Superior Court Approves ExxonMobil Settlement

By Politicker Staff | 08/25/15 2:36pm

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A Superior Court Judge today approved a $225 million settlement between the State and ExxonMobil to resolve liability for damage to the environment and injury to natural resources caused by contamination from the corporation’s refinery operations in Bayonne and Linden, as well as other facilities and service stations in New Jersey, Acting Attorney General John J. Hoffman and Department of Environmental Protection (DEP) Commissioner Bob Martin announced.

In approving the $225 million settlement, which enviros derided, Judge Hogan stated unequivocally that the standards met by the settlement are fair, reasonable and in the public’s interest, and acknowledged the adversarial and hard-fought posture taken by the State in the negotiations on behalf of the public:

“After giving considerable time and thought to its task, for the reasons stated in this opinion, the court finds that the proposed consent judgment is fair, reasonable, in the public interest, and consistent with the goals of the Spill Compensation and Control Act (“Spill Act”)… It therefore approves the Consent Judgment.

“The State proceeded under two different Governors and numerous DEP Commissioners to attempt to settle this case for a guaranteed sum of money, rather than leaving it to the uncertainties of trial. For seven years, Exxon repeatedly responded to the State’s olive branches with only token offers. An aggressive trial strategy is often the only way to bring reluctant parties to the table, and the State employed this tactic with success. The February 2015 agreement was not made on a whim, but was the end product of lengthy negotiations and zealous advocacy at trial.”

Under these ACOs, ExxonMobil must thoroughly investigate and fully remediate contamination at both facilities to standards defined in DEP regulations. ExxonMobil’s licensed site remediation professional is executing plans to clean up the contamination under the State’s supervision.

“This is an important settlement for the citizens of New Jersey and for our environment, one which came about because this administration aggressively pushed the case to trial,” said Acting Attorney General Hoffman. “Through this settlement, we have ensured the continuation of ExxonMobil’s cleanup obligation at these contaminated sites, and held the company financially accountable through a historic Natural Resource Damages settlement.”

“This decision is a victory for the people of New Jersey,” DEP Commissioner Martin said. “The settlement holds ExxonMobil accountable for contamination it caused in Bayonne and Linden and is six times greater than the previous largest NRD settlement in the state. We are pleased that the court looked at the long history of this litigation and made a careful and reasoned decision on the proposed settlement. We are also thankful for the tireless work put in by the Attorney General’s Office for this case over the past 11 years.”

Under the finalized settlement, the State and ExxonMobil have agreed to resolve ExxonMobil’s alleged liability to the DEP for natural resource damages resulting from discharges at its Bayway and Bayonne refineries. Additionally, the settlement preserves the State’s claims against ExxonMobil with respect to natural resource damages to the Arthur Kill, Newark Bay, and any other surface waters impacted by ExxonMobil’s operations.

The settlement also preserves the State’s claims against ExxonMobil relating to the Lail facility, which requires further investigation as to the impact of ExxonMobil’s operations on natural resources.  The settlement also addresses some pending and potential NRD claims involving a company refinery operation in Paulsboro.

In addition, the settlement resolves the State’s relatively minor NRD claims pertaining to 16 additional facilities and ExxonMobil’s retail service stations, but preserves all NRD claims relating to the discharge of MTBE at those stations.  The DEP will continue to vigorously litigate in federal court the State’s substantial NRD claims relating to the discharge of MTBE at the company’s retail service stations located throughout New Jersey.

ExxonMobil remains responsible for cleaning up all ExxonMobil sites in the State of New Jersey, including the 16 other facilities and the retail service stations subject to the settlement.

The settlement comes in addition to obligations and cleanup activity already taking place under the Administrative Consent Order reached in 1991.

The State filed its lawsuit against ExxonMobil in 2004.  In September 2008, a Superior Court Judge ruled that ExxonMobil was liable for causing a public nuisance by polluting the waterways, wetlands and marshes on and near its former refinery sites in Bayonne and Linden.

In ruling on part of a natural resource damages lawsuit filed on behalf of the DEP, the judge found that ExxonMobil had contaminated both sites through active disposal and accidental spilling of hazardous substances. The final settlement announced today eliminates Exxon’s ability to appeal those determinations

Prior to Judge Hogan’s decision, the State fielded comments from the public for 60 days regarding the proposed settlement. DEP’s Response To Comment document, which was filed with the court, can be found at: http://www.nj.gov/dep/nrr/settlements/exxon-response-to-comments.pdf

Acting Attorney General Hoffman, Assistant Attorney General David Apy, Deputy Attorney General Richard Engel and the law firm of Kanner & Whiteley handled the ExxonMobil matter on behalf of the State.

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