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Judge: Paper firm must keep paying for river cleanup

in Investigations

By Emily Zantow/Courthouse News

GREEN BAY, Wis. (CN) – A federal judge ruled that a global paper product manufacturer must pay Wisconsin future expenses for the ongoing cleanup of the Fox River, which was by polluted by the paper company and others decades ago.

U.S. District Judge William Griesbach ruled in favor of the United States and Wisconsin last Monday, ordering paper manufacturer P.H. Glatfelter to keep contributing money to the effort as the government incurs costs.

P.H. Glatfelter and others were involved in the manufacturing of carbonless paper in the 1960s and 1970s in a process that emitted toxic polychlorinated biphenyls, or PCBs, into the Fox River in eastern Wisconsin.

“There is no doubt that the plaintiffs will continue to incur response costs in the future. Glatfelter’s liability has already been determined by the court, and the plaintiffs should not be forced to incur further costs and delay in attempting to collect future costs,” Judge Griesbach wrote in a 15-page opinion.

PCBs are organic compounds that were commonly used as dielectric and coolant fluid in carbonless paper until the federal government banned their use in 1979 amid controversy surrounding their unintended impacts on human and environmental health.

The Environmental Protection Agency has been cleaning the polluted 200-mile-long Fox River for nearly 20 years. A 1998 commissioned study of recreational fishing damages to the river alone were estimated to be $123 million, according to the ruling.

Over the years, the liability of numerous parties accused of contributing to the pollution has been resolved through various judicial consent decrees and administrative orders.

In 2014, P.H. Glatfelter and other companies were found jointly and severally liable for $1.3 billion of the two-decade cleanup cost.

The U.S. government and Wisconsin claim the paper manufacturer still owes more than $33 million for past cleanup costs. P.H. Glatfelter, which is the only defendant to not reach a settlement over the Fox River cleanup, is represented by environmental lawyers from Greenberg Traurig.

However, the paper company argues that the more than $100 million dollars of settlement proceeds in a Natural Resource Damage Assessment and Restoration, or NRDAR, fund maintained by the U.S. Department of the Interior “vastly exceeds” the actual amount of damages to natural resources.

P.H. Glatfelter claims over $60 million of the transferred funds have not been applied to response costs, constituting a windfall for the government. It also says an additional $4 million in surplus over the amount of costs incurred have not been applied to reduce its liability for previous costs.

Judge Griesbach was sympathetic to that point.

“What the government chooses to do with settlement proceeds should not diminish non-settlors’ right to full credit for the settlement,” the judge wrote. “The plaintiffs should not be able to divert settlement funds to overpay NRD, as Glatfelter claims they have done, and still claim reimbursement for costs covered by the settlement.”

He also granted the company’s motion to reconsider his previous order blocking P.H. Glatfelter from providing evidence that the actual damages to natural resources in the Fox River were significantly less than the settlement money allocated for the cleanup.

“Glatfelter is not bound by the allocation of payment for NRD to the NRDAR Fund previously approved by the court. If at trial Glatfelter is able to establish that the amount of the previous settlements allocated to the Fund exceeds the actual NRD, Glatfelter is entitled to a reduction in its own liability to the extent of such excess,” Griesbach wrote.

However, the judge ruled the paper manufacturer must still pay its share of ongoing cleanup costs as they incur.

A trial to determine the P.H. Glatfelter’s reduction in liability for past costs and other issues has yet to be scheduled.

Wisconsin Attorney Brad Schimel called the ruling a win for the state Friday.

“At the Wisconsin Department of Justice, we prioritize the important work of protecting the state’s natural resources,” he said in a statement. “Many years of hard legal work by DOJ and the [Department of Natural Resources] led to the court’s decision this week, which will help us make sure that the Fox River can continue to be enjoyed for many generations to come.”

One of P.H. Glatfelter’s attorneys, David Mandelbaum with Greenberg Traurig, declined to comment on the ruling.

According to the Wisconsin Department of Justice, remediation work on the Fox River is expected to be completed in 2019.

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