Fullerton OKs $2.5-Million McColl Settlement

The City of Fullerton on Tuesday agreed to pay a $2.5-million settlement to the 141 families near the McColl hazardous waste dump who have claimed in numerous lawsuits that someone should have warned them that the landfill was not safe.

The city is the first of the three major defendants in the McColl case to settle with the families. The other two are the developers that built the tracts: the J. F. Shea Co. and the William Lyon Co.

The city’s settlement brings the total settlements, including those with nine other defendants, to $5.5 million.

Not all families were involved in all the settlements. But Jeffrey A. Matz of Encino, attorney for most of the families, said all the families will share in about $4.5 million of the $5.5-million total.

Matz called it the largest settlement ever made by a city in a toxic waste case.

“This is very good news for us,” Matz said. “Negotiations are moving right along with the other two defendants left. I’m confident we will settle this issue without going to trial.”

In fact, Matz said a settlement with the J. F. Shea Co. could come as early as today.

The Fullerton City Council agreed to the settlement at its meeting Tuesday after a lengthy closed-door meeting with its attorneys in the case. Council members pointed out that the city’s insurance carriers--more than a dozen--will pay most of the cost, and only $198,000 will come out of the city’s budget.

‘Settlement Speaks for Itself’

Councilwoman Molly McClanahan said later: “I think what was agreed to was the most reasonable option for the council.”

Matz said the “size of the settlement speaks for itself” in showing that the McColl families had a good case.

Fullerton Mayor Allen B. Catlin said the settlement is not an admission by the city that it was in the wrong.

“Our legal fees in this case have been more than $250,000,” Catlin said. “We feel we’re coming out of this pretty good by cutting our losses.”

During World War II, oil companies that produced high-octane aviation fuel deposited their waste in 12 leased sumps at the dump, operated by oil industry consultant Eli McColl.

The dump, which lies under a vacant field and part of the Los Coyotes Country Club golf course, is bordered on three sides by expensive homes in northwest Fullerton.

Concern over the dump’s noxious odors began when the first homes were occupied near the site in 1978.

After years of lobbying by Fullerton residents and local officials, the federal government agreed last year to a $26.5-million federal Superfund cleanup project to remove the foul-smelling waste. But the cleanup was blocked when a Superior Court judge in Kern County ordered a state environmental impact report.

The state is still in the planning stages of conducting its environmental study, which might not be completed for another year.

Residents involved in the lawsuits who live in the three McColl tracts--Fullerton Crest, the Meadows and the Island--have agreed to let retired Judge Joseph Wapner, who is seen on television on “People’s Court,” decide how the settlement money will be divided among them. Matz said Wapner’s plans should be submitted to Orange County Superior Court Judge Jerrold S. Oliver, who has been overseeing all the lawsuits, within the next week.

Praise for Judge

Matz credited Oliver with helping settle most of the McColl lawsuits and avoid a trial. For example, he said, Oliver ordered all the insurance carriers for the City of Fullerton to sit down at the same time with the McColl attorneys for a settlement conference.

“They were flying in here from all over the country, but it was a big help,” Matz said.

Matz said he could not predict how much each of the McColl families in the lawsuits might eventually receive because “negotiations with the two developers we have left to deal with are very delicate, and I wouldn’t want to say anything that might upset them.”

The Shea Co. was the developer for the Fullerton Crest tract; the Lyon Co. developed the Meadows and the Island.

The Orange County Board of Supervisors, a grading contractor, the current and previous owners of the Los Coyotes Country Club and four different oil companies are among the defendants that have settled with the McColl families.