EPA v. DRAKE CHEMICALS, INC, IN RE

Case summary

ON EXPANDED 115 SUPERFUND LIST. DRAKE CHEMICALS. DRAKE CHEM- ICALS, INC. (DRAKE), OWNED & OPERATED A FACILITY IN LOCK HAVEN, PA, WHICH MANUFACTURED CHEM INTERMEDIATES. LOCATED WITHIN A FEW THOUS. YDS OF A HEAVILY POPULATED RESIDENTIAL & COMMERCIAL AREA, DRAKE CONDUCTED BUSINESS FROM 1966 TO JAN 8, 1982, WHEN IT FILED IN BANKRUPTCY PURSUANT TO CHAPTER 7 (LIQUIDATION). DRAKE'S WASTE DISPOSAL PRACTICES & ON-SITE STORAGE PROBLEMS WERE KNOWN TO THE DEPARTMENT OF ENVIRONMENTAL RESOURCES OF THE COMMONWEALTH OF PENNSYLVANIA (DER) FOR YRS. THE STATE ENTERED A CONSENT ORDER WITH DRAKE ON APRIL 4, 1979. IN 1981, DRAKE FILED A PETITION FOR BANKRUPTCY UNDER CHAP. 11 (REORGANIZATION). ON JAN 5, 1982, DER ISSUED A CLEANUP ORDER BASED ON VIOLATION OF THE EARLIER ISSUED CONSENT ORDER. DRAKE TOOK NO CORRECTIVE ACTION, BUT IMMEDIATELY CONVERTED THE EXISTING CHAP. 11 BANKRUPTCY PETITION (REORGANIZATION) TO A CHAP. 7 BANKRUPTCY PETITION. ON FEB. 23, 1982, WHEN REGION III INSPECTORS ENTERED THE DRAKE FACILITY, AT THE REQUEST OF DER, THEY OBSERVED APPROX. 1,700 LEAKING, DECAYING DRUMS OF PROCESS WASTE WATER & SLUDGES. EPA & DER OFFI- CIALS ACTIVATED SUPERFUND FOR AN EMERGENCY REMOVAL ACTION, AFTER ORAL NOTIFICATION TO DRAKE'S PRES., ERNEST DION. APPROX $850,000 HAS BEEN EXPENDED BY SUPERFUND FOR CLEANUP AT DRAKE FACILITY. REGION III INVESTIGATTORS HAVE NOT HAD ACCESS TO DRAKE PRESIDENT DION'S FINANC. RECORDS BUT BELIEVE HIM TO HAVE SUBSTANTIAL PERS. ASSETS. REGION III ALSO HAS DEVELOPED EVIDENCE OF WRONGFUL DISPOSAL PRACTICES BY DRAKE, & BY ITS PRINCIPALS, INCLUDING ERNEST DION. INSPECTION OBSERVATIONS & SAMPLING INDICATE THE PRESENCE OF CYANIDES & OTHER ORGANIC CHEMICALS, SULFURIC ACID, NITRIC ACID & AMMONIA. IN THE OPINION OF THE SITE ENTRY TEAM, WASTES AT THE SITE POSED A FIRE, EXPLOSION & AIR POLLUTION HAZD TO THE LOCAL POPULATION. IN ADDITION, A HIGH LEVEL OF ORG. VAPORS, & LEACHATE WERE FOUND DISCHARGING FROM A LAGOON ON THE SITE. REGION III HAS RECOMMENDED THAT AN ACTION BASED ON SECTION 107 OF CERCLA, 42 USC S9607, BE PURSUED AGAINST THE BANKRUPT ESTATE. (THE REMOVAL COSTS EXPENDED MIGHT BEST BE CHARACTERIZED AS COSTS OF PRESERVING OR ADMINISTERING THE ESTATE PURSUANT TO 11 U.S.C. S503(B)(1)(A), IN ORDER TO GIVE THE GOV THE BEST OPPORTUNITY TO RECOVER THE MONIES EXPENDED.) AN ACTION BASED ON SECTION 107 OF CERCLA SHOULD PERHAPS ALSO BE PURSUED AGAINST ERNEST DION, PRES. OF DRAKE AS AN INDIVIDUAL, EITHER BY NAMING HIM AS A TORTFEASOR OR BY PIERCING THE CORPORATE VEIL. WHILE DRAKE IS PRESENTLY INVOLVED IN BANKRUPTCY PRODEEDINGS, ITS INDIVIDUAL CORPORATE OFFICERS MAY HAVE SUBSTANTIAL PERSONAL ASSETS & LIABILITY. WE AGREE W/ THE REGION'S ASSESSMNT THAT RECOVERY EFFORTS AGAINST THE INDIVIDUALS SHOULD BE VIGOROUSLY PURSUED.

Defendants (2)

• DRAKE CHEMICALSNamed in complaintNamed in settlement
• DION, ERNESTNamed in complaintNamed in settlement

Facilities (1)

• DRAKE CHEMICAL

  180 MYRTLE STREET, LOCK HAVEN, PA, 17745

  Registry ID: 110000817821

Statutes cited

• CERCLA 107A — Cost Recovery

Enforcement conclusions (1)

• DRAKE CHEMICALS, IN RE.entered 1989-08-15

  Primary law: CERCLA

Timeline (8 milestones)

• 1982-03-31Referred To Headquarters
• 1982-06-16Referred To Dept Of Justice
• 1983-08-30Referred TO U.S. Attorney
• 1983-09-09Complaint Filed With Court
• 1989-08-15Final Order Lodged
• 1989-08-15Final Order Entered
• 1989-09-08Concluded
• 1989-09-08Enforcement Action Closed