Bona Fide Prospective Purchaser Defense: Why Has It Failed To Deliver?

The goal of the Bona Fide Prospective Purchaser Defense,¹ enacted in January 2002, was to lessen the harshness of the Comprehensive Environmental Response, Compensation, and Liability Act's (CERCLA)² strict liability scheme by allowing purchasers of contaminated property to avoid liability provided certain pre-acquisition diligence standards and post-acquisition obligations were met. Ten years later, the defense has not delivered on its promise. As discussed below, many limitations and uncertainties limit the effectiveness of the defense.

Introduction

Passed in 1980, CERCLA was Congress' response to the public health and environmental threats posed by the legacy of over a century of haphazard'and largely unregulated'disposal of hazardous materials at industrial sites and waste disposal facilities. CERCLA addressed this legacy by introducing a radically new liability scheme with respect to the cleanup of contaminated sites. Under CERCLA, with limited exceptions,