The Fort Smith Board of Directors for the first time Tuesday (Feb. 11) heard from an attorney who believes the city may have the authority to level fines against Whirlpool Corp. for its admitted pollution of groundwater in and around the area of the company's former manufacturing facility in south Fort Smith.
The attorney, Melissa Sims of Sims Law Office in Princeton, Ill., reached out to City Administrator Ray Gosack after reading about the contamination issue on the Internet. In a letter to Gosack, Sims explained what her firm could provide the city should she be retained for legal representation.
"As we discussed, I partner with several top tier law firms in the country and together we represent municipalities in utilizing the city's ordinance violations to fine polluters for contamination on a contingency fee basis," she wrote, adding that she began her practice following her work as village attorney in DePue, Ill., where she used the village's nuisance ordinance to level fines against both Exxon Mobil and CBS Viacom for environmental contamination.
"The Seventh Circuit Court of Appeals ruled that no federal preemption applied and we grappled with state law preemption on the issue of abatement (injunction) action. Ultimately, the Village of DePue settled with the defendants for $975,000."
She said her firm, which only charges clients one-third of any judgment against defendants, have the resources to go after large corporations like Whirlpool, while other small local firms may not have the manpower or finances to wage a tough battle.
"I have other cases filed – and yet to be filed – in Illinois and other states working with large firms on a contingency fees basis to assist cities such as Fort Smith seek restitution for contamination from old factories which have reaped enormous benefit from spreading hazardous materials."
Sims, who participated in a conference call with the Board during Tuesday's study session, said in the case of Fort Smith, it could be possible to fine Whirlpool for not only polluting the land where the company sits, but also other properties where a toxic plume of trichloroethylene (TCE) has migrated in groundwater during the 30 years since the company's admitted spill of the cancer-causing chemical.
The local ordinance that could be used is the city's ban on littering, which imposes an initial $500 fine and subsequent $250 fines for everyday the litter is not cleaned up.
Sims said her initial research on Arkansas' statute of limitations laws indicates that municipalities, such as Fort Smith, may not have a stated timeline of how far back in time a city could go when it comes to imposing a fine, though a lot of it depends upon how far back it can be proven that the violator, in this case Whirlpool, committed the violation. By the company's own admission, TCE contamination occurred in the early 1980s, a time when the company stopped using the degreasing agent at its Fort Smith manufacturing facility.
In discussing the possibility that the city could retain counsel to pursue fines against Whirlpool, City Director Keith Lau raised the issue of whether pursuing legal action against the company would hurt the city's attempts to attract other businesses.
"We want to protect the citizens, I understand that. We want to protect and enforce our nuisance laws, I understand that. But we've also all talked about being business friendly in the city of Fort Smith and promoting industry. What kind of message does this send — and it's just something to think about — what message are we sending if there's an industry out there that inadvertently contaminates the groundwater, brings it to us, goes to the ADEQ, goes through their steps of remediation and then at the very end, we sue them — not sue them, fine them — for contamination? So there's a balancing act here and I'm not sure I'm comfortable with this."
City Director Philip Merry challenged Lau's statement, recalling how long it has taken Whirlpool to address the contamination that has spread from its facility to the neighborhood north of the factory.
"I can't imagine that there's a company out there that would think that 30 years is (a) fair timeframe to rectify a problem. And I can't imagine there's one out there that would find our litter laws so strong that they don't want to come (and) have to comply. I'm asking that we definitely allow this professional to dig in for free to see laws have been broken and recommend back to us what laws have been broken and what she thinks would be a fair thing to request and then we make the decision at that time. I think to not make an informed decision, as in to allow her to dig in and recommend for free, would be remiss on our part."
Merry made a motion to place the consideration of retaining Sims on the Feb. 18 Board agenda for a vote, with City Director Pam Weber seconding the motion.
Should Sims determine the city could impose fines on the city, she said it could up a month after being retained by the city before any court actions against the Benton Harbor, Mich.-based company are filed.
If fines are imposed and Whirlpool is found in violation or settles with the city, Gosack said Arkansas was clear that the money would have to be used for "governmental purposes," which he said could include infrastructure improvements or economic development initiatives, such as enlisting outside help to market the Whirlpool site to interested buyers. He said any money collected could not, by state law, be distributed to residents living above the plume, many of whom are engaged in a class action lawsuit against the company.
Following the meeting, resident Debbie Keith, who has been a vocal advocate for citizens in the contaminated area, voiced support for possible fines against the company and expressed disappointment at Lau's statement about the message imposing fines would send to businesses wanting to locate in Fort Smith.
"I think the city of Fort Smith should set a precedent and say this is not going to be acceptable. If you want to come here and do business (as) a blue collar industry, then you need to be responsible," she said. "It's absolutely ridiculous at this point in the game that we would even consider what Whirlpool thinks by any means. And yeah, they should be punished. If we have to slap their hands and tell them no, this is not acceptable…ADEQ should have done it. That's their job. ADEQ's not done their job, so we're being forced to do something."