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Thursday, August 06, 2009

Ind. Courts - "Red Spot may have to pay $26 million for cleanup" [Updated]

Dan Shaw has a report today in the Evansville Courier & Press headed "Red Spot may have to pay $26 million for cleanup: Plaintiff have had to remove asbestos within same site." Here are some quotes:

A plaintiff is asking Red Spot Paint & Varnish to pay nearly $26 million to clean up contaminants near the company’s headquarters.

Earlier this week, 1100 West LLC, a local real-estate partnership, submitted a remediation plan to a federal court. The document calls for Red Spot to take a number of steps to remove chemicals known as chlorinated solvents from seven acres lying west of U.S. 41 and between Columbia and Virginia streets.

According to court documents, 1100 West LLC is looking at building residences for homeless veterans there. The company alleges the land was contaminated from past operations at Red Spot’s building at 1107 E. Louisiana St.

The cost of the proposed remedy will be between $24.7 million and $25.8 million. Red Spot will have 60 days to raise objections, and a hearing on the case is scheduled to occur Nov. 4. * * *

Besides 1100 LLC, the remediation plan says contamination from Red Spot has encroached upon the Child Development Center run by the Community Action Program of Evansville at 1000 E. Virginia St. Inside the building, inspectors found vapors from chemicals used by Red Spot were at higher than acceptable concentrations, according to court documents.

Also affected is a building at 1011 E. Columbia St., leased by the construction firm Goedecke. The air inside has also been polluted by chemicals coming from Red Spot, according to the documents.

To clean up the sites, 1100 West LLC said Red Spot should use a method which runs electricity through the ground to heat the contaminants and hasten their evaporation. In the interest of preventing future pollution, a barrier should also be built between Red Spot and 1100 West LLC’s site.

The lawsuit against Red Spot dates to 2003. In June, the federal judge overseeing the case ruled that Red Spot and its lawyers had purposely withheld evidence and issued a default judgment in favor of 1100 West LLC.

The ruling gave Red Spot the responsibility of paying for the cleanup of 1100 West LLC’s site.

Here are earlier entries on the Red Spot case, from June 10th and June16th.

[Updated 8/9/09] The Indianapolis Business Journal had a brief story Aug. 7th that reported:

An Evansville company could be forced to pay nearly $26 million in environmental cleanup costs after a federal judge in June found the business and its former attorneys had purposely withheld evidence and misled the court.

A filing submitted Tuesday in U.S. District Court, Southern District of Indiana, by 1100 West LLC estimated costs to remediate its property at between $24.7 million and $25.8 million. Judge Larry McKinney will determine the amount, which is part of a partial settlement agreement reached last month with defendant Red Spot Paint & Varnish Co.

The agreement follows the draconian step McKinney took in June of declaring the plaintiff, 1100 West-a neighbor of Red Spot that had blamed the firm for contaminating its site-victorious in an environmental contamination lawsuit without going through a trial.

McKinney found Red Spot failed to come clean about its use of the toxins trichloroethylene and perchloroethylene, and that its legal counsel, Indianapolis law firm Bose McKinney & Evans LLP, "compounded the problem by, like a chameleon, becoming indistinguishable from its client."

The judge stipulated that Bose and Red Spot each pay half of the legal fees of 1100 West, which are estimated to run into the millions.

The law firm stepped down from representing Red Spot early this year, and the two principal litigators who handled the case are no longer with the firm. One was fired and the other agreed to quit, according to court records.

Posted by Marcia Oddi on August 6, 2009 12:43 PM
Posted to Environment | Ind Fed D.Ct. Decisions | Indiana Courts