In our last post, "Bankruptcy Does Not Discharge All Liability to Cleanup a Contaminated Site: Part I," we discussed the background of In re Mark IV Industries, Inc., 2011 U.S. Dist. LEXIS 110595 (S.D.N.Y., Sept. 28, 2011), describing the events that led up to the filing of the lawsuit and the Bankruptcy Court's decision. In this post, we will discuss the decision of the United States District Court for the Southern District of New York on appeal.
The United States District Court for the Southern District of New York recently confirmed that a party's liability to clean up a contaminated property was not discharged as part of a Chapter 11 reorganization, since such liability was not a "claim" under the Bankruptcy Code. See In re Mark IV Industries, Inc., 2011 U.S. Dist. LEXIS 110595 (S.D.N.Y., Sept. 28, 2011).
In Litgo New Jersey, Inc. v. Martin, 2011 U.S. Dist. LEXIS 2033 (D.N.J. Jan. 7, 2011) (denying Motion for Rehearing), the sole shareholder of company (a single-purpose entity) that owned a contaminated property was found liable as a "current operator" under CERCLA § 107(a) because he had "actual control over the day-to-day operations on the [property], including oversight and control over remedial activities carried out by [environmental remediation companies]."