Free Brief in Support of Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-0627-MSK-BNB LENNAR COLORADO, LLC,~ Plaintiff,
V.

THE UNITED STATES OF AMERICA, THE UNITED STATES DEPARTMENT OF DEFENSE, THE U.S. ARMY, THE U.S. AIR FORCE, and THE U.S. NAVY, Defendants. MEMORANDUM IN SUPPORT OF JOINT MOTION FOR ENTRY OF CONSENT DECREE INTRODUCTION Plaintiff Lennar Colorado, LLC ("Lennar"), and Defendants United States of America, United States Department of Defense, United States Army, United States Air Force, and United States Navy (collectively, "United States"), submit this memorandum in support of their Joint Motion for Entry of Consent Decree. This case was brought by Plaintiff Lennar against the United States pursuant to the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq., to recover costs Lennar incurred in investigating and cleaning up two parcels of property it owns located on the Former Lowry Bombing and Gunnery Range ("Range") located east of the Denver metropolitan area. Pursuant to the proposed Consent Decree, which is attached to the accompanying Joint

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Motion for Entry of Consent Decree, the United States will pay Lennar the sum of $4.55 million in consideration of Lennar's covenant not to sue and Lennar's agreement to indemnify the United States for costs the United States might incur, up to $4.55 million, relating to military munitions, munitions constituents, or inert items related thereto, on the High Plains and Beacon Point parcels. The proposed Consent Decree was negotiated at arm's-length after the parties undertook extensive discovery, retained experts, and filed numerous motions. As described in more detail below, the terms of the settlement are fair, reasonable, and faithful to the objectives of CERCLA, and the Court should therefore enter the Consent Decree. BACKGROUND A. Factual Background1/ Beginning in 1937, the United States War Department acquired approximately 65,000 acres of land southwest of Denver, Colorado, which was opened in 1942 as an Army facility known as Buckley Field. During World War II, Buckley Field contained six areas designated as bombing targets, a rocket and gunnery target, nine air-to-ground flexible gunnery targets, a nose and tail guns target, ajeep range, and three training camps. In 1946, about 59,000 acres of Buckley Field were assigned to the Lowry Bombing and Gunnery Range ("Range"). Sometime between 1949 and 1956, a ground-to-air gunnery range using small drone aircraft was established at the far southwest comer of the Range (the subsequent site of one of the parcels at issue in this case, "High Plains"). A 20 mm firing range was placed on the northwest portion of the Range, with firing directed towards the southeast. In 1965, the Air Force established an explosive l_/The following factual background section is based upon the "Stipulated Facts" submitted by the parties to the Court on May 4, 2005. 2

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ordnance refresher course on an area known as the "Jeep Range," which was located directly north of the other parcel involved in this case, the "Beacon Point" property. See Attachment A. The federal government disposed of substantially all the Range real property to other federal agencies, the State of Colorado and private parties between 1960 and 1980. The Range therefore became a "Formerly Used Defense Site" ("FUDS") within the meaning of the Defense Environmental Restoration Program ("DERP") statute, 10 U.S.C. § 2700 et seq. The DERP statute directs the Secretary of Defense to carry out a program of environmental restoration at FUDS sites. 10 U.S.C. § 2701(c)(1)(B). That responsibility has been delegated to the U.S. Army Corps of Engineers ("Corps"). In 1995, the Corps issued an "Archive Search Report," which concluded that there were potential ordnance and explosive wastes on the Range. The Corps then began an on-site investigation of the Range. At the same time, the Colorado Department of Public Health and Environment ("CDPHE") took on a regulatory role at the Range pursuant to the Colorado Hazardous Waste Act ("CHWA"), Colo. Rev. Stat. 25-15-101 et seq. The Corps and CDPHE disagreed on the proper method for investigation of the Range and the relative authority of the federal government and the State government over the manner of cleanup. In 1997, CDPHE issued a compliance order to the federal government under the CHWA, and then sued to enforce the order. That led to a settlement between the federal government and the State, in which the parties agreed to priorities and methods for cleanup of particular portions of the Range, but did not resolve the issue of the relative authority the Corps and CDPHE over the project. In April 1965, the United States quitclaimed a section (640 acres) of land located at the 3

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far southwest comer of the Range to representatives of the "Lowry Trust," a general partnership. That property, later known as the High Plains parcel, was sold in June 1999 to Heartland Colorado, LLC. Heartland Colorado was a Colorado limited liability company whose members were U.S. Home Corporation (Lennar's predecessor) and Colorado Land Source, a company which previously had located the property and put it under contract.~ U.S. Home ultimately became the sole member of Heartland Colorado, LLC. In March 1965, the United States quitclaimed to a group of investors a parcel of land that included what was later known as the 370-acre Beacon Point property. In January 2001, the Beacon Point parcel was sold to SEA Joint Venture, LLC, a Colorado limited liability company whose sole member was U.S. Home. The City of Aurora had annexed portions of the Range including High Plains and Beacon Point in 1988. In order to develop the properties for residential use, Lennar was required to obtain approvals from the City of Aurora. After an inquiry by Aurora, CDPHE indicated its belief that both High Plains and Beacon Point should be subjected to in-depth investigation and clearance before Aurora granted the necessary permission for development of the parcels. U.S. Home and CDPHE then entered into separate "Consent Agreements" for High Plains and Beacon Point under authority of the Colorado Hazardous Waste Act, in which U.S. Home agreed to perform investigations and clearances of those properties under the supervision of CDPHE. U.S. Home retained Foster Wheeler Environmental Corporation ("Foster Wheeler") to
In a corporate reorganization in December 2003, U.S. Home Corporation assigned its claims and liabilities regarding High Plains and Beacon Point to Lennar Colorado, LLC. While Heartland Colorado, LLC, and SEA Joint Venture, LLC, remain the record owners of High Plains and Beacon Point, the parties have stipulated that Lennar Colorado, LLC, should be treated as the owner of High Plains and Beacon Point for purposes of this litigation.

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perform an investigation and to clean up both parcels under the Consent Agreements. CDPHE ultimately accepted the work performed by Foster Wheeler. During its investigation, Foster Wheeler found 14 unexploded 20 mm "high explosive incendiary" projectiles on High Plains, as well as a buried cache of approximately 1,400 unexpended 20 mm target (non-explosive) cartridges; about 500.50-caliber cartridges, still in their original boxes; and eleven unexpended 20 mm cartridges on other areas of High Plains. Foster Wheeler found part of one 2.75-inch folding fin aircraft rocket with unexpended propellant on Beacon Point. Much inert munitionsrelated material was also found on both parcels, which was transported from the site or destroyed by the Corps.3J The parties have stipulated that Lennar paid $6,268,460.30 with regard to the investigation and clearance of the High Plains property, $1,376,603.20 regarding Beacon Point, and $49,800.00 for its share of general work plans developed by Foster Wheeler on behalf of a group of developers at the Range. Lennar also claims an unspecified amount for the work done by Foster Wheeler regarding the High Plains Extension. B. Statutory_ Background Congress enacted CERCLA in 1980 in response to the serious environmental and health dangers posed by property contaminated by hazardous substances. United States v. Bestfoods, 524 U.S. 51, 55 (1998). CERCLA provides the President with alternative means for cleaning up contaminated property. Federal agencies acting under a delegation from the President can undertake response actions to address hazardous substances, see 42 U.S.C. § 9604, or EPA or
3_/In addition to the High Plains and Beacon Point properties, in 2004 Foster Wheeler also investigated and cleared a 22.5-acre parcel adjacent to High Plains known as the "High Plains Extension."

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certain other agencies including the United States Department of Defense can compel responsible parties (through an administrative order or a request for judicial relief) to undertake response actions, which the lead federal agency then monitors, see id. § 9606. Under either approach, the United States may recover the costs associated with the response action ("response costs") through a cost recovery action under section 107(a). Id. § 9607(a). CERCLA also provides an avenue by which parties that clean up contaminated hazardous waste sites may either recover all the "response costs" they incur, jointly and severally, from entities which are "potentially liable parties" ("PRPs"), 42 U.S.C. § 9607(a)(4)(A), or obtain contribution from PRPs for the costs of the cleanup. 42 U.S.C. § 9613(f). The PRP categories include (1) owners and operators of facilities at which hazardous substances4-/are located; (2) past owners and operators of such facilities at the time hazardous substances were disposed of; (3) persons who arranged for disposal or treatment of hazardous substances; and (4) certain transporters of hazardous substances to the site. 42 U.S.C. § 9607(a)(1)-(4). In order to establish aprimafacie case for joint and several cost recovery under 42 U.S.C. § 9607(a), or for contribution, a private plaintiff must establish that (1) the site in question is a "facility"; (2) the defendant is a PRP; (3) the release or threatened release of a "hazardous

Under CERCLA, "hazardous substance" is defined to include hazardous substances as defined in the Clean Water Act, 33 U.S.C. § 1321(b)(2)(A); "toxic pollutants" under the Clean Water Act, 33 U.S.C. § 1317(a); "hazardous air pollutants" under the Clean Air Act, 42 U.S.C. § 7412; "imminently hazardous" chemical substances or mixtures under the Toxic Substances Control Act, 15 U.S.C. § 2606; additional substances specifically named as "hazardous substances" by EPA under CERCLA, 42 U.S.C. § 9602; and any wastes either having the "characteristics of hazardous waste" or having been "listed" by EPA as a "hazardous waste" under the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6921. 6

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substance" has occurred; and (4) the release or threatened release of hazardous substances caused the plaintiff to incur "necessary response costs" consistent with the National Contingency Plan ("NCP"). County Line Investment Co. v. Tinney, 933 F.2d 1508, 1513 (10th Cir. 1991); 42 U.S.C. § 9607(a)(4)(B). The NCP is a series of EPA regulations governing the manner in which CERCLA cleanups are to be undertaken. 40 C.F.R. Pt. 300. There are a limited set of defenses to liability under CERCLA, which must be proven by a PRP by a preponderance of the evidence, including the "innocent landowner" exception to CERCLA liability. A person who purchases a site upon which there has been a previous release of hazardous substances may escape CERCLA liability if the person can prove by a preponderance of the evidence that "[a]t the time the defendant acquired the facility the defendant did not know and had no reason to know that any hazardous substance.., was disposed of on, in, or at the facility." 42 U.S.C. § 9601(35)(A). In order to establish that the purchaser had "no reason to know" of the releases, he must show that he "carried out all appropriate inquiries.., into the previous ownership and uses of the facility in accordance with generally accepted good commercial and customary standards and practices" .... U.S.C. 42 § 9601(35)(B). Claims against federal PRPs for contribution under CERCLA are governed by section 113 (f), 42 U.S.C. § 9613(f). Plaintiff Lennar asserts that an implied cause of action for contribution exists under CERCLA section 107(a), apart from CERCLA section 113(f). The United States disputes that contention.

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C.

Course of the Litigation In its Complaint, filed on March 31, 2004, Lennar alleged that pursuant to section 107(a)

of CERCLA, 42 U.S.C. § 9607(a), the United States is jointly and severally liable to Lennar for all of Lennar's or its predecessor's response costs and alternatively, that the United States is liable to Lennar in contribution for some or all of those costs pursuant to CERCLA section 113(0, 42 U.S. § 9613(f). The parties engaged in extensive discovery, taking more than a dozen fact, record and expert depositions, and exchanging interrogatories, requests for documents, and requests for admissions. They reviewed more than one hundred thousand pages of documents and retained numerous experts to review and consult on various technical topics. Lennar ultimately determined that it would drop its contribution claims under CERCLA section 113(f), and proceed under a theory of joint and several liability under CERCLA section 107(a) and an implied cause of action for contribution under section 107(a). The United States filed a motion for summary judgment in May 2005, to which Lennar responded. In the meantime, the parties began to explore settlement, ultimately resulting in the proposed Consent Decree. D. Consent Decree Terms The proposed Consent Decree provides that the United States will pay Lennar the sum of $4.55 million. As consideration for this payment, Lennar2 covenants not to sue the United

"Lennar" is defined in the consent decree to mean Lennar Colorado, LLC, and its "parent entities, assignors, subsidiaries, successors and all related entities, past and future, as well as their officers, directors and agents." Consent Decree, ¶ l(f).

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States~ under CERCLA or "any other state or federal statutory or common law, in law or equity," for "costs, injunctive relief, natural resource damages, and/or any other relief," relating to "environmental contamination" on Beacon Point or High Plains. Id., ¶ 4. The covenant does not extend to claims against the United States for personal injury to third parties accruing after the entry of the Decree, and the United States expressly retains all defenses it might have to such a claim. /d. As additional consideration for the United States' payment, Lennar agrees to indemnify the United States "for any costs, natural resource damages, and/or the cost of any injunctive relief" arising under CERCLA, the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6901 et seq., the Colorado Hazardous Waste Act, or any other law, "which the United States incurs or for which it is sought to be held liable by any third party," including the State of Colorado and subsequent purchasers of some or all of Beacon Point and High Plains, in connection with military munitions, munitions constituents, or inert items associated with military munitions or constituents, now or formerly located on Beacon Point or High Plains. Consent Decree, ¶ 5. Lennar's indemnification obligation is limited to $4.55 million, the amount of the United States' payment, and excludes personal injury claims made by third parties. The United States is entitled to conduct the defense of any claims, and to litigate or settle the claims at its complete discretion. /d. Lennar also agrees to give, to any "subsequent purchaser or transferee of Lennar of any "United States" is defined in the consent decree to mean "the United States of America and all of its agencies, departments and instrumentalities, their officers, agents and employees, including but not limited to the Department of Defense, the United States Army, the United States Air Force, the United States Navy, and the Corps." Consent Decree, ¶ 1 (h). 9

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portion of the Beacon Point or High Plains parcels," notice of: (1) the fact that those parcels are located within the boundaries of the Range; (2) the history of investigations and clearance of military munitions, munitions constituents, and related inert items on the parcels; and (3) the risk that military munitions, munitions constituents, and inert times may remain on the parcels. Consent Decree, ¶ 7. Lennar also agrees to place a notice to that effect in the real property records of Arapahoe County, Colorado, and states that it has given equivalent notice to entities to which it has already transferred, or is in the process of transferring, property on Beacon Point or High Plains. Id. The proposed consent decree includes a provision acknowledging the parties' agreement that the United States is entitled to protection from contribution claims pursuant to CERCLA section 113(0(2), 42 U.S.C. § 9613(f)(2), and any other applicable provisions of federal or state law. Finally, the proposed consent decree states that the United States' obligations under the decree are subject to the availability of appropriated funds, and that no provision of the decree should be interpreted as requiring a payment in violation of the Anti-Deficiency Act, 31 U.S.C. § 1341, or other applicable law, Consent Decree, ¶ 3; that nothing in the decree is an admission or adjudication of any issue of fact or law, ¶ 8; that the decree is not a waiver, release or covenant not to sue any person not a party to the decree, ¶ 9; and that the decree is binding on the parties and their successors and assigns, but does not bar EPA or any other agency of the United States charged with environmental enforcement authority from acting within its authority as to Lennar. 711. lO

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STANDARD OF REVIEW APPLICABLE TO CONSENT DECREES A. General Principles "The initial decision to approve or reject a settlement proposal is committed to the sound discretion of the trial judge." SECv. Randolph, 736 F.2d 525,529 (9th Cir. 1984), quoting Officers for Justice v. Civil Serv. Comm 'n, 688 F.2d 615,625 (9th Cir. 1982); accord Jones v. Nuclear Pharmacy, Inc.~ 741 F.2d 322, 324 (10th Cir. 1984); United States v. Jones & Laughlin Steel Corp., 804 F.2d 348, 351 (6th Cir. 1986); United States v. Hooker Chem. & Plastics Corp., 776 F.2d 410, 411 (2nd Cir. 1985); United States v. Union Elec. Co., 132 F.3d 422, 430 (8th Cir. 1997); Kelley v. Thomas Solvent Co., 717 F. Supp. 507, 515 (W.D. Mich. 1989). Courts generally accord substantial deference to settlement agreements in general because "It]he inveterate policy of the law is to encourage, promote, and sustain the compromise and settlement of disputed claims." Am. Home Assurance Co. v. Cessna Aircraft Co., 551 F.2d 804, 808 (10th Cir. 1977), (quoting Tulsa City Lines v. Mains, 107 F.2d 377, 380 (10th Cir. 1939). See also, United States v. Akzo Coatings of Am. Inc., 949 F.2d 1409, 1436 (6th Cir. 1991) (there is a "presumption in favor of voluntary settlement"); Citizens for a Better Env 't v. Gorsuch, 718 F.2d 1117, 1126 (D.C. Cir. 1983) (both the parties and the public benefit from the "saving of time and money that results from the voluntary settlement of litigation"). Judicial deference to negotiated settlements is particularly appropriate where the government has entered into a consent decree. The Supreme Court has stated that: Sound policy would strongly lead us to decline.., to assess the wisdom of the Government's judgment in negotiating and accepting the.., consent decree, at least in the absence of any claim of bad faith or malfeasance on the part of the 11

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Government in so acting. Sam Fox Publ'g Co. v. United States, 366 U.S. 683,689 (1961). The policy of encouraging early settlements is strengthened where "a government actor committed to the protection of the government interest has pulled the laboring oar in constructing the proposed settlement.'" United States v. Cannons Eng'g Corp., 899 F.2d 79, 84 (1St Cir. 1990). See also United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir.) (the balancing of interests "must be left, in the first instance, to the discretion of the Attorney General"); United States v. Associated Milk Producers, Inc., 534 F.2d 113, 117 (8th Cir. 1976) ("Attorney General must retain considerable discretion in controlling government litigation and in determining what is in the public interest"); Randolph, 736 F.2d at 529 (a court "should pay deference to the judgment of the government agency which has negotiated and submitted the proposed judgment"). B. The Legal Standard to be Applied

"In exercising its discretion, the trial court must approve a settlement if it is fair, reasonable and adequate." Jones v. Nuclear Pharmacy, Inc., 741 F.2d 322, 324 (10th Cir. 1984). See also United States v. Oregon, 913 F.2d 576, 580 (9th Cir. 1990); Randolph, 736 F.2d at 529. In reviewing a consent decree, a district court must determine whether the proposed settlement fairly and reasonably resolves the controversy in a manner consistent with the public interest and applicable law. Jones & Laughlin Steel, 804 F.2d at 351; United States v. Metro. St. Louis Sewer Dist., 952 F.2d 1040, 1044 (8th Cir. 1992). ¯ A court is not required to make the same in-depth analysis of a proposed settlement that it 12

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would be required to make in order to enter a judgment on the merits after trial: Because a consent judgment represents parties' determination to resolve a dispute without litigating the merits, the court's role is not to resolve the underlying legal claims, but only to determine whether the settlement negotiated by the parties is in fact a fair, reasonable and adequate resolution of the disputed claims. United States v. County of Muskegon, 33 F. Supp. 2d 614, 620 (W.D. Mich. 1998), citing Citizens for a Better Env 7, 718 F.2d at 1126 ("The trial court in approving a settlement need not inquire into the precise legal rights of the parties nor reach and resolve the merits of the claims or controversy, but need only determine that the settlement is fair, adequate, reasonable and appropriate under the particular facts and that there has been valid consent by the concerned parties"). After performing its analysis, "the district court is faced with the option of either approving or denying the decree." United States v. Colorado, 937 F.2d 505,509 (10m Cir. 1991). "While the court may either approve or deny the issuance of a consent decree, generally it is not entitled to change the terms of the agreement stipulated to by the parties." Id. "Ultimately, the district court is faced with the option of either approving or denying the decree; 'the settlement must stand or fall as a whole.'" Id., citing Officers for Justice, 688 F.2d at 630. ARGUMENT The Tenth Circuit has articulated a four-part test to determine whether a proposed settlement is fair, reasonable and adequate. Specifically, the court should consider (a) whether the proposed settlement was fairly and honestly negotiated; (b) whether serious questions of law and fact exist, placing the ultimate outcome of the litigation in doubt; (c) whether the value of an

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immediate recovery outweighs the mere possibility of future relief after protracted and expensive litigation; and (d) the judgment of the parties that the settlement is fair and reasonable. Nuclear Pharmacy, 741 F.2d at 324 (10th Cir. 1984). The proposed Consent Decree clearly satisfies these criteria. In addition, the settlement serves the purposes of CERCLA. A. The Consent Decree was Fairly and Honestly Negotiated The terms of the Consent Decree were arrived at by the parties after extensive discovery, consultation with experts, and the filing of a dispositive motion by the United States. The settlement negotiations did not begin in earnest until after both parties had full information regarding the facts, many of which were stipulated, and after experts retained by the parties opined on various issues material to the case. Counsel for both parties were competent and experienced in litigating CERCLA cost recovery claims. The litigation was conducted in a collegial yet adversarial manner, and neither party held any undue advantage over the other in terms of access to legal advice or resources to pursue the case. The proposed Consent Decree was negotiated at arm's length by counsel, and included numerous offers and counteroffers, as well as detailed conversations regarding Consent Decree language. B. Serious Questions of Fact and Law Exist Both parties recognized and evaluated litigation risk in deciding to enter into the Consent Decree. At the time the parties reached their settlement, the United States had filed a motion for summary judgment, arguing that (a) Lennar's claimed response costs were not incurred in a manner "consistent" with the NCP, a necessary element of Lennar's claim; (b) Lennar was itself 14

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a PRP, the "innocent landowner" defense to that status was not applicable to Lennar, and Lennar was therefore precluded from bringing a CERCLA section 107(a)joint and several liability claim for its response costs against the United States; and (c) Lennar could not bring a contribution claim against the United States under CERCLA section 113(f)(1), 42 U.S.C. § 9613(f)(1), because Lennar had not been the subject of a CERCLA section 106 or 107 claim brought by the United States or a State. The United States also has additional defenses, including the question of whether some or all of the materials found on High Plains and Beacon Point would be considered a "hazardous substance" under CERCLA. If the case went forward to trial, Lennar would take the risk that the United States might prevail on one or more of these defenses and lessen or eliminate any recovery. In addition, because Lennar withdrew its contribution claims asserted under CERCLA section 113(f), it is possible that the Court might find no implied contribution cause of action against the United States under CERCLA section 107(a). If the Court found that there is no implied contribution claim under section 107(a) available, and that Lennar could not avail itself of the innocent landowner defense to Lennar's status as PRP, the United States' chances of prevailing would be strong. Even if the Court found in Lennar's favor on those points, an appeal to the Tenth Circuit might follow. The United States also faces litigation risks that factor into whether settlement is appropriate. The Court might find that Lennar has an innocent landowner defense to PRP liability regarding High Plains (Lennar indicated that it is not pursuing an innocent landowner defense as to Beacon Point), that the materials discovered in Lennar's investigation of High Plains and Beacon Point did in fact constitute "hazardous substances" under the law, and that 15

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Lennar's investigative process was undertaken consistent with the NCP. As a result, the Court might award all costs incurred by Lennar for clearance of the High Plains parcel. If the Court also found an implied contribution cause of action under CERCLA section 107(a), the Court might allocate up to one hundred percent of costs for the Beacon Point clearance to the United States, and enter a total award for Lennar substantially in excess of the agreed sum set forth in the Consent Decree. In short, although the factual issues in this case have been essentially resolved, there is sufficient doubt regarding the ultimate legal conclusions to be drawn therefrom that the outcome of the litigation is in doubt. C. The Value of Immediate Recovery Outweighs the Possibility of Future Relief Both parties have concluded that it is more advantageous to them, in light of the litigation risks, to resolve this case now rather than expending the resources necessary to take the case to trial and possibly through appeal. Plaintiff's attorney's fee and costs are not recoverable as CERCLA "response costs," and the United States takes the position that plaintiff is not an eligible party under the Equal Access to Justice Act, 28 U.S.C. § 2412. Continuing with the litigation may therefore simply reduce any net recovery by Lennar from the litigation. In addition, there is value to Lennar in obtaining the settlement amount as a result of entry of the Consent Decree rather than either risking no recovery or a recovery which might have to wait until possible appeals are exhausted. D. The Settlement is Fair and Reasonable and Serves the Purposes of CERCLA The terms of this Consent Decree were negotiated by the parties after they satisfied 16

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themselves as to the facts of the case and the law governing the matter. The parties are sophisticated and have made a judgment that the terms of the settlement are fair in light of the differing litigation risks and the costs each party faces in taking the case through trial and possible appeal. Neither party had an overwhelming advantage in resources available to litigate the case, and the facts underlying the matter were fully investigated. In addition, both Lennar and the United States retained experts on various matters relevant to the case. As a result, most of the material facts were stipulated by the parties. The settlement amount is substantial, but recognizes the additional expense the parties would be put to if the litigation went forward and the risk both parties face if the case is judicially resolved. In addition, the settlement set forth in the Consent Decree serves the purposes of CERCLA and is in the public interest. One of the primary purposes of the CERCLA statute is to assure that those responsible for the release of hazardous substances bear responsibility for remedying those conditions. Dedham Water Co. v. Cumberland Farms Dairy, Inc., 805 F.2d 1074, 1081 (1st Cir. 1986). In this case, the United States will pay approximately 56 percent of Lennar's claimed investigatory and cleanup costs. This substantial payment recognizes the United States' status as a PRP regarding the Range, but also ensures that the government pays an amount which takes account of the litigation risks involved and Lennar's role in the process as well. The parties therefore jointly conclude that the settlement set forth in the Consent Decree is fair, reasonable, and in the public interest, and should be approved by the Court.

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CONCLUSION For the reasons set forth above, the parties jointly move the Court to enter the Consent Decree.

Respectfully submitted, FOR PLAINTIFF: BROWNSTEIN HYATT & FARBER, P.C.

MARK J. MATHEWS MICHELLE C. KALES 410 Seventeenth Street, 22nd Floor Denver, CO 80202-4437 Phone: (303) 223-1100 Fax: (303) 223-1111

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FOR DEFENDANTS: KELLY A. JOHNSON Acting Assistant Attorney General Environment and Natural Resources Division

By: IEL PINKSTON MATTHEW OAKES Environmental Defense Section Environment and Natural Resources Division U.S. Department of Justice 999-18th Street, Suite 945 North Denver, Colorado 80202 Phone: (303) 312-7397 Fax: (303) 312-7331 [email protected] matthew.oakes@usdoj, gov WILLIAM LEONE Acting United States Attorney District of Colorado STEPHEN D. TAYLOR Assistant United States Attorney 1225 17th Street, Suite 700 Denver, Colorado 80202 Phone: (303) 454-0103 Fax: (303) 454-0404

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Attachment A

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