Coakley alleges company ripped off state fund

Bryan Cohen Apr. 19, 2012, 1:26pm


BOSTON (Legal Newsline) - Massachusetts Attorney General Martha Coakley filed a lawsuit against a company that she alleges illegally obtained millions of dollars from a state fund for environmental cleanup projects at multiple gasoline service stations in the state.

The Hess Corporation and Merit Oil, which was acquired by Hess in 2000, reached settlements with insurers on environmental cleanup projects but continued to submit reimbursement claims to the Massachusetts Underground Storage Tank Petroleum Cleanup Fund from 1998 to 2004.

The UST Fund's goal is to expedite the cleanup of environmentally dangerous leaks from underground storage tanks, which are commonly found at gasoline stations, by reimbursing owners for eligible expenses incurred in their response.

Claimants are required to disclose if they sought reimbursement from other sources, including insurance for expenses submitted to the fund. If the same expenses are recovered from both the fund and insurance, claimants are required to pay back the UST FUnd.

"We allege that Hess falsely claimed reimbursements from the UST Fund when it was also seeking restitution from insurance companies," Coakley said. "The UST Fund has several regulations to prevent this type of activity so that it may continue to help businesses keep our environment clean by assisting them with expensive projects that could otherwise shut them down."

Hess and Merit Oil also allegedly failed to certify to the UST Fund that their submissions were in compliance with the applicable regulations.

The lawsuit seeks all of the funding that Hess recovered from the UST Fund, as well as multiple damages, civil penalties, and investigative and litigation costs, which could total millions of dollars.

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