CERCLA Suit Seeks Cost Recovery from Companies that Deposited Waste in Calif. Landfill Decades Ago`

The California Department of Toxic Substances Control and the Toxic Substances Control Account (together DTSC) have filed a civil complaint against a number of defendants to recover the unreimbursed response costs of hazardous waste treatment associated with a now-defunct Benecia, California landfill. According to last Friday’s lawsuit, the state calculated that the defendants are responsible for a shortfall of more than $25 million in assurances for clean up or “post-closure” activities.

The filing names Exxon Mobil Corporation, E.I. DuPont De Nemours and Company Inc., Chevron USA Inc., Chevron Oronite Company LLC, Shell Oil Company, Pacific Gas and Electric Company, Prologis Inc., FMC Corporation, Union Pacific Railroad Company, United States Steel Corporation, International Business Machines Corporation, and Bayer CropScience Inc. as defendants in the Eastern District of California action for allegedly arranging for the disposal or treatment of waste at the landfill.

Allegedly, from 1968 to 1986 the landfill, then known as “Panoche,” reportedly received and disposed of more than 550,000 tons of waste, including “caustic and acidic liquids and solids; petroleum refining sludges; catalysts; hydrogen sulfide abatement sludges; oily slurries; truck washout debris; inorganic precipitates; contaminated soils; organic sludges; shredded currency; and paint pigment sludges.” Its owner and operator IT Corporation, undertook formal closure activities in 2003, but not before the company filed for bankruptcy.

In May 2004, the IT Environmental Liquidating Trust (ITELT) was established to oversee the long-term post-closure operation, maintenance, and upkeep of the landfill as part of the resolution of the bankruptcy proceedings. Post-closure activities reportedly included recovery, management, and the long-term monitoring of groundwater, leachate, and soil vapor contaminated by past waste management activities.

In February 2016, however, DTSC notified ITELT that it had violated certain requirements. Namely, the liquidation trust had underfunded post-closure efforts by approximately $7.5 million, which DTSC recalculated in July 2016 to be more than $25 million “based upon the 30-year financial assurance period.” ITELT replied that it had no ability to meet those financial obligations, and in response, DTSC issued an “Imminent and Substantial Endangerment Determination and Order and Remedial Action Order” (ISE Order).

The ISE Order addressed the threatened releases of hazardous substances should the landfill be improperly managed and clean-up efforts underfunded. The order named ITELT and a few generators, including the defendants and their affiliates, as respondents required to perform the work described therein.

The lawsuit seeks declaratory relief and an order requiring the defendants, jointly and severally, to compensate DTSC for the costs associated with implementing a complete post-closure plan. The plaintiffs are represented by the state’s office of the attorney general.