Source: Charleston Daily Mail (WV), February 18, 2014
Posted on: http://envfpn.advisen.com
Freedom Industries is asking the court to speed up the hearing process and give the green light to hire experts and environmental consultants to look into details of the Jan. 9 chemical spill.
Freedom wants experts and consultants to assist in remediation of the site, help preserve evidence and help in the defense against lawsuit allegations.
The filing also explained Freedom’s insurance policies, which will pay for parts of the remediation process.
In Saturday’s bankruptcy court filing, Freedom requests the hearing on this motion to take place at 10 a.m. Friday — the same time the court will hear other bankruptcy motions, including the final hearing on Freedom’s financial motion.
In January’s hearing on first-day motions, attorneys for West Virginia American Water and Freedom Industries reached an agreement for what’s known as debtor-in-possession financing while Freedom reorganizes under Chapter 11 bankruptcy code.
In this agreement, Freedom would get a $3 million cash infusion from Mountaineer Funding with the potential for an extra $1 million later.
The reason Freedom wants a hearing to hire experts to be expedited is because it wants experts to take a look at details surrounding the leak before evidence is removed or destroyed in the remediation process, according to the filing.
The filing notes Freedom’s Charleston facility must be decommissioned by March 15 and some parties against Freedom already have begun ground and metallurgical testing.
Freedom filed a motion last Friday to hire Pittsburgh-based Civil & Environmental Consultants, Inc., as special environmental consultants to look into the leak.
According to previous reports, a DEP official said in January Freedom hired the consulting company to help with site remediation.
In its filing, Freedom says the firm will investigate how the soil, groundwater and surface water were affected by the leak and will look for ways to address these effects.
“Ultimately the goal will be to remediate the site to a point where the Freedom facility represents no unacceptable risks to human health and the environment.”
Freedom says the consulting firm does not have a connection to the company or its creditors and will work with its already hired professionals in the remediation process.
According to the filing, the firm’s anticipated hourly rate ranges from $75-$195 but that rate will be approved at a later time.
Freedom also wants the court to give it the green light to hire experts and pay them from the company’s insurance policies.
Attached to its motion to retain experts were the resumes of Dayne M. Crowley, James K. Merrill, Adil H. Khan and Edward M. Beck. All of them work for Amec Environmental & Infrastructure Inc.
According to the documents, Crowley is a senior principal hydrogeologist who has conducted site investigation and remediation projects related to the closure of a facility. In his work, he determines sources of contamination.
Merrill, a principal engineer, has worked with consulting in welding and engineering.
Khan, a senior engineer and metals specialist, has worked in the study of corrosion and environmental degradation of engineered materials.
And finally, Beck is a senior principal metals specialist/vice president, who focuses on building rehabilitation, construction inspection, quality control/assurance and structural engineering issues, according to the documents.
The filing says these experts will “almost exclusively” act as consultants but later may offer opinion testimony.
Freedom noted in the filing it has worked with plaintiffs’ attorneys to preserve evidence. The company’s special counsel even led a Feb. 7 tour of the Charleston facility.
In that tour, plaintiffs’ attorneys and experts got the chance to see the facility and give input on preservation and collection of evidence.
However, Freedom says the court hasn’t yet ruled on whether the company can hire special litigation counsel. The company says it also hasn’t retained any experts.
“If (Freedom) is unable to retain the experts needed to deal with the claims against the bankruptcy estate and in some instances defend what it believes to be improper claims and/or penalties, the holders of valid claims will inevitably suffer as will its overall efforts to restructure,” the motion states.
The filing also explained about Freedom’s two insurance policies, a primary and an excess policy. Both policies are issued by AIG Specialty Insurance Company and provide coverage for things such as pollution legal liability.
According to the filing, the primary policy has an each loss limit of $1 million and a general aggregate limit of $2 million with a $25,000 deductible. The excess policy, meanwhile, has an each loss limit of $2 million and an aggregate limit of $2 million.
Before Freedom filed Chapter 11 bankruptcy, the filing states, AIG said the primary policy would provide coverage for Freedom’s defense.
After Freedom filed for bankruptcy, AIG told Freedom it would pay fees for the experts but this has to be approved by the court.