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U.S. Owes Oil Companies Cleanup Costs From WWII

WASHINGTON (CN) - The Court of Federal Claims ruled that the U.S. government must reimburse oil companies for the $18 million in cleanup costs associated with the increased production of high-octane gas used in airplanes during World War II.

During the war, the government had the power to seize control of refineries for the war effort, but instead decided to execute contracts with oil companies, including Shell Oil Co. and Texaco. Long after the war was over and the contracts expired, the oil companies had to pay at least $18 million to clean up the hazardous waste created during the mass production of the 100-octane "aviation gasoline." The oil companies sought reimbursement, but the government refused, saying it lacked authority under the Anti-Deficiency Act to agree to any indemnification clause.

The claims court held that the Act does not release the government from its obligation.

"To now refuse to pay costs imposed by supporting the war effort on behalf of the United States does not benefit the honor of our Nation," Judge Smith wrote.

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