Citations
- 655 F. Supp. 2d 473
Full opinion text
OPINION
DEBEVOISE, Senior District Judge.
This matter involves a dispute over the environmental contamination of an area of land in Montville, New Jersey, where a fruit orchard was operated in the mid-twentieth century and which was later developed into a residential neighborhood. The Bonnieview Homeowners Association, L.L.C. (“Bonnieview”) and members of that association, the Individual Plaintiffs, (collectively, “the Plaintiffs”) assert various causes of action arising out of that environmental contamination against Woodmont Builders, L.L.C. (“Woodmont Builders”); Woodmont Court at Montville, L.L.C. (“Woodmont Court”) (together, “Woodmont Properties”); Donald Witmondt (together with Woodmont Properties, “Woodmont”); Associated Sales, Inc. (“Associated Sales”); David Mandelbaum, Karen A. Mandelbaum, Nathan Mandelbaum, Ronald G. Targan, Judith Targan, Leslie J. Koralek and Richard W. Koralek as Co-Trustees under the Anita S. Koralek Living Trust (together, the “Individual Defendants”); and Montville Township (“Montville”).
Woodmont, Associated Sales and the Individual Defendants (together, the “Woodmont Defendants”) assert counterclaims against the Plaintiffs. The Woodmont Defendants also assert a cross-claim against Montville.
The original complaint in this case was filed on September 12, 2003. The Plaintiffs filed their First Amended Complaint (“FAC”) on February 15, 2005. On August 19, 2009, after the parties had already filed their motions for summary judgment, the Plaintiffs filed their Second Amended Complaint (“SAC”), which added Donald Witmondt, the managing member of Woodmont Builders and Woodmont Court and president of Associated Sales, as a defendant. Because Mr. Witmondt was not a party to the action at the time these motions were briefed and argued, the court will not grant judgment against Mr. Witmondt on any counts at this time, but will grant summary judgment dismissing counts against Mr. Witmondt if appropriate. Additionally, although the operative complaint in this matter when these motions for summary judgment were filed was the FAC, the court will address these motions as directed to the SAC, given that the SAC is now the operative complaint. The SAC is, in any case, substantially the same as the FAC except for the addition of Mr. Witmondt as a defendant.
The court is aware that, at one time, Woodmont Court and the Plaintiffs were engaged in arbitration. While the court is unaware of the status of that arbitration, both the Plaintiffs and Woodmont Defendants consented to the inclusion of Woodmont Court in these proceedings for summary judgment (see Pls.’ Opp’n Br. 64) and the court will proceed accordingly.
The Woodmont Defendants and Mont-ville now move for summary judgment to dismiss all counts of the SAC. The Plaintiffs move for partial summary judgment on some counts of the SAC and to dismiss the Woodmont Defendants’ counterclaims and two of the defenses pled in their Answer. For the reasons set forth below, the Woodmont Defendants’ motions will be granted in part and denied in part; Mont-ville’s motion will be granted; and the Plaintiffs’ motions will be granted in part and denied in part.
I. BACKGROUND
A. The Property
The land that is the subject of this litigation was originally comprised of approximately 130 contiguous acres in the Township of Montville, Morris County, New Jersey (“the Property”). Bonnieview Farms, which is not a party to this litigation, owned and operated the Property for agricultural purposes, including as a fruit orchard, from 1941 until it was abandoned some time prior to 1970. In 1970, the Individual Defendants obtained title to the Property. Mr. David Mandelbaum testified that when the Individual Defendants purchased the Property it was not being farmed, but that he knew it had been previously used as an apple orchard. He also testified that the land was not farmed from the time that the Individual Defendants purchased the Property until approximately 1988. Sometime after 1988, a portion of the Property was used for foresting. A June 27, 1989 letter from William Roe, the consulting forester at the Property, reflects that he had been managing the property since 1975, at which time he completed an “inventory and plan.” This document also reflects that there was a timber sale at the Property in 1977.
The Woodmont Defendants maintain that the Property was never used for agriculture other than foresting during the time that the Individual Defendants owned it and that the Individual Defendants were not aware of any environmental problems on the Property during the time they owned it. The Plaintiffs dispute this contention based on the fact that in 1989, David Mandelbaum submitted an Application for Farmland Assessment to the State of New Jersey which stated both that the entire Property was used for “fruit crops” and that the entire Property was used for “woodland products.” The Defendants argue that the listing of “fruit crops” on the Farmland Assessment was in error and that the Property could not have been used for both fruit crops and woodland products at the same time.
In 1998, at the request of the Department of Planning & Development of the County of Morris (in which Montville Township is located), former defendant Post, Buckley, Schuh & Jernigan, Inc. (“PBS & J”), an environmental consulting firm, performed an environmental assessment of the Property and issued a Phase I Environmental Assessment report, dated April 1998. The report included a review of aerial photographs of the site from various years between 1939 and 1991. The report stated that the Property “was forested in all the photographs viewed” and that the eastern portion “contained rows of trees, indicating that the area may have been a tree nursery, while the western portion was naturally occurring forest.” (Certification of Stephen Smithson, May 14, 2009 (hereafter, “May 14 Smithson Cert.”), Ex. G at 3.) The report revealed that the Property had assorted debris on it, such as tires, wood and metal debris, cement, household debris, abandoned vehicles, hot water heaters, refrigerators, and empty aboveground storage tanks and drums, but did not mention any of the hazardous substances at issue in this case or possible soil contamination. (Id. at 12-14.) The report concluded that “none of the observed debris was considered hazardous, [but] additional material in lower layers could be classified as such.” (Id. at 21.) While no sampling was recommended at the time, the report stated that “when the debris is removed, the lower layers should be carefully examined.” (Id.)
In 1999, Montville engaged former defendant Princeton Hydro, LLC (“Princeton”), an environmental consulting firm, which provided a report dated May 10, 1999. That report did not mention any discharge of pesticide constituents or other contaminants onto the soil and did not recommend any action with respect to the alleged contaminants.
B. Sale of the Property and Construction of the Individual Plaintiffs’ Homes
At some point prior to October 1997, Woodmont Builders entered into an agreement with David Mandelbaum, Nathan Mandelbaum, Ronald Targan and the Estate of Adolph Koralek whereby Woodmont would develop the Property for the construction of single family dwellings houses, the proceeds of the sale of which would be shared by the parties to the agreement. On or around September 24, 1998, the Montville Township Planning Board approved an application to construct 'a residential subdivision on a 30-acre portion of the Property. On February 10, 1999, Montville acquired an approximately 100-acre portion of the Property from the Individual Defendants for use as “open space” (hereafter, the “Open Space Parcel”). On June 18, 2000, Woodmont Court acquired the remaining 30-acre portion of the Property (hereafter, the “Residential Lots”) from the Individual Defendants and thereafter began construction of a residential subdivision. The Plaintiffs allege that Woodmont did not conduct any due diligence before acquiring the residential lots. Mr. Witmondt, however, testified that, in purchasing the Residential Lots, Woodmont Court relied upon the review by PBS & J and the fact that Montville’s Board of Health reviewed the lots in connection with the proposed residential development. (Witmondt Aff., June 3, 2009, ¶ 4.) After Woodmont Court acquired the Residential Lots, Woodmont Builders developed the land and built single-family homes on the Residential Lots.
After removing surface debris — including tires, abandoned cars, farm trucks, hot water heaters and 50-gallon tanks — from the Residential Lots, to prepare each site on Bonnieview Lane for construction Woodmont Builders then removed the topsoil from the Residential Lots. Woodmont Builders combined and stockpiled the soils, and after the foundations for the homes were dug, and the houses erected, took the topsoil from the stockpile and returned it to the Residential Lots to become the lawns. Mr. Witmondt testified that the areas on the Residential Lots that were wooded or had wetlands were not disturbed and that, generally, only the areas that later became lawns or had landscaping were disturbed. During the excavation and regrading process, Woodmont Builders did not test for hazardous substances in the soil that it removed from and subsequently replaced on the Residential Lots.
Associated Sales, through its agents, facilitated the sale of the homes on the Residential Lots to the Individual Plaintiffs. Advertisements published on behalf of Woodmont Properties and Associated Sales represented that the homes were built on “natural homesites” and were a “great place to raise children.” Three Individual Plaintiffs testified that Edward Tomback, whom they believed to be an Associated Sales representative, told them that, during the building process, the topsoil at the Residential Lots was replaced with “good soil” or “fresh topsoil.” Mr. Tomback, a licensed real estate agent and broker, testified that he has been with the company he owns, AmeriFirst, Inc. since about 1988, and that he was never employed by Associated Sales but acted as the broker to sell the homes on the Residential Lots. He also testified that he knows nothing about the nature of topsoil or grading of soil in connection with building homes and would therefore never have discussed the quality of soil with any of the Individual Plaintiffs.
The Individual Plaintiffs purchased their homes on Bonnieview Lane Between January 2001 and October 2002. The following is a list of the addresses and dates of purchase of the Individual Plaintiffs’ homes:
• Renee K. Goodlow and Michael R. Berry purchased 5 Bonnieview Lane on January 8, 2001.
• Rene N. and Stephen J. Hrop purchased 3 Bonnieview Lane on March 31, 2001.
• Parhat and Sema Yasar purchased 17 Bonnieview Lane on August 31, 2001.
• Yuangen Zhu and Qi Liu purchased 9 Bonnieview Lane on September 17, 2001.
• Fazal and Sanyakhan Bari purchased 19 Bonnieview Lane on October 4, 2001. They resold 19 Bonnieview Lane on July 31, 2007.
• San Chee and George T. Lee purchased 15 Bonnieview Lane on November 26, 2001.
• G. Thomas and Sharon Perrone purchased 11 Bonnieview Lane on January 25, 2002.
• Joseph and Bobbie Intile purchased 33 Bonnieview Lane on May 23, 2002.
• Juan F. and Rafael Hernandez purchased 1 Bonnieview Lane on August 26, 2002.
• Keith Hamilton purchased 6 Bonnie-view Lane on August 28, 2002.
• Yi Lu and Bruce Tang purchased 26 Bonnieview Lane on August 28, 2002.
• James and Diane Sadowski purchased 25 Bonnieview Lane on October 16, 2002.
• Daniel and Pauline Roh purchased 27 Bonnieview Lane on October 24, 2002.
• Louise Ann and Bruce Dostal purchased 29 Bonnieview Lane on November 18, 2002.
Prior to purchasing their homes, the Individual Plaintiffs had title searches performed by title insurance companies. The title reports did not mention any possibility of pesticide contamination on the Residential Lots. One Individual Plaintiff, Sharon Perrone, testified that it was “widely known around town” that the Property had been an orchard, but that she did not know that orchards used pesticides in their operation. (Certification of Lee Henig-Elona, May 13, 2009 (hereafter, “May 13 Henig-Elona Cert.”), Ex. 14 at 16:22 — 17: 17.)
On July 26, 2001, Montville entered into an agreement with the NJDEP to investigate and remediate the Property. In March 2002, Montville’s environmental consultant, Maser Consulting P.A. (“Maser”), conducted soil sampling on the Open Space Parcel. Maser prepared a report of its findings in August 2002; it identified three Areas of Concern (“AOCs”). Sampling results indicated that the Open Space Parcel was contaminated with pesticides and other contaminants in excess of the applicable standards: the Residential Direct Contact Soil Cleanup Criteria (“RDCSCC”) of the New Jersey Department of Environmental Protection ("NJDEP”). Maser informed Montville of the pesticide contamination on the Open Space Parcel in a telephone conversation with Montville Township engineer Anthony Barile, and in a follow-up letter dated September 3, 2002. That letter stated, in part:
All of the AOCs listed above were sampled and found to contain contaminants of concern. Based on the historical aerials, [Maser] believes the 25-lot residential subdivision under construction from which the open space was originally subdivided from [sic] may also have been part of the same orchard and may contain , constituents elevated above the RDCSCC.
The majority of constituents elevated above the RDCSCC are metals and pesticides associated with historic orchard and land use. [Maser] would recommend applying and obtaining a Letter of No Further Action (NFA) from the NJDEP....
The Township’s Board of Health involvement may be warranted at this time to advise the public regarding contaminated soils at the site and the adjacent subdivision. Until a NFA is issued for the site, a Public Notice advising of potential hazards at the site may also be warranted to limit public contact with the soils of the site.
The constituents identified do not present an imminent health hazard to the public. The majority of the constituents are metals/pesticides ... [that] do not easily migrate into surface and/or groundwater. The health issue that is present is related to long-term ingestion of contaminated soils or long-term inhalation of dust originating from the soils. Long-term exposure to such contaminants is considered to be carcinogenic.
(May 14 Smithson Cert. Ex. T at 3.) The letter also noted that because the majority of the Open Space Parcel was forested, the soils were stable and exposure to contaminants was limited. It also stated that because Montville “is now aware of the elevated constituents above the RDCSCC at the site, it may be liable for any future public contact with soils and potential health issues involved with such contact.” (Id.)
By letter dated April 29, 2003, Montville notified the homeowners on Bonnieview Lane that it had discovered arsenic and levels of insecticides on the 100 acre Open Space Parcel. By letter dated May 7, 2003, Montville requested permission to test the Individual Plaintiffs’ properties for environmental contaminants, reasoning that “to the extent the township’s property and your residential property would have been part of the contiguous land formerly operated by Bonnieview Farms,” such testing was advised. By letter dated May 29, 2003, Montville advised the Individual Plaintiffs that the soil tests revealed the presence of arsenic, dieldrin, lead, or DDT, all hazardous substances under federal and New Jersey law, and that Montville had reported the results to the NJDEP as required by law. Mr. Witmondt testified that he did not know about the pesticide residues until after Montville notified the Individual Plaintiffs in May 2003. He did know that the Property had been previously used as an apple orchard, and the Plaintiffs argue that the Woodmont Defendants, as experienced developers, therefore should have known that residual pesticides were present on the Residential Lots. Mr. David Mandelbaum testified he had no knowledge of environmental problems at the Property until after the sale of the Property to Montville. (May 13 Henig-Elona Cert. Ex. 2, 44:4-9.)
C. Contamination of the Property
The original contamination of the Property by pesticides took place at some point prior to 1970, when the Property was used for agricultural purposes, including as a commercial apple and peach orchard. At the time when the Property was used as an orchard, the operations included storing fertilizer and insecticides for spraying and applying onto the trees in the orchard. The parties agree that chemicals and insecticides were stored in drums and other containers at the Property. There is no dispute that no sampling or testing of the soil on the Property was conducted prior to Maser’s soil sampling in March 2002.
In connection with this litigation, Mont-ville hired Robert L. Zelley, Professional Geologist and Principal at Maser, to provide his professional opinion on the source, remedial responses, and extent of contamination at the Property. In a letter dated November 14, 2008, Mr. Zelley opined that “[t]he historical legal application of a variety of pesticides has resulted in concentrations of arsenic, lead and DDT and its metabolites, and dieldrin above their respective NJDEP human health and ecological standards in the surface soils throughout the area.” (May 13 Henig-Elona Cert. Ex. 7 at 3.) The Plaintiffs argue, however, that soil sampling indicates that pesticides were spilled or leaked on the Property during its use as an orchard. To support this contention, Plaintiffs cite to the deposition testimony of Dr. Jorge Berkowitz, who testified that the pesticide concentration in the soil was heterogeneous, not homogeneous, and that such a distribution indicated that “in certain portions of the property something happened that did not happen in other portions of the property. How that happened, I don’t know.” (May 14 Smithson Cert. Ex. HH at 85:14-24.) Dr. Berkowitz did not agree, however, that pesticides were spilled or leaked. Plaintiffs also cite to Table 2 in the May 27, 2003 letter from Maser to the NJDEP which provided a Remedial Investigation Workplan on behalf of Montville for the Property. (Id. Ex. E.) Again, Table 2 supports the contention that the concentration of soil contamination varied in different areas of the Property, but does not offer any evidence or opinion as to the reason for the heterogeneous distribution of contamination- — whether it was caused by spills, leaks, proper application of the pesticides, or some other reason.
It is undisputed that the Defendants did not add pesticides or other hazardous substances to the Residential Lots or Open Space Parcel, but the Plaintiffs claim that, by clearing the topsoil, stockpiling it, then spreading it over the Residential Lots, the Defendants caused the pesticide contamination to be spread “ubiquitously across the Residential Lots” and into areas previously not contaminated, and to be extended from the surface into the subsurface soil. In the course of this litigation, Plaintiffs hired environmental consultant, Whitestone Associates, Inc. (“White-stone”), to provide expert opinions regarding the contamination in the Residential Lots. Thomas K. Uzzo, President of White-stone, and Keith Tockman, Senior Professional Geologist at Whitestone, authored a report, dated September 25, 2008 (hereafter, the “Whitestone Report”), in which they concluded that, “[t]o a reasonable degree of professional certainty, these soil movement and replacement actions spread and worsened the arsenic, lead and organic pesticide contamination by redistributing the contaminants over a greater area and at more expansive depths than typically would be experienced at the pre-development orchard property.” (May 14 Smithson Cert. Ex. D at 14.)
Defendants dispute the Plaintiffs’ contention that the earthwork worsened the contamination of the Residential Lots and that it extended contamination from surface into subsurface soils. Defendants hired Langan Engineering and Environmental Services (“Langan”) to respond to the Whitestone Report and to offer further opinions on the issues in this case. Dr. Jorge H. Berkowitz, Senior Associate at Langan, authored a report, dated January 2009, in which he opined that the soil reworking on the Residential Lots actually improved the condition of the soil because “re-working soils will eliminate ‘hot spots’ of contamination, lowering and homogenizing the concentration” of contaminants, which has “beneficial human health consequences” because it lowers the “potential dose of contaminants per aliquot of soil.” (May 13 Henig-Elona Cert. Ex. 3 at 15-16.)
Dr. Berkowitz compared the concentrations of pesticides in the “blended” areas of the Residential Lots to the soil in the undisturbed orchard on the Open Space Parcel and in the wooded areas of the Individual Plaintiffs’ properties. (Id. at 20.) Dr. Berkowitz made these comparisons, rather than compare the soil on the Residential Lots before and after the earthwork, because there was no sampling of the soil prior to the earthwork. (Id.) He reported that the mean value for arsenic and dieldrin for all of the samples taken in the lawn areas of the Residential Lots was 6.07 mg/kg (or parts per million, “ppm”) for arsenic and 0.028 ppm for dieldrin. (Id.) For the samples taken from the former orchard on the Open Space Parcel, Dr. Berkowitz reported a mean value of 32.71 ppm for arsenic and a mean value of 0.225 ppm for dieldrin. (Id.) In comparing the mean concentrations found in the lawns of the Residential Lots with those in the former orchard on the Open Space Parcel, he calculated that the mean concentration of arsenic on the lawns of the Residential Lots was approximately 19% of that in the Open Space Parcel and the mean concentration of dieldrin on the lawns of the Residential Lots was approximately 12% of that in the Open Space Parcel. (Id. at 21.) For the samples taken from the undisturbed wooded areas of the Individual Plaintiffs’ properties, Dr. Berkowitz reported a mean value of 14.53 ppm for arsenic and a mean value of 0.123 ppm for dieldrin. In comparing the mean concentrations found in the lawns of the Residential Lots with those in the undisturbed wooded areas, he reported that the mean concentration of arsenic in the lawns of the Residential Lots was 42% of that in the wooded areas and the mean concentration of dieldrin in the lawns of the Residential Lots was 23% of that found in the wooded areas. Plaintiffs note, however, that at his deposition, Dr. Berkowitz testified that the difference between the concentration of dieldrin in the lawn areas of the Residential Lots and in the woodlands was not statistically significant. (Certification of Stephen Smithson, June 4, 2009 (hereafter, “June 4 Smithson Cert.”), Ex. HHH at 205:10 — 206:17.)
Dr. Berkowitz concluded that “[i]t is intuitively obvious, and scientifically demonstrated, that excavation and combining of top soil, and other earth moving activities achieved positive results in reducing contamination concentrations per aliquot of soil, thereby reducing public health risk across the development site” and that it did not appear that Woodmont’s earth moving activities “in any way worsened site conditions.” (May 13 Henig-Elona Cert. Ex. 3 at 22.) Plaintiffs contend that Woodmont Builder’s earthworks caused the contamination to be spread ubiquitously across the Residential Lots and extended the contamination from the surface into the subsurface soils, thus exacerbating the contamination.
Six of the Individual Plaintiffs have added pools, driveways or additions to their homes. The following properties on Bonnieview Lane were improved by their owners: 1, 3, and 19 Bonnieview Lane added pools; 6 Bonnieview Lane added a pool and driveway; 17 Bonnieview Lane added a driveway; and 5 Bonnieview Lane added a driveway and an addition to the home. Defendants allege that these improvements worsened contamination. Plaintiffs, relying upon figures from a draft Remedial Investigation Report Addendum/Remedial Action Workplan (“RIRA/RAW”), dated July 2007, prepared by EWMA (June 4 Smithson Cert. Ex. GGG), argue that the Defendants’ own consultants do not identify any contamination in the vicinity of the Plaintiffs’ improvements except for at 19 Bonnieview Lane. Many of these figures do not even show where the improvements were constructed on the property, and it is therefore not possible to tell whether there is contamination in that area. Neither party has submitted evidence regarding what was done with any soil that was disturbed during the construction of these improvements.
D. Current Levels of Contaminants in the Residential Lots
The NJDEP residential soil cleanup criteria for arsenic is 20 ppm and 0.042 ppm for dieldrin. Dr. Berkowitz reported that the mean value for arsenic and dieldrin for all of the samples taken in the lawn areas of the Residential Lots was 6.07 ppm for arsenic and 0.028 ppm for dieldrin. (May 13 Henig-Elona Cert. Ex. 3 at 20.) The Defendants argue that these figures demonstrate that the mean levels in disturbed areas of the Residential Lots meet residential standards.
The Plaintiffs, however, contend that the Residential Lots are contaminated with arsenic and dieldrin in excess of the residential standards. The Plaintiffs rely on a June 4, 2003 summary report authored by Robert L. Zelley and Eric J. Paulistaitis of Maser. Mr. Zelley and Mr. Paulistaitis report that soil sampling was conducted on each of the Individual Plaintiffs’ Residential Lots. Two samples from each of the Residential Lots were tested: a composite sample composed of several samples collected throughout that Residential Lot, and “a discrete sample collected from an area judged to have the highest potential for human exposure or an area selected by the property owner.” (May 14 Smithson Cert. Ex. X at 1.) All samples were collected from the 0-6 inch zone below the existing sod/lawn. (Id.) Mr. Zelley and Mr. Paulistaitis report that arsenic and dieldrin were present in the majority of samples at levels above the residential standards. (Id. at 2.) Arsenic in the discrete samples ranged from 3.7 to 45 ppm, with a mean of 23.03 ppm and a median of 24.50 ppm. In the composite samples, the arsenic ranged from 18 to 110 ppm with a mean of 33.38 ppm and a median of 28.00 ppm. (Id.) The RDCSCC for arsenic is 20 ppm. Dieldrin in the discrete samples ranged from 0.0095 ppm to 0.23 ppm, with a mean of 0.084 ppm and a median of 0.074 ppm. In the composite samples, the dieldrin ranged from 0.045 to 0.510 ppm, with a mean of 0.127 ppm and a median value of 0.095 ppm. (Id.) The RDCSCC for dieldrin is 0.042 ppm. Based on these results, Mr. Zelley and Mr. Paulistaitis conclude that “[ajrsenic and dieldrin are present in the surface soils throughout” the Plaintiffs’ neighborhood at levels above the NJDEP RDCSCC. (Id. at 3.)
The Plaintiffs also argue that Woodmont’s September 2007 RIRA/RAW shows that the levels of arsenic and dieldrin on the Residential Lots exceed the RDCSCC. (Id. Ex. Y.) In that report, Environmental Waste Management Associates (“EWMA”) described sampling of soil in the Residential Lots and the results of testing that soil for arsenic and dieldrin. While a majority of the samples did not contain arsenic and dieldrin at levels above the RDCSCC, many of the samples did contain arsenic and dieldrin at levels above the RDCSCC. (Id.) Plaintiffs also point to the April 2009 Remedial Action Workplan Addendum (RAWA), submitted to the NJDEP by EWMA on behalf of Woodmont, which proposes the remedial action of blending— specifically, blending the- impacted soils with “clean on-site soils from deeper depths and, if necessary, clean off-site soils from a virgin source in an effort to reduce contaminant concentrations to below the NJDEP RDCSCC.” (May 14 Smithson Cert. Ex. XX at 14.) Defendants argue that Woodmont Court has entered into a memorandum of agreement with the NJDEP to voluntarily investigate the Residential Lots and that the Defendants have no legal obligation to perform any investigation or remediation and that the lots “now overwhelmingly meet” the RDCSCC.
There is no evidence that any of the Individual Plaintiffs have vacated their homes as a result of the pesticide contamination. The Plaintiffs argue that some Individual Plaintiffs have tried to sell their homes but have been unsuccessful due to the pesticide contamination, and that those who have sold their homes have done so at a loss due to the contamination, but they do not contest that the Individual Plaintiffs, or the people to whom they sold the homes, continue to live in their homes on Bonnieview Lane.
E. Costs Incurred by the Plaintiffs and Stigma Devaluation
Whitestone has performed a variety of consulting services for the Plaintiffs in connection with the pesticide contamination at the Residential Lots. Whitestone has analyzed sampling data from the Residential Lots, evaluated alternatives for remediation of the properties, and communicated with the NJDEP regarding the appropriate permanent remedy for the properties. The Plaintiffs claim that the costs of Whitestone’s services are response costs, but the Defendants maintain that these costs are not “response costs” as defined by CERCLA and note that the Plaintiffs have not remediated the contamination at their properties.
The Plaintiffs allege that the Individual Plaintiffs have experienced a devaluation of their homes as a result of the stigma attached to environmental contamination. In support of their contention, the Plaintiffs offer the report, dated September 26, 2008, of Mark Sussman and Joseph Cimiluca, both New Jersey State Certified General Real Estate Appraisers (hereafter, the “Sussman Report”). As stated in the cover letter to the report, the purpose of the assignment undertaken by Mr. Sussman and Mr. Cimiluca was “to estimate the market value of each property in order to determine any diminution in value due to the discovery, in or about May 2003, of pesticide contamination on the soils surrounding [the Individual Plaintiffs’] homes.” (May 14 Smithson Cert. Ex. ZZ.) The report offers an opinion as to the valuation of the homes of the Individual Plaintiffs and the diminution of that value resulting from the soil contamination as of July 11, 2006. For each of the Individual Plaintiffs’ homes except for two, Mr. Suss-man and Mr. Cimiluca opined that the stigma damages equaled 10% of the market value if uncontaminated. For the other two homes they opined that the stigma damages equaled 20% of the market value if uncontaminated. (Id.)
The Woodmont Defendants dispute that the Plaintiffs have or will suffer any devaluation of their homes due to environmental contamination. In support of their contention, the Defendants offer the report of Charles E. Blau, Esq., who is a State Licensed Real Estate Appraiser. As stated in the cover letter to the report, Mr. Blau inspected the Plaintiffs’ properties in order to estimate the effect on the market value of the properties “with a ‘No Further Action’ letter from the New Jersey Department of Environmental Protection after an approved remediation of historic pesticides in the soil.” (Certification of Lee Henig-Elona, June 3, 2009, (hereafter, “June 3 Henig-Elona Cert.”) Ex. 26.) Mr. Blau concluded that there was no effect on the market value of the homes. (Id.)
On May 4, 2004, the Plaintiffs filed a claim with the Spill Compensation and Control Act Fund.
II. DISCUSSION
A. Standard of Review for Summary Judgment
Summary judgment is proper where “there is no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). For an issue to be genuine, there must be “a sufficient evidentiary basis on which a reasonable jury could find for the non-moving party.” Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir.2006). For a fact to be material, it must have the ability to “affect the outcome of the suit under governing law.” Id. Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment.
In a motion for summary judgment, the moving party has the burden of showing that no genuine issue of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). When the moving party does not bear the burden of proof at trial, the moving party may discharge its burden by showing that there is an absence of evidence to support the non-moving party’s case. Id. at 325, 106 S.Ct. 2548. If the moving party can make such a showing, then the burden shifts to the non-moving party to present evidence that a genuine issue of fact exists and a trial is necessary. Id. at 324, 106 S.Ct. 2548. In meeting its burden, the non-moving party must offer specific facts that establish a genuine issue of material fact, not just create “some metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).
In deciding whether an issue of material fact exists, the Court must consider all facts and their reasonable inferences in the light most favorable to the non-moving party. See Pa. Coal Ass’n v. Babbitt, 63 F.3d 231, 236 (3d Cir.1995). The Court’s function, however, is not to weigh the evidence and determine the truth of the matter, but, rather, to determine whether there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). If there are no issues that require a trial, then judgment as a matter of law is appropriate.
B. CERCLA (First, Second & Third Counts of SAC and All Counterclaims)
Congress enacted CERCLA in 1980 to address the “serious environmental and health risks posed by pollution.” United States v. Bestfoods, 524 U.S. 51, 55, 118 S.Ct. 1876, 141 L.Ed.2d 43 (1998). The two provisions of CERCLA at issue in this case, §§ 107 and 113, “allow private parties to recover expenses associated with cleaning up contaminated sites.” United States v. Atl. Research Corp., 551 U.S. 128, 127 S.Ct. 2331, 2333, 168 L.Ed.2d 28 (2007). These two provisions provide two “clearly distinct” remedies. Cooper Indus., Inc. v. Aviall Serv., Inc., 543 U.S. 157, 163, 125 S.Ct. 577, 160 L.Ed.2d 548 (2004). Section 107(a) provides for a right to cost recovery in certain circumstances, whereas § 113 provides for a separate right to contribution in other circumstances. Atl. Research, 127 S.Ct. at 2337. “[A] private party that has itself incurred cleanup costs” may recover those costs uncler § 107. Id. at 2338. A potentially responsible party (defined below) “with common liability stemming from an action instituted under § 106 or § 107(a)” is entitled to contribution under § 113. Id.
The Plaintiffs have asserted claims against Woodmont and the Individual Defendants under §§ 107 and 113 of CERCLA and the Woodmont Defendants have asserted counterclaims against the Plaintiffs under §§ 107 and 113 of CERCLA.
The Plaintiffs now move for summary judgment that Woodmont Builders is strictly liable for response costs under § 107(a) of CERCLA, and that the Plaintiffs are entitled to a declaratory judgment against Woodmont Builders for future response costs or damages pursuant to § 113(g) of CERCLA. The Woodmont Defendants move for summary judgment dismissing all of the Plaintiffs’ claims under CERCLA. The Plaintiffs’ claims under CERCLA are: (1) Woodmont and the Individual Defendants are liable under § 107 of CERCLA as owners/operators at the time of disposal of a hazardous substance or as arrangers (Count One); (2) Woodmont and the Individual Defendants are liable under § 113 of CERCLA for contribution for response costs (Count Two); (3) the Plaintiffs are entitled to a declaratory judgment that Woodmont and the Individual Defendants are liable for future response costs or damages incurred by the Plaintiffs (Count Three).
i. Potentially Responsible Parties
CERCLA provides for the apportionment of the cost of cleanup of hazardous waste among entities generally referred to as potentially responsible parties (“PRPs”). E.I. DuPont de Nemours & Co. v. United States, 508 F.3d 126, 128 (3d Cir.2007). Section 107 defines four categories of PRPs:
(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 or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances, and
(4) any person who accepts or accepted any hazardous substances for transport to disposal or treatment facilities, incineration vessels or sites selected by such person, from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance.
42 U.S.C. § 9607(a). Woodmont alleges that they are not PRPs and, thus, cannot be held liable under either § 107 or § 113.
The Plaintiffs allege that Woodmont Court and Woodmont Builders are liable under § 107(a)(2) as past owners and operators, respectively, of the Residential Lots during the time of disposal of hazardous substances. Woodmont argues that they are not PRPs under § 107(a)(2) because there was no “disposal” during their ownership of the Residential Lots. It is undisputed that Woodmont did not add any additional pesticides to the soil, so the question is whether a “disposal” occurred when they removed the contaminated soil from the Residential Lots, combined and stockpiled those soils, then spread the soil back on the Residential Lots to create the Individual Plaintiffs’ lawns.
CERCLA section 9601(29) adopts the definition of “disposal” from the Solid Waste Disposal Act, 42 U.S.C. § 6903(3), which states: “The term ‘disposal’ means the discharge, deposit, injection, dumping, spilling, leaking, or placing of any solid waste or hazardous waste into or on any land or water so that such solid waste or hazardous waste or any constituent thereof may enter the environment or be emitted into the air or discharged into any waters, including ground waters.” Woodmont argues that a disposal did not occur when Woodmont Builders moved and replaced the soils on the Residential Lots because “[a] CERCLA disposal requires active conduct resulting in pollution.” (Defs.’ Mot. Summ. J. 13 n. 6.) They cite to ABB Industrial Systems, Inc. v. Prime Technology, Inc., where the Court of Appeals for the Second Circuit held that passive migration of a contaminant in soil did not constitute a “disposal” under CERCLA. 120 F.3d 351, 358-59 (2d Cir.1997). The Court of Appeals for the Third Circuit has also held that there is a “strong argument” that, in the context of a “disposal” under CERCLA, the terms “ ‘leaking’ and ‘spilling’ should be read to require affirmative human action.” United States v. CDMG Realty Co., 96 F.3d 706, 714 (3d Cir.1996) (holding that the passive migration, or “gradual spreading of contamination” alleged in that case did not constitute a disposal under CERCLA, but declining to address whether a disposal always requires human conduct.) Woodmont Builders, however, was not passive: it removed contaminated soils, combined and stockpiled them, then re-spread the soils on the Residential Lots. In CDMG, the Court of Appeals addressed not only the question of whether passive migration constituted a “disposal” under CERCLA, but also whether a party’s soil investigation, which “caused the mixing, shifting, and spreading of contaminants” constituted a disposal. Id. at 718-19. The Court held that a disposal includes “not only the initial introduction of contaminants onto a property but also the spreading of contaminants due to subsequent activity.” Id. at 719. “[T]his definition of disposal does not limit disposal to a one-time occurrence — there may be other disposals when hazardous substances are moved, dispersed, or released during landfill excavations and fillings.” Id. (quoting Tanglewood E. Homeowners v. Charles-Thomas, Inc., 849 F.2d 1568, 1573 (5th Cir.1988) (internal quotations omitted)). Additionally, “the dispersal of contaminants need not reach a particular threshold in order to constitute a ‘disposal.’ ” Id. “There is no exception for de minimis disturbances.” Id. “The fact that a defendant’s dispersal of contaminants is trivial may provide a ground to allocate less liability to that defendant, but it is not a defense to liability.” Id. The Court of Appeals in CDMG was dealing with a situation somewhat different than the one here in that the alleged act of disposal in CDMG consisted of a soil investigation. Because “CERCLA clearly contemplates that some soil investigation be allowed to examine contaminated property,” the Court held that it was “not enough for a plaintiff to show that a soil investigation has caused the spread of contaminants.” Id. at 721. Rather, in order to prove that a “ ‘disposal’ has occurred based on a soil investigation, a plaintiff must also show that the investigation was conducted negligently.” Id.
The Court of Appeals in CDMG cited to two cases from other Courts of Appeals which addressed similar issues — one from the Ninth Circuit and one from the Fifth Circuit. In Kaiser Aluminum & Chemical Corp. v. Catellus Development Corp., 976 F.2d 1338 (9th Cir.1992), a company called Ferry was hired to excavate and grade a portion of land for a proposed housing development. Id. at 1339. While excavating the development site, Ferry spread some of the displaced soil, which contained hazardous chemical compounds, over other parts of the property. Id. at 1339-40. On appeal from a motion to dismiss, the Ninth Circuit held that the allegations that Ferry had “excavated the tainted soil, moved it away from the excavation site, and spread it over uncontaminated portions of the property” were sufficient to state a claim that Ferry had “disposed” of a hazardous substance under CERCLA. Id. at 1342. In Tanglewood, developers built a housing subdivision on a site where a wood treatment plant had formerly operated; large amounts of highly-toxic waste accumulated on the site during the time of operation of the wood treatment plant. 849 F.2d at 1571. During construction of the subdivision, the developers filled in and graded several creosote pools — spreading tainted soil over the entire site. Id. The Fifth Circuit held that, under CERCLA, a “disposal” is not limited to a one-time occurrence; “there may be other disposals when hazardous materials are moved, dispersed, or released during landfill excavations and fillings.” Id. at 1573.
The Court of Appeals for the Eleventh Circuit has also held that CERCLA’s definition of “disposal” is not “limited to instances where a hazardous substance is initially introduced into the environment at a facility.” Redwing Carriers, Inc. v. Saraland Apartments, 94 F.3d 1489, 1510 (11th Cir.1996) (citing Kaiser Aluminum, 976 F.2d at 1342). The Eleventh Circuit held that “CERCLA’s definition of ‘disposal’ should be read broadly to include the subsequent movement and dispersal of hazardous substances within a facility.” Id. (citing Kaiser Aluminum, 976 F.2d at 1342). It concluded, “We agree with the Fifth and Ninth circuits, and hold that a ‘disposal’ may occur when a party disperses contaminated soil during the course of grading and filling a construction site.” Id. at 1512.
The Woodmont Defendants argue that the movement of the contaminated soils in this case was not a “disposal” under CERCLA, and they, therefore, cannot be held liable for it because the cases in which such liability has been imposed “involved the movement of soil that had either been visibly contaminated or which had been taken from a dirty property to a clean one, and the movement worsened the site conditions.” (Defs.’ Mot. Summ. J. 20.) While the Defendants are correct about the facts of these'cases, the holdings in those cases were not limited to such situations. Specifically, the Court of Appeals in CDMG held that a “disposal” under CERCLA “includes not only the initial introduction of contaminants onto a property but also the spreading of contaminants due to subsequent activity.” 96 F.3d at 719. This definition was not limited by the Court of Appeals, or by the Fifth or Ninth Circuits in Tanglewood and Kaiser, respectively, to situations where soil that is moved is visibly contaminated or taken from a dirty property to a clean one and the movement worsened conditions. Thus, Woodmont Builders’ movement of the contaminated soils on the Residential Lots may be considered a “disposal” under CERCLA. Similarly, the movement of soils by the Individual Plaintiffs for various improvements on their lots (pools, driveways, etc.) may also be considered a disposal under CERCLA. Thus, Woodmont Builders (as an operator) and Woodmont Court (as an owner) are PRPs under § 107(a)(2). For the same reasons, any of the Individual Plaintiffs who spread contaminated soils on their properties when they constructed improvements are PRPs under § 107(a)(1) or (a)(2). Similarly, the Individual Defendants may be PRPs under § 107(a)(2), but, as discussed above, there are issues of fact as to the activities that occurred on the Property when the Individual Plaintiffs owned it and whether any of those activities included earthwork or movement of soils.
The Plaintiffs also allege that the Woodmont Defendants are PRPs under § 107(a)(3) as arrangers. (SAC ¶ 78.) The Supreme Court recently addressed arranger liability under CERCLA. The Court explained that, “under the plain language of the statute, an entity may qualify as an arranger under § 9607(a)(3) when it takes intentional steps to dispose of a hazardous substance.” Burlington N. & Santa Fe Ry. Co. v. United States, — U.S. -, 129 S.Ct. 1870, 1879, 173 L.Ed.2d 812 (2009) (citing United States v. Cello-Foil Products, Inc., 100 F.3d 1227, 1231 (6th Cir.1996)). Plaintiffs admit that arranger liability under § 107(a)(3) requires an intent to dispose of hazardous substances. (Pls.’ Opp’n Br. 30.) Here, there is no evidence that Woodmont took intentional steps to dispose of a hazardous substance — because it is undisputed that Woodmont was unaware of the contamination in the soils at the time it developed the Residential Lots — so it cannot be liable as an arranger under § 107(a)(3).
The Plaintiffs also allege that the Individual Defendants are liable under § 107(a)(1) by operation of law pursuant to § 101(35X0:
Nothing in this paragraph or in section 9607(b)(3) of this title shall diminish the liability of any previous owner or operator of such facility who would otherwise be liable under this chapter. Notwithstanding this paragraph, if the defendant obtained actual knowledge of the release or threatened release of a hazardous substance at such facility when the defendant owned the real property and then subsequently transferred ownership of the property to another person without disclosing such knowledge, such defendant shall be treated as liable under section 9607(a)(1) of this title and no defense under section 9607(b)(3) of this title shall be available to such defendant.
42 U.S.C. § 9601(35)(C). The Plaintiffs argue that if the Individual Defendants had “actual knowledge of the release or threatened release of a hazardous substance” at the Property, then they are treated by operation of law as if they were the current owners of the Residential Lots under CERCLA § 107(a)(1). (Pls.’ Opp’n Br. 39.) They admit, however, that whether the Individual Defendants “did indeed have such knowledge is a genuine issue of material fact.” (Id.) The Plaintiffs are, therefore, correct, that whether the Individual Defendants are liable under § 107(a)(1) by operation of law pursuant to § 101(35)(C) is not appropriate for resolution at this time.
ii. CERCLA § 107 (First Count of SAC)
Section 107 of CERCLA “permits recovery of cleanup costs but does not create a right to contribution.” Atl. Research, 127 S.Ct. at 2338. “A private party may recover under § 107(a) without any establishment of liability to a third party.” Id. Section 107 allows a PRP to recover only the costs it has “incurred” in cleaning a site. “When a party pays to satisfy a settlement agreement or a court judgment, it does not incur its own costs of response,” but is instead reimbursing other parties for their costs. Id.
Section 107 makes PRPs liable for, among other things:
(A) all costs of removal or remedial action incurred by the United States Government or a State or an Indian tribe not inconsistent with the national contingency plan;
(B) any other necessary costs of response incurred by any other person consistent with the national contingency plan.
Id. § 9607(a)(4)(A)-(B). Until fairly recently, it was unclear whether a PRP could recover from another PRP under § 107 of CERCLA or whether a PRP was limited to actions under § 113. The Supreme Court settled that question in Atlantic Research, where it held that PRPs may avail themselves of both CERCLA §§ 107(a) and 113(f). 127 S.Ct. at 2336 (“[T]he plain language of subparagraph (B) [of § 9607(a)(4) ] authorizes cost-recovery actions by any private party, including PRPs.”).
In order to prove liability under § 107 of CERCLA, a plaintiff must prove:
1) that the defendant is a PRP; 2) that hazardous substances were disposed of at a “facility”; 3) that there has been a “release” or “threatened” release of hazardous substances from the facility into the environment; and 4) that the release or threatened release has required or will require the plaintiff to incur “response costs.”
N.J. Tpk. Auth. v. PPG Indus., Inc., 197 F.3d 96, 103-04 (3d Cir.1999). The response costs must be consistent with the national contingency plan. 42 U.S.C. § 9607(a)(4).
First, as discussed above, Woodmont Properties are PRPs because their removal, stockpiling, and re-spreading of contaminated soil on the Residential Lots is considered a “disposal” under CERCLA. Second, it is not disputed that the Residential Lots are a “facility” under CERCLA and that dieldrin and arsenic are both “hazardous substances” under CERCLA. CERCLA defines “release” to include “disposing,” so there was also a release of hazardous substances. CDMG, 96 F.3d at 715; 42 U.S.C. § 9601(22).
There is a question, however, regarding the fourth requirement to prove a claim under CERCLA § 107: whether the release has required or will require the Plaintiffs to incur “response costs.” First, the Woodmont argues that the removal, stockpiling and re-spreading of the contaminated soils (i.e., the “disposal” and “release”) did not and will not require the Plaintiffs to incur response costs because those actions actually improved the condition of the soil. Second, Woodmont argues that only they, and not the Plaintiffs, have actually incurred response costs.
CERCLA defines the terms “respond” or “response” to mean “remove, removal, remedy, and remedial action” and states that these terms include “enforcement activities related thereto.” 42 U.S.C. § 9601(25). The terms “remove” or “removal” are defined, in relevant part, to mean:
[T]he cleanup or removal of released hazardous substances from the environment, such actions as may be necessary [sic] 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 a release or threat of release ....
Id. § 9601(23). The terms “remedy” or “remedial action” are defined, in relevant part, to mean:
[T]hose 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, perimeter protection using dikes, trenches, or ditches, clay cover, neutralization, cleanup of released hazardous substances and associated contaminated materials, recycling or reuse, diversion, destruction, segregation of reactive wastes, dredging or excavations, repair or replacement of leaking containers....
Id. § 9601(24).
The Court of Appeals has held that cleaning up contamination is central to the definition of “response costs.” “The heart of these definitions of removal and remedy are directed at containing and cleaning up hazardous releases.... [T]herefore[,] ... necessary costs of response must be necessary to the containment and cleanup of hazardous releases.” Redland Soccer Club, Inc. v. Dep’t of the Army, 55 F.3d 827, 850 (3d Cir.1995) (quoting United States v. Hardage, 982 F.2d 1436, 1448 (10th Cir.1992)) (internal quotation marks omitted). To prevail, the Plaintiffs must show that their costs were “monies ... expended to clean up sites or to prevent further releases of hazardous chemicals.” Black Horse Lane Assoc., L.P. v. Dow Chem. Corp., 228 F.3d 275, 294 (3d Cir.2000) (quoting Redland Soccer Club, 55 F.3d at 850) (further citations omitted); see also Young v. United States, 394 F.3d 858, 863 (10th Cir.2005) (response cost is only “necessary” if it is “closely tied to the actual cleanup of hazardous releases”); Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 669-70 (5th Cir.1989) (explaining that “[t]o justifiably incur response costs, one necessarily must have acted to contain a release threatening the public health or the environment”). “[Pjrivate parties may not recoup litigation-related expenses in an action to recover response costs pursuant to section 107(a)(4)(B) of CERCLA.” Black Horse, 228 F.3d at 294 (citing Key Tronic Corp. v. United States, 511 U.S. 809, 819-20, 114 S.Ct. 1960, 128 L.Ed.2d 797 (1994); Redland Soccer Club, 55 F.3d at 850).
The facts in Black Horse presented the same question as does this case regarding whether a party had incurred “response costs” or simply litigation costs. There, the Court of Appeals affirmed that the costs for which the parties involved were seeking reimbursement were litigation related expenses, not “necessary costs of response.” In examining the billing statements that demonstrated the alleged “response costs,” the Court noted that they (1) were for “consulting fees,” (2) covered services rendered from November 1996 to May 1998 when the complaint was filed in March 1997, and (3) showed a significant charge corresponding to the time period during which the consultant submitted an expert report in the litigation. Black Horse, 228 F.3d at 294-95. Finally, the Court also noted:
[A]s appellants’ environmental consultant, ESI’s responsibilities were limited to reviewing Essex’s quarterly reports it submitted to the DEP, and to providing appellants with a summary or analysis of Essex’s progress in completing its remediation and detoxification efforts in accordance with the approved Clean-Up Plan. Indeed, ESI was not involved in Essex’s cleanup effort; it neither performed an investigation of the Property nor gathered data for that purpose. In our view, the nature of Essex’s responsibilities toward its clients as described in the record thus confirms that it was retained to assess, for litigation purposes, whether Essex was complying with its contractual responsibility to cleanup the Property pursuant to the requirements set out in the Clean-Up Plan.
Here, Plaintiffs argue that they have incurred two forms of “necessary response costs.” (Pis.’ Reply Br. 14.) They argue that both of these costs were for services that “pertain to developing remedial strategies for the Homes.” (Id. 16.) First, their counsel participated in meetings and conferences with the NJDEP “about the investigation and remedial options” at the Individual Plaintiffs’ homes. (Id. 14.) The Plaintiffs allege that these meetings were “wholly separate from the conduct of the litigation.” (Id. 15.) They contend that the costs for these legal services are necessary response costs because “lawyers’ work that is closely tied to the actual cleanup may constitute a necessary cost of response in and of itself under the terms of § 107(a)(4)(B).” (Id. citing Key Tronic, 511 U.S. at 819-20, 114 S.Ct. 1960.)
Second, the Plaintiffs’ environmental consultant, Whitestone, “engaged in activities designed to lead to the clean up of the Homes.” (Id.) They argue that those activities were also necessary response costs. Whitestone has analyzed sampling data from the Residential Lots, evaluated alternatives for remediation of the Residential Lots, and communicated with the NJDEP regarding the appropriate permanent remedies for the properties. On September 14, 2007, Whitestone sent a letter to the Plaintiffs regarding its review of the July 2007 RIRA/RAW provided by Woodmont. (See May 14 Smithson Cert. Ex. TT.) On November 16, 2007, Whitestone sent a letter to the Individual Plaintiffs in which it evaluated Woodmont’s proposed RAW. (Id.) Whitestone concluded that the RAW was insufficient because the “horizontal delineation of contaminants has not been properly completed, the ‘hot spot’ remedial plan is too limited, and the post-remedial sampling plan is inadequate.” (Id.) On November 21, 2007, counsel for the Plaintiffs sent Whitestone’s November 16, 2006 letter to the NJDEP. On June 10, 2008, the NJDEP sent a “Notice of Deficiency” to Woodmont regarding its September 2007 RAW. (Id. Ex. KK.) Many of the deficiencies noted by the NJDEP were the same as those pointed out in Whitestone’s November 16, 2007 letter.
Citing the Supreme Court’s decision in Key Tronic, the Plaintiffs argue that the work performed by their counsel is the type of lawyers’ work that is “closely tied to the actual cleanup” and thus “may constitute a necessary cost of response in and of itself under the terms of § 107(a)(4)(B).” 511 U.S. at 820, 114 S.Ct. 1960. The type of work that fell into that category in Key Tronic, however, was identifying other PRPs. Id. The Court explained,
Tracking down other responsible solvent polluters increases the probability that a cleanup will be effective and get paid for. Key Tronic is therefore quite right to claim that such efforts significantly benefited the entire cleanup effort and served a statutory purpose apart from the reallocation of costs. These kinds of activities are recoverable costs of response clearly distinguishable from litigation expenses....
This reasoning does not extend, however, to the legal services performed in connection with the negotiations between Key Tronic and the EPA that culminated in the consent decree. Studies that Key Tronic’s counsel prepared or supervised during those negotiations may indeed have aided the EPA and may also have affected the ultimate scope and form of the cleanup. We nevertheless view such work as primarily protecting Key Tronic’s interests as a defendant in the proceedings that established the extent of its liability. As such, these services do not constitute “necessary costs of response” and are not recoverable under CERCLA.
Id. at 820-21, 114 S.Ct. 1960. The Plaintiffs argue tha