EPA v. DOW CHEMICAL (VERTAC CHEMICAL CO)

Case summary

SINCE 1976, VERTAC HAS OWNED A 92.7 ACRE MANUFACTURING SITE LOCATED IN JACKSONVILLE. UNTIL MAY 1980, VERTAC MANUFAC- TURED PESTICIDES/HERBICIDES AT THAT SITE INCLUDING 2,4,5-T AND 2,4-D. IN 1980, THE US INITIATED A CIVIL ACTION IN THE US DISTRICT COURT, EASTERN DIST OF ARKANSAS, WESTERN DIV AGAINST VERTAC AND HERCULES, INC., A PRIOR OWNER OF THE JACKSONVILLE SITE, PRIMARILY PURSUANT TO CWA, 33 USC 1311, 1342, AND 1319. THE COMPLAINT REQUESTED CIVIL PENALTIES AND APPROPRIATE INJUNCTIVE RELIEF, INCLUDING THE ABATEMENT WHICH CREATED AND WERE CREATING AN IMMINENT AND SUBSTANTIAL ENDANGERMENTTO HEALTH AND THE ENVIRONMENT. THE STATE OF ARKANSAS, THROUGH THE ARKANSAS DEPT OF POLLUTION & ECOLOGY (ADPC&E), FILED A SIMILAR LAWSUIT AND THE TWO CASES WERE CONSOLIDATED. * IN 1982, A CONSENT DECREE WAS ENTERED IN THE ABOVE DESCRIBED CASE. THIS DECREE WAS NEGOTIATED BY THE US, ADPC&E, VERTAC AND HERCULES, INC. AND REQUIRED, IN PART, THAT VERTAC COMPLY COMPLY WITH SPECIFIED HAZARDOUS WASTE MANAGEMENT STANDARDS AND REMEDIATE SPECIFIED ENVIRONMENTAL CONDITIONS AT THE SITE. THE DECREE WAS BINDING UPON VERTAC'S OFFICERS AND AGENTS. PURSUANT TO THE DIST COURT'S ONGOING JURISDICTION UNDER THE CONSENT DECREE, THE US, ADPC&E AND VERTAC SIGNED A STIPULATION ON JULY 15, 1987 WHICH PROVIDED THAT THE US AND ADPC&E WOULD NOT OPPOSE A CORPORATE REORGANIZATION PLANNED BY VERTAC, IF VERTAC AND ITS OFFSHORE SHAREHOLDERS ESTABLISHED CERTAIN FINANCIAL INSTRUMENTS TO ENSURE PAYMENT OF SOME OF VERTAC'S ENVIRONMENTAL LIABILITIES AT THE JACKSON VILLE, ARK SITE. THE STIPULATION FURTHER PROVIDED THAT THE ASSETS AND BUSINESSES RETAINED BY VERTAC WOULD BE AVAILABLE TO MEET VERTAC'S ENVIRONMENTAL OBLIGATION. * IN AUGUST, 1986, AFTER VERTAC COMPLETED ITS REORGANIZATION, PHOENIX CAPITAL ENTERPRISES, INC. (PHOENIX), A CORPORATION INCORPORATED IN DELAWARE, ACQUIRED 100 PERCENT OF VERTAC'S STOCK. C.P. BOMAR, JR., CHIEF EXECUTIVE OFFICER OF VERTAC FROM 1984 TO JULY, 1986, IS ALSO PRESIDENT, SOLE DIRECTOR AND CONTROLLING COMMON STOCK SHAREHOLDER OF PHOENIX. BOMAR, ON BEHALF OF PHOENIX, HAS RATIFIED DECISIONS OF VERTAC BOARD OF DIRECTORS SINCE DECEMBER 31, 1986. J. RANDAL TOMBLIN, VERTAC'S VICE PRESIDENT OF CORPORATE DEVELOPMENT FROM OCT- OBER, 1984 TO JULY, 1986, BECAME PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR OF VERTAC ON OR BEFORE JULY, 1986. * ON FEBRUARY 1, 1987, VERTAC ABANDONED THE JACKSONVILLE SITE AND ON FEBRUARY 9, 1987 SOLD ITS ENTIRE AGRICULTURAL CHEMI- CALS MARKETING BUSINESS, INCLUDING ALL PESTICIDE REGISTRA- TIONS, TRADEMARKS, PATENTS, CUSTOMER LISTS, CONTRACT RIGHTS, AND OTHER ASSETS TO INTER-AG, A WHOLLY OWNED SUBSIDIARY OF PHOENIX. IN ADDITION, ON FEBRUARY 10, 1987, VERTAC, INTER- AG AND DOW (VERTAC'S/INTER-AG'S PRINCIPAL SUPPLIER IN ITS AGRICULTURAL CHEMICALS MARKETING BUSINESS) ENTERED INTO AN AGREEMENT WHEREBY DOWN RECEIVED PAYMENTS ON VERTAC'S UNSECURED DEBT TO DOW WHICH AROSE FROM PREVIOUS TRANSACTIONS UNDER A PRIOR SUPPLY AGREEMENT BETWEEN DOWN AND VERTAC. UNDER THIS AGREEMENT, DOW RECEIVED A SECURITY INTEREST IN THE INTEREST PAYMENTS ON VERTAC'S ENVIRONMENTAL TRUST FUND ESTABLISHED PURSUANT TO THE STIPULATION DESCRIBED ABOVE. * PRIOR TO FEB 1, 1987, VERTAC NOTIFIED THE US AND ADPC&E THAT IT WAS NOT GOING TO CONTINUE TO MANAGE THE WASTES STORED AT THE JACKSONVILLE FACILITY IN ACCORDANCE WITH THE 1982 CONSENT DECREE. VERTAC DID NOT PROVIDE NOTICE OF THE FEBRUARY 9, 1987 SALE OF ITS ASSETS. SINCE JAN 24, 1987, EPA HAS BEEN CONDUCTING RESPONSE ACTIVITIES ON THE VERTAC SITE TO MANAGE AND STABILIZE LEAKIN

Defendants (4)

• C. P. BOMAR, JR.Named in complaintNamed in settlement
• DOW CHEMICALNamed in complaintNamed in settlement
• PHOENIX CAPITAL ENTERPRISESNamed in complaintNamed in settlement
• T. RANDAL TOMBLINNamed in complaintNamed in settlement

Facilities (1)

• VERTAC CHEMICAL CORPORATION

  MARSHALL RD, .75M W ON HWY 167, JACKSONVILLE, AR, 72076

  Registry ID: 110001709508

Statutes cited

• RCRA 7003 — Imminent Order: Solid or Hazardous Waste
• CERCLA 107 — Superfund

Enforcement conclusions (1)

• PHOENIX CAPITAL ENTERPRISESentered 1991-02-04

  Primary law: CERCLA

Timeline (6 milestones)

• 1987-11-23Enforcement Action Data Entered
• 1987-11-23Referred To Dept Of Justice
• 1988-09-25Complaint Filed With Court
• 1991-02-04Final Order Lodged
• 1991-02-04Final Order Entered
• 1991-02-04Concluded