Chemtura Corp., the bankrupt plastic-additives maker, expects to complete negotiations with most federal and state regulators over costs to clean up pollution by mid-July, a lawyer for the company said.
“We think we can have an agreement in principle with the majority of parties in the next 30 days,” Chemtura lawyer Brian Stansbury told U.S. District Judge Richard Berman in Manhattan today.
The company, based in Middlebury, Connecticut, already has a preliminary agreement with some agencies fighting for about $2 billion in cleanup costs, Stansbury said. Chemtura will file a reorganization plan by June 17 that will clarify the company’s progress in the talks, he said.
Maureen Leary, a lawyer for New York state’s Environmental Protection Bureau, said New York and New Jersey aren’t close to an agreement with Chemtura, and there is “no substantial likelihood” that they will settle within 30 days.
“We’re not hearing what we need to hear on the other side, and we haven’t heard it for 10 months,” she said. “There’s a huge chasm between the two sides.”
Chemtura, which filed for bankruptcy protection in March 2009, sued the U.S. and several states, claiming it should be able to cancel some environmental claims because of its bankruptcy. The U.S. won its bid to have the case moved to district court from bankruptcy court.
As many as 197 sites may be involved, the U.S. said in court papers. The Environmental Protection Agency is seeking about $2 billion in cleanup costs for at least 19 sites where it claims Chemtura is partly responsible. The largest estimated cost, $1 billion, is for a cleanup of the Gowanus Canal in Brooklyn, New York.
Chemtura’s complaint, filed as part of its reorganization in U.S. Bankruptcy Court in Manhattan, sought a declaration by U.S. Bankruptcy Judge Robert Gerber that all environmental claims against sites owned by affiliates or their corporate predecessors are unsecured under bankruptcy law.
“This case is about the ability of governmental entities to ensure that debtors remediate environmental harm pursuant to binding court and administrative orders,” lawyers for the U.S. wrote in court papers.
Chemtura is a successor to Crompton & Knowles Corp., a chemical maker since 1954. The company said it was burdened with “legacy liabilities” from mergers including the 1996 purchase of Uniroyal Chemical Co., a 1999 merger with Witco and the 2005 acquisition of Great Lakes Chemical Corp.
The bankruptcy case is In re Chemtura Corp., 09-11233, U.S. Bankruptcy Court, Southern District of New York (Manhattan). The district-court case is Chemtura Corp. v. U.S., 10-cv-00503, U.S. District Court, Southern District of New York (Manhattan).