Sevenson Environmental Services, Inc., a New York environmental remediation firm, agreed on November 18, 2014, to pay $2.72 million to resolve claims that it received kickbacks and engaged in bid-rigging and rate inflation related to a contract with the EPA to cleanup a Superfund site.
The site involved is the Federal Creosote Superfund Site in Manville, New Jersey. From around 1910 to 1957, the American/Federal Creosote Treatment facility treated wood with creosote at the site. In 1962, construction began on the Claremont Development, a residential community. The former lagoons and canals of the creosoting operation were filled, and the Claremont Development was constructed on top of the site.
Eventually, creosote sludge from the former creosoting operation seeped into a residential basement. The EPA conducted surface soil sampling in 1998 and identified unsafe levels of coal tar creosote and toxic substances in the soil. Sevenson was hired as the prime contractor and awarded multiple contracts by the EPA to complete the remediation project. The remediation consisted of excavation, characterization, transportation, and disposal of approximately 450,000 cubic yards of contaminated material from two lagoons and over 100 residential and commercial properties in the area.
Coal tar creosote like the creosote used at the site is a chemical product obtained by distilling tar. It is useful as a preservative for wood and was once widely used to treat railroad ties and telephone poles. The EPA now categorizes coal tar creosote as a possible carcinogen. Exposure is also alleged to cause skin irritations, irritations to the respiratory tract, and eye irritations.
According to reports, Sevenson and several of its subcontractors earned in excess of $500,000 in illegal kickbacks over the course of approximately 10 years on the remediation. Ultimately, the government filed several lawsuits against Sevenson and the subcontractors under the federal False Claims Act and Anti-Kickback Act. Norman Stoerr, the Assistant Project Manager and contract administrator at the site, was convicted in criminal proceedings of participating in illegal bid rigging and a kickback scheme.
For more information, or for assistance with creosote-related litigation and claims, contact Toni Ellington at (504) 599-8500.
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