STEPHEN V. WILSON, District Judge.
The undersigned "Plaintiffs" and "Settling Defendants," as defined in Section IV herein (collectively, the "Parties"), enter into this Consent Decree (the "Decree" or "Consent Decree") in order to resolve Settling Defendants' alleged liability in connection with the releases and threatened releases of hazardous substances at the Space Bank Mini Storage facility, also known as the former Naval Information Research Foundation Under Sea Center, located at 3202 East Foothill Boulevard in the City of Pasadena, California (the "Site"). This Consent Decree resolves the liability of Settling Defendants for the "Matters Addressed" in this Consent Decree as defined in Section X.A. of this Decree.
This Consent Decree is entered into by the California Department of Toxic Substances Control pursuant to its authority under Sections 107 and 113 of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq., as amended by the Superfund Amendments and Reauthorization Act of 1986, Pub.L.No. 99-499, 100 Stat. 1613 (1986), 42 U.S.C. §§ 9607 and 9613. Pursuant to the aforementioned authority and pursuant to CERCLA § 113(f)(2), 42 U.S.C. § 9613(f)(2), the undersigned signatories to this Decree each have stipulated and agreed to the making and entry of this Consent Decree in settlement of the claims raised in the complaint (Section V).
Plaintiffs and Settling Defendants agree, and this Court by entering this Consent Decree finds, that this Consent Decree has been negotiated by the Parties in good faith and that settlement of this matter and entry of this Consent Decree avoids expensive, prolonged and complicated litigation between the Parties, benefits the environment and the community, is the most appropriate means to resolve the matters covered herein, and is fair, reasonable and in the public interest.
The Court has jurisdiction over the subject matter of this action pursuant to 28 U.S.C. § 1331 and CERCLA, and supplemental jurisdiction over claims arising under the laws of the State of California pursuant to 28 U.S.C. § 1367(a). Solely for purposes of this Consent Decree, Settling Defendants waive: (i) service of summons; and (ii) all objections and defenses they may have to the jurisdiction of the Court, venue in this district, or Plaintiffs' rights to enforce this Consent Decree. Settling Defendants agree not to challenge or object to entry of this Decree by the Court unless Plaintiffs have notified them in writing that Plaintiffs no longer support entry of the Decree or that Plaintiffs seek to modify the Decree. The undersigned Parties to this Decree agree not to challenge this Court's jurisdiction to enforce the terms of this Decree once it has been entered, and this Court maintains jurisdiction over this Decree for that purpose.
The "Parties" to this Consent Decree are as follows:
The "Plaintiffs" are:
1. The California Department of Toxic Substances Control (the "Department" or "DTSC") and the California Toxic Substances Control Account, to the extent that funds from that account, or predecessors to that account, have been, or will be, expended on behalf of the Department. The Toxic Substances Control Account is successor in interest to the following accounts:
The "Settling Defendants" are:
Concurrent with the lodging of this Consent Decree, Plaintiffs are filing a complaint pursuant to CERCLA and providing Settling Defendants with a copy of that complaint. In the complaint, Plaintiffs assert that Settling Defendants are liable under CERCLA for costs that Plaintiffs have incurred or will incur in response to releases and threatened releases of hazardous substances at the Site. Subject to the covenants, conditions, and reservations of rights in this Consent Decree, this Consent Decree resolves the claims asserted in the complaint.
Unless otherwise expressly provided herein, terms used in this Consent Decree that are defined in CERCLA or in regulations promulgated under CERCLA shall have the meaning assigned to them therein. Whenever terms listed below are used in this Consent Decree or in any attachments or exhibits hereto, the following definitions shall apply:
1. "Consent Decree" or "Decree" shall mean this Consent Decree.
2. "HSAA" shall mean the Carpenter-Presley-Tanner Hazardous Substance Account Act, California Health & Safety Code § 25300 et seq.
3. "California Hazardous Waste Control Law" shall mean California Health & Safety Code § 25100 et seq.
4. "Parties" shall mean Plaintiffs and Settling Defendants, and each of them.
5. "Response Costs" shall mean the costs associated with any removal, remedy or remedial action taken with respect to the Site, including, without limitation: (i) enforcement activities related thereto; (ii) contractor costs; and (iii) oversight costs.
6. "Site" shall mean the Space Bank Mini Storage facility located at 3202 East Foothill Boulevard in the City of Pasadena, California. A legal description of the property comprising that facility is attached hereto as Exhibit A.
Settling Defendants do not admit any allegations, findings, determinations or conclusions contained in the complaint or this Consent Decree. Settling Defendants' entry into this Consent Decree and compliance with its terms shall not be construed as an admission of liability with respect to the Site. Nothing in this Consent Decree shall be construed as an admission by any Settling Defendant of any issue of law or fact. Except as specifically provided for herein, nothing in this Consent Decree shall prejudice, waive, or impair any right, remedy, or defense that Settling Defendants may have against any entity.
The following is a summary of the Site background as alleged by the Department, which, for the purposes of this Decree, Settling Defendants neither admit nor deny. The allegations that DTSC sets forth in this summary shall not become findings of the Court and shall not be binding on any party or non-party in any pending or future litigation:
A. The Site consists of a roughly rectangular-shaped parcel of land of approximately 9.33 acres developed with 27 buildings and structures.
B. The U.S. Department of the Navy (the "Navy") reportedly constructed the majority of the buildings located on the Site between 1945 and 1954, with the exception of Building 30, which was constructed by the Navy in the 1970s. Prior to development of the Site with the current buildings, the Site was developed by C. Temple Murphy Furniture. Company, followed by the establishment of the Hamlin and Hood Stoneworks, a plaster casting and stoneworks business, in 1930. In the early-1940's, these properties were acquired by Latisteel Corporation of California, a manufacturer of steel framing, and the California Wirebound Box Company. From 1943 to 1945, the Site was leased to and developed by the California Institute of Technology for its torpedo program. From the late-1940's until about 1974, the Navy used the Site primarily for weapons research and development, focusing on propulsion and guidance systems for underwater ordnance.
C. In 1974, the Navy reportedly declared the Site excess. In 1978, the U.S. General Services Administration sold the Site to Space Bank LTD, a California general partnership ("Space Bank"). Space Bank has operated the Site since 1979 as a self-storage facility with some space allocated to small commercial workshops, which have included operations such as wood working, metal working, stone cutting, auto restoration, and paper recycling. Space Bank is a general partnership between Mr. Robert Oltman and Ms. Margaret Schubert.'
D. In 1991, an inspection by the State of California Department of Health Services identified 37 transformers on the Site that had been present since occupation by the Navy. Laboratory testing of fluids identified 19 transformers that contained polychlorinated biphenyl ("PCB") concentrations of 5 parts per million ("ppm") or greater, and were therefore subject to removal or retrofitting. Of these 19 transformers, Space Bank had ten transformers removed and had the remaining nine transformers retrofitted at Space Bank's sole cost and expense.
E. In June 1998, a 2,000-gallon gasoline underground storage tank ("UST") and two 200-gallon diesel USTs were removed by Maness Corporation for the U.S. Army Corps of Engineers (the "ACOE"). In August 1998, the ACOE conducted limited surface and subsurface soil sampling at the Site near features installed by the Navy associated with storm water collection, including catch basins, inlets and seepage pits. Science Applications International Corporation conducted a follow up investigation for the ACOE in November 2001. As a result of these investigations, various metals and both volatile and semi-volatile organic compounds were detected in soil and sediments at these portions of the Site.
F. On December 2, 2004, DTSC issued an Imminent and Substantial Endangerment Determination and Remedial Action Order ("Order") to the Navy, the ACOE, and Space Bank. According to the Order, a release or a threatened release of hazardous substances has occurred on the Site that may be an imminent and substantial endangerment to the public health or to the environment. On November 13, 2006, DTSC revoked the Order and entered into a formal dispute resolution ("DR") process with the ACOE. Since no resolution was reached at the first level of the DR process, on May 18, 2010, DTSC issued a letter to the ACOE stating the necessity for proceeding to the second level of the DR process. However, by December 2010, DTSC determined it was unproductive to continue the DR process and decided to resume its prior path of taking an enforcement action. In a letter dated March 16, 2011, DTSC formally notified the ACOE and confirmed that DTSC had terminated the DR process via email on December 13, 2010. DTSC's decision was based on the fact that the process had been ongoing for several years and it did not appear there had been any change in the positions taken by DTSC or the ACOE during that time.
G. In 2005, Kaiser Foundation Health Plan, Inc. ("Kaiser") expressed interest in purchasing the Site to demolish the existing structures, and construct a new medical office building on the Site. A subsurface soil investigation was conducted by SECOR International, Inc. ("SECOR") on behalf of Kaiser in December 2005. Results of this investigation showed the presence of volatile organic compounds ("VOCs") including acetone, xylenes, methylene chloride, toluene, and tetrachloroethylene ("PCE") ranging from 6.3 micrograms per kilogram ("µg/kg") to 180 µg/kg; TPH (carbon chain >C17) from 12 to 1100 milligrams per kilogram; and various metals.
H. In April 2006, an investigation of the vertical and lateral extent of existing impacts to soil in the vicinity of the former Navy flammable/hazardous storage building (Building 131) was conducted on behalf of the ACOE by Innovative Technical Solutions, Inc. In this investigation, soil samples were collected from three boring locations in the vicinity of Building 131. PCE was present in all three borings to a depth of 45 feet below grade at concentrations ranging from 7.1 to 44 µg/kg.
I. In March 2007, Kennedy/Jenks Consultants ("Kennedy/Jenks"), on behalf of Space Bank, conducted a Site-wide, screening-level shallow soil vapor survey. Results of this survey indicated an area-wide presence of VOCs (predominantly PCE, carbon tetrachloride, and Freon 113) at levels ranging from 0.1 to 23 micrograms per liter at the sample depth of 5 feet.
J. In May 2007, Kennedy/Jenks produced a document that summarized the Site's known environmental history. Prior to this report, the Site's history had been described in numerous prior reports and a significant volume of data had been obtained and presented. The document produced for Space Bank by Kennedy/Jenks organized this data and historical material into a single report.
K. In September 2007, Space Bank and Pasadena Gateway, LLC ("Pasadena Gateway") entered into a purchase and sales agreement for the Site. As part of the purchase and sales agreement, Pasadena Gateway agreed to perform additional response actions under the oversight of DTSC pursuant to the terms and conditions of an Agreement Not To Sue (i.e., Prospective Purchaser Agreement) entered into between Pasadena Gateway, DTSC, and the California Regional Water Control Board, Los Angeles Region (RWQCB-LA). These additional response actions include a further characterization of soils and a preliminary groundwater investigation at the Site. In November 2007, Ninyo and Moore conducted a subsurface soil investigation for Pasadena Gateway. Preliminary results of the investigation showed the presence of PCE, Freon 1113, and carbon tetrachloride to a depth of 150 feet in soil gas samples. Metals, predominantly arsenic, were detected down to 50 feet in soil matrix samples.
L. In July 2008, Kennedy/Jenks issued a detailed tenant history of the Site while under Space Bank's ownership. As set forth in the tenant history report, since the start of Space Bank's operations in 1978, there have been two primary types of tenants at the Site. The first type of tenant is an individual or business that has used the Site for self-storage Of household or office goods. The second type, of tenant is, typically, an individual or small commercial business that has out-grown a garage-sized operation and needs slightly larger accommodations. Most of these workshops are less than 1,000-square feet in size. The report concluded that most of the tenants have had little or no potential to have impacted the subsurface of the Site. Rental contracts have always prohibited the storage of flammable, explosive, or inherently dangerous materials and any tenants wanting to store, use, or dispose of large quantities of hazardous materials have never been permitted to rent at Space Bank. However, certain tenants may have used products or ingredients that contained hazardous substances, and one tenant stored certain hazardous materials in violation of the applicable rental agreement. According to Space Bank personnel, no reportable spills or fires have occurred during Space Bank's ownership.
In cooperation with DTSC, Settling Defendants have proactively engaged in extensive Site assessment and investigation activities relating to potential hazardous substances releases at the Site and Settling Defendants agree to implement and/or cooperate with DTSC in implementing additional response actions as specified in this Decree.
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C. In negotiating this Decree with Settling Defendants, Plaintiffs have taken into account: (1) Settling Defendants' past conduct and contributions towards the investigation and assessment of the Site, as set forth above; (2) any use of hazardous substances by Settling Defendants, their agents tenants and lessees, and Settling Defendants' potential responsibility for hazardous substances releases at the Site; (3) Settling Defendants' past and ongoing cooperation with DTSC; (4) the value of Settling Defendants' investigation and assessment activities to DTSC in fashioning and implementing an appropriate remedial action at the Site; and (5) the additional response actions to be conducted by Pasadena Gateway in the future. Based on these considerations, Plaintiffs have determined that the settlement set forth in this Decree, including Settling Defendants' past contribution and future obligations pursuant to this Section IX, is fair, reasonable, and consistent with the provisions of CERCLA.
Except as specifically provided in Section XI of this Decree (Reservation of Rights), Plaintiffs covenant not to sue or take any other further civil or administrative action against Settling Defendants for "Matters Addressed" in this Decree.
This Covenant Not to Sue is conditioned upon the satisfactory performance by Settling Defendants of their obligations under this Consent Decree. Except as expressly provided in Section XIII.A (Parties Bound), this Covenant Not to Sue is that of Plaintiffs only and does not affect the rights of any other agency of the State of California.
Settling Defendants are not released from any matter not addressed by this Consent Decree. Settling Defendants are not released from any claims arising from the rights reserved by Plaintiffs in Section XI of this Decree (Reservation of Rights).
Settling Defendants hereby covenant not to sue or assert any claims, causes of action or claims for reimbursement against Plaintiffs arising out of any matters relating to the Site or this Consent Decree. Settling Defendants reserve the right to take action to compel Plaintiffs to comply with the terms of this Consent Decree.
In the event Plaintiffs initiate any legal proceedings against Settling Defendants for non-compliance with this Consent Decree, Settling Defendants shall not contest their obligation to fully comply with this Decree. However, in such proceedings, Settling Defendants may raise any and all defenses that Settling Defendants deem to be relevant to the issue of whether or not they have complied with the terms of the Decree. Plaintiffs reserve their rights to recover the fees and costs they reasonably incur to enforce this Consent Decree, after first providing Settling Defendants with written notice specifying any alleged non-compliance with the terms set forth in this Decree.
Nothing in this Consent Decree is intended or shall be construed to limit the rights of Plaintiffs or Settling Defendants with respect to claims arising out of or relating to the deposit, release, or disposal of hazardous substances at any location other than the Site subject to this Decree. This Section XI, however, shall not limit the covenants not to sue and releases in this Decree that apply to claims arising from the spread or passive migration of hazardous substances from the Site.
Nothing in this Consent Decree shall constitute or be construed as a release or covenant not to sue regarding any claim or cause of action against any person (as defined in CERCLA § 101(21), 42 U.S.C. § 9601(21)) or any other entity who is not a signatory to this Consent Decree, for any liability he, she or it may have arising out of or relating to the Site. The legal and equitable rights retained include, but are not limited to: (i) the Department's right to compel any person who is not a signatory to the Decree to take response actions for hazardous substance contamination at the Site; and (ii) the rights of the Parties to seek reimbursement and/or other relief from any person who is not a signatory to this Decree for costs incurred as a result of such contamination. Except as provided in Section XIII.A (Parties Bound), nothing in this Consent Decree shall be construed to create any rights in, or grant any cause of action to, any person not a party to this Consent Decree.
Plaintiffs' Covenants Not to Sue (Section X) above, do not pertain to, and Plaintiffs reserve the right to bring claims against Settling Defendants arising from, the following matters:
Except as expressly provided in the Consent Decree, nothing in the Consent Decree is intended nor shall it be construed to preclude the Department from exercising its authority under any law, statute or regulation. Furthermore, nothing in the Consent Decree is intended, nor shall it be construed, to preclude any other state agency, department, board or entity or any federal entity from exercising its authority under any law, statute or regulation.
Notwithstanding any other provision of this Consent Decree, Plaintiffs reserve the right to institute proceedings in this action or in a new action seeking to compel Settling Defendants to perform additional response work to address the releases of hazardous substances at or from the Site and/or seeking reimbursement of the Department's Response Costs, if new information is discovered that indicates that Settling Defendants, or their agents, tenants or lessees, contributed hazardous substances to the Site in such greater amount or of such greater toxic or other hazardous effects that Settling Defendants no longer qualify for protection under the Covenants Not to Sue, because Settling Defendants (a) contributed greater than one percent (1%) of the hazardous substances at the Site or (b) contributed hazardous substances that are significantly more toxic or are of significantly greater hazardous effect than other hazardous substances at the Site.
Except as otherwise provided in this Decree, the. Parties expressly reserve all rights and defenses that they may have.
With regard to claims for contribution against Settling Defendants, the Parties agree, and the Court finds as follows:
This Decree applies to and is binding upon the Parties and each of them, and each of their trustees, corporate predecessors, administrators, successors and assignees. This Decree shall be binding upon, and inure to the benefit of, the Department and any successor agencies of the State of California, including any agencies that succeed to (1) DTSC's authority pursuant to the HSAA; and (2) DTSC's authority as lead agency of the State of California with respect to the Site.
By entering into this Decree, the Department does not waive the right to take my further actions authorized by law, except as expressly provided herein.
The failure of the Department to enforce any provision of this Consent Decree shall in no way be deemed a waiver of such provision, or in any way affect the validity of this Decree. The failure of the Department to enforce any such provision shall not preclude it from later enforcing the same or any other provision of this Consent Decree.
The statements of fact set forth in this Decree are not intended to constitute a finding by DTSC as to the risks to human health or the environment that may be posed by contamination at the Site. This Decree does not constitute a representation by DTSC that the Site, or any part thereof, is fit for any particular purpose.
Nothing herein is intended, nor shall be construed, to limit, impair, or prejudice the governmental tort, statutory or sovereign immunities available to DTSC under applicable law for its oversight or other activities with respect to the Site.
This Consent Decree may be modified upon written approval of the Parties hereto and with the consent of the court.
After this Decree has been entered by the Court, Plaintiffs shall record a copy of this Decree, including the Exhibit hereto, with the Los Angeles County Recorder with respect to the Site, solely for the purpose of informing future purchasers of the Site, or of any portion of the Site, of the contribution protection and covenants not to sue that are provided by this Decree. The Parties shall cooperate and provide assistance in taking the steps necessary to achieve the recording of this Decree.
This Consent Decree constitutes the entire agreement between the Parties and may not be amended or supplemented except as provided for in the Consent Decree.
Each party to this Consent Decree shall bear its own costs, attorneys' fees, expert witness fees and all other costs of litigation, with the following exception: Settling Defendants agree to reimburse DISC for all of its costs, if not otherwise recovered, and the reasonable fees and costs that the Attorney General bills to DTSC with respect (1) to the negotiation, approval and entry of this Decree, and (2) activities performed pursuant to Section XIII.G. (Recording), above This paragraph shall have no effect on the rights of the Department or Settling Defendants to recover such fees or costs from any other party.
This Consent Decree may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
This Decree is entered into and shall be construed and interpreted in accordance with the laws of the State of California and, where applicable, the laws of the United States.
Notification to or communication among the Parties as required or provided for in this Consent Decree shall be addressed as follows:
This Consent Decree shall be subject to a public comment period of not less than thirty (30) calendar days. DTSC may modify or withdraw its consent to this Consent Decree if comments-received disclose facts or considerations that indicate that this Consent Decree is inappropriate, improper or inadequate.
The Department will provide the Attorney General of the United States and the United States Environmental Protection Agency ("U.S. EPA") with copies of the complaint filed in the present action. Within ten (10) business days after the day that this Decree is signed by all the Parties, the Department will serve copies of this Decree on the Project Officer for California at the offices of U.S. EPA, Region IX. DTSC will also provide the Project Officer for California with notice of the opportunity for public comments, as set forth in Section XIV (Public Comment).
Notwithstanding any dismissal of this action or of any of the claims filed in this action, the Court retains jurisdiction to enforce the terms of this Decree and to resolve any disputes arising under this Decree.
The Effective Date of this Decree is the date that this Court enters an Order approving this Decree.
A. This Consent Decree, including the Covenant Not to Sue (Section X) and Contribution Protection (Section XII) provided herein, is expressly contingent upon the consummation of the sale of the Site by Settling Defendants to Pasadena Gateway and the transfer of title to the Site from Settling Defendants to Pasadena Gateway. Unless otherwise agreed to by the Parties pursuant to this Section XVIII, if, for any reason, the purchase and sale of the Site is not consummated and title is not transferred from Settling Defendants to Pasadena Gateway on or before January 30, 2016, then this Consent Decree, including the Covenant Not to Sue (Section X) and Contribution Protection (Section XII), may be terminated by Plaintiffs, as follows:
B. Should Settling Defendants and Pasadena Gateway agree to extend their closing date beyond January 30, 2016, then this Consent Decree shall continue to be deemed valid and operative and not be deemed terminated during the pendency of the extended closing date, subject to the following conditions:
C. Notwithstanding and separate from the provisions of Section XVIII.B., above, Settling Defendants may seek an extension of the Termination Date by making a written request to DTSC ("Extension Request"), which Extension Request must be received by DTSC prior to the Termination Date, and in which Settling Defendants represent that:
DTSC shall not unreasonably deny Settling Defendants' Extension Request.
If the Site is not sold, within the DTSC-approved extension period, to a purchaser who has executed a PPA with DTSC and the RWQCB-LA, then DTSC may terminate this Consent Decree. DTSC will proceed with this termination in accordance with the procedure outlined in Section XVIII.A.1.
In the event that this Consent Decree is terminated, then commencing with the Termination Date and for 120 calendar days thereafter, Plaintiffs will refrain from taking the following actions regarding conditions now known or suspected to be present at the Site:
The tolling described in Section XVIII.E.1, above, shall remain in effect during the 120 day duration of this stay of legal action.
Plaintiffs will provide Settling Defendants with thirty (30) calendar days' written notice of their election to pursue or commence an action against Settling Defendants as specified in subsections (1) and (2) above, but Plaintiffs need not provide such notice if the action is taken to address an imminent and/or substantial endangerment to the public health or welfare or to the environment.
Each signatory to this Consent Decree certifies that he or she is fully authorized by the party he or she represents to enter into the terms and conditions of this Consent Decree, to execute it on behalf of the party represented, and to legally bind that party to all the terms and conditions of this Decree.
