Does CERCLA and the Texas SWDA also provide for arranger liability?

Yes.  CERCLA also imposes liability on “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.”   The Texas SWDA has a similar definition.

Until recently, when interpreting “arranger” liability, parties would rely on the so-called nexus test, drawn from Geraghty & Miller v. Conoco Inc.  In that case, the Fifth Circuit held that an arranger is liable only when there is some nexus between that person’s or entity’s control and the hazardous waste contained in the facility.  A sufficient nexus exists when the arranger has the obligation to exercise control over hazardous waste disposal, and not the mere ability or opportunity to control the disposal.

However, the Fifth Circuit recently recognized that Geraghty & Miller is no longer good law.  In Vine Street v. Borg Warner Corp. the Fifth Circuit applied the “intentional steps test” based upon the recent U.S. Supreme Court case Burlington Northern & Santa Fe Railroad, rather than the “outdated nexus standard from Geraghty & Miller” that the district court had applied.   Under Burlington Northern, a plaintiff must establish that the purported arranger took “intentional steps to dispose of a hazardous substance.”  

After applying this new test, the Fifth Circuit then held that a company that designed and sold dry cleaning equipment did not intend for a dry cleaning chemical, perchloroethylene, to be disposed.   Thus, the company was not subject to “arranger” liability, even though the company knew that some dry cleaning chemical would escape into the sewer system and the company took additional steps to reduce any discharge of the chemical after it learned its machines were not completely efficient.

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