A state supreme court judge approved a settlement between Exxon and New Jersey on Monday, despite the fact that the settlement was $8.68 billion less than the $8.9 billion the state had originally requested.
Environmentalists are calling foul on the agreement, which they say falls dramatically short of the amount needed to clean up and restore 1,500 polluted acres of wetlands and surrounding natural environment in northern New Jersey, where Exxon operated a petrochemical operations for decades. Exxon was found responsible for the pollution in 2008.
“It’s certainly really disappointing and a little hard to understand from the outside,” Margaret Brown, an attorney with the Natural Resources Defense Council (NRDC) told ThinkProgress. Brown said that up until the closing arguments last November, the state was saying that it needed $2.5 billion to clean up the site and was asking for $8.9 billion in costs for clean up and restoration. NRDC and a group of environmental advocates applied to be named as intervenors in the case in June, but the judge turned them down.
“Once Exxon and the state agreed to the settlement, there was no one arguing the other side,” Brown said.
Calling it a “landmark settlement,” the acting attorney general’s office released a statement saying the decision “represents the single largest environmental settlement with a corporate defendant in state history and, following resolution of any appeals, ends more than a decade of aggressive and costly litigation and negotiations by the state spanning multiple administrations.”
The environmental degradation in the area is severe. According to court documents, wetlands in the area were “mostly covered with a tar of petroleum products or filled with other hazardous constituents and debris,” and there were 45 acres described as “sludge lagoons.” A state report found that “many of these dredge fill areas still look and smell like petroleum waste dumps,” the New York Times reported. “Spilled materials from pipeline ruptures, tank failures or overflows, and explosions have resulted in widespread groundwater, soil and sediment contamination,” the report continues.
The final settlement was a long time in the making. The state first filed its lawsuit in 2004, for contamination that happened over decades. That contamination includes pollution that occurred before 1976, when the state passed the so-called Spill Act, which holds polluters accountable. In an Frequently Asked Questions document provided by the attorney general’s office, the state said Exxon argued “vigorously” that discharges prior to the passage of the Spill Act should not be covered. The state suggested that continuing to pursue an award from the courts could result in the court agreeing that Exxon did not have to cover those damages.
According to the New York Times, the Christie administration petitioned the court twice to hold off on issuing an award, citing ongoing settlement talks. In February, the two litigants submitted the settlement.
In his decision, Judge Michael Hogan wrote, “For seven years, Exxon repeatedly responded to the State’s olive branches with only token offers. An aggressive trial strategy is often the only way to bring reluctant parties to the table, and the state employed this tactic with success. The February 2015 agreement was not made on a whim, but was the end product of lengthy negotiations and zealous advocacy at trial.”
Only $50 million of the settlement is set aside for natural resources, Brown said. Another $50 million will go to outside counsel, and the rest will fall to New Jersey’s general fund.
“To us its just simply unacceptable to accept such a small amount, and it’s just really a loss for the people of New Jersey and the environment,” she said.