NOT FOR PUBLICATION FILED

UNITED STATES COURT OF APPEALS JAN 31 2023

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

COLUMBIA FALLS ALUMINUM No. 21-36042

COMPANY, LLC,

D.C. No. 9:18-cv-00131-DWM Plaintiff-counter- defendant-Appellant,

MEMORANDUM*

v.

ATLANTIC RICHFIELD COMPANY,

Defendant-counter-claimant- Appellee.

Appeal from the United States District Court for the District of Montana Donald W. Molloy, District Judge, Presiding

Argued and Submitted December 5, 2022 San Francisco, California

Before: WATFORD and SANCHEZ, Circuit Judges, and BENITEZ,** District Judge.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Roger T. Benitez, United States District Judge for the Southern District of California, sitting by designation. Appellant Columbia Falls Aluminum Co., LLC (“CFAC”) appeals the district

court’s equitable allocation of environmental cleanup costs between CFAC and

Appellee Atlantic Richfield Co. (“ARCO”) under the Comprehensive

Environmental Response, Compensation, and Liability Act (“CERCLA”). We

review the equitable factors considered for abuse of discretion, and the equitable

allocation of those factors for clear error. TDY Holdings, LLC v. United States, 885

F.3d 1142, 1146–47 (9th Cir. 2018). “A finding of fact is clearly erroneous only

where it is ‘(1) illogical, (2) implausible, or (3) without support in inferences that

may be drawn from the facts in the record.’” United States v. Christensen, 828 F.3d

763, 779 (9th Cir. 2015) (quoting United States v. Pineda–Doval, 692 F.3d 942, 944

(9th Cir. 2012)). If there are two reasonable interpretations of the evidence, “the

factfinder’s choice between them cannot be clearly erroneous.” Christensen, 828

F.3d at 779 (quoting United States v. Working, 224 F.3d 1093, 1102 (9th Cir. 2000)

(en banc)). We affirm.

From 1955 to 1985, ARCO owned and operated an aluminum smelting site

in Columbia Falls, Montana (the “Site”). In 1985, ARCO sold the Site to CFAC for

$1.00, and CFAC operated the Site until 2009. Both ARCO and CFAC generated

substantial profits in their respective operations and over the years, hazardous waste

was disposed of throughout the Site, resulting in environmental contamination.

The transfer of the Site from ARCO to CFAC was governed by a written

2 agreement (the “Agreement”) containing cross-indemnity provisions.

1. The district court’s equitable allocation of CERCLA costs and reliance

on the Agreement is consistent with its other findings. The district court relied on

the Agreement when allocating 65 percent of CERCLA costs to CFAC versus 35

percent to ARCO. The court found that the Agreement was not drafted with the

specificity required under Montana law to effectuate a waiver of the right to sue

under statutes such as CERCLA. The court also found that the extrinsic evidence of

the parties’ intent was not sufficiently clear to overcome the lack of specificity in the

Agreement’s text. Therefore, unlike in Trinity Indus., Inc. v. Greenlease Holding

Co., 903 F.3d 333, 361 (3d Cir. 2018), the district court’s refusal to enforce the

Agreement rested solely on the fact that the high bar set by state law was not met.

Given the court’s finding that the parties did intend the Agreement to cover

non-statutory liability for the very environmental conditions at issue in this case, the

court was within its discretion to consider the Agreement for purposes of equitable

allocation under CERCLA. As the court noted, “[e]ven if the indemnity provisions

are not enforceable as a matter of contract law to bar CFAC’s claims, the evidence

shows that the parties intended for CFAC alone to have an indemnification

obligation to ARCO after August 31, 1990.” Accordingly, the district court did not

err in refusing to enforce the Agreement as a matter of law but considering it when

equitably allocating costs. See Cadillac Fairview/California, Inc. v. Dow Chemical

3 Co., 299 F.3d 1019, 1025 (9th Cir. 2002) (equitably allocating 100 percent of

CERCLA cleanup costs to the government based on an indemnity clause that was

not enforceable as a matter of law); Kerr-McGee Chem. Corp. v. Lefton Iron & Metal

Co., 14 F.3d 321, 326 (7th Cir. 1994) (holding the district court erred in allocating

cleanup costs by not considering contractual arrangements, which reflected an intent

to indemnify).1

2. The district court did not err in applying the Gore Factors focused on

the amount and nature of hazardous waste.2 Despite CFAC’s contention that the

district court was required to allocate costs based on each party’s respective

contamination of the Site, the text of CERCLA clearly and unambiguously states

1 CFAC also challenges the district court’s 65-35 allocation as arbitrary and speculative. However, the court found the Gore Factors and respective economic benefits to be neutral, relying on the Agreement to tip the scales in favor of ARCO. Because courts “need not allocate response costs to a mathematical certainty . . . ,” there is no error here. See ASARCO LLC v. Atl. Richfield Co., LLC, 975 F.3d 859, 869 (9th Cir. 2020), cert. dismissed sub nom. Atl. Richfield Co. v. Asarco LLC, 141 S. Ct. 2843 (2021); Nikko Materials USA, Inc. v. NavCom Def. Elecs., Inc., 291 F. App’x 67, 70 (9th Cir. 2008) (“The district court . . . acted within its discretion in reducing the level of contribution from sixty-six percent to sixty percent based on the contractual relationship between the parties and . . . [the] aggressive conduct during negotiations . . . .”). 2 These Gore Factors include: “(1) the ability of the parties to demonstrate that their contribution to a discharge, release or disposal of a hazardous waste can be distinguished; (2) the amount of the hazardous waste involved; (3) the degree of toxicity of the hazardous waste involved; [and] (4) the degree of involvement by the parties in the generation, transportation, treatment, storage, or disposal of the hazardous waste . . . .” TDY Holdings, 885 F.3d at 1146 n.1 (quoting Kerr-McGee Chem. Corp., 14 F.3d at 326 n.4).

4 that “[i]n resolving contribution claims, the court may allocate response costs among

liable parties using such equitable factors as the court determines are appropriate.”

42 U.S.C.A. § 9613(f)(1). While the Gore factors are certainly relevant and have

been used by other courts, they are “neither an exhaustive nor exclusive list.” Env’t

Transp. Sys., Inc. v. ENSCO, Inc., 969 F.2d 503, 509 (7th Cir. 1992). Here, the

district court considered the Gore Factors but found the first four to be neutral, taking

into consideration the practical effect of the proposed remedial measure—a slurry

wall that would encompass the West Landfill and the Wet Scrubber Sludge Pond

(“WSSP”).

Considering CFAC’s contamination of the WSSP, along with the fact that a

large portion of the slurry wall would contain the WSSP, the district court did not

err in considering the proposed remedial measure alongside the Gore Factors. See

Boeing Co. v. Cascade Corp., 207 F.3d 1177, 1188 (9th Cir. 2000) (illustrating how

in certain circumstances where the cost of remedial measures does not equate to the

volume of contamination, it would be inappropriate to look to contamination alone).

Ideally, the district court would have explained more fully each party’s relative

contribution to the need for this joint remedial measure. See Akzo Nobel Coatings,

Inc. v. Aigner Corp., 197 F.3d 302, 305 (7th Cir. 1999). But we cannot say based

on the evidence before us that the district court clearly erred in finding that the slurry

wall was occasioned by both ARCO’s and CFAC’s contamination.

5 3. The district court did not err in its economic benefits analysis. Both

parties realized hundreds of millions of dollars in profits during their respective

operations. Although ARCO earned more profit than CFAC, ARCO expended over

$1 billion dollars on the Site—including the facility’s construction and upgrades to

mitigate environmental contamination—while CFAC spent only $95 million on Site

improvements. The district court also considered that CFAC received the facility

and everything ARCO put into it for $1.00. Recognizing these other forms of

economic benefit and the substantial profits earned by both parties, the district court

did not err in concluding that the totality of the economic picture was neutral. Cf.

Lockheed Martin Corp. v. United States, 35 F. Supp. 3d 92, 132 (D.D.C.

2014), aff’d, 833 F.3d 225 (D.C. Cir. 2016) (“Although LPC may not have reaped

large profits from its contracts with the government, it helped its parent corporation

Lockheed Aircraft Corporation establish a foothold in the rocket propulsion field, a

position that Lockheed retains to this day.”).

AFFIRMED.

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