Friday, February 20, 2009

Natural Resource Damages ruling helps, hurts New Jersey's DEP

In a double-edged decision last month, a state court ruled that the New Jersey Department of Environmental Protection can order responsible parties to pay for Natural Resource Damages (NRD) even if the site contamination occurred prior to the April 1, 1977 adoption of the state's Spill Act.

The ruling was a defeat for ExxonMobil which, under a 1991 Administrative Court Order, has been remediating refinery sites in Linden and Bayonne while actively opposing the payment of pre-Spill Act NRD claims.

That portion of the decision was a big victory for the state and is likely to lead to substantial financial awards. The state says its prosecution of NRD cases has already produced $55 million for restoration projects.

But the judge also ruled that the state could not recover its attorney fees incurred in pursuit of pre-Spill Act NRD claims.

That has to be a serious blow to the Department since it has used private law firms to pursue virtually all of its major NRD claims on a contingency fee basis.

For more, check out:

Saul Ewing environmental attorney David C. Apy's analysis of the ruling

N.J. going after ExxonMobil $$$ (Jersey Journal article)

N.J. wins court round in ExxonMobil spill case (NJBIZ)

A September, 2003 DEP policy directive on natural resource damages

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