Mass. AG announces two settlements

By Bryan Cohen | May 4, 2012


BOSTON (Legal Newsline) - Massachusetts Attorney General Martha Coakley announced two settlements on Thursday with General Motors and Aulson Company Inc., resolving allegations of damaged natural resources and failing to pay quarterly employment contributions, resepctively.

The U.S. Bankruptcy Court for the Southern District of New York approved an $875,000 settlement on Tuesday between a successor to GM created to handle unresolved claims, the Motors Liquidation General Unsecured Creditors Trust and the Massachusetts Department of Environmental Protection. Under the terms of the settlement, $875,000 is established as an allowed claim by the MassDEP which resolves all outstanding natural resource damages claims in the matter.

"We are committed to holding accountable businesses that injure or destroy our natural resources by discharging hazardous materials into our soil and wetlands," Coakley said. "We are pleased that this settlement will provide some compensation for the environmental harm caused by this former GM plant."

GM operated and owned the Framingham plant from 1946 to 1994. During most of the period of operation, the property included above ground storage tanks, railways, an industrial wastewater treatment plant, a paint shop, wetlands areas and a storm water settling lagoon. GM sold parts of the property to Auto Dealers Exchange Services of America in 1994, though GM still retained ownership of 30 acres of wetlands including a lagoon, a four acre former landfill and Beaverdam Brook.

While GM operated the property, MassDEP alleged that the company discharged hazardous materials, such as metals and polycyclic aromatic hydrocarbons, that contaminated local natural resources. Discharges from storm water outfalls and the settling lagoon allegedly contaminated the Beaverdam Brook banks, streambed and surrounding wetlands, impairing animals, birds and benthic macroinvertebrates. Toxicity studies and scientific assessments attributed adverse ecological effects to elevated PAH and metal concentrations.

Under the terms of the settlement, distributions will be paid on a quarterly basis with the actual amount connected to the value of new GM stocks and other instruments. Eighty-percent will be paid in the first quarterly distribution in July. Funds will be put into the state's Natural Resources Damages Trust and will be used for activities like assessment of natural resources damages, enforcement of natural resource laws and natural resource restoration.

The $327,000 settlement with the Methuen-based Aulson Company Inc. resolves allegations that the company failed to pay into the state's unemployment trust fund. The case was referred to Coakley's office by the Executive Office of Labor and Workforce Development's Department of Unemployment Assistance. The referral was part of a collaborative effort to target employers that fail to pay their quarterly unemployment contributions.

"Failure to pay unemployment contributions puts a greater strain on the unemployment system," Coakley said. "Through enforcement, we aim to level the playing field for those businesses that already follow the law and to assure future compliance."

Under the terms of the settlement agreement with Aulson Company Inc. and Alan P. Aulson Sr., the company's president, the defendants agreed to pay the state $327,565.98 for allegedly failing to pay quarterly unemployment contributions between January 2009 and January 2012. The Department of Unemployment Assistance administers the unemployment insurance program, which gives temporary assistance to unemployed workers. The funding for such benefits comes from employers in the state of Massachusetts. Employers either pay quarterly contributions into the trust fund or non-profit or self-insure, reimbursing the state for benefits paid.

Aulson Company Inc. allegedly failed to pay employer tax contributions starting in January 2009 and at various times through January 2012. Due to the alleged failure to pay the tax liability, Aulson and his company owe more than $327,000 in employer contributions. Under the terms of the settlement, the defendants made a lump sum $150,000 payment to the state and will continue to make monthly payments that total $30,000 until the remaining balance is completely paid.

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