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United States v. Apex Oil Co.

July 6, 2006

UNITED STATES OF AMERICA, PLAINTIFF,
v.
APEX OIL COMPANY, INC. DEFENDANT.



The opinion of the court was delivered by: Herndon, District Judge:

MEMORANDUM AND ORDER

I. Introduction

Before the Court is a motion submitted by the government seeking partial summary judgment on its second cause of action. (Doc. 18.) Specifically, the government moves for a declaration pursuant to 28 U.S.C. § 2201 that the injunctive relief it seeks in its first cause of action does not constitute a dischargeable "claim" under the Bankruptcy Code. (Id.) Defendant Apex Oil Company ("Defendant") disagrees. (Doc. 32.) It maintains that the injunction the government requests does amount to a claim under the Code, and further that this claim was discharged in earlier bankruptcy proceedings. (Id.) For the reasons below, the Court grants the government's motion.

II. Background

Defendant is an successor company to corporate entities - both named Clark Oil and Refining Corporation - that owned and operated a refinery and associated pipelines in Hartford, Illinois (the "refinery"). In December 1987, these and other affiliated entities filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code.*fn1 On August 16, 1990, the U.S. Bankruptcy Court for the Eastern District of Missouri entered an Order of Confirmation discharging the consolidated debtors and their estates from any and all claims, debts, and liens arising before the confirmation date.

Nearly fifteen years later, this suit followed. On April 5, 2005, the government sued Defendant, alleging that releases from the refinery pose an "imminent and substantial endangerment" to health or the environment. (Doc. 1.) The government seeks two things: injunctive relief pursuant to theResource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6973(a) to abate the alleged endangerment, and a declaration under 28 U.S.C. § 2201 affirming that such relief was not discharged.*fn2 (Id.) The instant motion for partial summary judgment relates only to the second, or declaratory-relief, cause of action.*fn3

III. Analysis

A. Summary Judgment Standard

Summary judgment is proper where the pleadings and affidavits, if any, "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c);Oats v. Discovery Zone, 116 F.3d 1161, 1165 (7th Cir. 1997) (citingCelotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)). The movant bears the burden of establishing the absence of fact issues and entitlement to judgment. Santaella v. Metropolitan Life Ins. Co., 123 F.3d 456, 461 (7th Cir. 1997) (citing Celotex, 477 U.S. at 323). In reviewing a summary judgment motion, a court does not determine the truth of asserted matters, but rather decides whether there is a genuine factual issue for trial. Celex Group, Inc. v. Executive Gallery, Inc., 877 F. Supp. 1114, 1124 (N.D. Ill. 1995). The Court must consider the entire record, drawing reasonable inferences and resolving factual disputes in favor of the non-movant. Regensburger v. China Adoption Consultants, Ltd., 138 F.3d 1201, 1205 (7th Cir. 1998) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)).

B. A "Claim" Under the Bankruptcy Code

With respect to the government's second cause of action, the issue is whether the injunctive relief sought by the government would amount to a "claim" discharged in the Chapter 11 proceedings participated in by Defendant's predecessors. Backing up a step, under the Bankruptcy Code, and to enable debtors to start fresh after a bankruptcy, "debts" are discharged in Chapter 11 proceedings.

11 U.S.C. § 727. The Code defines a "debt" as "liability on a claim." 11 U.S.C. § 101(12). A "claim," in turn, is defined as a

(A) right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, legal, equitable, secured, or unsecured; or

(B) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured, ...


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