Solutia Sues 19 Companies to Recover PCB Cleanup Costs

Solutia Inc. esterday initiated a lawsuit on its behalf and on behalf of Pharmacia, a wholly owned subsidiary of Pfizer (NYSE: PFE), in U.S.

District Court for the Northern District of Alabama seeking a fair and equitable sharing of past and future cleanup costs with 19 other companies that contributed to environmental contamination -- PCBs and hazardous metals -- in and around Anniston, Alabama.

"This lawsuit will in no way slow down the cleanup process, or alter Solutia's commitment to continue leading the PCB cleanup in the Anniston community," said John C. Hunter, Solutia chairman and chief executive officer. "We will continue to move forward vigorously with the cleanup while working to sort out the financial responsibility."

"As Solutia was conducting sampling and cleanup activities under an earlier agreement with the U.S. Environmental Protection Agency (EPA), we discovered that some of the materials being cleaned up, particularly lead, cadmium and arsenic, did not originate with us. It became evident that other industries played a significant role, and they should share financial responsibility for the cleanup," Hunter said.

Solutia estimates that nearly a third of the $54 million it has spent to date on environmental investigations and remediation has addressed materials and contamination not generated by the former PCB operations in Anniston. In addition, the evidence suggests that the majority of the residential properties to be cleaned up in the future under the pending federal Consent Decree have been contaminated by sources other than run-off or discharges from the facility previously owned by Monsanto, now know as Pharmacia.

The cost recovery action initiated by Solutia follows provisions of the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA). The EPA named Solutia and Pharmacia as Potentially Responsible Parties (PRPs) for PCB cleanup in the Anniston area pursuant to CERCLA. The pending Consent Decree obligates Solutia to bring other sources of PCB contamination to the EPA's attention, which the company has done. Solutia has the right under CERCLA to file suit against companies that have contributed to the contamination to have them pay their fair share of past and future cleanup costs. Such cost-recovery actions are very common in federal cleanup programs.

The company's extensive environmental investigation and cleanup work has shown that some PCBs and hazardous metals (including lead, cadmium and arsenic) in and around Anniston came from sources other than surface water discharges from the old PCB production plant in west Anniston. "In addition, we believe that the information gathered through this investigation will be used, when appropriate, to defend the Company in the two PCB mass tort lawsuits currently in process." said Jeffry Quinn, Solutia senior vice president and general counsel. "For example, we believe that the majority of the property damage claims, alleging PCB contamination, presented to the Abernathy jury to date, could not have been caused by runoff or discharges from the former PCB operations," Quinn added.

"Because of the nature of the material in which PCBs and hazardous metals are found or the location of the contamination, some of those contaminants could not have come from our plant site. These contaminants came from foundries and other industrial facilities and were used for a variety of manufacturing purposes. PCBs and hazardous metals went from those facilities to properties in the Anniston area in several ways -- through use of foundry sand as fill material, through direct disposal in waterways, or through spent industrial fluids (heat transfer and hydraulic fluids) leaving facilities in surface water discharges," continued Quinn.

600450 Solutia Sues 19 Companies to Recover PCB Cleanup Costs
Date: 9 June 2003

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