On the final day of 2021, a judge approved Kuusakoski’s $6 million legal settlement with Ohio warehouse owners, marking a major milestone in the years-long Closed Loop CRT cleanup case.
U.S. District Court Judge Edmund Sargus on Dec. 31 approved the deal, which was the largest in the legal battle between the landlords and former CRT material suppliers to Closed Loop Refining and Recovery. The decision drops Kuusakoski from the lawsuit from landowners, but the company is still facing a separate suit from OEMs that claim the e-scrap processor breached its recycling contract with them.
When Closed Loop closed in early 2016, it left tens of millions of pounds of CRT materials in storage at three Columbus, Ohio warehouses. Two of the warehouses were owned by Garrison Southfield Park and one is owned by Olymbec USA. Those companies filed lawsuits in U.S. District Court for the Southern District of Ohio seeking to force former material suppliers to help fund the cleanups.
Meanwhile, one of the Garrison cleanup projects and the Olymbec project have now been completed, documents show. The two projects carried a total cost of $6.02 million, about 22% less than previously estimated.
No breach-of-contract shield for Kuusakoski
In their lawsuit, the Ohio landlords claim Kuusakoski (and Vintage Tech, which was acquired by Kuusakoski) were responsible for shipping over 49 million pounds to the properties.
A year ago, the parties reached a settlement agreement through which Kuusakoski would pay $6 million, with insurance covering at least some of the sum. The largest settlement reached to date, the draft deal was submitted to the judge for approval in December 2020.
But after it was submitted to court, some of the OEM defendants – Samsung, LG and the Electronic Manufacturers Recycling Management Co. (MRM) – objected to the wording of the settlement, claiming it would have unfairly shielded Kuusakoski from contract-dispute claims. Samsung, LG and MRM each contracted with Vintage Tech to handle e-scrap recycling on their behalf, and they allege Vintage Tech breached their contract and is contractually obligated to indemnify them in the Closed Loop court case (Samsung in December 2020 filed a lawsuit against Vintage Tech in U.S. District Court for the Southern District of New York over the issue).
Judge Edmund Sargus agreed with the OEMs on that point.
“Approving the proposed contribution bar would allow Vintage Tech to cut and run – stripping the OEM Defendants of their bargained-for contractual rights while at the same time leaving them exposed to liability in this case solely because of those contracts,” Sargus wrote.
He asked Kuusakoski and the landlords if they’d agree to a settlement without that protection. On Oct. 22, they told him they would. He approved the settlement on Dec. 31, 2021.
(Story continues after slideshow. )
These photos, from Ensafe’s closure reports, show 1655 Watkins Road and 2200 Fairwood Ave. before and after the cleanup projects. The first six images are from 1655 Watkins Road, which Garrison Southfield Park sold last year, and the following eight show the Olymbec USA warehouse at 2200 Fairwood Ave. before, during and after the cleanup project.
Two cleanups complete
In another recent development in the Closed Loop saga, records posted online by consulting firm Ensafe provide details on the two completed cleanups, which ultimately cost less than originally estimated.
For Garrison, the 145,000-square-foot warehouse at 1655 Watkins Road was cleaned up as of Jan. 26, 2021, when the final inspection took place, according to Ensafe’s closure report. A total of 7.7 million pounds were removed; of that, 75% was treated and disposed of at a MAX Environmental landfill, and the remaining 25% was recycled by e-scrap processor CompuPoint USA. CompuPoint, which shipped CRT materials to Closed Loop, is helping to clean up the sites as part of its legal settlement with landlords.
The total cleanup cost for 1655 Watkins Road was $1.96 million, which was below the September 2020 estimate of $2.66 million. According to the report, NovoTec Recycling and CompuPoint USA were paid a total of $1.06 million for material removal, recycling and disposal; HEPA Environmental Services was paid $619,000 for contamination reduction zone construction and maintenance, lead abatement and decontamination, and wall construction; and Ensafe was paid $256,000 for project management. An additional $28,000 was racked up in utility bills.
For Olymbec, the 131,000-square-foot space that had been leased by Closed Loop at 2200 Fairwood Ave. was cleaned up as of July 14, 2021, when it received its final inspection, according to the August 2021 closure report. More than 25 million pounds of material were removed from the warehouse. Over 97% of it was treated and disposed of at MAX Environmental, and the remaining 3% was recycled by CompuPoint USA.
The total cleanup project cost for 2200 Fairwood Ave. was $4.06 million. Novotec Recycling was paid $2.96 million for removal and disposal of material, CompuPoint was paid $44,000 for CRT recycling, HEPA Environmental Services was paid nearly $635,000 for site preparation, lead abatement and building decontamination, and Ensafe and several contractors were paid the remaining $25,000 for various other services. The cleanup plan had previously estimated the project would cost $5.06 million.
In another piece of related news, Garrison Southfield Park sold one of its two Columbus warehouses. According to Franklin County, Ohio property records, the New York firm sold the 8.3-acre property at 1655 Watkins Road for $5.42 million on July 22, 2021. The current owner is a Toronto company called Watkins Road Owner II LP.
Garrison Southfield Park still owns 9.2 acres holding the adjacent warehouse, at 1675 Watkins Road, which it bought in 2013 for $12 million, property records show.
And Olymbec USA still owns 14.5-acre 2200 Fairwood Ave. property, which it bought on Jan. 14, 2014 for $2.07 million, records show.