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Wednesday, December 10, 2008

Ind. Decisions - Yesterday's Raybestos ruling [Updated]

The Supreme Court's opinion yesterday in the case of Indiana Department of Environmental Management v. Raybestos Products Co. (see ILB summary here) is the subject of a press release this afternoon by Attorney General Carter:

The Indiana Supreme Court has upheld a decision to overturn a trial court ruling that would have denied the Indiana Department of Environmental Management (IDEM) the ability to exercise its authority to enforce strict standards of environmental clean-up at contaminated sites and would have cost taxpayers $16.4 million. * * *

On June 12, 2006 and October 30, 2006 a Marion County Superior Court ordered the State to pay approximately $16.4 million, which included attorney fees to Raybestos Company for Breach of Contract.

In 1997, Raybestos entered into an Agreement with IDEM for a risk assessment and removal plan of high levels of polychlorinated biphenyls (PCB’s) found in the Shelly Ditch, downstream from the Raybestos plant in Crawfordsville, IN. In 2003 Raybestos filed suit against IDEM for Breach of Contract when the Agency disproved the risk assessment and removal plan of the contamination. IDEM was also being challenged for seeking Environmental Protection Agency (EPA) review to force Raybestos to clean-up PCB’s to safe levels. The original agreement between the parties in 1997 contained a level of PCB’s that was twenty times higher than federal requirements allow.

The Indiana Court of Appeals overturned the trial court ruling on November 14, 2007, finding that a cleanup level of PCB’s twenty times higher than that of the federal requirement would be contrary to public policy.

[Updated 6:30 PM] This AP story posted today on the Chicago Tribune website reports:

INDIANAPOLIS - Taxpayers won't get the bill for a PCB cleanup in Crawfordsville due to a decision by the Indiana Supreme Court.

The ruling upheld a Court of Appeals decision that the state should not have to pay Raybestos Products Co. $16.4 million in damages related to potential cleanup costs.

"This decision reinforces the fact that Indiana will hold those who cause contamination responsible for the costs of clean-up," said Thomas W. Easterly, commissioner of the Indiana Department of Environmental Management.

The Supreme Court on Tuesday ruled that an agreed order between IDEM and a polluter is an agency action, not a contract that will support a claim for damages against IDEM.

The ruling also frees IDEM to set a standard for the cleanup stricter than that Raybestos initially agreed to, which was 20 times that allowed by the EPA. A 2007 Court of Appeals ruling held that the higher limit was unenforceable because it was contrary to public policy.

Posted by Marcia Oddi on December 10, 2008 04:29 PM
Posted to Environment | Ind. Sup.Ct. Decisions