United States v. Bestfoods

In United States v. Bestfoods, 524 U.S. 51, 118 S.Ct. 1876, 141 L.Ed.2d 43 (1998), the Supreme Court answered the question of whether a parent corporation that participated in, and exercised control over, the operations of a subsidiary may, without more, be held liable as an operator of a polluting facility owned or operated by the subsidiary. The Court said no, unless the corporate veil is pierced. Bestfoods, 118 S.Ct. at 1881. However, it added that a corporate parent that actively participated in, and exercised control over, the operations of the facility itself may be held directly liable in its own right as an operator of the facility. Id. Bestfoods, a case involving 42 U.S.C. 9607(a)(2), operator liability, must logically be applied to cases involving 9607(a)(3), arranger liability: Both operators and arrangers are potentially responsible parties ("PRPs").