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In: Operations Management

Nurad, Inc. brought this suit to recover costs it incurred in removing several underground storage tanks...

Nurad, Inc. brought this suit to recover costs it incurred in removing several underground storage tanks (USTs) from property it owns in Baltimore, Maryland. From 1905 to 1963, William E. Hooper & Sons (Hooper Co.) owned the site known as Hooperwood Mills. At some point before 1935, Hooper Co. installed tanks for the storage of mineral spirits which it used to coat fabrics in its textile finishing plant. In 1962, Hooper Co. sold Hooperwood Mills to Monumental Enterprises, Inc. without removing the mineral spirits or the tanks. In 1963, Monumental leased several of the buildings on the site to various tenants, including Allstates Moving. In 1976, Monumental Enterprises sold Hooperwood Mills to Kenneth Mumaw, who subdivided the property and sold a portion of it to Nurad. Nurad, which manufactured antennae, never used the tanks, nor knew of their existence. However, in 1987 the Maryland Department of the Environment ordered Nurad to remove the tanks from the ground or fill them with sand or concrete. Nurad asked Hooper Co., Mumaw, and Allstates Moving to contribute toward the $226,000 in cleanup cost, but they all refused. (Monumental Enterprises was no longer in existence) Who would be liable for the clean up under CERCLA? Explain. Nurad, Inc. v. William E. Hooper & Sons, 966 F.2d 837. (CA-4, 1992)

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First, we shall deal with the claims by Nurad to the former locals. Nurad's claims were rejected by the district court on the ground that they did not have the authority to control USTs. In Nurad's opinion, the court defined this term too narrowly to include only those people who had control of the facility in fact. The District Court used the correct standard to argue that, as long as the facility is in place, the tenant defendants don't have real control to qualify as operators. Hooper Co. quickly pointed out that it sold USTs and their content later on to property investors but I agree with the district court that it would never be possible to reverse the earlier disposal by selling previously abandoned tanks to a real-estate investor – who didn't use mineral or tank spirits or apparently didn't use them. An accused person who left hazardous substances at the site may not be able to escape CERCLA's responsibility by labeling the transfer as a sale of hazardous waste.

Finally, I agree with the district court on the particular insignificance of the Hooper Co.claim that no statutory disposal is made. By placing them in UST's and abandoning them after closing its completion plant in 1962, The company disposed of dangerous substances at the site. The Statute states that 'disposal' includes placing any dangerous wastes into or on any land, so that hazardous waste can 'emerge into the environment. This definition has been specifically decided by courts. Nurad has the right, but not all, to reimburse certain previous Hooperwood Mill occupants. I believe Nurad's claims against each of its tenants, together with the Hooper Brothers should be dismissed from a district court, and I believe that the entry should be a summary judgment in favor of Nurad against the Hooper Co.

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