal. 1991)).

139. Id.; see also supra note 128 and accompanying text.

140. Stanton, 984 F.2d at 1020.

141. Id. The Stanton court noted that the Supreme Court had established this rule in Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 263 (1975). Stanton, 984 F.2d at 1020.

142. Stanton, 984 F.2d at 1020. For a discussion of explicit fee-shifting provisions in CERCLA, see supra notes 83-95 and accompanying text.

143. Stanton, 984 F.2d at 1020. Most notably, the same conclusions were reached by the First Circuit in In re Hemingway Transp., Inc., 993 F.2d 915, 934-35 (1st Cir. 1993) and by the Ninth Circuit in Key Tronic Corp. v. United States, 984 F.2d 1025, 1027-28 (9th Cir. 1993) [hereinafter short citation as Key Tronic II], aff'd in part and rev'd in part, 114 S. Ct. 1960 (1994); see also infra notes 185-87 and accompanying text.

144. FMC Corp. v. Aero Indus., Inc., 998 F.2d 842 (10th Cir. 1993).

145. Id. at 847.

146. Id. at 844. After Aero purchased the site which "had been used as a gallium and arsenic refining facility" at a bankruptcy auction, the Utah Department of Health informed Aero that the site was contaminated and "requested Aero's compliance with a state approved closure plan." Id. Aero did not, despite this request, follow the requirements of the plan. Id. In 1988, the EPA ordered Aero, FMC, and others "to take action to remove hazardous substances and contaminated soil from the site." Id.

147. Id.

148. Id. The EPA certified that FMC's cost of response and removal ($970,605.20) was "necessary and not inconsistent" with the NCP. Id. In addition, FMC "incurred $244,287.89 for nonlitigation removal-related attorney's fees and costs" as well as litigation fees and other costs. Id.

149. FMC, 998 F.2d at 845. For a discussion of joint and several liability under CERCLA, see supra notes 41-42 and accompanying text.

150. FMC, 998 F.2d at 845.

151. Id. at 847.

152. Id.

153. Id.

154. Id.

155. FMC, 998 F.2d at 847 (citing Runyon v. McCrary, 427 U.S. 160, 185 (1976)).

156. Id.

157. Id.

158. Id.

159. United States v. Hardage, 982 F.2d 1436 (1992). In Hardage, the Tenth Circuit stated that "`"necessary costs of response" must be necessary to the containment and cleanup'" in order to recover under § 9607. FMC, 998 F.2d at 848 (quoting Hardage, 982 F.2d at 1448 (citing Daigle v. Shell Oil Co., 972 F.2d 1527, 1535-37 (10th Cir. 1992))). The court went on to hold that "`when a private party incurs response costs . . . solely to defend against the government's . . . action, the private party's response costs are not "necessary" within the meaning of [section 9607(a)(4)(B)].'" Id. (alteration in original) (quoting Hardage, 982 F.2d at 1448).

160. FMC, 998 F.2d at 848.

161. Id. The court instructed the district court to "ascertain whether any of the nonlitigation attorneys [sic] fees sought by the plaintiffs were necessary to the containment and cleanup of hazardous releases and therefore recoverable as necessary costs." Id.

162. Key Tronic Corp. v. United States, 766 F. Supp. 865 (E.D. Wash. 1991), rev'd, 984 F.2d 1025 (9th Cir. 1993), rev'd in part and aff'd in part, 114 S. Ct. 1960 (1994).

163. Key Tronic III, 114 S. Ct. at 1963; Key Tronic II, 984 F.2d at 1026-27; see also Key Tronic I, 766 F. Supp. at 866-67.

164. Key Tronic III, 114 S. Ct. at 1963.

165. See sources cited supra note 9 for a discussion of the NCP.

166. Key Tronic III, 114 S. Ct. at 1963.

167. Id.

168. Key Tronic II, 984 F.2d at 1026.

169. Id. "Pursuant to . . . [42 U.S.C. § 9622(g)(5)], the Air Force was freed from liability for contribution claims made by other parties regarding matters addressed in the settlement between the Air Force and the EPA." Id.; see also id. at 1026 n.1.

170. Id. Key Tronic settled with the other potentially responsible parties named in the original suit. Key Tronic I, 766 F. Supp. at 868.

171. Key Tronic III, 114 S. Ct. at 1963. "The $1.2 million included attorney's fees for three types of legal services: (1) the identification of other potentially responsible parties (PRP's) [sic] . . . (2) preparation and negotiation of its agreement with the EPA; and (3) the prosecution of this [contribution] litigation." Id.

172. Id. at 1964 (citing Key Tronic Corp. v. United States, 766 F. Supp. 865, 868 (E.D. Wash. 1991), rev'd, 984 F.2d 1025 (9th Cir. 1993), aff'd in part and rev'd in part, 114 S. Ct. 1960 (1994)).

173. Key Tronic I, 766 F. Supp. at 869. Key Tronic cited two cases which "characterized a Section [9607] cost recovery claim by a private party `as a private enforcement action.'" Id. (citing Cadillac Fairview, Inc. v. Dow Chem. Co., 840 F.2d 691, 694 (9th Cir. 1988); Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887, 892 (9th Cir. 1986)).

174. Id. at 871. This is pursuant to the American Rule which is discussed in supra notes 58-82 and accompanying text.

175. Key Tronic I, 766 F. Supp. at 871.

176. Id. "Congress failed to restrict `enforcement activities' in the definition to governmental actions." Id.

177. Id. The court relied on public policy rationale in allowing private parties to recover fees as enforcement costs. Id. at 872.

178. Id. at 871.

179. Id. at 872. This conclusion was based on the district court's holding as well as the Air Force's admission that the government is typically able to recover PRP search costs in CERCLA enforcement actions. Id.

180. Key Tronic I, 766 F. Supp. at 872. The court reasoned that because "[c]ourts have held that consultant and legal fees incurred in the investigation of a hazardous waste site are recoverable as necessary response costs," Key Tronic's negotiation costs should be likewise recoverable. Id. (citing International Clinical Labs., Inc. v. Stevens, No. CV87-3472, 1990 U.S. Dist. LEXIS 3685 (E.D.N.Y. Jan. 12, 1990); BCW Assocs. v. Occidental Chem. Corp., No. CV86-5947, 1988 U.S. Dist. LEXIS 11275 (E.D. Pa. Sept. 30, 1988)).

181. Key Tronic Corp. v. United States, 984 F.2d 1025, 1026 (9th Cir. 1993), aff'd in part and rev'd in part, 114 S. Ct. 1960 (1994).

182. See supra notes 174-76 and accompanying text.

183. Key Tronic II, 984 F.2d at 1026.

184. Id. at 1027.

185. Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1020 (9th Cir. 1993); see also supra notes 133-43 and accompanying text.

186. Key Tronic II, 984 F.2d at 1027. The majority stated that "[i]n Stanton . . . we held that a litigant cannot recover in a private response cost recovery action attorneys' fees from a party that was responsible for the pollution." Id. Judge Canby, the same judge who had dissented in Stanton, dissented from this majority's opinion based on his reading of Congress's definition of "`response' in section [9601](25) to include `enforcement activities.'" Id. at 1028 (Canby, J., dissenting). He restated his conclusion from Stanton that Congress "intended to authorize the recovery of attorneys' fees along with cleanup costs." Id. (Canby, J., dissenting).

187. Id. The majority held that "the district court lacked the authority to enter an award for the legal expenses incurred by Key Tronic in searching for other potentially responsible parties." Id. at 1027.

188. Key Tronic Corp. v. United States, 114 S. Ct. 1960, 1965 (1994).

189. Id. at 1963.

190. Id. at 1967.

191. Id. at 1965.

192. For a brief discussion of the purposes of CERCLA, see supra notes 5-12 and accompanying text.

193. Key Tronic III, 114 S. Ct. at 1966-67. For a discussion of the provisions authorizing attorneys' fees, see supra notes 83-95 and accompanying text.

194. Key Tronic III, 114 S. Ct. at 1966.

195. Id. at 1967.

196. Id. at 1966.

197. Id. at 1966-67.

198. Id.

199. Key Tronic III, 114 S. Ct. at 1967.

200. Id. Justice Scalia maintained that such reasoning amounted to a "negative inference," and that the "`"attorneys' fees" was used elsewhere' argument is simply a watered-down version of the `magic words' argument . . . ." Id. at 1969 (Scalia, J., dissenting).

201. Id. at 1967.

202. Id. The Court concluded that "it would stretch the plain terms of the phrase `enforcement activities' too far to construe it as encompassing the kind of private cost recovery at issue in this case." Id.

203. Id.

204. Key Tronic III, 114 S. Ct. at 1967.

205. FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 847 (10th Cir. 1993). For a complete discussion of the holding in FMC, see supra part II.B.3.c.

206. Key Tronic III, 114 S. Ct. at 1967.

207. Id.

208. Id. "Key Tronic's search for other responsible parties . . . prompt[ed] the EPA to initiate its enforcement action against the Air Force." Id. Key Tronic's searching "efforts significantly benefited the entire cleanup." Id.

209. Id. "[T]hese [nonlitigation] efforts might well be performed by engineers, chemists, private investigators or other professionals who are not lawyers." Id.

210. Id. The Court instructed the district court to address, on remand, the issue of the exact amount of recoverable attorneys' fees incurred in PRP searching. Id. at 1967 n.14.

211. Key Tronic III, 114 S. Ct. at 1968.

212. Id. at 1967-68.

213. Id. The Court stated that despite the fact that the studies prepared by Key Tronic's attorneys were ultimately used to benefit the cleanup effort, the work had been designed "primarily [to] protect[] Key Tronic's interests as a defendant in the proceedings that established the extent of its liability." Id.

214. Id.

215. Id. at 1969 (Scalia, J., dissenting). "[T]o meet the demands of [the American Rule], Congress need only be explicit--it need not incant the magic phrase `attorney's fees.'" Id. (Scalia, J., dissenting).

216. See supra notes 204-10 and accompanying text.

217. Key Tronic III, 114 S. Ct. at 1968-69 (Scalia, J., dissenting). Justice Scalia wrote: "I disagree with the Court's conclusion that a private litigant cannot recover the attorney's fees associated with bringing a cost recovery action under § [9607] . . . ." Id. (Scalia, J., dissenting).

218. Id. (Scalia, J., dissenting).

219. Id. at 1966-67.

220. Id. at 1968 (Scalia, J., dissenting). According to Justice Scalia, private contribution recovery actions are not, as the majority believed, "an `implied' right of action[;]" instead, he argued that § 9607 "states, as clearly as can be, that `[c]overed persons . . . shall be liable for . . . necessary costs of response incurred by any other person.'" Id. (Scalia, J., dissenting) (alteration in original) (omissions in original).

221. Id. at 1968 (Scalia, J., dissenting).

222. Key Tronic III, 114 S. Ct. at 1969 (Scalia, J., dissenting).

223. Id. at 1968 (Scalia, J., dissenting). Justice Scalia stated that "[w]here, as here, Congress has explicitly authorized recovery of costs of `enforcement activities,' and where, as here, the costs of `enforcement activities' naturally (and indeed primarily) include attorney's fees, that textual authorization satisfies [the American Rule]." Id. (Scalia, J., dissenting).

224. Id. (Scalia, J., dissenting).

225. Id. (Scalia, J., dissenting).

226. Id. (Scalia, J., dissenting).

227. Id. (Scalia, J., dissenting). Justice Scalia reasoned that "[w]hile the term `enforcement' often--perhaps even usually--is used in connection with government prosecution, that is assuredly not the only form of legal action it refers to. It clearly includes the assertion of a valid private claim against another private litigant." Id. (Scalia, J., dissenting).

228. See Sidney M. Wolf, Up In the Air: Recovery of Attorney Fees in a CERCLA § 107(a)(4)(B) Suit, 69 N.D. L. Rev. 275, 291-92 (1993) ("The restrictive approach is, however, the majority view among the district courts which have ruled on the recoverability of attorney fees as response costs in § 9607(a)(4)(B) suits."). See generally Michael B. Jones, Comment, The Recovery of Attorneys' Fees Under CERCLA: Are They "Costs of Response" for Private Litigants?, 11 Temp. Envtl. L. & Tech. J. 261, 266 (1992).

229. Key Tronic III, 114 S. Ct. at 1965. "[A]ttorney's fees generally are not a recoverable cost of litigation `absent explicit congressional authorization.'" Id. (emphasis added) (quoting Runyon v. McCrary, 427 U.S. 160, 185 (1976)).

230. Id. at 1969 (Scalia, J., dissenting). Justice Scalia contended that the words "attorneys' fees" need not be mentioned in order for explicit congressional authority to be evident. Id. (Scalia, J., dissenting).

231. Id. at 1967. In so holding, the Court recognized "that the judiciary should not `supply omissions in a statute even though that which was omitted may have been omitted by oversight or inadvertence.'" Jones, Comment, supra note 227, at 272 (quoting Santa Fe Pac. Realty Corp. v. United States, 980 F. Supp. 687, 695 n.4 (E.D. Cal. 1991) (quoting In re Shear, 139 F. Supp. 217, 221 (N.D. Cal. 1956) (citing Wallace v. Cutten, 298 U.S. 229 (1936); Iselin v. United States, 270 U.S. 245 (1926); Ebert v. Poston, 226 U.S. 548 (1925)))).

232. Key Tronic III, 114 S. Ct. at 1969 (Scalia, J., dissenting). The negative inference argument relies on the assumption that where Congress authorizes recovery of attorneys' fees by using explicit language in certain sections of a statute, it can be inferred that Congress intended to withhold such authorization where it remained silent on the issue in other sections of the statute. Id. at 1966. Justice Scalia discarded this well-reasoned argument, apparently implying that the court is free to supply its own words despite the well-settled American Rule. Id. (Scalia, J., dissenting).

233. Id. at 1967. The Court logically recognized "that where attorneys' fees were intended by Congress . . . [under some] sections of CERCLA, the award was explicitly provided." Jones, Comment, supra note 227, at 272. It follows, according to the negative inference argument, that where Congress made no explicit provision for attorneys' fees, Congress did not intend for attorneys' fees to be recovered. Id.

234. See supra note 203 and accompanying text.

235. Key Tronic III, 114 S. Ct. at 1965 (emphasis added) (quoting Runyon v. McCrary, 427 U.S. 160, 185 (1976) (citing Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 247 (1975))).

236. Id. at 1967. The Court stated that "[t]he conclusion we reach with respect to litigation-related fees does not signify that all payments that happen to be made to a lawyer are unrecoverable expenses under CERCLA." Id.

237. Id. (quoting FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 847 (1993)); see also supra notes 206-10 and accompanying text.

238. Key Tronic III, 114 S. Ct. at 1967.

239. Id.

240. Id. In support of this holding, the Court "recognized the [positive] role Key Tronic's search for other responsible parties played in uncovering the Air Force's disposal of wastes at the site and in prompting the EPA to initiate its enforcement action against the Air Force." Id. (citing Key Tronic I, 766 F. Supp. at 872 n.4).

241. Id.

242. Id. Given the fact that the primary goal of "tracking down other responsible solvent polluters," id., is reallocation of costs, one may draw the inference that the Court must have meant that serving a statutory purpose apart from reallocation of costs could be an alternate or incidental effect and still satisfy the standard. See supra note 49 and accompanying text.

243. See generally Key Tronic III, 114 S. Ct. at 1967-68.

244. Id. at 1968.

245. Id.

246. Id. at 1967; see also supra note 237 and accompanying text.

247. Key Tronic III, 114 S. Ct. at 1967. The primary goal of a PRP search is to limit the scope of a private party's liability and reallocate costs. See supra note 49 and accompanying text. Similarly, this was undoubtedly the primary purpose of the studies prepared during Key Tonic's negotiations with the EPA. See supra note 49 and accompanying text.

248. Key Tronic III, 114 S. Ct. at 1967.

249. Id. at 1963.

250. Id. at 1967.

251. See supra notes 242-43 and accompanying text.

* This article is dedicated to my wife, Tracey, for her love and support, and to my parents for always encouraging me to pursue my dreams.