Fmc Corporation v. United States Department of Commerce Ronald Brown, Secretary of Commerce, in His Official Capacity United States of America
Docket: 92-1945
Court: Court of Appeals for the Third Circuit; July 5, 1994; Federal Appellate Court
The United States Court of Appeals for the Third Circuit addressed an appeal from the United States and the Department of Commerce regarding a judgment from the Eastern District of Pennsylvania. The district court found the United States liable as an "owner," "operator," and "arranger" for response costs under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) related to hazardous waste at a facility that FMC Corporation acquired post-World War II. FMC sought contribution from the government after the Environmental Protection Agency (EPA) aimed to recover cleanup costs from it. The government acknowledged its liability as an "owner" but argued that its actions as a regulator were protected by sovereign immunity and denied being an "operator" or "arranger" under CERCLA. The court rejected these arguments, confirming that the government could be liable beyond merely being an owner. Under CERCLA, liability is strict, holding any "owner" or "operator" responsible for cleanup costs, regardless of when they acquired the facility relative to the disposal of hazardous substances.
Section 101(21) of CERCLA defines "person" to include the "United States Government," establishing that the government is subject to the same legal obligations as private entities under the law. The Superfund Amendments and Reauthorization Act of 1986 waived the sovereign immunity of the United States, mandating that all government branches comply with CERCLA regulations and be liable for cleanup costs as outlined in section 9607. Consequently, individuals or entities facing response costs can seek contribution from the government if it is deemed liable under CERCLA.
The case in question involves a facility in Front Royal, Virginia, previously owned by American Viscose Corporation and later purchased by FMC. During World War II, the U.S. government prompted American Viscose to convert its plant for high tenacity rayon production, leading to environmental violations due to inadequate controls. Inspections in 1982 found carbon bisulfide contamination, prompting EPA cleanup actions and notifying FMC of potential liability. In 1990, FMC filed suit against the Department of Commerce, claiming the government shared liability for the facility as an "owner," "operator," and "arranger for disposal" of hazardous waste due to its extensive involvement in operations during the war.
The government sought to dismiss the case, contending its actions were merely regulatory and did not constitute liability under CERCLA. However, the district court ruled against the government, asserting that significant government involvement could impose CERCLA liability regardless of the nature of its actions.
In a motion for partial summary judgment, the government claimed it did not waive sovereign immunity under CERCLA for regulatory activities and that its involvement at the site did not constitute ownership or operation necessary for liability. The district court denied this motion, citing material factual disputes regarding the government's activities at the plant. Following a four-day non-jury trial in March 1991, the court issued a ruling on February 20, 1992, holding the government liable as an owner, operator, and arranger for activities occurring between January 1942 and March 1948.
The trial primarily relied on document evidence due to the passing of individuals knowledgeable about the facility's historical operations, supplemented by depositions and some live testimony. The facility spans 440 acres, including a manufacturing plant and 23 waste disposal areas, with ownership transitioning from American Viscose (1940-1963), to FMC (1963-1976), and then to Avtex Fibers-Front Royal, Inc. (1976-1989).
The War Production Board (WPB), established by executive order in January 1942, had authority over war-related production, directing industries on procurement and operational compliance. The WPB expanded its powers to seize non-compliant industries, particularly in response to the U.S. losing 90% of its crude rubber supply due to Japanese occupation in Asia, which necessitated a shift to synthetic substitutes like high tenacity rayon. The WPB mandated American Viscose to convert the Front Royal facility for high tenacity rayon production, critical for wartime efforts, diverting resources from regular textile rayon production. The government viewed such plants as "war plants," and the WPB regarded the American Viscose facility as integral to the war effort, indicating that non-compliance would result in government seizure.
To facilitate the conversion and expansion of a plant, the government, through the Defense Plant Corporation (DPC), leased essential equipment, including 50 spinning machines and related systems. However, American Viscose was not permitted to install this equipment; instead, the government hired Rust Engineering Company to manage the installation, maintaining significant oversight throughout the process. DPC controlled design approvals, supply purchases, operational rules, and on-site management through a government representative.
The government collected rent from American Viscose for the machinery until March 1948 and owned it during this period. To ensure a steady supply of critical raw materials for high tenacity rayon production, the government constructed a sulfuric acid plant and commissioned Stauffer Chemical Company to produce carbon bisulfide. American Viscose was mandated to source these materials through government channels.
The government’s involvement extended to workforce management, as it identified labor shortages and intervened to secure draft deferments, direct labor transfers, and provide housing. A full-time representative was appointed to address workforce-related issues. While the government did not directly hire employees, it reimbursed American Viscose for certain salaries.
Once production commenced, the government continued to exert control over operations, including the authority to set operational rules and manage worker competency. The government influenced American Viscose's profit margins by controlling raw material supply and pricing, as well as production levels, with most of the facility's output intended for government use in wartime materials.
The government had knowledge of hazardous waste generation during the production of high tenacity rayon due to the visible waste disposal activities at the facility, where wastes were placed in large unlined basins. Between 1942 and 1945, approximately 65,500 cubic yards of viscose waste were disposed of in these basins. The inherent nature of the production process meant that increased production led to increased waste, exacerbated by government pressures to maximize output, which overstrained equipment and resulted in more material being scrapped. Additionally, the government rejected non-specification material, further contributing to waste generation. The government also owned the equipment at the facility and supervised the production process, aware of waste generation and disposal methods.
The district court found the government to be both an owner and operator of the facility and an arranger for waste disposal based on several findings: the government mandated production changes, set specifications and prices, owned the production equipment, supervised the process and workers, and was aware of waste generation and disposal methods. Following these findings, the court ordered a trial to determine liability allocation between FMC and the government, but they settled, allowing the government to appeal the ruling on its liability. Under the settlement, the government accepted 8% of cleanup costs as an owner, with potential increased liability to 26% if upheld as an operator and arranger. The government anticipated liability between $26 million and $78 million, a figure FMC contested as overstated. The government filed a notice of appeal, and the district court had proper subject matter jurisdiction for the case. The appellate court would review factual findings for clear error and legal applications de novo.
The government asserts that it has not waived its sovereign immunity under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) for claims related to wartime regulatory activities. Despite CERCLA section 120(a)(1) stating that U.S. departments and agencies must comply with the chapter like any non-governmental entity, the government relies on the principle that federal immunity can only be waived through explicit consent, which must be narrowly interpreted in favor of the government. Citing case law, the government argues that CERCLA's waiver does not cover federal regulatory actions that a non-governmental entity cannot perform. The government references cases where site owners sued the EPA for actions taken during cleanups, emphasizing that the courts ruled the U.S. is not liable as an operator under CERCLA when acting in a regulatory capacity. Specifically, in one case, the court found that the waiver of sovereign immunity applies only when the government acts as a business and does not extend to regulatory actions aimed at addressing hazardous waste situations.
The government asserts that regulatory activities cannot lead to CERCLA liability since only a government can regulate. However, the interpretation of CERCLA and relevant case law indicates otherwise. Section 120(a)(1) does not exclude regulatory actions from liability; instead, it establishes that the government is liable to the same extent as any private entity. If the government engages in actions that would make a private party liable, it too is liable, even if a private party cannot perform those specific actions, such as owning a military base. For instance, the U.S. Navy was found liable under CERCLA for authorizing demolition that released hazardous substances.
This interpretation aligns with a straightforward reading of statutory language and is supported by precedent, including the Supreme Court's decision in Indian Towing Co. v. United States, which held that the government can be liable for activities not replicable by private individuals. Furthermore, the dissent's view that the government's mobilization of the private economy for war efforts cannot be subject to liability is contested. The relevant activity is characterized as the government’s routine actions regarding the Front Royal site, rather than the broader purpose of mobilization.
The conclusion adheres to CERCLA's intent as a remedial statute meant to be broadly construed to hold parties responsible for environmental harm. The government's proposed regulatory exemption contradicts CERCLA's overarching goal of ensuring accountability for the costs associated with hazardous waste disposal. Those benefiting from commercial activities should bear the associated health and environmental costs within their operational expenses.
CERCLA aims to incentivize responsible handling of hazardous substances by placing cleanup burdens on responsible parties, including the government if it operates hazardous waste facilities or manages hazardous waste treatment and disposal. This ensures that the government internalizes the societal and environmental costs of hazardous substances, similar to private entities. Section 107(b) of CERCLA outlines three specific defenses against liability, excluding a proposed “regulatory” defense that the government seeks to invoke. The waiver of sovereign immunity in Section 120 positions the government like any non-governmental entity, reinforcing that regulatory actions do not exempt it from liability under CERCLA. The court cites United States v. Rohm and Haas Co. to emphasize that Congress did not define governmental oversight as a form of "removal" under CERCLA, indicating a refusal to recognize an unwritten regulatory exception. Section 107(d)(2) further illustrates that while CERCLA imposes liability on government entities for cleanup costs, it provides immunity for actions taken in response to environmental emergencies caused by hazardous substances from other facilities. Thus, while the government can be liable for its regulatory actions, it is protected when responding to emergencies, as the law’s primary aim is to ensure that those responsible for hazardous waste bear the cleanup costs, not to deter government cleanup efforts.
Congress intended for the federal government to be treated similarly to state and local governments regarding liability under CERCLA. State and local governments have immunity from liability for cleanup activities in response to emergencies created by others, but not for regulatory conduct. This distinction suggests that the federal government's waiver of sovereign immunity should be interpreted similarly. In the case of the American Viscose plant, the relevant question is not whether the government acted in a regulatory capacity but whether its activities qualify it as an owner, operator, or arranger under CERCLA.
The liability issue focuses on whether the government is liable as an operator or arranger, as the ownership question has been settled. CERCLA defines "operator" circularly, but case law provides criteria for determining operator liability. The "actual control" test, established in Lansford-Coaldale Joint Water Auth. v. Tonolli Corp., imposes liability based on substantial control over another entity's operations, requiring "active involvement" in their activities.
The government exercised substantial control over the facility, directing its production, controlling raw material supply and pricing, supplying manufacturing equipment, managing the labor force, and dictating sales conditions. Thus, the government is deemed to have liability as an operator due to its extensive control and involvement in the facility's operations.
The government acknowledges the district court's findings regarding its control over the facility, specifically that it determined the product, production level, pricing, and sales. This indicates that the government acted as an operator of the facility, a conclusion supported by the Lansford-Coaldale precedent, which requires evidence of substantial control over daily operations and policy-making. Under CERCLA section 120, the government holds the same liability position as any non-governmental entity. Relevant factors for establishing operator status include control over finances, employee management, daily operations, environmental maintenance, and economic benefits beyond taxes.
Case law, such as United States v. New Castle County and Colorado v. Idarado Mining Co., outlines considerations for determining operator liability, including the ability to direct actions causing pollution and control over marketing and employment decisions. The Lansford-Coaldale standard has been applied in various cases, with differing outcomes. For example, in United States v. Stringfellow, California was deemed liable as an operator due to its comprehensive control over the landfill site. Conversely, in United States v. Dart Industries, the South Carolina Department of Health and Environmental Control was ruled not to be an operator because it lacked direct management over the site's operations and finances, emphasizing the need for "hands-on" involvement in contributing to hazardous waste release.
The district court in New Castle County, 727 F.Supp. 854, found the state not liable as an operator of a landfill, noting that its involvement was limited to periodic inspections and regulatory mandates without direct management of the site. However, the circumstances surrounding American Viscose distinguish it from New Castle County, as the federal government exercised substantial day-to-day control over American Viscose's operations and was directly involved in its production processes for high tenacity rayon at its direction. The government diverted American Viscose from other commercial activities to meet its needs, exerted control through regulations and inspections, built and managed plants supplying raw materials, arranged labor resources, and oversaw employee relations. Additionally, the government provided machinery and dictated marketing and pricing for products. This level of involvement establishes the government as liable as an operator, contradicting the lower court's conclusion and aligning with established CERCLA case law regarding operator liability. The government's argument minimizing its role to concerns over federal equipment fails to recognize its comprehensive participation in facility operations. Evidence from a 1944 meeting involving government and American Viscose representatives further illustrates the government's active role in addressing operational challenges, reinforcing the conclusion of its liability.
The government's concerns during the meeting extended beyond ordinary purchaser interests regarding equipment, reflecting a significant focus on the efficient operation of a critical production facility. A letter dated March 14, 1944, from Donald M. Nelson, Chairman of the War Production Board (WPB), to Paul V. McNutt, Chairman of the War Manpower Commission, highlighted the urgency of increasing tire-type high tenacity rayon production from 66 million to 240 million pounds annually. The letter indicated perceived inadequacies in staffing preparations at the Front Royal plant, which was crucial for achieving this production goal. This emphasizes that government involvement was not limited to managing its equipment but was driven by wartime production needs, justifying its participation in operational decisions. The district court's conclusion that the government was effectively an operator of the facility aligns with the historical context of wartime exigencies.
The government also contended it was not liable as an arranger under CERCLA section 107(a)(3) for the disposal of hazardous wastes; however, the court affirmed the district court's ruling on this matter without further discussion, indicating a split in opinion. The government expressed concerns about the potential financial liability, estimating costs between $26 million and $78 million, and warned of similar liabilities in related cases. Despite these concerns, the court emphasized that potential broad implications for government liability do not justify altering the interpretation of CERCLA’s provisions.
The defect in the statute is inherent and requires correction by Congress, as established in Sedima, S.P.R.L. v. Imrex Co. The judgment of the district court from September 17, 1992, will be affirmed. Chief Judge Sloviter, dissenting with Judges Cowen and Roth, contends that the United States' extensive efforts during World War II to coordinate private industry for war supplies do not subject the government to liability as an "operator" or "arranger" under CERCLA. Sloviter argues that Congress did not waive the government's sovereign immunity for these specific governmental activities, and the majority's broad imposition of liability is unprecedented in CERCLA's history, with potential far-reaching implications.
While CERCLA includes a waiver of some governmental sovereign immunity, the scope of this waiver is limited to the extent of liability for private parties. The government asserts that its activities should only lead to liability when acting as a nongovernmental entity, such as by owning facilities, rather than when performing regulatory actions related to private entities. Sloviter finds this interpretation reasonable, maintaining that the government's ownership of facilities would incur liability, but regulatory actions would not, even if they result in hazardous waste discharge. The majority opinion, however, interprets the waiver to mean that if the government undertakes activities that would make a private entity liable, then the government is also liable, a view that Sloviter finds illogical.
Certain government functions are unique and cannot be performed by private entities, particularly the mobilization of the economy for war efforts. While some regulatory activities, such as operating a lighthouse, can be undertaken by private parties, others, like winning a war, are reserved for the federal government, which is not subject to the waiver of sovereign immunity under section 120(a)(1) of CERCLA. The importance of federal powers in ensuring national security is emphasized, referencing The Federalist No. 41 and case law, including Feres v. United States, which highlights the government's exclusive authority to conscript and command military forces. Although judges typically possess broad authority, military matters present unique challenges, raising concerns about the separation of powers. The majority opinion acknowledges that distinctions between federal and private liability cannot be completely eliminated and proposes an "implied" exception to liability in cases where the government acts solely for hazardous material cleanup, arguing this aligns with CERCLA's objectives. However, this interpretation may overlook the federal government's responsibilities beyond environmental issues, such as its obligation to ensure adequate production of war materials, as noted in Lichter v. United States. The discussion is contextualized by a recent commemoration of D-Day, underscoring the significant role of American industry in wartime production.
Hitler's failure in production is highlighted as a critical factor before other losses. The federal government alone possessed the authority and capability to organize essential production activities, such as resource allocation, production quotas, manpower arrangement, and price control to mitigate inflation. The majority's imposition of liability on the government stems from its unique organizational role, which private entities could not replicate. There is no evidence that Congress intended to waive sovereign immunity for these specific governmental activities, as such liability only arises when the government operates its facilities rather than regulating private entities.
The sovereign immunity waiver is rooted in CERCLA, specifically in the section titled "Federal facilities," indicating it was meant to ensure liability for hazardous waste from federal operations. The majority's argument that similar language existed in earlier statutes lacks consideration of the clarifying intention behind the 1986 placement of the waiver. Legislative remarks from Senators during the relevant discussions support the view that the waiver was designed to address hazardous sites primarily at military bases and some Department of Energy locations. Further, interpreting the waiver in this manner does not negate it; there are numerous government facilities posing environmental hazards, and Congress was aware of these issues, as evidenced by extensive documentation and studies.
In United States v. Rohm and Haas Co., the court determined that the government cannot recover costs associated with its oversight of private parties involved in remediation activities under CERCLA, emphasizing the distinct nature of government actions compared to private actions. The ruling highlighted that federal oversight aims to protect the public interest, not the interests of the private parties being overseen, which requires a clear congressional intent to allow recovery of administrative costs. The discussion extends to the government's liability for payment, asserting that government activities, such as mobilizing private industry during wartime, are unique and cannot be equated to private actions.
Furthermore, any ambiguity regarding the waiver of sovereign immunity must be strictly construed in favor of the United States, following established legal principles that require unambiguous statutory language for waivers to be applicable. The court cited previous decisions stressing that legislative history cannot clarify ambiguities absent from the statute itself. Even in remedial statutes, the strict construction rule applies, indicating that policy interests related to sovereign immunity should not be overlooked in favor of internalizing cleanup costs.
A waiver of sovereign immunity must consider the implications of imposing liability on the government for its regulatory activities, as such liability could have significant social costs that might deter governmental decision-making. In Sea-Land Service, Inc. v. United States, it was established that sovereign immunity serves as a structural protection for democratic governance rather than merely a barrier to individual rights. There is insufficient evidence to suggest that Congress intended to impose financial liability on the government when enacting or amending CERCLA, particularly concerning the environmental impacts of its wartime regulatory activities. The government provided evidence indicating that extensive regulation during World War II parallels the current situation, and the ruling from the district court has led to numerous claims against the government under CERCLA for past regulatory actions. It is improbable that Congress intended to assign massive liability, potentially in the hundreds of millions of dollars, without explicit legislative intent. Consequently, the district court should have granted the government's motion for summary judgment, as the waiver of sovereign immunity under section 120(a)(1) of CERCLA does not apply to the activities underlying FMC's claims. Additionally, even if Congress had not limited the waiver, the evidence does not support classifying the government as an "operator" of the American Viscose facility, as the definition requires actual and substantial control over day-to-day operations and policy-making decisions.
Management decisions deemed essential for operator liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) require a detailed examination of the facts surrounding a party's control over a facility. In FMC Corp. v. United States Dep't of Commerce, the court evaluated claims of government operation over American Viscose during World War II, concluding that various factors presented by the majority did not substantiate the government's status as an operator of the privately owned plant.
Key points outlined include:
1. The government's diversion of American Viscose’s activities related to war efforts alone does not establish operator status.
2. The War Production Board (WPB) was authorized to regulate production during the war but primarily focused on procurement policy and resource allocation rather than direct operational control of private facilities.
3. Although the government maintained some regulatory oversight, including inspections and the provision of machinery, these actions did not equate to direct management of the plant's internal operations.
4. Historical context indicates that the government opted not to operate private industry directly, instead exerting regulatory control to maximize individual freedom while ensuring production capacity for military needs.
5. The assertion that directives issued by the government constituted operational control lacks the necessary evidence of direct management required for operator liability under CERCLA.
Overall, the document argues against categorizing the government as an operator of American Viscose based on the presented facts, emphasizing the distinction between regulatory oversight and operational management.
The government's "significant degree of control" over the production process does not equate to it being an "operator" of the facility, as the majority suggests. The conclusion lacks support since there is no evidence that the government exercised de facto day-to-day control; American Viscose management remained intact. The reference to the "possibility of seizure" is insufficient to establish operational status, as such potential action does not equate to actual operation. While the government imposed regulations during wartime that affected various industries, this does not imply it operated those plants. The mention of an "on-site inspector" is redundant and should be understood in the context of the majority's earlier points. Furthermore, the majority's reliance on the government's construction of raw material plants to support claims of control is flawed, as these plants sold raw materials to American Viscose through third parties and were not directly involved in the facility at issue for the CERCLA cleanup. The government's actions regarding labor force arrangements and supervision do not equate to control over the employees, as the on-site government representative was there to assist rather than direct the workforce.
American Viscose supervisors exclusively directed employee tasks within the plant, including work assignments, shift allocations, vacation scheduling, and general supervision. While the government sought to boost production of a limited resource, it did not exert direct control over the plant's operations or employee management. The majority's claims of government oversight are based on misleading interpretations of evidence, suggesting that government involvement was merely a response to American Viscose's requests rather than an attempt to control daily operations.
The government’s leasing of machinery to American Viscose should not be conflated with operational liability, as the government has already accepted ownership liability for its equipment. Furthermore, while the government regulated product marketing and pricing due to the wartime context, such regulation does not equate to direct management involvement. The majority failed to address the profit aspect of American Viscose's operations, indicating that the company was compensated adequately for its production efforts.
The idea that society should shoulder the cleanup costs of hazardous waste generated during the war effort is inconsistent with the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), which treats cleanup expenses as part of production costs. The government’s role as the ultimate consumer of the rayon produced does not impact the assessment of cleanup costs, similar to how General Motors would not be held liable for cleanup costs related to its independent suppliers. Overall, the government’s activities during the war effort do not constitute the level of operational control necessary for CERCLA liability.
Participation in the management of a corporation is essential for establishing liability as an "operator" under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). Circuit Judge Stapleton expresses uncertainty regarding whether Section 120(a)(1) of CERCLA preserves the sovereign immunity of the United States in such contexts, suggesting that precedent from Indian Towing Co. v. United States indicates it should not. He believes Congress did not intend the term "operator" to encompass governmental entities with limited economic interests as regulators or consumers. Stapleton aligns with Chief Judge Sloviter's dissenting opinion on this matter.
Judge Alito dissents from the preceding paragraphs, asserting that the issue of government liability for cleanup under CERCLA is not before the court. He questions why Congress would restrict sovereign immunity waivers to federally owned facilities, referencing Alcan Aluminum to argue that Congress likely intended both private corporations and the government to be liable for contamination from their facilities. The case of Key Tronic Corp. v. United States illustrates that the U.S. government has settled CERCLA-related claims, treating the waiver of immunity as applicable beyond federal facilities.
The court of appeals addressed an appeal related to a mandatory injunction for a state's cleanup plan but did not resolve the issue of the parent's operator status. The determination of operator liability is fact-intensive and therefore cannot be generalized across different cases, particularly regarding wartime production facilities. The Supreme Court has not yet ruled on this specific liability issue.
Sovereign immunity under the Federal Tort Claims Act (FTCA) generally does not waive liability for the government’s regulatory actions due to the absence of private analogs to such powers. Cases like *Myers v. United States* and *Akutowicz v. United States* illustrate that claims involving government regulatory powers, such as negligent mine inspections and citizenship decertification, are not actionable because these actions are unique to government functions. Similarly, in *C.P. Chem. Co. v. United States*, the court ruled that the government cannot be held liable for administrative regulation promulgation, as no private entity could perform such actions. Additionally, in *Jayvee Brand, Inc. v. United States*, it was determined that quasi-legislative or quasi-adjudicative actions taken by federal agencies cannot be analogized to private actions. The *Miller Act* scenario further supports that only federal contracts are implicated, and thus private individuals cannot be liable for the failures related to the Act.
The majority opinion suggests Congress intended to align the treatment of the federal government with state and local governments regarding sovereign immunity. However, this assertion lacks substantial support and is challenged by the historical differences in how Congress has treated federal and state sovereign immunity. The federal government’s immunity was partially waived in 1980, while state immunity was not addressed until 1986, highlighting a legislative distinction between the two. Furthermore, explicit protections were included for state and local governments in emergencies related to hazardous substance releases, while no similar provisions exist for the federal government.
The majority's interpretation of federal cleanup exceptions under the waiver of sovereign immunity renders the statute's specific exception for state government cleanup redundant. Section 101(20)(D) waives both state and federal sovereign immunity, implying that the majority's view incorrectly limits government liability in cases similar to Key Tronic Corp. v. United States, where the Air Force was liable for its own hazardous waste disposal. The author argues that their reading of the statute does not absolve the government from liability for operating facilities or disposing of its waste but does distinguish between regulatory activities and direct involvement in waste disposal.
The majority's reliance on statutory provisions fails to demonstrate that CERCLA's sovereign immunity waiver includes federal regulatory activities. Section 107(b) lists defenses to liability but does not imply a regulatory defense, and section 107(d)(2) provides immunity for state and local governments' cleanup actions, indicating Congress did not intend for similar immunity for the federal government. Furthermore, the district court's findings incorrectly suggest that government personnel supervised plant operations; they were only overseeing the installation of government-owned equipment, not the production activities of American Viscose. The record does not support any claim of government supervision over production processes, and any such findings are considered erroneous.
The statement at page 1720 is deemed misplaced as it reflects the conclusion of events stemming from American Viscose's request for trailers for its workers. Initially, a representative from the War Production Board (WPB) instructed another to ensure that American Viscose submitted the proper forms for the first hundred trailers. When American Viscose inquired about preparing a site for the trailers, one WPB representative advised waiting for approval, while another indicated that approval would be expedited. A further WPB representative noted that assigning a priority representative would help address any bottlenecks, to which another responded positively if the representative was proactive. Additionally, correspondence between the WPB chairman and the War Manpower Commission chairman indicated that the WPB aimed to coordinate staffing preparations for an expanded facility due to previous planning inadequacies, as recognized by local management and other responsible parties. Overall, the government’s actions were focused on facilitating a coordinated response to American Viscose's requests rather than exerting significant control over the day-to-day operations of the private facility. The court remains divided on the issue of the government's liability as an arranger, and tradition dictates that no opinion is provided in such a case, hence independent reasons for reversing the district court are not articulated.
