Judge Bars NJ's $800M Suit Against Grace
http://www.chron.com/disp/story.mpl/ap/fn/5666628.html
© 2008 The Associated Press
PHILADELPHIA — A bankruptcy judge on Tuesday barred New Jersey environmental regulators from imposing an $800 million fine against W.R. Grace & Co. for allegedly lying about asbestos contamination in the state.
Judge Judith Fitzgerald ordered the New Jersey Department of Environmental Protection to drop a lawsuit it filed against W.R. Grace in 2005 in an effort to collect the fines.
The lawsuit said Grace lied to the state about asbestos dangers at a Hamilton, N.J., plant where it processed vermiculite for more than 40 years. The vermiculite, from a mine in Libby, Mont., was found to have contained asbestos.
When Grace closed the Hamilton plant in 1994, it submitted an environmental report to the New Jersey Department of Environmental Protection that said the vermiculite Grace processed didn't contain harmful levels of asbestos, leading the state to conclude there was no need to test the soil or clean up the site.
In 2000, however, U.S. Environmental Protection Agency found high concentrations of asbestos.
W.R. Grace filed for Chapter 11 protection April 2, 2001. Fitzgerald said New Jersey's state court lawsuit against the company ran afoul of the shield that protects bankrupt companies from legal actions.
New Jersey said its moves against W.R. Grace were exempt from the Chapter 11 shield as an exercise of its police or regulatory power. State regulators said they acted to protect the public health and safety from a company that allegedly filed false reports about the extent of asbestos contamination at a site in New Jersey.
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