Virginia's largest utility faces a $40 billion lawsuit over a golf course whose owner claims the power company built it using 1.5 million tons of toxic coal ash.
RICHMOND, Va. (CN) - The 5 owner of Virginia golf course sued Dominion Resources for over $40 billion, claiming the utility lied to it as proceeded to build the facility out of 1.5 million tons of toxic coal ash.
The multimillion dollar Battlefield Golf Course has been a hotbed for legal disputes since investigators confirmed the presence of toxic chemicals leaching into a groundwater aquifer that supplies neighboring residents with their drinking water.
Upon testing the water, URS Corporation, a contractor hired by Dominion, found more than double the amount of arsenic than the safe drinking water limit, as well as high levels of chromium, lead, beryllium, manganese and zinc.
A subsequent study found, "water quality impacts in the shallow groundwater beneath the site would persist for 200 years or more."
In a complaint filed in the circuit court for the City of Richmond. plaintiff CPM Virginia, a former business partner of Dominion, says the utility was looking for a cost-effective way to dispose of an abundance of coal ash, and hired them to help with the project.
Coal ash, also known as fly ash or bottom ash, is a byproduct of coal-burning energy plants. Through burning coal, Dominion produces "enormous quantities of coal ash that need to be disposed of or used," the plaintiff says.
CPM had previously used coal ash in the successful a golf course in Pennsylvania, an instance in which it says it was able to rely on the producer of the coal ash for accurate information regarding its quality and suitability to the project.
It says Dominion expressed an interest in doing a similar project, and that the Battlefield Golf Course site was chosen after an extensive review. The defendant then lobbied the Chesapeake City Council, which had jurisdiction over the site, to grant it an exemption to rules requiring coal ash to be disposed of in a lined landfill.
But as the planning on the golf course proceeded, CPM says, it began to have reservations about the project. Namely, it says, it was troubled by Dominion's refusal to provide it with copies of environmental studies done on the site.
Instead, "Dominion provided assurances that the environmental reports indicated that there was no risk of environmental contamination with toxic or hazardous chemicals," the plaintiff says.
Based in part on these assurances, on June 24, 2001, the parties entered into an agreement to complete the development of the golf course.
CPM says that agreement was contingent upon Dominion receiving a favorable environmental assessment from its consultant that showed there was no risk of the property being contaminated by toxic or hazardous materials.
As the project moved forward, VFL Technology Corporation was appointed to prepare a mixture of coal ash with a binding agent to prevent the leaching of chemicals and make the material more suitable for landscaping.
The waste management company also oversaw transport of coal ash from Chesapeake Energy Center to Battlefield.
CPM alleges that Dominion and VFL Technology knowing concealed environmental assessments done for the project between 2001 and 2011, and hid the results to avoid pulling the plug on the project.
"The two URS studies gave Dominion actual, constructive and/or superior knowledge that the coal ash contained hazardous substances that would contaminate the property," the plaintiff says. "Dominion knew that any amount of contamination would result in the property being considered an 'open dump' in violation of State and local law."
According to the complaint, "despite being in possession of multiple reports indicating a high potential for environmental contamination due to inadequate reagent binders and the proximity of household water wells, drinking water aquifers and ecologically sensitive waterways," Dominion insisted the compounds were "safe as dirt."
Based on these assurances, CPM then exercised its option to buy the golf course.
Now CPM claims URS worked with Dominion to cover up environmental infractions due to the large financial investment it had made to "meet Dominion's requested profit margins."
The complaint alleges "engineers at URS ... changed their methods of analysis to produce results that would allow Dominion to conduct the project more profitably and based on their analysis on facts that were not supported by their own hydrogeological investigation in order to allow Dominion to conduct the project more profitably."
Dominion is also accused of endangering CPM employees exposed to high ammonia levels in the coal ash and reagent binder compound without proper protective equipment.
CPM alleges "toxic chemicals from the coal ash have contaminated the Golf Course property to such an extent that it will require complete remediation and removal ... The result of Dominion and VFL's misrepresentations is that CPM completed the project and will become owner of a contaminated coal ash dumping grounds, as opposed to the golf course it was promised under contract."
The plaintiff is seeking the more than $40 billion compensatory and punitive damages on claims of breach of contract, fraud in the inducement, intentional misrepresentation, private nuisance, breach of express warranty, breach of implied warranty, negligence, and interference with prospective business advantage.
It is represented by Richard Phillips of Easton, Md.
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