U.S. Ecology Wins Round in Dispute Over Cleanup

American Ecology Corp., a waste-disposal concern based in Agoura Hills, won a round in its legal fight with the state of Illinois over hazardous-waste sites near Sheffield, about 120 miles west of Chicago.

Illinois Circuit Judge Fred P. Wagner last week dismissed one of two suits that Illinois had filed against U.S. Ecology Inc., a subsidiary of American Ecology.

At issue are two chemical-waste sites and a low-level radioactive-waste site that U.S. Ecology had operated near Sheffield. Both sides agree that all three sites are leaking and must be cleaned up, although U.S. Ecology contends that the contamination is limited to the sites and “does not pose a threat to the people around there or to the drinking water supply,” said spokeswoman Nicki Hobson.

The dispute centers largely on how U.S. Ecology should clean up the sites. Illinois is asking the court to force U.S. Ecology to unearth most of the hazardous material and move it to another area, whereas U.S. Ecology wants to treat the problem at the sites, Hobson said.

“We are committed to taking care of it; it’s just a difference of opinion as to what ought to be done,” Hobson said.

Millions Hinge on Outcome

The outcome could mean tens of millions of dollars to American Ecology, which conceded in its 1987 annual report that the suits “could have a material adverse effect” on its financial standing. In 1987, it earned $4.6 million on revenues of $68.1 million.

“No one is really sure at this point” how much each cleanup plan would cost, Hobson said. But she estimated that American Ecology’s proposal would cost about $10 million to $12 million. As for the state’s proposal, Hobson said she has heard estimates that it could cost American Ecology “anywhere from $400 million to $500 million.”

The suit dismissed last week, filed in 1980, covered the chemical sites. It was dismissed because prosecutors failed to fully respond to U.S. Ecology’s requests for information to prepare its defense, said court clerk Wayne Jacobson.

However, he noted, Wagner dismissed the suit “without prejudice,” meaning that the state is free to refile the suit. Richard Cosby, a special assistant attorney general for Illinois, said his office probably would either refile or ask Wagner to reverse his decision.

The other suit, filed in 1978 and covering the radioactive-waste site, is pending before Wagner. Its next hearing is scheduled for April 28, Jacobson said.

One of the chemical-waste sites was in operation from 1967 to 1974 and the other from 1974 until 1983. The radioactive-waste site was used between 1968 and 1978.