How Energy Company Buyers Can Limit Environmental Liability Risk

By and on June 1, 2020

Many energy companies may be driven into bankruptcy because of the COVID-19 pandemic. Third parties seeking to purchase those companies’ assets may be concerned about potential successor liability for the seller’s environmental obligations. This article highlights some steps that asset purchasers in bankruptcy can take to reduce the risk of such liability.

Successor liability exists under each of the major federal environmental laws. Four especially important statutes for energy companies are the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, the Resource Conservation and Recovery Act, the Clean Water Act and the Clean Air Act.

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Jacob HollingerJacob Hollinger
Jacob Hollinger handles environmental and energy-related compliance and litigation matters for energy, manufacturing and financial sector clients. He is a former high-ranking Clean Air Act attorney for the US Environmental Protection Agency (EPA), has handled dozens of government investigations and enforcement actions and has extensive experience in all aspects of civil litigation. Read Jacob Hollinger's full bio.


AvatarDarren Azman
Darren Azman focuses his practice on corporate restructurings, creditors’ rights and distressed acquisitions. Darren’s clients include private equity sponsors, troubled companies and their boards of directors, secured lenders and other constituents in connection with in-court and out-of-court restructurings. Read Darren's bio.

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