Appleton Papers Urges DOJ for New Approach to Litigation Over Fox River Clean-up

March 14, 2012 (Press Release) - Citing numerous instances in which Federal officials have ignored environmental laws, regulations and rules of procedure; improperly driven up the cost of the Lower Fox River cleanup; and generally prevented the company from having its day in court, Appleton Papers Inc. (API) today sought a new approach for resolving enforcement litigation involving the Lower Fox River remediation effort.

In a letter to the U.S. Department of Justice, lawyers for the company said that a year-and-a-half into the Environmental Protection Agency's enforcement action to clean up the river "the Government has taken no steps to establish the most basic element of its case against API — that API is liable under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)."

David R. Erickson, a lawyer for the company, wrote "the litigation history demonstrates that by design, or in effect, the Government in doing everything it can to avoid justice, increase the costs of this litigation and delay any resolution on the merits."

The letter was written in response to the Government's demand that API agree to dredge 680,000 cubic yards of the Lower Fox River during the 2012 dredging season at an estimated cost of $75 million. The demand, Mr. Erickson said, is premised on a "new and unjustifiable interpretation" of a 2007 EPA Record of Decision that does not comport with proper Federal procedures.

The demand, API contends, is just the latest in a series of actions that has violated standard procedures and placed the company in "a due process-defective vise of the Government’s making." For example, the letter stated:

  • The Government has refused to ask the Federal Court to schedule a trial so the government can prove its case, instead selectively enforcing a Unilateral Administrative Order against only two of the companies (NCR and API) named as Potentially Responsible Parties (PRPs) for polluting the river;
  • Using potential economic penalties for failing to comply with the UAO as a threat, in 2007 the EPA insisted that dredging begin prior to completion of the remedial action’s design, an inefficient approach that created huge and unnecessary expenses for NCR and API and was therefore an abuse of the agency’s authority;
  • When it learned two years ago that it had underestimated the cost of the cleanup by $265 million, or 62%, the EPA decided not to amend its Record of Decision – which would have triggered a formal review by a special EPA board – and instead side-stepped the scrutiny by issuing an “Explanation of Significant Difference."

"API has accommodated the Government the past 3+ years expecting it would have a meaningful chance to be heard," said Mr. Erickson in his letter. "That cooperation has been rewarded by unreasonable and what API believes are unlawful remedial demands."

The company has an obligation to its employees, the communities in which it operates and its shareholders "to operate its business, including its handling of litigation, in a sustainable manner," the letter said. "The status quo is not sustainable."

In place of the current inconclusive and patently unfair process, API proposed that the parties to the dispute agree to resolve the litigation on an accelerated schedule. This proposal would be accompanied either by a temporary suspension of remediation efforts during the 2012 dredging season or a "measured but significant amount" of remediation work while the matter is resolved in court.

If the Government’s allegations are proven at trial, questions about which company is liable will end. But if the Government’s allegations cannot win on the merits, the Government will avoid being directly responsible for a potential miscarriage of justice that jeopardizes the jobs of 885 Wisconsin residents — and about 1,000 others — who work for a company that was not even in existence when PCBs were released into the Lower Fox River.

The proposal, Mr. Erickson said, "will ensure fairness both to EPA to test its conduct in this matter…and to API to test API’s claim of nonliability or, if needed, API’s defenses."

As it has repeatedly noted in the past, API reminded the Government that it could also direct the remediation order it has issued, but never enforced, against the other named PRPs.

SOURCE: Appleton Papers Inc.