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Cleaning Up

By Annie Gausn | Aug. 2, 2006

Law Office Management

Aug. 2, 2006

Cleaning Up

Litigation began in earnest in 1983 over Stringfellow, a Superfund site in Riverside County. The cleanup--and the litigation--continues.

By Dennis Pfaff
      Supervising State Deputy Attorney General Don Robinson says he keeps running into fellow lawyers who have been involved in some way with Stringfellow. No wonder.
      Almost 25 years ago Robinson was in a crowded auditorium at the Los Angeles Convention Center when corporate executives and their lawyers first met to hear state and federal officials describe the magnitude of the cleanup problem at the Stringfellow acid pits in Riverside County. Stringfellow is a Superfund site that had leached more than 30 million gallons of waste chemicals into the surrounding groundwater. Back then, in 1982, government officials estimated it would cost about $18 million to filter out and neutralize the various contaminants. But the estimate was wildly off.
      ?The site isn?t going to be cleaned up for 400 years,? says Allen Wolfenden, chief of the Stringfellow cleanup for the state Department of Toxic Substances Control, California?s lead hazardous-waste watchdog agency. And the final price tag is likely to approach or exceed a half-billion dollars. But what could end up being at least as expensive is the related litigation, which is believed to have already employed more than a thousand lawyers.
      The litigation began in earnest in 1983, when state and federal officials brought a federal lawsuit against more than 20 manufacturing and waste-hauling companies that had used the site as a dumping ground. To their credit, those companies began cooperating with the cleanup almost immediately. But they also claimed that the state itself should be liable for the costs because California officials induced the property?s owner to open the dump and then licensed it after doing a laughably poor job of investigating the site.
      Apparently the companies? point was compelling: After two federal trials, California was saddled with full responsibility for the cleanup. However, the state appealed, and the case was not fully settled until 2002. Ultimately, California agreed to shoulder the burden of all future costs, and the companies ate the approximately $90 million they had sunk into the effort over the prior 19 years. Eventually, the state also reimbursed the federal government $99 million for its costs in dealing with the site.
      Key to the companies? legal strategy was their willingness to go ahead with the cleanup?a move that shifted the emphasis of the case from whether the work would get done to who should pay for it.
      Meanwhile, both the state and the private companies found themselves battling local residents in a series of tort actions over the contamination. One settlement in the 1990s with nearly 4,000 people garnered about $50 million for the plaintiffs and another $65 million for their attorneys, with the state kicking in more than $13 million of that total.
      Whether the state?s taxpayers or insurance companies will ultimately pick up the rest of the tab remains unclear. California has been fighting with its insurers for more than a decade over the issue, collecting about $120 million in settlements so far. Similar battles raged more quietly between some of the companies involved in the dump site and their insurers, soaking up even more lawyer time.
      Last year a Riverside Superior Court jury found against a handful of holdout state insurers, determining that they violated their contracts by refusing to pay the state?s share of the clean-up. However, Judge E. Michael Kaiser?s pre- and posttrial rulings snatched away much of the state?s victory by capping California?s recovery at less than $50 million, an amount already exceeded by the previous settlements.
      That?s an absurd result, says Lead Supervising Deputy Attorney General Darryl L. Doke. Doke adds that the appeals could drag on for years.

Annie Gausn

Daily Journal Staff Writer

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