Lockheed Payments Ordered Withheld

The retired judge who mediated a secret deal under which Lockheed Martin Corp. agreed to pay $60 million to more than 1,300 neighbors of its Burbank plant has ordered some of the payments withheld pending a review of how the settlement became public, company officials said Tuesday.

John K. Trotter, presiding justice of the state Court of Appeal until 1987 and a professional mediator, decided to investigate the “apparent breaches of confidentiality and the impact of those breaches” on the agreement, Lockheed officials said.

The judge directed the company to hold a portion of the settlement funds in escrow pending further discussions with those involved in the deal, said Maureen Curow, a spokeswoman for Lockheed Martin.

“In light of the extensive press coverage of details of the settlement reached between Lockheed Martin and Burbank residents, the mediator, Judge Trotter, is conducting a review,” Curow said.

Curow said she could not confirm that the amount being withheld was half the settlement. It was unclear how long the judge’s review would take to complete, or what his recommendations would be, she said.

“He’s not saying, ‘You’re not going to get it,’ ” or canceling it,” she said. “It’s an action he’s taking while conducting a review.”

Trotter was unavailable for comment Tuesday.

Ted McConkey, a Burbank city councilman, said Lockheed’s decision is the firm’s most recent blunder in dealing with claims by hundreds of neighbors that illnesses such as cancer may have been related to toxic contamination of water, soil and air surrounding the now-closed aerospace facility.

“I think it stinks,” McConkey said. “I think the whole process was unfair.”

The out-of-court settlement, which was disclosed last month, caused an uproar among residents who felt they were unfairly left out.

Following bitter complaints, including appeals to the City Council, neighbors who were not part of the deal sued in federal court in Los Angeles.

Patrick J. Grannan, the lead lawyer in the suit, which seeks to be certified as a class action, said he believes as many as 600,000 area residents could ultimately be involved because of contamination by Lockheed. The lawsuit seeks unspecified compensatory and punitive damages, medical monitoring and other relief.

The two named plaintiffs and others suffered loss in property values, other economic harm and losses because of Lockheed’s release of carcinogens and other toxic solvents or hazardous substances, according to the lawsuit.

Lockheed maintains that the plant posed no health risks.

Trotter, in an interview last month, said the company had several reasons for settling despite his feeling that neighbors lacked medical evidence to prove their families’ illnesses stemmed from the former plant.

He said the company, for example, could have faced a larger payout regardless of medical evidence because jury decisions are unpredictable. Also, Lockheed seemed eager to settle with at least some Burbank residents because it did cause some contamination during its many years of production in the city, he said.

Curow said notices about the judge’s latest decision were issued to residents involved in the confidential settlement by the lawyer who handled their negotiations, David Casselman. Casselman did not return calls Tuesday.

McConkey said the pending lawsuit is not likely to be the only legal action sought by residents in the wake of the confidential settlement. In addition, city officials want to schedule a town meeting that would feature Trotter.

“What we want him to do is answer as many questions for the residents as he can,” McConkey said. “The whole thing just smells.”