EPA v. JACK FRIEDLAND ET AL

Case summary

UNDER THE PROPOSED CONSENT DECREE, THE SETTLING PARTIES, JACK, HAROLD AND LEONARD FRIEDLAND AGREE TO PAY THE GOVERNMENTS A MINIMUM OF $7 MILLION WITH A POTENTIAL PAYMENT OF UP TO $40 MILLION, FOR RESPONSE COSTS RELATING TO THE SITE. THE COMMONWEALTH OF MASSACHUSETTS IS ALSO A PARTY TO THIS CONSENT DECREE. THE GOVERNMENT'S LIABILITY THEORY AGAINST THE FRIEDLAND IS BASED UPON THEIR STATUS AS OWNERS UNDER CERCLA SECTION 107(A). IN PARTICULAR, THE FRIEDLANDS OWNED (BUT DID NOT OPERATE)THE SITE BETWEEN 1960 AND 1979. DURING THIS PERIOD THE FRIEDLANDS LEASED THE PROPERTY TO SEVERAL COMPANIES. EPA HAS EVIDENCE INDICATING THAT, IN THE COURSE OF THEIR OPERATIONS, THE LESSEES IMPROPERLY DISPOSED OF POLYCHLORINATED BIPHENYLS, VOLATILE ORGANIC COMPOUNDS, AND METALS AT THE SITE. ACCORDINGLY, EPA IDENTIFIED NOT ONLY THE FRIEDLANDS, BUT ALSO THEIR LESSEES AS POTENTIALLY RESPONSIBLE PARTIES AT THE SITE. IN 1992 FOLLOWING THE FAILURE OF THESE PARTIES TO SETTLE THEIR LIABILITY AND TO COMPLY WITH AN EPA UNILATERAL ADMINISTRATIVE ORDER (UAO) TO PERFORM THE CLEANUP, THE UNITED STATES AND THE COMMONWEALTH SUED THEM TO RECOVER SITE RESPONSE COSTS. UNTIL RECENTLY, THE PARTIES ATTEMPTS TO SETTLE THIS LITIGATION WERE FRUSTRATED BY THE UNWILLINGNESS OF FPE AND CDE TO COME FORWARD WITH A MEANINGFUL OFFER IN LIGHT TO THE MAGNITUDE OF THE ESTIMATED SITE RESPONSE COSTS. IN MAY 1994, HOWEVER, A NOVEL SETTLEMENT OPPORTUNITY WAS CREATED WHEN THE FEDERAL DISTRICT COURT RULED IN A RELATED ACTION THAT FPE, CDE AND COOPER WERE CONTRACTUALLY BOUND BY THE PROVISIONS OF THEIR LEASES TO INDEMNIFY THE FRIEDLANDS FOR THEIR ENVIRONMENTAL LIABILITY AT THE SITE. IN RESPONSE TO THIS FAVORABLE RULING, THE FRIEDLANDS AGREED TO SETTLE THEIR LIABILITY AT THE SITE BY ENTERING INTO A CONSENT DECREE WITH EPA AND THE COMMONWEALTH. IN PARTICULAR, THE FRIEDLANDS HAVE AGREED TO STIPULATE TO THEIR LIABLILITY UNDER CERCLA AND M.G.L. C. 21E AND ENTER INTO A JUDGMENT AGAINST THEM IN THE AMOUNT OF APPROXIMATELY $40,000,000. IN TURN THE FRIEDLANDS WILL PURSUE THEIR INDEMNITORS TO A SIGNIFICANT PORTION OF THE AGREED-UPON JUDGEMENT. THE FRIEDLANDS HAVE AGREED TO PAY $1.5 MILLION UP FRONT AND TO PURSUE THE OTHER PARTIES UNDER THE LEASE INDEMNIFICATION CLAUSES. PROCEEDS FROM THE INDEMNITORS WILL BE SHARED AMONG THE GOVERNMENTS, AND THE FRIEDLANDS ON A SLIDING SCALE, WITH THE FRIEDLANDS GUARANTEEING THE GOVERNMENTS AT LEAST AN ADDITIONAL $5.5 MILLION ( IF THEY RECEIVE LESS THAN $5.5 MILLION FORM THE INDEMINITORS, THE FRIEDLANDS MUST PAY THE DIFFERENCE). IF AN AMOUNT IS RECOVERED WHICH IS GREATER THAN $5.5 MILLION BUT LESS THAN $22 MILLION, THE UNITED STATES WILL RECEIVE 87.5% OF THE PROCEEDS AND THE FRIEDLANDS WILL RECEIVE THE BALANCE. IF THE FRIEDLANDS RECOVER AN AMOUNT GREATER THAN $22 MILLION, THE UNITED STATES WILL RECOVER 75% OF THE AMOUNT AND THE FRIEDLANDS WILL RECEIVE THE BALANCE. IN AUGUST 1990, UNDER THE AUTHORITY OF CERCLA SECTION 106A, EPA ISSUED A UAO TO THE FRIEDLANDS, AMONG OTHERS, ORDERING THEM TO PERFORM REMEDIAL WORK AT THE SITE. THE RESPONDENTS MADE NO EFFORTS TO COMPLY WITH THE UAO. ACCORDINGLY, THE ATTACHED CONSENT DECREE OBLIGATES THE FRIEDLANDS TO PAY $1.5 MILLION PENALTY (AS PART OF THE $40 MILLION JUDGMENT AMOUNT) FOR THEIR NON-COMPLIANCE WITH THE AUGUST 1990 UAO.

Defendants (4)

• FRIEDLAND BROTHERS ENTERPRISESNamed in complaint
• HAROLD FRIEDLANDNamed in complaint
• JACK FRIEDLANDNamed in complaint
• LEONARD FRIEDLANDNamed in complaint

Facilities (1)

• NORWOOD PCB SUPERFUND SITE

  921 PROVIDENCE HIGHWAY, NORWOOD, MA, 02062

  Registry ID: 110006362006

Statutes cited

• CERCLA 106B — Superfund
• CERCLA 107A — Cost Recovery

Timeline (3 milestones)

• 1992-06-09Referred To Dept Of Justice
• 1993-06-01Enforcement Action Data Entered
• 1995-04-17Complaint Filed With Court