Asarco, LLC v. Noranda Mining, Inc. , 844 F.3d 1201 ( 2017 )

FILED
United States Court of Appeals
Tenth Circuit
PUBLISH January 3, 2017
Elisabeth A. Shumaker
UNITED STATES COURT OF APPEALS Clerk of Court
TENTH CIRCUIT
ASARCO, LLC, a Delaware limited
liability company,
Plaintiff - Appellant,
v. No. 16-4045
NORANDA MINING, INC., a
Delaware corporation,
Defendant - Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH
(D.C. No. 2:12-CV-00527-TC)
Gregory Evans (Laura G. Brys of McGuireWoods, LLP, Los Angeles, California;
David C. Reymann and Cheylynn Hayman of Parr, Brown, Gee & Loveless, P.C.,
Salt Lake City, Utah, with him on the briefs), for Plaintiff - Appellant.
Jeffrey C. Corey (Richard J. Angell, Zack L. Winzeler, and Alan S. Mouritsen of
Parsons Behle & Latimer, with him on the brief), Salt Lake City, Utah, for
Defendant - Appellee.
Before KELLY, GORSUCH, and HOLMES, Circuit Judges.
KELLY, Circuit Judge.
Plaintiff-Appellant Asarco, LLC appeals from the district court’s entry of
summary judgment against it in its contribution action against Noranda Mining,
Inc., under Section 113(f) of the Comprehensive Environmental Response,
Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9613(f) (2012). See
Asarco, LLC v. Noranda Mining, Inc. (Noranda), No. 2:12-CV-527-TC-DBP,
2016 WL 1317493 (D. Utah Mar. 31, 2016). The district court held that Asarco
was judicially estopped from pursuing its claim because of representations it
made to a bankruptcy court concerning its settlement agreement with the EPA for
the site in question. Id. at *12, *16. It also found, as a matter of law, that Asarco
could not establish that it paid more than its fair share of costs for the site. Id. at
*15–16. Exercising jurisdiction pursuant to 28 U.S.C. § 1291, we reverse and
remand.
Background
A. Asarco’s Settlement Agreement and Reorganization Plan
Asarco is an integrated mining, smelting, and refining company that filed
for Chapter 11 bankruptcy in August 2005. Because of its long history of mining
in the United States, it had the “dubious distinction” of having the largest amount
of environmental claims brought against it in any bankruptcy proceeding, totaling
approximately $6.5 billion of non-duplicated proofs of claim. In re ASARCO
LLC (Asarco I), No. 05-21207, 2009 WL 8176641, at *3–4 (Bankr. S.D. Tex.
June 5, 2009). In 2009, after years of negotiations and hearings, the bankruptcy
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court approved a comprehensive settlement agreement, by which Asarco agreed to
pay approximately $1.79 billion to resolve environmental claims at 52 sites in 19
states. Id. at *8. Although the agreement was negotiated on a global basis, it was
divided into five independent settlement groupings of related sites. Id. The last
of these groupings, the Miscellaneous Federal and State Environmental Settlement
Agreement (“Miscellaneous Agreement”), settled for a combined $94.6 million.
Id. at *9. It contained settlements for 26 sites in 12 states, including the site at
issue in this appeal: the Lower Silver Creek / Richardson Flat Site (“Site”). Id. at
*1, *54. It settled for $7.4 million. Id. at *54.
In reviewing Asarco’s proposed global settlement agreement, the
bankruptcy court explained that it was bound by two different legal standards.
First, Bankruptcy Rule 9019(a) gave the bankruptcy court discretion to approve a
compromise or settlement plan. Id. at *9 (citing Fed. R. Bankr. P. 9019(a)). The
court noted that it should approve a settlement when doing so is “fair, equitable,
and in the best interests of the estate.” Id. at *10 (citation omitted). Under this
standard, the court “need not resolve disputed issues but should apprise itself of
the relevant facts and law so that it can make an informed and intelligent decision
as to the reasonableness of the settlement.” Id. (citation omitted).
The second governing legal standard was CERCLA itself. See id. at
*36–39. Under CERCLA, the bankruptcy court was tasked with reviewing the
settlement agreement to ensure it was “fair, reasonable, and consistent with
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CERCLA.” Id. at *37 (citations omitted). The court explained that because
CERCLA encourages settlement, and because this proposal was the product of
years of arm’s-length negotiation between the estate, the DOJ, and the EPA, its
review of the settlement proposal was necessarily limited. Instead of reviewing
the settlement proposal de novo, its task was to ensure the settlement was
procedurally and substantively fair — that it “reflect[ed] a reasonable
compromise of the litigation.” Id. at *38 (citation omitted).
Specifically, the court continued, “[t]o be fair to other non-settling
responsible parties, a settlement should recover at least an amount ‘roughly
correlated with[] some acceptable measure of comparative fault,’ apportioning
liability ‘according to rational (if necessarily imprecise) estimates’ of fair shares
of liability for a given facility.” Id. (second alteration in original) (quoting
United States v. Cannons Eng’g Corp., 899 F.2d 79, 87 (1st Cir. 1990)).
“Although the settlement should have ‘some reasonable linkage’ to the
proportionate share of the settling parties, ‘[r]easonable linkage’ does not mean
that the agency must choose ‘the best or even the fairest method of apportioning
liability.’” Id. (alteration in original) (citation omitted) (quoting United States v.
Wallace, 893 F. Supp. 627, 633 (N.D. Tex. 1995)).
To meet these standards, Asarco and the EPA presented the bankruptcy
court with evidence that the settlement agreements were fair and equitable, both
to the estate and its creditors (i.e., that the estate was not paying out substantially
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more than it owed) and under CERCLA (i.e., that the government was recovering
enough to meet the public interest in cleanup of the environmental sites and that
other Potentially Responsible Parties (“PRPs”) would not be saddled with liability
far beyond their comparative fault). The bankruptcy court received testimony
from 47 witnesses and admitted nearly 1700 exhibits into evidence. Id. at *2.
One of those who offered testimony in support of the settlement was
Donald A. Robbins, the recently retired director of environmental services for
Asarco. See 1 Aplt. App. 93 (“Robbins Declaration”). Mr. Robbins submitted an
18-page declaration to the bankruptcy court detailing why he thought the global
settlement agreement should be approved under Bankruptcy Rule 9019.
Regarding the Miscellaneous Agreement, he explained that the federal and state
governments’ claims for these 26 sites totaled about $220 million, that Asarco
estimated the total cost of remediation to range from $54.2 million to $149.5
million, and that the proposed settlement would resolve all the claims for around
$95 million. Id. at 95–96, 96 n.3. He also discussed the reasons why either
Asarco or the government would be willing to settle for more or less than what
each believed the true cost of remediation would be. For example, he noted that
there were many uncertainties that generally applied to all of the proposed
settlements, including the existence and viability of other PRPs and the possibility
that Asarco would be found jointly and severally liable for the full costs of
remediation. Id. at 98–99. He concluded: “On the whole, I believe that there is a
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reasonable linkage between the settlement reached and ASARCO’s fair share of
responsibility at all of these sites.” Id. at 99.
Mr. Robbins then discussed 23 of the Miscellaneous Agreement sites
individually, providing the amount the government initially sought, the range of
Asarco’s projections of remedial costs, and other issues that might affect Asarco’s
liability for each site. Id. at 101–10. Regarding the Site at issue, he wrote:
The Lower Silver Creek/Richardson Flat[] site encompasses two
distinct, but related areas: the Richardson Flat[] tailing impoundment
and the downstream watershed. The area is close to Park City, Utah.
EPA initially sought $607,000 to remediate only the tailings
impoundment. In a late filed claim, EPA later sought $46,400,000 in
future remedial costs related to the downstream watershed. ASARCO
estimated that future remedial costs would range between $3,600,000
and $17,200,000 for [the] tailings impoundment and approximately
$22,500,000 for the watershed. The proposed settlement is for
$7,400,000. The key issues at the Lower Silver Creek site are:
• Joint and several liability: Whether ASARCO would be liable for
100% of the response costs. I understand that there may be other
PRPs associated with this site, and the settlement amount reflects
only ASARCO’s share of the response costs;
• The volume of contaminated material at the Lower Silver Creek
area that needs to be treated and the response plan for treating
that material is uncertain; and
• Whether the excusable neglect doctrine applies to the
government’s late-file[d] claim.
Id. at 103.
The bankruptcy court approved the global settlement on June 5, 2009.
Asarco I, 2009 WL 8176641, at *53. As to the bankruptcy standard, the court
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found the settlement benefitted the estate because it “eliminat[ed] the need to
conduct additional contested hearings as to each of the 52 sites addressed in the
Settlement Agreements, avoid[ed] the risk of adverse litigation results . . . , and
fix[ed] ASARCO’s obligations for past and future, known and unknown
environmental liabilities.” Id. at *12. As for the environmental standard, the
court concluded the settlement was consistent with the aims of CERCLA and fair
to the government and other PRPs: “[t]he compromise at any given site generally
reflects the litigation risk associated with the inherent difficulty of proving future
cleanup costs.” Id. at *42. Further, the proposed settlement amounts were
“substantively fair because they are roughly correlated with [Asarco’s]
comparable fault, taking into account the litigation risks and additional factors.”
Id.
Finally, the bankruptcy court also approved certain reservations of rights by
Asarco. First, the settlement agreement itself outlined how (a) the settling
governments covenanted not to sue Asarco for liabilities related to the sites, (b)
Asarco would receive CERCLA contribution protection against other PRPs for the
covered sites, and (c) neither the governments nor Asarco were giving up any
claims they might have against non-settling parties related to the sites. See 3
Aplt. App. 408–15. Second, the final Chapter 11 Plan of Reorganization
(“Reorganization Plan”) expressly reserved any contribution actions reorganized
Asarco might have against non-settling PRPs, and then specifically listed the
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Richardson Flat site in the Schedule of Preserved Litigation Claims. 6 Aplt. App.
1204. The Reorganization Plan was approved by the federal district court at the
bankruptcy court’s recommendation in November 2009. In re Asarco LLC
(Asarco II), 420 B.R. 314 (S.D. Tex. 2009).
B. The Site
The Site at issue generally refers to two related areas near Park City, Utah:
(1) the Richardson Flat Tailings Impoundment, and (2) Lower Silver Creek. The
area has been used since the 1870s for mining operations for lead and silver ore.
As part of the process for extracting the ore, the pulverized rock — known as
“tailings” and bearing a consistency of sand or powder — was left over. The
tailings would wash down Silver Creek and accumulate in the Lower Silver Creek
area, covering an area roughly three miles long. See 3 Aplt. App. 557. In 1912,
the Richardson Flat Tailings Impoundment was created upstream as a dam and
diversion system to catch the tailings for reprocessing. See id. at 555. These
tailings at the two related sites caused the environmental contamination now in
dispute.
C. Asarco’s Contribution Claim in the District Court
In June 2013, reorganized Asarco filed suit against Noranda seeking
contribution under Section 113(f) of CERCLA for monies Asarco paid under the
settlement agreement for cleanup costs associated with the Lower Silver Creek /
Richardson Flat Site. 1 Aplt. App. 11, 23–30. Specifically, Asarco claimed the
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$8.7 million it paid — $7.4 million in principal plus $1.3 million in interest 1 —
was more than its fair share of the cleanup costs, and that Noranda, as another
PRP, should pay Asarco for its share. 1 Aplt. App. 28–30.
Noranda moved for summary judgment on four grounds: (1) Asarco failed
to preserve the contribution claim when it was discharged from bankruptcy; (2)
Asarco was judicially estopped from seeking contribution because it represented
to the bankruptcy court that it was paying only its fair share of liability for the
Site; (3) Noranda was protected by a partial consent decree; and (4) Asarco’s
claim failed as a matter of law because Asarco could not establish it paid more
than its fair share of cleanup costs for the Site.
The district court held that Asarco successfully preserved its contribution
claim against Noranda, but that Asarco was judicially estopped from now
bringing the claim because of its representations to the bankruptcy court.
Noranda, 2016 WL 1317493, at *11, *15. It also held that Asarco could not
establish that it paid more than its fair share of costs. Id. at *15–16. This appeal
followed.
1
In its briefing, Asarco notes that it also paid an additional $1.7 million in
costs related to the Site, in the form of a CERCLA settlement with another PRP,
Atlantic Richfield, which settled with United Park City Mines Company on behalf
of itself and Asarco. See Aplt. Br. at 12 n.7; Aplt. Reply Br. at 18 n.10, 26–27;
see also 6 Aplt. App. 1035–69. Asarco did not seek contribution for this
settlement in its Second Amended Complaint against Noranda. See 1 Aplt. App.
29–30.
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Discussion
A. Judicial Estoppel
On summary judgment, we view the facts and make all reasonable
inferences in a light most favorable to the nonmovant, Asarco, in determining
whether Noranda is entitled to judgment as a matter of law. See Fed. R. Civ. P.
56(a); Cillo v. City of Greenwood Vill., 739 F.3d 451, 461 (10th Cir. 2013). We
then review the district court’s decision to judicially estop Asarco for an abuse of
discretion. Eastman v. Union Pac. R.R. Co., 493 F.3d 1151, 1156 (10th Cir.
2007) (citation omitted).
Judicial estoppel is an equitable remedy designed to “protect the integrity
of the judicial process by prohibiting parties from deliberately changing positions
according to the exigencies of the moment.” New Hampshire v. Maine, 532 U.S.
742, 749–50 (2001) (internal quotation marks and citations omitted). The burden
falls on the moving party to show the need for its application — a difficult task
given “our reluctance to impose the harsh remedy.” Vehicle Mkt. Research, Inc.
v. Mitchell Int’l, Inc., 767 F.3d 987, 988 (10th Cir. 2014). Indeed, we recognize
the doctrine as a “powerful weapon” to be used only when “less forceful remedies
are inadequate,” id. at 993, and therefore apply it “both narrowly and cautiously,”
Hansen v. Harper Excavating, Inc., 641 F.3d 1216, 1227 (10th Cir. 2011) (citation
omitted).
Three factors typically inform a court’s decision to judicially estop a party.
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First, a party takes a position that is “clearly inconsistent” with its earlier
position. New Hampshire, 532 U.S. at 750 (citations omitted). Second, adopting
the later position would create the impression that “either the first or the second
court was misled.” Id. (citation omitted). And third, allowing the party to change
its position would give it “an unfair advantage or impose an unfair detriment on
the opposing party if not estopped.” Id. at 751 (citations omitted); see also
Hansen, 641 F.3d at 1227.
Noranda argues, and the district court held, that these factors are met here.
In essence, Noranda says, Asarco represented to the bankruptcy court that the
$7.4 million settlement was fair both to the government and to the bankruptcy
estate because that amount represented only Asarco’s proportionate share of
liability for the Site. To now allow Asarco to turn around and claim that this
amount constituted an overpayment would reward Asarco for effectively
“conceal[ing] a multi-million dollar asset from its creditors and the bankruptcy
court.” Aplee. Br. at 3.
We disagree, and conclude that Noranda has not met its burden of showing
that relief is warranted. Therefore, the district court abused its discretion in
applying judicial estoppel. See Vehicle Mkt. Research, 767 F.3d at 989,
999–1000. The overall context of the CERCLA settlement approved by the
bankruptcy court makes it apparent that Asarco’s positions are not clearly
inconsistent, that to allow Asarco to pursue its claim would not create the
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perception that a court was misled, and that Asarco would not necessarily gain an
unfair advantage by being allowed to pursue its claim now. We address each
factor in turn.
1. Inconsistency of Positions
The district court found that (1) Asarco told the bankruptcy court its fair
share of liability for the Site was $7.4 million; (2) Asarco now claims this amount
actually represents more than its allocable share of costs; and (3) it follows that
the two statements are “clearly inconsistent.” Noranda, 2016 WL 1317493, at
*12–13.
The crux of this line of reasoning comes from one sentence in the Robbins
Declaration: “I understand that there may be other PRPs associated with this site,
and the settlement amount reflects only ASARCO’s share of the response
costs[.]” 1 Aplt. App. 103.
For its part, Asarco contends this statement, though poorly phrased, was
meant to indicate Asarco’s belief that the $7.4 million figure represented Asarco’s
“potential joint and several liability” for the Site. Aplt. Br. at 23. That is,
“Robbins was explaining that Asarco’s allocable share of the response costs was
one of the key uncertain issues that would not be resolved through litigation
because the parties decided to settle.” Id. at 26. In a deposition, Mr. Robbins
testified accordingly — that the $7.4 million figure was for Asarco’s “fair joint
and several liability share.” 7 Aplt. App. 1365.
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Noranda says this explanation does not hold up. It argues that, because the
EPA’s total claim for the Site approximated $50 million, and Asarco’s estimations
to clean up the Site ranged from $26 million to $40 million, the only way a $7.4
million settlement would make sense is if it were solely for Asarco’s apportioned
share. Aplee Br. at 42–43. Noranda buttresses this factual argument with a legal
one: the bankruptcy court could only approve the settlement if it were correlated
to Asarco’s “comparative fault”; it could not approve the settlement if Asarco was
taking on the entirety of the potential liability. Id. at 47–48.
The latter argument first. Though it is true that a CERCLA settlement
should be fair, reasonable, and roughly correlated with the responsible party’s
comparative fault, see Cannons, 899 F.2d at 87, this guideline does not do away
with the contribution provisions of CERCLA itself, see 42 U.S.C. § 9613(f). To
encourage PRPs to settle, Congress provided that an entity that has resolved its
liability to the government “for some or all of a response action . . . in an
administrative or judicially approved settlement may seek contribution from any
person who is not party to a settlement [with the government].” 42 U.S.C.
§9613(f)(3)(B); see also Young v. United States, 394 F.3d 858, 862 (10th Cir.
2005). Thus, as the bankruptcy court noted, “nothing in Cannons suggests that a
settlement is necessarily unfair if a settling PRP pays more than an amount
equivalent to its comparative fault.” Asarco I, 2009 WL 8176641, at *43. Were
it otherwise, no party would settle before a mini-trial was held to determine its
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exact share of environmental liability — and then there would never be need for a
contribution action by a settling party. Even acknowledging the tension between
Bankruptcy Rule 9019 and CERCLA, we cannot agree that the bankruptcy court
would err if it approved a settlement that might have been for more than Asarco’s
exact share of environmental liability.
As for Noranda’s factual argument, the Robbins Declaration shows that
Asarco’s actual estimate of remedial costs for the Site was $22.5 million for the
watershed and between $3.6 million and $17.2 million for the Tailings
Impoundment. 1 Aplt. App. 103; see also Asarco I, 2009 WL 8176641, at *54
(bankruptcy court recording approximately $3.6 million as Asarco’s low estimate
for the Site). But one of the main uncertainties about how much the government’s
claim was actually worth was whether it would even be allowed to proceed on the
late-filed claim for the watershed. Thus, as the EPA explained in its brief to the
bankruptcy court in support of the settlement, the $7.4 million settlement for the
Site not only “discount[ed] for some uncertainty regarding the nature of Asarco’s
operations on its leaseholds and the uncertainty of estimating costs when a
remedy has not been formally selected,” but also “reflect[ed] the litigation risk
associated with the timing of the claim amendment for this Site.” 1 Aplt. App. at
131.
CERLCA allows a party to settle for an inexact amount and later seek
contribution from other PRPs for any amounts it overpaid. Since doing so,
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without more, does not equate to pursuing inconsistent positions, the district
court’s conclusion is inconsistent with the nature of CERCLA claims and of
Asarco’s underlying settlement.
2. Impression that a Court was Misled
It follows that neither do we think the second New Hampshire factor has
been met. As the Supreme Court explained, “courts regularly inquire whether the
party has succeeded in persuading a court to accept that party’s earlier position,
so that judicial acceptance of an inconsistent position in a later proceeding would
create the perception that either the first or the second court was misled.” New
Hampshire, 532 U.S. at 750 (internal quotation marks and citation omitted).
Though the parties dispute whether the bankruptcy court’s approval of the
settlement actually constitutes “sufficient ‘judicial acceptance’ to estop the party
from later advancing an inconsistent position,” Noranda, 2016 WL 1317493, at
*14 (quoting Reynolds v. Comm’r of Internal Revenue, 861 F.2d 469, 473 (6th
Cir. 1988)), we think the simpler inquiry is whether allowing Asarco to proceed
with its contribution claim would create the impression that either court was
duped — for it is this unfairness with which the equitable doctrine is concerned.
We do not think it would. First, as discussed above, this is because we do not
think the actual positions by Asarco necessarily conflict. But second, it is
because the bankruptcy court itself knew and approved of Asarco’s preservation
of contribution claims for the sites it settled. This came not only in the form of a
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general reservation in the settlement agreement, 3 Aplt. App. 411, but also as a
specific reservation of a potential contribution action for the Site in the approved
Reorganization Plan, 6 Aplt. App. 1200, 1204. 2
That is, it is one thing for the bankruptcy court never to be told of assets or
potential claims by the debtor and then for the debtor to seek to bring those
claims in a different court. E.g., Eastman, 493 F.3d at 1153. But it is another
thing for the bankruptcy court that approved the settlement to also approve the
debtor’s reservation of rights with regard to such an asset. It makes it much less
likely that Asarco was “playing ‘fast and loose with the courts.’” Scarano v.
Cent. R. Co., 203 F.2d 510, 513 (3d Cir. 1953) (citation omitted).
3. Unfair Advantage
Noranda also argues that allowing Asarco to pursue its contribution claim
“would reward Asarco for either misleading the bankruptcy court, the district
court, or both,” Aplee. Br. at 58, and that this is “exactly the type of unfair
advantage the judicial estoppel doctrine is intended to prevent.” Id.
Yet the opposite could also be said — that it would be unfair to Asarco to
prevent it from pursuing a claim it expressly reserved in bankruptcy. In Asarco’s
2
Specifically, the Reorganization Plan was approved by the federal district
court in Texas in November 2009. Asarco II, 420 B.R. at 357. It adopted the
bankruptcy court’s report and recommendation to approve the Parent’s (i.e.,
Asarco Incorporated and Americas Mining Corporation) plan for reorganization of
the debtor (Asarco LLC). Id. at 357–58. It is this Reorganization Plan that
includes the reservation to reorganized Asarco of the potential PRP contribution
claims. 6 Aplt. App. 1200–04.
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view, it settled the environmental claims with the EPA for inexact amounts
because it was relying on the CERCLA framework that allows it to pursue the
difference in contribution actions later on. See 42 U.S.C. § 9613(f).
The specific statement in the Robbins Declaration does not change this.
Given the context of the statement — appearing in the middle of an 18-page
report on all the sites included in the Miscellaneous Agreement, and regarding a
proposed settlement that at $7.4 million comprised less than one percent of the
total global settlement of $1.8 billion — and given that Mr. Robbins testified in a
deposition that he made a mistake in how he worded the statement, see 7 Aplt.
App. 1365, we think it would be unfair to estop Asarco simply because of one
ambiguous sentence.
Though it is true that we have generally been unreceptive to “debtors’
attempts to recover on claims about which they ‘inadvertently or mistakenly’
forgot to inform the bankruptcy court,” Eastman, 493 F.3d at 1157, this case is
easily distinguishable. In Eastman, for instance, the debtor failed to disclose his
pending lawsuit as a potential asset of the estate in his bankruptcy petition. Id. at
1153. The district court found, and we affirmed, that the debtor’s concealment of
this asset from the bankruptcy court was not inadvertent, but planned to mislead
the bankruptcy court. Id. at 1154–55, 1159–60. Therefore, judicial estoppel was
necessary to protect the integrity of the judicial process. Id.; see also Queen v.
TA Operating, LLC, 734 F.3d 1081, 1087–91 (10th Cir. 2013). Though we do not
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say that inadvertent representations can never “count” for judicial estoppel
purposes, we do think this case is sufficiently distinct from Eastman to warrant a
different result.
B. Noranda’s Consent Decree and Asarco’s Bankruptcy Settlement
The district court also held, as a matter of law, that Asarco cannot establish
that it paid more than its fair share of costs for the Site or that Noranda would be
liable for any part of the difference. Noranda, 2016 WL 1317493, at *15–16.
The court provided two reasons for its decision. First, a 2006 consent decree
between Noranda and the EPA gave Noranda contribution protection for costs
associated with the Tailings Impoundment before March 1, 2006. Id. at *15.
Second, the same statements that called for application of the judicial estoppel
doctrine, “whether treated as judicial admissions or as undisputed substantive
evidence of its pro rata share,” definitively established Asarco’s liability for the
Site. Id. at *16.
First, the consent decree. It is true that Noranda is protected from
contribution claims for “matters addressed” in the decree, 6 Aplt. App. 1083, and
that those matters include costs incurred by the EPA in connection with the
“Richardson Flat Tailings Site” through March 1, 2006, id. at 1078. But it
necessarily follows that the consent decree does not protect Noranda from (a)
costs associated with the Tailings Site incurred after March 1, 2006, or (b) costs
associated with other (if related) sites, such as Lower Silver Creek. So the
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question is whether the contribution Asarco seeks falls within one of those two
categories and, if so, whether Asarco is legally able to recover those costs from
Noranda.
Regarding the timing issue, Noranda argues that because the EPA’s first
proof of claim sought only $607,000 from Asarco for past response costs at the
Richardson Flat Tailings Impoundment, its supplemental proof of claim, which
totaled $50 million, was for past and future response costs related only to Lower
Silver Creek. Aplee. Br. at 66–68. Indeed, this had to be the case, Noranda says,
because by the time of the Asarco-EPA settlement, the EPA had entered into a
consent decree with United Park City Mines Company (“UPCM”), another PRP,
under which UPCM agreed to finance and carry out the future response costs for
the Tailings Impoundment. Id.; see also 4 Aplt. App. 715–68. Thus, according to
Noranda, Asarco cannot now seek contribution because UPCM, not Asarco, paid
the EPA for any future response costs associated with the Tailings Impoundment.
Aplee Br. at 66–68.
The settlement agreement between Asarco and the EPA does not make any
such timing distinctions. See 3 Aplt. App. 394–95, 400–01 (“In settlement and
full satisfaction of all claims and causes of action of the United States . . . against
Debtors with respect to any and all costs of response incurred, or to be incurred,
in connection with . . . the Richardson Flat Site . . . .”). Nor does a look back to
the EPA’s proofs of claim settle the issue. Though the first proof of claim sought
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$607,000 from Asarco for “unreimbursed response costs” at Richardson Flat
Tailings Impoundment, 5 Aplt. App. 932, the supplemental proof of claim
“include[d] the Lower Silver Creek area as part of Richardson Flat,” id. at 959.
Indeed, the EPA discussed the two areas together “because of the[ir]
interconnection.” Id. Thus, the claims for the sites were also combined:
13. ASARCO is liable to reimburse the United States for the
costs . . . of actions taken or to be taken by the United States in
response to releases and threatened releases of hazardous substances at
Richardson Flat and in the Lower Silver Creek area.
14. In addition to the $607,000 asserted in the United States’ August
1, 2006 Proof of Claim for Richardson Flat, the United States estimates
at this time that its future response costs at Richardson Flat and in the
Lower Silver Creek area will total approximately $50 million.
Id. at 960. Further, the Robbins Declaration itself discussed the future remedial
costs for the Tailings Impoundment: “ASARCO estimated that future remedial
costs would range between $3,600,000 and $17,200,000 for [the] tailings
impoundment and approximately $22,500,000 for the watershed.” 1 Aplt. App.
103.
Noranda’s geographical argument is similarly unavailing. In its Complaint,
Asarco sought contribution from Noranda “for its equitable share in contribution
to Asarco’s Richardson Flat[] Site Government Settlement.” 1 Aplt. App. 30.
Asarco described that site as including, “[i]n addition to the tailings
impoundment, . . . the Ontario #3 mine, the Keetley Drain Tunnel, portions of the
Lower Silver Creek Area, a slurry line, and other associated mine workings.” Id.
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at 26. Thus, by its terms the Complaint seeks relief for costs associated with sites
outside of the area Noranda settled. We disagree that either Noranda’s or
Asarco’s settlement agreements foreclose Asarco’s claim as a matter of law.
Second, for the same reasons we do not think Asarco’s position before the
bankruptcy court warrants judicial estoppel, neither do we agree that Asarco’s
representations constitute undisputed substantive evidence of its exact share or a
judicial admission of liability. 3 At the summary judgment stage, the evidence
must be viewed in a light most favorable to Asarco, and Asarco has presented
evidence to dispute Noranda’s interpretation of the Robbins Declaration on this
point. Therefore, we find that Asarco has raised a genuine issue of material fact
and that it should be able to present evidence as to (1) why it believes it paid for
post-2006 costs related to the Richardson Flat Tailings Impoundment, and (2)
why at least some of those costs, and any other costs for Lower Silver Creek and
3
“Judicial admissions are ‘formal, deliberate declarations which a party or
his attorney makes in a judicial proceeding for the purpose of dispensing with
proof of formal matters or of facts about which there is no real dispute.’” U.S.
Energy Corp. v. Nukem, Inc., 400 F.3d 822, 833 n.4 (10th Cir. 2005) (quoting
Kempter v. Hurd, 713 P.2d 1274, 1279 (Colo. 1986)). True judicial admissions
are binding in the entirety of the case in which they were made. In contrast,
“ordinary evidentiary admissions” can be controverted or explained by a party,
and such admissions include “pleadings in another case, superseded or withdrawn
pleadings in the same case, [and] judicial admissions in another case.” 30B
Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 7026
(Kenneth W. Graham, Jr. & Michael H. Graham eds., 4th ed. 2014) (collecting
cases). Thus, even assuming Mr. Robbins’s statement to the bankruptcy court
was a judicial admission in that case, it would only be an evidentiary admission in
this one.
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related sites, should be borne by Noranda.
We therefore REVERSE the district court’s grant of summary judgment and
REMAND the case for proceedings consistent with this opinion.
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