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United States v. CTS Corp.

United States District Court, W.D. North Carolina, Asheville Division

February 11, 2016

UNITED STATES OF AMERICA, Plaintiff,
v.
CTS CORPORATION, MILLS GAP ROAD ASSOCIATES, and NORTHROP GRUMMAN SYSTEMS CORPORATION, Defendants.

          CONSENT DECREE FOR INTERIM REMEDIAL DESIGN/REMEDIAL ACTION AT THE CTS OF ASHEVILLE, INC. SUPERFUND SITE

          Dennis L. Howell United States Magistrate Judge

         TABLE OF CONTENTS

         I. BACKGROUND ......................................................................................................................... 1

         II. JURISDICTION .......................................................................................................................... 2

         III. PARTIES BOUND ...................................................................................................................... 2

         IV. DEFINITIONS ............................................................................................................................ 3

         V. GENERAL PROVISIONS .......................................................................................................... 5

         VI. PERFORMANCE OF THE WORK ............................................................................................ 6

         VII. REMEDY REVIEW .................................................................................................................... 8

         VIII. PROPERTY REQUIREMENTS ................................................................................................. 8

         IX. FINANCIAL ASSURANCE ..................................................................................................... 11

         X. PAYMENTS FOR FUTURE RESPONSE COSTS .................................................................. 14

         XI. INDEMNIFICATION AND INSURANCE .............................................................................. 16

         XII. FORCE MAJEURE ................................................................................................................... 17

         XIII. DISPUTE RESOLUTION ......................................................................................................... 18

         XIV. STIPULATED PENALTIES ..................................................................................................... 20

         XV. COVENANTS BY PLAINTIFF ................................................................................................ 23

         XVI. COVENANTS BY SDs ............................................................................................................. 25

         XVII. EFFECT OF SETTLEMENT; CONTRIBUTION .................................................................... 27

         XVIII. ACCESS TO INFORMATION ................................................................................................. 28

         XIX. RETENTION OF RECORDS ................................................................................................... 29

         XX. NOTICES AND SUBMISSIONS ............................................................................................. 30

         XXI. RETENTION OF JURISDICTION ........................................................................................... 31

         XXII. APPENDICES ........................................................................................................................... 31

         XXIII. MODIFICATION ...................................................................................................................... 31

         XXIV. LODGING AND OPPORTUNITY FOR PUBLIC COMMENT ............................................. 32

         XXV. SIGNATORIES/SERVICE ....................................................................................................... 32

         XXVI. FINAL JUDGMENT ................................................................................................................. 32

         I. BACKGROUND

         A. The United States of America (“United States”), on behalf of the Administrator of the United States Environmental Protection Agency (“EPA”), filed a complaint in this matter pursuant to Sections 106 and 107 of the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. §§ 9606 and 9607.

         B. The United States in its complaint seeks, inter alia: (1) reimbursement of costs incurred by EPA and the Department of Justice (“DOJ”) for response actions at the CTS of Asheville, Inc. Superfund Site in Asheville, Buncombe County, North Carolina (“Site”), together with accrued interest; and (2) performance of response actions by the defendants at the Site consistent with the National Contingency Plan, 40 C.F.R. Part 300 (“NCP”).

         C. In accordance with the NCP and Section 121(f)(1)(F) of CERCLA, 42 U.S.C. § 9621(f)(1)(F), EPA notified the State of North Carolina (the “State”) on May 10, 2016, of negotiations with potentially responsible parties (“PRPs”) regarding the implementation of the interim remedial design/remedial action (“RD/RA”) for the Site, and EPA has provided the State with an opportunity to participate in such negotiations and be a party to this Consent Decree (“CD”).

         D. In accordance with Section 122(j)(1) of CERCLA, 42 U.S.C. § 9622(j)(1), EPA notified the U.S. Department of the Interior and the National Oceanic and Atmospheric Administration on May 10, 2016, of negotiations with PRPs regarding the release of hazardous substances that may have resulted in injury to the natural resources under federal trusteeship and encouraged the trustee(s) to participate in the negotiation of this CD.

         F. The defendants that have entered into this CD (“Settling Defendants” or “SDs”) do not admit any liability to Plaintiff arising out of the transactions or occurrences alleged in the complaint, nor do they acknowledge that the release or threatened release of hazardous substances at or from the Site constitutes an imminent and substantial endangerment to the public health or welfare or the environment.

         G. There are two pre-existing administrative orders applicable to the Site (Administrative Order on Consent for Removal Action, Mills Gap Road Groundwater Contamination Site, EPA Docket No. CER-04-2004-3755 (January 16, 2004) and Administrative Settlement Agreement and Order on Consent for Remedial Investigation/Feasibility Study, EPA Docket No. CERCLA-04-2012-3762 (January 26, 2012)).

         H. Pursuant to Section 105 of CERCLA, 42 U.S.C. § 9605, EPA placed the Site on the National Priorities List (“NPL”), set forth at 40 C.F.R. Part 300, Appendix B, by publication in the Federal Register on March 15, 2012, 77 Fed. Reg. 15276.

         I. In response to a release or a substantial threat of a release of a hazardous substances at or from the Site, CTS Corporation completed a Focused Feasibility Study (“FFS”) Report on September 21, 2015. CTS submitted a supplemental FFS on November 25, 2015.

         J. Pursuant to Section 117 of CERCLA, 42 U.S.C. § 9617, EPA published notice of the completion of the FFS and of the proposed plan for an interim remedial action on October 1, 2015, in a major local newspaper of general circulation. EPA provided an opportunity for written and oral comments from the public on the proposed plan for the interim remedial action. A copy of the transcript of the public meeting is available to the public as part of the administrative record upon which the Director of the Superfund Division, EPA Region 4, based the selection of the response action.

         K. The decision by EPA on the interim remedial action to be implemented at the Site is embodied in an Interim Record of Decision (“IROD”), executed on February 11, 2016, on which the State has given its concurrence. The IROD includes EPA's explanation for any significant differences between the IROD and the proposed plan as well as a responsiveness summary to the public comments. Notice of the IROD was published in accordance with Section 117(b) of CERCLA, 42 U.S.C. § 9617(b).

         L. Based on the information presently available to EPA, EPA believes that the Work will be properly and promptly conducted by SDs if conducted in accordance with this CD and its appendices.

         M. Solely for the purposes of Section 113(j) of CERCLA, 42 U.S.C. § 9613(j), the remedy set forth in the IROD and the Work to be performed by SDs shall constitute a response action taken or ordered by the President for which judicial review shall be limited to the administrative record.

         N. The Parties recognize, and the Court by entering this CD finds, that this CD has been negotiated by the Parties in good faith and implementation of this CD will expedite the cleanup of the Site and will avoid prolonged and complicated litigation between the Parties, and that this CD is fair, reasonable, and in the public interest.

         NOW, THEREFORE, it is hereby Ordered, Adjudged, and Decreed:

         II. JURISDICTION

         1. This Court has jurisdiction over the subject matter of this action pursuant to 28 U.S.C. §§ 1331 and 1345, and 42 U.S.C. §§ 9606, 9607, and 9613(b). This Court also has personal jurisdiction over SDs. Solely for the purposes of this CD and the underlying complaint, SDs waive all objections and defenses that they may have to jurisdiction of the Court or to venue in this District. SDs shall not challenge the terms of this CD or this Court's jurisdiction to enter and enforce this CD.

         III. PARTIES BOUND

         2. This CD is binding upon the United States and upon SDs and their heirs, successors, and assigns. Any change in ownership or corporate or other legal status of a S.D. including, but not limited to, any transfer of assets or real or personal property, shall in no way alter such SD's responsibilities under this CD.

         3. SDs shall provide a copy of this CD to each contractor hired to perform the Work and to each person representing any S.D. with respect to the Site or the Work, and shall condition all contracts entered into hereunder upon performance of the Work in conformity with the terms of this CD. SDs or their contractors shall provide written notice of the CD to all subcontractors hired to perform any portion of the Work. SDs shall nonetheless be responsible for ensuring that their contractors and subcontractors perform the Work in accordance with the terms of this CD. With regard to the activities undertaken pursuant to this CD, each contractor and subcontractor shall be deemed to be in a contractual relationship with SDs within the meaning of Section 107(b)(3) of CERCLA, 42 U.S.C. § 9607(b)(3).

         IV. DEFINITIONS

         4. Unless otherwise expressly provided in this CD, terms used in this CD that are defined in CERCLA or in regulations promulgated under CERCLA shall have the meaning assigned to them in CERCLA or in such regulations. Whenever terms listed below are used in this CD or its appendices, the following definitions shall apply solely for purposes of this CD:

         “Affected Property” shall mean all real property at the Site and any other real property where EPA determines, at any time, that access, land, water, or other resource use restrictions, and/or Institutional Controls are needed to implement the Interim Remedial Action, including, but not limited to all parcels adjacent to the Site.

         “CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. §§ 9601-9675.

         “Consent Decree” or “CD” shall mean this consent decree and all appendices attached hereto (listed in Section XXII). In the event of conflict between this CD and any appendix, this CD shall control.

         “Day” or “day” shall mean a calendar day. In computing any period of time under this CD, where the last day would fall on a Saturday, Sunday, or federal or State holiday, the period shall run until the close of business of the next working day.

         “DOJ” shall mean the United States Department of Justice and its successor departments, agencies, or instrumentalities.

         “Effective Date” shall mean the date upon which the approval of this CD is recorded on the Court's docket.

         “EPA” shall mean the United States Environmental Protection Agency and its successor departments, agencies, or instrumentalities.

         “EPA Hazardous Substance Superfund” shall mean the Hazardous Substance Superfund established by the Internal Revenue Code, 26 U.S.C. § 9507.

         “Future Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, that the United States incurs in reviewing or developing deliverables submitted pursuant to this CD, in overseeing implementation of the Work, or otherwise implementing, overseeing, or enforcing this CD, including, but not limited to, payroll costs, contractor costs, travel costs, laboratory costs, the costs incurred pursuant to ¶ 11 (Emergencies and Releases), ¶ 12 (Community Involvement) (including the costs of any technical assistance grant under Section 117(e) of CERCLA, 42 U.S.C. § 9617(e)), ¶ 26 (Access to Financial Assurance), Section VII (Remedy Review), Section VIII (Property Requirements) (including the cost of attorney time and any monies paid to secure or enforce access or land, water, or other resource use restrictions and/or to secure, implement, monitor, maintain, or enforce Institutional Controls including the amount of just compensation), and Section XIII (Dispute Resolution), and all litigation costs. Future Response Costs shall also include all Interim Response Costs and Agency for Toxic Substances and Disease Registry (“ATSDR”) costs regarding the Site.

         “Interim Record of Decision” or “IROD” shall mean the EPA Record of Decision relating to the Site Dated: February 11, 2016, by the Director of the Superfund Division, EPA Region 4, and all attachments thereto. The IROD is attached as Appendix A.

         “Interim Remedial Action” or “RA” shall mean the remedial action selected in the IROD.

         “Interim Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, (a) paid by the United States in connection with the Site between February 11, 2016, and the Effective Date, or (b) incurred by the United States in connection with the Site between February 11, 2016 and the Effective Date but paid after the Effective Date.

         “Interest” shall mean interest at the rate specified for interest on investments of the EPA Hazardous Substance Superfund, compounded annually on October 1 of each year, in accordance with 42 U.S.C. § 9607(a). The applicable rate of interest shall be the rate in effect at the time the interest accrues. The rate of interest is subject to change on October 1 of each year. Rates are available online at http://www2.epa.gov/superfund/superfund-interest-rates.

         “National Contingency Plan” or “NCP” shall mean the National Oil and Hazardous Substances Pollution Contingency Plan promulgated pursuant to Section 105 of CERCLA, 42 U.S.C. § 9605, codified at 40 C.F.R. Part 300, and any amendments thereto.

         “NCDEQ” shall mean the North Carolina Department of Environmental Quality and any successor departments or agencies of the State.

         “Non-Settling Owner” shall mean any person, other than a SD, that owns or controls any Affected Property. The clause “Non-Settling Owner's Affected Property” means Affected Property owned or controlled by Non-Settling Owner.

         “Operation and Maintenance” or “O&M” shall mean all activities required to operate, maintain, and monitor the effectiveness of the RA as specified in the SOW or any EPA-approved O&M Plan.

         “Owner SD” shall mean any SD, including Mills Gap Road Associates, that owns or controls any Affected Property. The clause “Owner SD's Affected Property” means Affected Property owned or controlled by Owner SD.

         “Paragraph” or “¶” shall mean a portion of this CD identified by an Arabic numeral or an upper or lower case letter.

         “Parties” shall mean the United States and SDs.

         “Past Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, that the United States paid at or in connection with the Site through February 11, 2016, plus Interest on all such costs that has accrued pursuant to 42 U.S.C. § 9607(a) through such date.

         “Performance Standards” or “PS” shall mean the cleanup levels and other measures of achievement of the Interim Remedial Action objectives, as set forth in the IROD.

         “Plaintiff” shall mean the United States.

         “RCRA” shall mean the Solid Waste Disposal Act, 42 U.S.C. §§ 6901-6992 (also known as the Resource Conservation and Recovery Act).

         “Remedial Design” or “RD” shall mean those activities to be undertaken by SDs to develop final plans and specifications for the RA as stated in the SOW.

         “Section” shall mean a portion of this CD identified by a Roman numeral.

         “Settling Defendants” or “SDs” shall mean those Parties identified in Appendix D.

         “Site” shall mean the CTS of Asheville, Inc. Superfund Site, encompassing approximately nine acres, located at 235 Mills Gap Road in Asheville, Buncombe County, North Carolina, and depicted generally on the map attached as Appendix C.

         “State” shall mean the State of North Carolina.

         “Statement of Work” or “SOW” shall mean the document describing the activities SDs must perform to implement the RD, the RA, and O&M regarding the Site, which is attached as Appendix B.

         “Supervising Contractor” shall mean the principal contractor retained by SDs to supervise and direct the implementation of the Work under this CD.

         “Transfer” shall mean to sell, assign, convey, lease, mortgage, or grant a security interest in, or where used as a noun, a sale, assignment, conveyance, or other disposition of any interest by operation of law or otherwise.

         “United States” shall mean the United States of America and each department, agency, and instrumentality of the United States, including EPA.

         “Waste Material” shall mean (1) any “hazardous substance” under Section 101(14) of CERCLA, 42 U.S.C. § 9601(14); (2) any pollutant or contaminant under Section 101(33) of CERCLA, 42 U.S.C. § 9601(33); (3) any “solid waste” under Section 1004(27) of RCRA, 42 U.S.C.§ 6903(27); and (4) any “hazardous waste” under Section 130A-290(a)(8) of the General Statutes of North Carolina.

         “Work” shall mean all activities and obligations SDs are required to perform under this CD, except the activities required under Section XIX (Retention of Records).

         V. GENERAL PROVISIONS

         5. Objectives of the Parties.

         The objectives of the Parties in entering into this CD are to protect public health or welfare or the environment by the design and implementation of response actions at the Site by SDs, to pay response costs of Plaintiff, and to resolve the claims of Plaintiff against SDs as provided in this CD.

         6. Commitments by SDs.

         a. SDs shall finance and perform the Work in accordance with this CD and all deliverables developed by SDs and approved or modified by EPA pursuant to this CD. SDs shall pay the United States for its response costs as provided in this CD.

         b. SDs' obligations to finance and perform the Work, including obligations to pay amounts due under this CD, are joint and several. In the event of the insolvency of any S.D. or the failure by any S.D. to implement any requirement of this CD, the remaining SDs shall complete all such requirements.

         7. Compliance with Applicable Law.

         Nothing in this CD limits SDs' obligations to comply with the requirements of all applicable federal and state laws and regulations. SDs must also comply with all applicable or relevant and appropriate requirements of all federal and state environmental laws as set forth in the IROD and the SOW. The activities conducted pursuant to this CD, if approved by EPA, shall be deemed to be consistent with the NCP as provided in Section 300.700(c)(3)(ii) of the NCP.

         8. Permits.

         a. As provided in Section 121(e) of CERCLA, 42 U.S.C. § 9621(e), and Section 300.400(e) of the NCP, no permit shall be required for any portion of the Work conducted entirely on-site (i.e., within the areal extent of contamination or in very close proximity to the contamination and necessary for implementation of the Work). Where any portion of the Work that is not on-site requires a federal or state permit or approval, SDs shall submit timely and complete applications and take all other actions necessary to obtain all such permits or approvals.

         b. SDs may seek relief under the provisions of Section XII (Force Majeure) for any delay in the performance of the Work resulting from a failure to obtain, or a delay in obtaining, any permit or approval referenced in ¶ 8.a and required for the Work, provided that they have submitted timely and complete applications and taken all other actions necessary to obtain all such permits or approvals.

         c. This CD is not, and shall not be construed to be, a permit issued pursuant to any federal or state statute or regulation.

         VI. PERFORMANCE OF THE WORK

         9. Coordination and Supervision.

         a. Project Coordinators.

         (1) SDs' Project Coordinator must have sufficient technical expertise to coordinate the Work. SDs' Project Coordinator may not be an attorney representing any S.D. in this matter and may not act as the Supervising Contractor. SDs' Project Coordinator may assign other representatives, including other contractors, to assist in coordinating the Work.

         (2) EPA shall designate and notify the SDs of EPA's Project Coordinator and Alternate Project Coordinator. EPA may designate other representatives, which may include its employees, contractors and/or consultants, to oversee the Work. EPA's Project Coordinator/Alternate Project Coordinator will have the same authority as a remedial project manager and/or an on-scene coordinator, as described in the NCP. This includes the authority to halt the Work and/or to conduct or direct any necessary response action when he or she determines that conditions at the Site constitute an emergency or may present an immediate threat to public health or welfare or the environment due to a release or threatened release of Waste Material.

         (3) SDs' Project Coordinators shall meet with EPA's Project Coordinator in person or ...


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