Federal Suit Over DDT Dumping Is Dismissed : Courts: Judge rules U.S. filed Palos Verdes case too late. Decision is blow to effort to clean up offshore deposits.

In a ruling that sent shock waves through U.S. environmental agencies, a federal judge Wednesday dismissed a huge government lawsuit against chemical companies that dumped millions of pounds of the pesticide DDT into the ocean off Palos Verdes Peninsula.

The stunning decision by U.S. District Judge A. Andrew Hauk dealt a severe blow to federal efforts to collect several hundred million dollars to be used to clean up the enormous offshore deposit of DDT--the largest in the nation--and heal the coastal environment.

The dismissal--granted on the grounds that the government lawsuit was filed too late--came five years into the case and after $24 million in taxpayer funds were spent collecting evidence. Federal lawyers said the ruling was curious because Hauk has been overseeing the case since it was filed in 1990.

Before his ruling, the Los Angeles judge--known for eyebrow-raising remarks from the bench--threw numerous personal barbs at environmentalists, the Clinton Administration and the U.S. Environmental Protection Agency. He called environmentalists a bunch of “do-gooders and pointy-heads running around snooping” and “always complaining about something or another.”

The lawsuit against Montrose Chemical Corp. and six other firms was the largest in U.S. history alleging damage to natural resources from chemical dumping, and it was expected to be a landmark case in resolving coastal pollution issues. In environmental circles, the Montrose case was often compared to the $5-billion verdict against Exxon to compensate for its 1989 massive oil tanker spill in Alaska.

“This is just unbelievable,” said Mark Gold, director of Heal the Bay, an environmental group that has worked to clean up Santa Monica Bay. “It is an outrage for the environment.”

Several lawyers said it was highly unusual for a judge to dismiss such a major case, citing a missed filing deadline under federal law, after presiding over the litigation for so many years. The motion to dismiss was originally filed in 1993. In another unusual twist, in ruling now in the companies’ favor Hauk rejected the advice of a special master he had appointed to help the case proceed.

Justice Department attorneys said they would probably appeal to a higher court, but Hauk handed them another major blow Wednesday by refusing to grant their request for an immediate appeal, which could mean an appellate court won’t review it for years.

“This isn’t over,” said Justice Department attorney Gerald George, the lead government lawyer. “They are litigating against the United States and the United States doesn’t go away.”

Karl Lytz, a San Francisco attorney representing Montrose Chemical Corp., said Hauk “did the right thing” because the case was too old for the companies to fairly defend themselves.

“From Montrose’s perspective, the government was suing us for conduct that we had terminated back in 1971, and it always seemed to us that the government’s claim had grown very stale,” Lytz said.

“We had no one left, no current employee of our company, who really knew anything about these matters. The only fair thing to do was to recognize that the claim had grown stale after all these years, and it is unfair to try to defend ourselves under the circumstances.”

DDT from the Montrose plant in Torrance was released into sewers that empty in the ocean off the Palos Verdes Peninsula for nearly a quarter of a century from 1947, when the plant opened, through 1971, when the county cut off access to the sewer system because of mounting concerns over ocean pollution.

About 100 tons of contaminated sediments still lie on the ocean floor, spread over at least a 27-square-mile area of the Palos Verdes shelf and deeper ocean floor. The federal government has wrestled for decades with what to do about the contamination, and had turned to the lawsuit to seek funds to help restore the coastal environment.

Court records filed in October show that the government has spent $23.6 million in scientific research to support the case. The suit was at a pivotal point because the government’s expert witnesses had just completed their scientific reports, and depositions had begun this month.

“The biggest loser here is definitely the environment and most likely the people in the Los Angeles area,” said John Lyons, assistant regional counsel for the EPA.

“Over the last five to seven years, EPA and the (federal) trustees have spent a lot of time, energy and money working together to address the releases that originated from the Montrose plant,” he said.

Without the opportunity to collect damages from the companies, wildlife experts and health officials warn that the DDT continues to pose a cancer threat to the health of people, largely poor minorities, who eat fish caught off Palos Verdes as well as to birds, fish and other marine life off the coast.

Since the 1950s, DDT has been linked to near-extinctions of bald eagles, brown pelicans and peregrine falcons and high amounts of contamination in sea lions, dolphins and fish. The pollutant is sucked up by aquatic organisms, building up in the food chain and accumulating in the fat of fish, marine mammals and birds.

Montrose’s Torrance plant was the largest manufacturer of the pesticide, which was banned from use in the United States in 1972.

“I can’t believe . . . how Montrose can skate, considering their contribution of 1,800 tons of DDT in the environment that still is endangering the lives of thousands of individuals, posing a cancer risk,” said Gold of Heal the Bay.

The chemical companies, however, say the scientistic evidence is unpersuasive.

“I don’t think that the government would ever be able to prove its claim,” Lytz said. “There really is no compelling evidence that anything is happening that is injurious in any significant way to the environment from the conditions out on the Palos Verdes shelf.”

The issue that Hauk ruled on--the deadline the federal government faced in filing the case--was hotly disputed by the two sides.

A 1985 federal environmental law states that natural resource damage cases must be filed within three years of the date of final regulations. In this case, the dispute came down to which year those regulations actually became “final” because they were issued once, then reversed and issued again. Hauk sided with Montrose Chemical Corp. in deciding that the earlier date applied.

His decision, though, conflicts with a decision by a Seattle federal judge who ruled the opposite way in a similar natural resource case.

Hauk dismissed the case against all defendants--four co-owners of Montrose (Chris-Craft Industries Inc., Stauffer Management Co., ICI American Holdings Inc., Atkemix Inc.), pesticide manufacturer Rhone-Poulenc Basic Chemicals Co. and Westinghouse Electric Corp., which is linked to another hazardous contaminant, PCBs, that is polluting the ocean.

The only part of the case against Montrose that is left standing is a claim filed by the EPA to force cleanup of the manufacturing plant and surrounding area in Torrance. That poses a major problem for the government because an appeal of Wednesday’s dismissal cannot be filed until that claim over the land cleanup is resolved, which could take years.

The federal government estimates that it would cost $1 billion to clean up the DDT from the ocean and restore the environment. But the federal attorneys said they were seeking far less from the companies, although they refuse to publicly reveal the amount.

Dismissal of the case also puts pressure on the EPA to grant a request by environmentalists to declare the ocean off Palos Verdes a Superfund site, which would allow the EPA to tap into a special nationwide pool of funds collected from polluters. The Torrance plant is already a Superfund site.

EPA officials said they were considering the option, but that Superfund cases often drag on for years and cost millions of dollars.

“No matter what we do, it’s going to take years, even if we decided tomorrow we ought to do something,” said Jeff Zelickson, a top-ranking administrator at EPA’s western region.

On Tuesday, a federal appeals court overturned a settlement in which Los Angeles County Sanitation Districts, which operates the sewer system, and 150 municipalities agreed to pay $45.7 million to settle their portion of the Montrose case.

A Justice Department official said Wednesday’s dismissal now means that the county and cities will probably never pay, even though the settlement had been reached.

Throughout the morning hearing, Hauk seemed irritated. At one point he called the case “an absolute mess” and he frequently called the Justice Department’s arguments “poppycock.”

He called George, the lead federal attorney, “Mr. Government,” adding, “I can’t remember your name.” Hauk also called the Natural Resources Defense Council, one of the nation’s most influential environmental groups, a small-time outfit with a Downtown Los Angeles location that is “nothing but a letter drop . . . a little office.”

He also criticized the lead plaintiff, the National Oceanic and Atmospheric Administration, as “all pointy-heads, so-called experts, pseudoscientists on environmental matters.”

On Wednesday he saved most of his wrath for Felicia Marcus, the top regional administrator of the EPA. Hauk noted that Marcus had served on the boards of Heal the Bay and the Natural Resources Defense Council before she was appointed to her EPA post.

Marcus had already disqualified herself from handling the issue because of her previous ties to Los Angeles environmentalists. But Hauk was not appeased, and he repeatedly referred to Marcus, as “that lady,” adding “they (EPA managers) are all ladies, aren’t they?”