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United States v. Newmont Capital Limited

February 20, 2009


The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge


Presently before the Court is Plaintiffs' unopposed Motion for Judgment to Enter Consent Decree. Because the Court finds the terms of the Consent Decree fair, reasonable, and consistent with the purposes that the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq., is intended to serve, Plaintiffs' Motion is granted.*fn1


On September 12, 2008, pursuant to 42 U.S.C. § 9622(d), the United States, on behalf of the Environmental Protection Agency ("EPA") and the California Department of Toxic Substances Control ("DTSC") (collectively "Plaintiffs") lodged a Consent Decree with this Court resolving their claims against Newmont Capital Limited ("Newmont Capital") and Newmont Mining Corporation of Canada Limited ("Newmont Mining") (collectively "Defendants").

As required by law, notice of the proposed settlement was also published in the Federal Register, inviting public comment. One comment was received before the comment period expired on October 20, 2008. However, that response did not address whether the Consent Decree was fair, reasonable, or consistent with the goals of CERCLA, and instead made only generalized allegations against Defendants.

Accordingly, Plaintiffs now move for entry of the Consent Decree, under which Defendants agree to reimburse Plaintiffs for a portion of clean-up costs incurred at the Lava Mine Superfund Site ("the Site"). Specifically, settling Defendants agree to pay to Plaintiffs three million dollars, $1,860,000 to the United States and $1,140,000 to DTSC. Applicable interest began accruing on July 2, 2008, and will continue to do so through the date of payment.


The Site is located approximately five miles southeast of Nevada City, California, and includes portions of Little Clipper Creek drainage, Clipper Creek drainage, Little Greenhorn Creek, Lost Lake, and the underlying groundwater. Both the Lava Cap Mine and the Banner Mine are located on the Site.

Gold and silver mining began at the Lava Cap Mine in 1860 and at the Banner Mine in 1861, though, from 1860 to 1934, neither mine was utilized for large scale operations. However, in 1932, the Lava Cap Gold Mining Corporation ("LCGMC") bought both mines and subsequently constructed an ore processing plant. Thereafter, from 1934 until it ceased operations in 1943, the Lava Cap Mine became one of the largest gold mines operating in California.

The extensive mining operations created a large pile of mill tailings at the Site.*fn2 Despite efforts to contain those mill tailings, arsenic contaminated water was released from the Lava Cap Mine into, inter alia, Little Clipper Creek.

From 1934 to 1983, ownership of the mines transferred to various corporations under whose control arsenic-contaminated water and tailings continued to be released into the environment. Eventually, in 1979, a log dam partially collapsed, releasing a sudden and significant discharge of tailings into Little Clipper Creek.

On July 11, 1983, Franco-Nevada Mining Corporation Limited ("FNMCL") entered into an agreement to purchase the Lava Cap Mine and the Banner Mine. On December 31, 1983, Keystone Copper Corporation ("Keystone") conveyed title to both mines to Franco-Nevada Mining Corporation, Inc. ("FNMCI"). At some point, FNMCL became Newmont Mining and FNMCI became Newmont Capital. Newmont Capital did not conduct any active mining at the Site, and, by December 23, 1986, conveyed both mines back to Keystone.

On or about January 1, 1997, the upper half of the aforementioned log dam completely collapsed, discharging over 10,000 cubic yards of mill tailings into Little Clipper Creek. That discharge prompted investigations by several local and national agencies. The EPA eventually determined that the conditions at the Site met the National Contingency Plan criteria set forth in 40 C.F.R. Part 300.415(b)(2) for removal action, and on January 19, 1999, listed the Site on the National Priorities List ("NPL").

Through April 30, 2008, the EPA had incurred $21,365,002.14 in response costs for the Site, and anticipates incurring additional response costs as well. Through March 31, 2008, DTSC had incurred $717,143.16 in response costs and likewise anticipates continuing to incur additional costs. ...

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