16 September 2020

Third Circuit Limits CERCLA Liability Shield

On September 8, 2020, in New Jersey Department of Environmental Protection (NJDEP), et al. v. American Thermoplastics Corp., et al., the U.S. Court of Appeals for the Third Circuit limited the liability shield a potentially responsible party (PRP) receives when it settles a cost recovery action with a state under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The court held that “a settling-PRP is protected only insofar as a consent decree and a contribution action address the same matters. In effect, our decision encourages a PRP to settle with both the relevant State and Federal Governments.”