Fox River PCB liability reshuffled in judge's ruling

• Georgia-Pacific%2C Glatfelter could see share of costs increase based on ruling
• Some companies exempt from further liability because of negotiated agreements with government
• NCR directed to submit proposed judgment to court by end of week

Georgia-Pacific and other area paper companies may have to contribute a greater share in the $1 billion Fox River cleanup than they realized, according to a new federal court ruling.

U.S. District Judge William Griesbach, who earlier appeared ready to leave NCR Corp. with responsibility for the entire cleanup of river, now says the company may be no more than 28 percent liable, at least for the section of the river between De Pere and Green Bay.

The new ruling is based on experts' testimony on how to apportion responsibility based on estimates of the amount of PCBs released into the river by each of the potentially responsible companies.

"NCR has established the harm is theoretically capable of division and that there is also a reasonable basis to apportion its share of the remediation costs (for that section of the river) at 28 percent," Griesbach said in a ruling issued late last week.

The ruling concerns cleanup of polychlorinated biphenyls, or PCBs, from the river. NCR produced PCB-coated paper as carbonless copy paper in the 1950s and 1960s and sold scrap from the production process to area paper companies that used it for its recyclable fiber. Production involving that recycled paper was a major source of the cancer-causing PCBs in the river.

As ordered by the federal government, dredging and processing sediment from the river has been ongoing on a stretch of the river north of the De Pere dam for the last several years. The work has been almost entirely funded by NCR and Appvion, the former Appleton Papers Inc., while legal wrangling has continued among them and paper recyclers along the river over ultimate financial responsibility for the cleanup.

Appvion, which bought NCRs paper plants in Appleton and Combined locks after PCBs were bannedin 1976, has since been found not responsible. Cleanup this year, begun March 30 and expected to run until the river freezes, is being funded by NCR, Georgia-Pacific and P.H. Glatfelter Co. under an agreement based on the assumption that the court in the future will establish final cost shares for the potentially responsible companies. The overall cleanup project is expected to run through 2017.

Several companies may be exempt from being tapped for costs because of settlement agreements they already reached with the federal government. That means most or all of the remaining work above and beyond NCR's 28 percent share will fall to Georgia-Pacific and Glatfelter. However, NCR and Appvion are free to sue them and other potentially responsible companies to recoup some of the expenses they've already paid.

Griesbach originally ruled that NCR continued to produce carbonless copy paper well after learning that PCBs posed a long-term health risk to humans and wildlife. As a result, he ruled that the company should be liable for all cleanup costs, which have been estimated at nearly $1 billion.

But the 7th District Court of Appeals overturned that ruling this fall, disagreeing with Griesbach's finding that there was no practical way to divide shares of discharge responsibility.

Under the 7th District's ruling on how to divide the shares, Griesbach last week said he had to accept NCR's contention it was no more than 28 percent liable for the portion of cleanup from the De Pere dam to Green Bay, believed to be well over half of the cost of the entire cleanup project.

NCR had no responsibility for PCB contamination upriver of its production facilities in Appleton and Combined Locks and has made no claim regarding other portions of the Fox downstream, Griesbach ruled.

"NCR is pleased with the court's ruling, which we believe is entirely correct and consistent with the position we advocated at trial and on appeal," the company said in a prepared statement. "NCR has taken a leadership position in cleaning up the Fox River and believes that it has already done more than its fair share of the work. We have consistently advocated that a reasonable remediation project shared in by all responsible parties should be the goal of the regulatory authorities."

Georgia-Pacific "is still evaluating what the consequences might be," company spokesman Mike Kawleski said Tuesday. "This just came out Friday. We need to wait for the Department of Justice and others involved. So we'll let it run its course. We don't really know what it means for us at this point."

The U.S. Department of Justice, representing the government in the action against the paper companies, declined to comment. No spokesman from Glatfelter could be reached.

Griesbach directed NCR to submit a proposed judgment to the court within the next week. The government will have another seven days to respond, Griesbach said.

— psrubas@pressgazettemedia.com and follow him on Twitter @PGpaulsrubas