A Beltsville hauling company and its president filed a $90 million lawsuit against Potomac Electric Power Co. in U.S. District Court here yesterday, alleging that the utility company knowingly sold as scrap metal electrical transformers contaminated with dangerous PCB-laden oil.
Since last July a Prince George's County grand jury has been investigating whether Maryland hazardous waste disposal laws were violated at United Rigging and Hauling Inc., a 15-acre site in the Beltsville Industrial Park on Ammendale Road. State investigators last May found hundreds of haphazardly stacked electrical transformers at the site, according to state health department files.
Tests later showed that more than 100 of the transformers, including 75 Pepco transformers, and soil at the plant contained dangerous levels of PCBs, or polychlorinated biphenyls, chemicals used to insulate equipment to prevent electrical fires. Manufacture of PCBs was banned in 1977 because the chemicals were found to cause cancer, birth defects and liver damage in laboratory animals.
The suit, citing letters and conversations between United President Charles E. Sloan and Pepco officials between 1980 and 1983 in which Sloan allegedly was assured the 2,000 transformers he bought from Pepco were "flushed" of any PCBs, asks for $50 million in compensatory damages and $40 million in punitive damages -- half for Sloan and half for United. Sloan owns the 15-acre property where the plant is located, according to the lawsuit.
In August Pepco and United signed a consent order with the EPA and the Maryland Department of Health and Mental Hygiene in which the companies agreed to remove the remaining transformers and thoroughly clean up the site. Yesterday a spokeswoman for Pepco said the utility is paying most of the cleanup cost, estimated at $2 million, but she declined to discuss the United suit in detail.
"We're really not commenting at all on the contents of it. We regret United's actions and believe the suit is groundless," Pepco spokeswoman Nancy Moses said.
After the discovery of what Maryland health officials regard as the worst PCB contamination ever discovered in the state, the U.S. Environmental Protection Agency began an emergency cleanup at United, paying contractors an estimated $300,000 out of the federal Superfund to safely dispose of 50 transformers owned by Electrical Equipment Corp. of Lorton and several hundred drums filled with contaminated soil.
About 5,000 people live within a half-mile radius of the plant but state officials have said the emergency action has precluded immediate health threats.
"We didn't generate any of the chemicals and and we weren't operating any kind of a dump site there. We bought transformers that they told us weren't contaminated that turned out to be contaminated," William J. Rodgers, an attorney representing Sloan and United, said yesterday.
The lawsuit was filed in federal court for the District of Columbia because although Sloan and United are located in Maryland, Pepco is headquartered in the District, where most of the contracts between the two companies were signed, according to the lawsuit.