Shell Oil Co. v. United States

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During World War II, the U.S. contracted with oil companies for the production of aviation fuel, which resulted in production of hazardous waste. The waste was dumped at the California McColl site. Several decades later, the oil companies were held liable for cleanup costs under the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. 9601, and sought reimbursement from the government based on the contracts. The district court entered summary judgment on liability, finding that the contracts contained open ended indemnification agreements and encompassed costs for CERLCA cleanup, and awarded $87,344,345.70. The trial judge subsequently discovered that his wife had inherited 97.59 shares of stock in a parent to two of the oil companies. The judge ultimately vacated his summary judgment rulings; severed two companies from the suit and directed the clerk to reassign their claims to a different judge; reinstated his prior decisions with respect to two remaining companies; and entered judgment against the government ($68,849,505). The Federal Circuit vacated and remanded for reassignment to another judge. The judge was required to recuse himself under 28 U.S.C. 455(b)(4) and the error was not harmless. View "Shell Oil Co. v. United States" on Justia Law