United States v. Asarco , 430 F.3d 972 ( 2005 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, 
Plaintiff-Appellant,
and
STATE OF IDAHO,
Plaintiff,
v.
ASARCO INCORPORATED; HECLA No. 04-35052
MINING COMPANY,  D.C. No.
Defendants-Appellees, CV-94-00206-EJL
and
COEUR D’ALENE MINES
CORPORATION; CALLAHAN MINING
CORPORATION; SUNSHINE PRECIOUS
METALS, INC.; SUNSHINE MINING
COMPANY, INC.,
Defendants.

15675
15676 UNITED STATES v. ASARCO INC.
UNITED STATES OF AMERICA, 
Plaintiff-Appellant,
and
STATE OF IDAHO,
Plaintiff,
No. 04-35479
v.
COEUR D’ALENE MINES
 D.C. No.
CV-94-00206-EJL
CORPORATION; CALLAHAN MINING
CORPORATION; HECLA MINING
COMPANY; SUNSHINE PRECIOUS
METALS, INC.; SUNSHINE MINING
COMPANY, INC.,
Defendants-Appellees.

UNITED STATES v. ASARCO INC. 15677
UNITED STATES OF AMERICA, 
Plaintiff,
and
STATE OF IDAHO,
Plaintiff-Appellant,
v.
No. 04-35106
ASARCO INCORPORATED; HECLA
MINING COMPANY,  D.C. No.
CV-94-00206-EJL
Defendants-Appellees,
and OPINION
COEUR D’ALENE MINES
CORPORATION; CALLAHAN MINING
CORPORATION; SUNSHINE PRECIOUS
METALS, INC.; SUNSHINE MINING
COMPANY, INC.,
Defendants.

Appeal from the United States District Court
for the District of Idaho
Edward J. Lodge, District Judge, Presiding
Argued and Submitted
June 7, 2005—Seattle, Washington
Filed December 5, 2005
Before: Warren J. Ferguson, Robert R. Beezer, and
M. Margaret McKeown, Circuit Judges.
Opinion by Judge Ferguson
15680 UNITED STATES v. ASARCO INC.
COUNSEL
Ronald M. Spritzer (briefed and argued) and Greer S. Gold-
man (briefed), Environmental and Natural Resources Divi-
sion, U.S. Department of Justice, Washington, D.C., for
plaintiff-appellant United States.
UNITED STATES v. ASARCO INC. 15681
Curt A. Fransen, Deputy Attorney General, Coeur d’Alene,
Idaho, for plaintiff-appellant State of Idaho.
Elizabeth H. Temkin, Denver, Colorado, for defendant-
appellee Hecla Mining Company.
OPINION
FERGUSON, Circuit Judge:
In 1994, the United States and the State of Idaho (together,
“Plaintiffs”) entered into a consent decree with various min-
ing companies, including Hecla Mining Company and
Asarco, Inc. (together, “Defendants”), requiring the latter to
perform certain cleanup actions in exchange for specific lia-
bility releases in the seriously contaminated Bunker Hill
Superfund Site. The site, also known as “the Box,” is a
twenty-one square mile area surrounded by the Coeur d’Alene
River Basin (“the Basin”) in northern Idaho. In 2001, the Dis-
trict Court modified the consent decree for the Box (“the Box
Decree” or “the decree”) because it found that Defendants
faced unanticipated liability outside the Box that made com-
pliance with the decree substantially more onerous.
In 1996, the United States had filed an action under the
Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA)1 to recover from Defendants costs
incurred in cleaning up environmental contamination in the
heavily mined 1500 square mile Basin. In 2003, after the
Environmental Protection Agency (EPA) had completed a
remedial investigation and feasibility study of, as well as a
record of decision (ROD) for, the Basin, the District Court
1
CERCLA was enacted in 1980 and reauthorized and amended in 1986
by the Superfund Amendments and Reauthorization Act of 1986, Pub. L.
No. 99-499, 100 Stat. 1613 (Oct. 17, 1986). 42 U.S.C. § 9601 et seq.
15682 UNITED STATES v. ASARCO INC.
reduced Defendants’ cleanup obligation under the Box decree
by $7 million.
Plaintiffs presently contend that the District Court abused
its discretion when it relied on extrinsic evidence, rather than
the plain terms of the decree, to find that Defendants did not
anticipate the EPA’s contested action outside the Box.
Because the decree in fact expressly reserved the United
States’ authority to take such action, we reverse the Court’s
modification order. In so doing, we hold that in modifying a
consent decree under Rule 60(b)(5) of the Federal Rules of
Civil Procedure, a court must first interpret the terms and pro-
visions of the decree as it would a contract to determine if the
moving party anticipated a significant change in factual con-
ditions, thereby making modification improper.
I. BACKGROUND
A. Bunker Hill Superfund Site
The EPA listed the Bunker Hill Superfund Site (hereinafter
“the Box”), a twenty-one square mile area in Shoshone
County, Idaho, on its National Priorities List in 1983 as one
of the country’s most contaminated sites. Over one hundred
years of mining and sixty-five years of smelting activity, as
well as various natural and man-made events, had caused
widespread contamination in the area. The EPA’s record of
decision for the Box explained that, in particular, “[s]oils, sur-
face water, ground water, and air throughout the [s]ite have
been contaminated by heavy metals, to varying degrees,
through a combination of airborne particulate deposition, allu-
vial deposition of tailings dumped into the river by mining
activity, past waste disposal practices, and contaminant
migration from onsite sources.”
Section 104 of CERCLA permits the President to respond
directly to releases or threatened releases of hazardous sub-
stances, such as those existing in the Box, by undertaking “re-
UNITED STATES v. ASARCO INC. 15683
sponse actions” consistent with the National Oil and
Hazardous Substances Pollution Contingency Plan (“NCP”).
See 40 C.F.R. § 300.1-.86 (1985). Before selecting a response
action, however, the NCP requires that the EPA first conduct
a remedial investigation and feasibility study, which is
designed to “assess site conditions and evaluate alternatives to
the extent necessary to select a remedy” that will “eliminate,
reduce, or control risks to human health and the environ-
ment.” 40 C.F.R. § 300.430(a)(1)-(2). Potential response
actions include a “remedial action,” which is a cost-effective,
long-term plan for a permanent remedy, and a “removal
action,” which is generally a short-term action intended to
address only emergency situations. 42 U.S.C. § 9601(24),
(23); see ROGER W. FINDLEY & DANIEL A. FARBER, ENVIRON-
MENTAL LAW 18687 (5th ed. 2000).
For purposes of the remedial investigation and feasibility
study of the Box, the EPA divided the twenty-one square
miles into populated and non-populated areas. The agency
eventually issued a ROD for the populated areas in 1991 and
a ROD for the non-populated areas in 1992. Taken together,
the records of decision supported a remedial action in the Box
targeting widespread heavy metal contamination in soils, sur-
face water, and ground water and seeking to reduce associated
risks to human health, particularly children’s exposure to lead.
Between 1992 and 1994, Plaintiffs engaged in settlement
negotiations with potentially responsible parties (“PRPs”),
including Defendants, after filing a complaint against them to
recover costs for the EPA’s remedial action in the Box.2 The
2
While sections 106 and 107 of CERCLA authorize the Attorney Gen-
eral to sue responsible parties who have contributed to contaminating a
Superfund site, including past, remote, and future owners, operators, gen-
erators, arrangers, and transporters, section 122(a) of CERCLA encour-
ages settlement agreements between the United States and PRPs for
expediting effective remedial action and minimizing litigation. See FIND-
LEY & FARBER, supra, at 202. The State of Idaho joined the complaint against Defendants pursuant
to relevant state law and section 107 of CERCLA. See 42 U.S.C. § 9607.
15684 UNITED STATES v. ASARCO INC.
parties agree that at the time of their negotiations the EPA
expressed its intent not to use CERCLA remedial authority to
clean up contamination (or “superfund” the area) outside the
Box. Instead, it planned to address the environmental contam-
ination in that area through the Coeur d’Alene Basin Restora-
tion Project (“the Basin Restoration Project”), a cost-
effective, long-term approach, not a “response action,” that
was designed to be a public and private venture among local,
state, and federal agencies, the Coeur d’Alene Tribe, and pri-
vate property owners in the Basin (including Defendants).
In 1994, the District Court entered the parties’ settlement
as a consent decree in which Defendants, among other PRPs,
agreed to perform certain cleanup actions in the Box’s popu-
lated areas and Plaintiffs assumed primary responsibility for
the Box’s non-populated areas. The parties agree that the
United States explicitly reserved in the decree the right to pur-
sue PRPs for “liability arising from the past, present, or future
disposal, release, or threat of release of Waste Materials out-
side the Site.” Consent Decree (CD) ¶ 90(2). In addition, no
party disputes that, under the decree, the United States “re-
tain[ed] all authority and reserve[d] all rights to take any and
all response actions authorized by law.” CD ¶ 93 (emphasis
added). Moreover, the parties recognize that the decree lim-
ited the United States’ covenant not to sue the PRPs strictly
to the Box. CD ¶ 84a.
B. Modification of Consent Decree
In March 1996, nearly two years after the District Court
had approved the consent decree for the Box, the United
States, at the request of the EPA, the Department of the Inte-
rior, and the Department of Agriculture, filed an action to
recover from PRPs, among other things, damages under CER-
CLA for injury to natural resources in the heavily mined
Basin, that is, the area outside the Box.3 In early 1998, the
3
The State of Idaho is not a party to the Basin litigation. It nonetheless
asserts that the consent decree for the Box should remain distinct from the
unresolved disputes concerning the Basin.
UNITED STATES v. ASARCO INC. 15685
EPA publicly announced that it would be conducting a reme-
dial investigation and feasibility study of the Basin. Three
years later, in January 2001, Defendants filed a motion in the
District Court of Idaho to modify the consent decree, contend-
ing that the EPA’s decision to superfund the Basin constituted
an unanticipated change in factual circumstances that made
compliance with the Box decree substantially more onerous.
In particular, Defendants alleged that the EPA had repeat-
edly assured them that it would not expand the Superfund site
from the Box to the Basin.4 Despite recognizing that the
decree specifically reserved the United States’ right to super-
fund the Basin, the District Court relied on oral and written
assurances that the EPA had allegedly given Defendants prior
to and after entering the decree to find that the latter did not
anticipate the contested action. The Court found that between
1991 and early 1998, the EPA consistently stated “that actions
outside the Box would be coordinated with the broader objec-
tives of the Coeur d’Alene Restoration Project . . . and regula-
tory tools other than remedial authority under CERCLA.”
The Court explained that “[t]his finding [was] based on
repeated representations and references to the ‘multi-media
approach’ in letters, in the 1991 and 1992 RODs . . . in con-
versations with EPA management, in the [Basin Restoration
Project] Framework document and in Department of Justice
pleadings to the Court in this case and in United States v.
Asarco, et al., 96-122-N-EJL.” On September 30, 2001, the
Court held that modification of the decree was appropriate
because enforcement of the decree as it stood would drive
4
We note that Defendants previously challenged the EPA’s expansion
of the Superfund site boundaries from the Box to the Basin in United
States v. Asarco Inc., 214 F.3d 1104 (9th Cir. 2000). We held there that
while the EPA gave adequate notice of the expansion, the D.C. Circuit had
exclusive jurisdiction to rule on any challenge to the expanded boundaries.
Id. at 1107. Defendants subsequently filed a notice with this Court indicat-
ing that they were not filing an appeal in the D.C. Circuit, in effect aban-
doning their formal challenge to the EPA’s expansion of the Superfund
site boundary lines.
15686 UNITED STATES v. ASARCO INC.
“the mining industry out of business” and “bleed[ ] the com-
panies to death.”
The District Court nevertheless withheld deciding on actual
modifications to the consent decree until the EPA had com-
pleted the Basin’s remedial investigation and feasibility study
and ROD. The EPA issued the ROD in September 2002, and
the Court issued an order on November 18, 2003 reducing
Defendants’ financial obligation under the decree by $7 mil-
lion.5 The Court subsequently approved the parties’ allocation
of the $7 million in an April 16, 2004 order. Plaintiffs timely
appealed the Court’s last two orders, which this Court has
consolidated for purposes of this appeal.
II. STANDARD OF REVIEW
Motions for relief from judgment under Rule 60(b) are
reviewed for abuse of discretion. Casey v. Albertson’s Inc.,
362 F.3d 1254, 1257 (9th Cir. 2004) (citing SEC v. Coldicutt,
258 F.3d 939, 941 (9th Cir. 2001)). “A district court abuses
its discretion if it does not apply the correct law or if it rests
its decision on a clearly erroneous finding of material fact.”
Casey, 362 F.3d at 1257 (citing Bateman v. United States
Postal Serv., 231 F.3d 1200, 1223 (9th Cir. 2000)). Here,
because the facts are generally undisputed, we face a mixed
question of law and fact. A mixed question of law and fact
exists when there is no factual dispute, the rule of law is clear,
5
The District Court arrived at $7 million by considering the original,
undisputed estimated cost for the Box ($40 million), the expenditures to
date ($44.7 million), and the estimated cost of the remaining work in the
Box ($27 to $35 million in present value). Although the Court conceded
that “[Defendants’] liability for the Basin is still unknown,” it 1) sub-
tracted $40 million from $44.7 million, which is $4.7 million; 2) added
that amount to $31 million (the middle figure in the range of estimated
remaining costs for the Box), which is $35.7 million; and 3) calculated
20% of that amount, which is $7.14 million. Notably, the District Court
failed to explain the basis for reducing Defendants’ obligations by approx-
imately 20%.
UNITED STATES v. ASARCO INC. 15687
and the question is whether the facts satisfy the legal rule.
Pullman-Standard v. Swint, 456 U.S. 273, 289 n.19 (1982).
Mixed questions of law and fact are reviewed de novo. United
States v. City of Spokane, 918 F.2d 84, 86 (9th Cir. 1990).
III. DISCUSSION
[1] The District Court modified the consent decree under
Rule 60(b)(5) of the Federal Rules of Civil Procedure, which
provides in relevant part that a court may relieve a party from
a final judgment when—
the judgment has been satisfied, released, or dis-
charged, or a prior judgment upon which it is based
has been reversed or otherwise vacated, or it is no
longer equitable that the judgment should have pro-
spective application[.]
(emphasis added.) “[This] Rule codifies the courts’ traditional
authority, inherent in the jurisdiction of the chancery, to mod-
ify or vacate the prospective effect of their decrees[.]” Belle-
vue Manor Assoc. v. United States, 165 F.3d 1249, 1252 (9th
Cir. 1999) (internal quotations and citations omitted).
[2] In Rufo v. Inmates of Suffolk County Jail, the Supreme
Court articulated the applicable two-prong standard for modi-
fying a consent decree under Rule 60(b)(5). 502 U.S. 367(1992). The moving party must satisfy the initial burden of
showing a significant change either in factual conditions or in
the law warranting modification of the decree. Id. at 384. The
district court must then determine whether the proposed modi-
fication is suitably tailored to resolve the problems created by
the changed factual or legal conditions. Id. at 391. In particu-
lar, “[i]f the movant cites significantly changed factual condi-
tions,” as Defendants do here, “it must additionally show that
the changed conditions make compliance with the consent
decree ‘more onerous,’ ‘unworkable,’ or ‘detrimental to the
public interest.’ ” Small v. Hunt, 98 F.3d 789, 795 (4th Cir.
15688 UNITED STATES v. ASARCO INC.
1996) (quoting Rufo, 502 U.S. at 384). A court should not
ordinarily modify a decree, however, “where a party relies
upon events that actually were anticipated at the time it
entered into a decree.” Rufo, 502 U.S. at 385 (citation omit-
ted).
Defendants bore the initial burden in the District Court of
showing that the EPA’s decision to superfund the Basin con-
stituted a significant and unanticipated change in factual con-
ditions warranting modification of the decree. See id. at 384-
85. “If it is clear that [Defendants] anticipated changing con-
ditions that would make performance of the decree more
onerous but nevertheless agreed to the decree, [Defendants]
would [then] have to satisfy a heavy burden to convince a
court that [they] agreed to the decree in good faith, made a
reasonable effort to comply with the decree, and should be
relieved of the undertaking under Rule 60(b).” Id. at 385. We
refer to this latter requirement as the heavy burden standard.
We recognize Defendants’ valid concern that Rule 60(b)(5)
should be treated as a flexible standard. Defendants correctly
maintain that the Rule is designed to provide judges with dis-
cretion and flexibility in modifying a decree. In Rufo, the
Supreme Court explains that “[b]ecause such decrees often
remain in place for extended periods of time, the likelihood
of significant changes occurring during the life of the decree
is increased.” Id. at 380 (citation omitted). But the likelihood
of significant changes occurring over the life of the decree
does not mean that courts have unbridled discretion to modify
a decree when a party actually anticipated the changed factual
circumstances in question. Rufo makes clear that “on such
terms as are just, a party may be relieved from a final judg-
ment or decree where it is no longer equitable that the judg-
ment have prospective application[.]” Id.Accordingly, we address two questions in this appeal. First,
did Defendants anticipate at the time they entered into the
decree that the EPA would superfund the Basin? Second, if
UNITED STATES v. ASARCO INC. 15689
so, did Defendants satisfy the heavy burden standard estab-
lished in Rufo? We find that Defendants indeed anticipated
that the EPA might superfund the Basin and, in addition,
failed to meet the heavy burden standard because they did not
make a reasonable effort to comply with the decree. Thus, we
need not address whether the actual modification of the
decree is suitably tailored under Rufo’s second prong in order
to conclude that the District Court abused its discretion in
modifying the consent decree.
A. Defendants Anticipated the EPA’s Contested Action
The parties do not challenge on appeal the consent decree’s
unequivocal terms or conditions. In fact, they agree that under
the decree, the United States “retain[ed] all authority and
reserve[d] all rights to take any and all response actions
authorized by law.” CD ¶ 93. Moreover, Defendants notably
stated in their answering brief to this Court that “[t]he compa-
nies in this case have never questioned [the] EPA’s authority
to exercise CERCLA authorities outside the Box. In this
regard, the governments are correct that the Decree’s reserva-
tion of rights confirms the parties’ expectation that the EPA
might take such action.” The District Court also found in no
uncertain terms “no legally binding commitment either in the
Consent Decree or in the related Records of Decision that
would prohibit the EPA from using full CERCLA remedial
authority outside the Box.”
The exact issue here, then, is whether the District Court
erred in modifying Defendants’ obligation under the decree
on the basis of extrinsic evidence that suggests that Defen-
dants did not anticipate the contested action. Ultimately, we
must determine to what extent contract principles apply when
modifying a consent decree as a matter of equity under Rule
60(b)(5).
1. Consent Decrees
[3] Without question courts treat consent decrees as con-
tracts for enforcement purposes. A consent decree, like a con-
15690 UNITED STATES v. ASARCO INC.
tract, must be discerned within its four corners, extrinsic
evidence being relevant only to resolve ambiguity in the
decree. In United States v. Armour & Co., for example, the
Supreme Court found that defendant, a meat packing com-
pany, did not violate the terms of the meat packers consent
decree of 1920, which forbade meat packing companies from
owning grocery stores, by allowing Greyhound to buy an
ownership share of its stock while simultaneously owning
grocery subsidiaries. 402 U.S. 673, 682-83 (1971). The Court
reasoned that if the government wanted to prevent a single
corporation like Greyhound from owning both meat packing
companies and grocery stores, it should have provided such
a prohibition in the decree. After all, “[c]onsent decrees are
entered into by parties to a case after careful negotiation has
produced agreement on their precise terms. . . . Naturally, the
agreement reached normally embodies a compromise; in
exchange for the saving of cost and elimination of risk, the
parties each give up something they might have won had they
proceeded with the litigation.” Id. at 681.
The Supreme Court rearticulated its Armour holding in
United States v. ITT Cont’l Baking Co., where it considered
extrinsic evidence to interpret a vague term in a consent
decree. 420 U.S. 223 (1975). The case involved a Federal
Trade Commission consent order prohibiting baking compa-
nies such as ITT Continental from “acquiring” other baking
companies. In construing the term “acquiring” in the decree,
the Court took into account evidence of events surrounding
the negotiation of, and other documents incorporated in, the
decree. The Court explained that “[s]uch reliance [on extrinsic
evidence] does not in any way depart from the ‘four corners’
rule of Armour” because where contract terms are ambiguous,
“reliance upon certain aids to construction is proper, as with
any other contract.” Id. at 238.
This Court has applied contract principles in accordance
with Supreme Court precedent when interpreting consent
decrees. See Molski v. Gleich, 318 F.3d 937, 956 (9th Cir.
UNITED STATES v. ASARCO INC. 15691
2003) (Graber, J., specially concurring) (stating that “[i]n con-
struing a consent decree, we apply the same principles used
to interpret a contract.”) (citing Thompson v. Enomoto, 915
F.2d 1383, 1388 (9th Cir. 1990)); Gates v. Shinn, 98 F.3d 463,
468 (9th Cir. 1996) (discussing how “[a] consent decree is . . .
‘in some respects contractual in nature’ ” and, as such,
“[c]ourts must find the meaning of a consent decree ‘within
its four corners[ ]’ ”) (citing Rufo, 502 U.S. at 378; Armour &
Co., 402 U.S. at 681-82); Enomoto, 915 F.2d at 1388(explaining that “[i]n construing consent decrees, courts use
contract principles”).
2. Modification Under Rule 60(b)(5)
Defendants contend, however, that a court need not inter-
pret a consent decree within its four corners in order to mod-
ify it. Since Rule 60(b)(5) is a rule grounded in equity,
Defendants maintain that courts must instead weigh the total-
ity of the circumstances when determining if a moving party
anticipated a contested change in factual circumstances.
We disagree with Defendants because modification of a
consent decree invariably hinges on interpretation of the very
terms of the decree. That is, in order to discern if Defendants
anticipated that the EPA might superfund the Basin, we must
first interpret the decree, which embodies the parties’ careful
negotiation and enforceable commitments. Only if the
decree’s terms are ambiguous—for example, if it is not clear
in the decree whether Defendants anticipated the EPA’s con-
tested action—do we consider extrinsic evidence.
This case does not present a novel issue. The Fourth Cir-
cuit’s decision in Thompson v. HUD illustrates how a court,
in modifying a consent decree, must necessarily first interpret
the terms of the decree. 220 F.3d 241 (4th Cir. 2000). Thomp-
son involved a group of African American public housing res-
idents who entered into a consent decree with the United
States Department of Housing and Urban Development
15692 UNITED STATES v. ASARCO INC.
(HUD) requiring that new family housing financed with pub-
lic funds be located in non-impacted areas (areas without high
concentrations of minority residents or public housing). The
decree purported to eliminate racial segregation and discrimi-
nation in Baltimore’s public housing system. But instead of
abiding by the decree, the local defendants decided that a
more viable plan than the one agreed to would be to construct
senior housing in impacted areas. The district court modified
the consent decree to allow local defendants to seek federal
funds for their new plans.
The Fourth Circuit reversed the district court on the ground
that a particular section in the consent decree, into which the
parties knowingly and voluntarily entered, “provide[d] that,
until the other obligations under the Decree ha[d] been satis-
fied, any new construction of public housing built with public
housing funds must be located in a non-impacted area.” Id. at
247. The plain terms of the decree, despite the viability of the
senior housing plans, “ma[d]e[ ] it clear that the parties con-
templated that new construction would be required or desired
during the life of the Consent Decree.” Id. Because the local
defendants anticipated this change in factual circumstances,
the Fourth Circuit found that modification of the decree was
unwarranted.
The Fourth Circuit’s decision in United States v. Bishop
Processing Co., although predating Rufo, further supports our
understanding that a court must first interpret the decree in
deciding whether to modify it on the basis of changed factual
circumstances. 423 F.2d 469 (4th Cir. 1970). There, the
Fourth Circuit refused to modify a consent decree to include
limitations that appeared nowhere in the agreement. The
Bishop Processing Company, operator of a rendering and ani-
mal reduction plant, entered into a consent decree with the
United States and the states of Delaware and Maryland; the
decree required Bishop to cease all manufacturing and pro-
cessing of malodorous air pollution upon a filing of an affida-
vit by the Director of Delaware’s Air Pollution Control
UNITED STATES v. ASARCO INC. 15693
Division stating that Bishop was discharging malodorous air
pollution across state lines. After being ordered twice to cease
operations, Bishop contended that the decree was entered into
with various “understandings” about investigative procedures
to be used by the Director, procedures inconsistent with the
ones that the Director had used in reporting Bishop’s actions.
Id. at 472.
Our sister circuit found Bishop’s “understandings” unavail-
ing because “Bishop had ample opportunity to propose incor-
poration in the decree of any protection it may have felt
necessary, and to object to procedures it deemed contrary to
its understanding of the decree’s terms.” Id. It added that
“[Bishop] cannot now ask the court to revise the decree by
inserting language or to interpret it to embrace matters which,
if present at all, were lurking in the recesses of Bishop’s cor-
porate mind.” Id.[4] Here, as in Thompson, the plain terms of the consent
decree reveal the parties’ expectation that a particular change
in factual circumstances might occur during the lifetime of the
decree. In fact, the decree provided that the United States
reserved its “rights to take any and all response actions autho-
rized by law” and to pursue Defendants for liability for
response costs incurred outside the Box. CD ¶¶ 93, 84a. As in
Bishop, Defendants also had “ample opportunity to propose
incorporation” of a provision in the decree prohibiting or lim-
iting the EPA from superfunding the area outside the Box.
Bishop, 423 F.2d at 472. Indeed, Defendants conceded at oral
argument and in their answering brief that the “EPA refused
to provide any commitments in the Box Decree as to its inten-
tions outside the Box.” The District Court itself recognized
that “if such a [binding] commitment [on the Basin] had been
reached . . . such a commitment would have been drafted into
the decree.” As in Bishop Processing Co. and Thompson, we
find that the decree in this case is plain in its terms and, as
such, Defendants anticipated that the EPA might superfund
the area outside the Box.
15694 UNITED STATES v. ASARCO INC.
Defendants’ reliance on Bellevue Manor Assoc. v. United
States as a case establishing a totality of the circumstances
test for modification is unavailing. 165 F.3d 1249 (9th Cir.
1999). Bellevue does not announce such a test. We merely
expanded Rufo’s application in Bellevue to all petitions
brought under Rule 60(b)(5), which “is routinely used to chal-
lenge the continued validity of consent decrees, which courts
often liken to contracts.” Id. at 1253 (footnote and citation
omitted). In particular, we found that a purely private com-
mercial contract between HUD and private landlords who par-
ticipated in a federal rent subsidy program could be
challenged under Rule 60(b)(5) because the Rule’s plain lan-
guage does not except final judgments interpreting commer-
cial contracts, and courts have applied the Rule in essentially
private cases. In short, Bellevue does not support Defendants’
position.
Were we to replace the unambiguous language in the con-
sent decree, providing that the EPA could superfund the
Basin, with Defendants’ contrary “understanding” that the
EPA promised it would not do so, we would defy the decree’s
specific purpose. The decree purports to hold Defendants,
who are potentially responsible parties, accountable for elimi-
nating the waste and contamination in the Box’s populated
areas. To hold otherwise would also strip the decree of its
broader purpose, “which is to enable parties to avoid the
expense and risk of litigation while still obtaining the greater
enforceability (compared to an ordinary settlement agree-
ment) that a court judgment provides.” Jeff D. v. Kempthorne,
365 F.3d 844, 852 (9th Cir. 2004) (citations omitted).
3. Extrinsic Evidence
Even assuming that the consent decree’s terms are ambigu-
ous, there is conflicting evidence at best as to the EPA’s
promises to Defendants that it would not superfund the area
outside the Box. Indeed, in its November 24, 1992 letter to
Defendants regarding the Bunker Hill Site/Coeur d’Alene
UNITED STATES v. ASARCO INC. 15695
Basin, the EPA explained that “[it] [did] not currently intend
to expand the use of CERCLA remedial authorities beyond
those actions outlined in the Bunker Hill [ROD].” (emphasis
added.) It also stated that “[t]he success of [the Basin Restora-
tion Project] depends on cooperation and coordination with
affected private parties and public land management agen-
cies.” (emphasis added.) The EPA’s statements were state-
ments of present intent, not enforceable promises.
Additionally, when the EPA’s attorney asked Asarco’s law-
yer, James L. Woods, during his September 21, 2001 deposi-
tion whether “anyone from EPA ever t[old] [him] that the
Agency would never, ever exercise Superfund remedial
authority outside of the Box” or “expand the bounds of the
Superfund site,” Woods replied with the following:
I believe—can I point to a specific statement to that
effect, no. But I had the clear intention that that’s
what they were saying. The direct answer to your
question is I do not recollect a specific statement to
that effect.
Woods’s statement demonstrates that even if we were to con-
sider extrinsic evidence, Defendants cannot prove that the
EPA promised them, unequivocally or explicitly, that it would
not superfund the area outside the Box.
[5] Accordingly, while the District Court found that “all of
the parties to the Consent Decree hoped the [Basin Restora-
tion Project] would be successful in cleaning up the Basin,”
we find that these expectations are not a basis for modifying
the decree. Mere hopes do not translate into enforceable
promises. The EPA expressly reserved in the decree the right
to superfund the area outside the Box and, as such, Defen-
dants anticipated this change in factual circumstances. The
District Court erred in concluding that Defendants did not
anticipate this change in circumstances on the basis of extrin-
sic evidence.
15696 UNITED STATES v. ASARCO INC.
B. Defendants Made No Reasonable Effort to Comply
with the Decree
[6] Because the District Court concluded that changed fac-
tual circumstances were not anticipated, it did not apply the
appropriate heavy burden standard established in Rufo. When
a party anticipates changing conditions that would make per-
formance of the decree more onerous, “the party [must] sat-
isfy a heavy burden to convince a court that it agreed to the
decree in good faith, made a reasonable effort to comply with
the decree, and should be relieved of the undertaking under
Rule 60(b).” Rufo, 502 U.S. at 385. We must therefore decide
whether to remand to the District Court, or determine on the
basis of the record before us whether Defendants meet this
burden.
The Fourth Circuit addressed a similar situation in Thomp-
son, 220 F.3d 241. There, the district court also rejected the
plaintiffs’ contention that any change in circumstances was
anticipated at the time of the consent decree, and so did not
analyze the defendants’ modification request under the proper
heavy burden standard. The Fourth Circuit did not remand the
case, however, because it had a “[fully-developed] record
[that] reveal[ed] no evidence that the Local Defendants made
a reasonable effort to comply with the requirements . . . of the
Consent Decree, as required by Rufo.” Id. at 248. The local
defendants, for example, neither investigated funding the
senior housing project through use of monies not prohibited
by the decree nor evaluated locating the senior village in a
non-impacted area.
[7] Here, as in Thompson, a remand is not required. The
District Court held an evidentiary hearing on the modification
request, and we have a fully-developed record to review. See
Bellevue, 165 F.3d at 1257 (explaining that a “[r]emand is not
necessary where the issue has been fully briefed on appeal,
the record is clear and remand would ‘impose needless addi-
tional expense and delay . . .’ ” (quoting In re Pintlar Corp.,
UNITED STATES v. ASARCO INC. 15697
133 F.3d 1141, 1145 (9th Cir. 1998))). In seeking to justify
a modification to the decree, Defendants allege that the EPA’s
decision to superfund the Basin has significantly impacted
their financial footing. The record before us, however, does
not provide any definitive indication that Defendants’ finan-
cial situation is in peril or that its situation has significantly
changed as a result of the EPA’s decision to superfund the
Basin. Rather, Defendants’ allegations are at best speculative
given that it is unclear what liability Defendants now face in
the Basin compared to what they would have faced under the
Basin Restoration Project. We do not accept that Defendants
have made reasonable efforts to comply with the decree, or
have met their heavy burden in this case, where the cost of
compliance is unknown and the proper baseline against which
to measure any increase in liability remains indeterminate.
[8] Because Defendants have not made any reasonable
efforts to comply with the decree, we find that they should not
be relieved under Rule 60(b)(5) of their obligations in the
Box.
IV. CONCLUSION
For the foregoing reasons, we reverse the District Court’s
order modifying the consent decree at issue in this case.
REVERSED.