The U.S. government sued Land O’Lakes this week, saying the company must pay $23.4 million in cleanup costs for an oil refinery it never actually ran.
Land O’Lakes, one of the largest U.S. farm cooperatives, said Thursday it will “vigorously” fight the government’s suit, which was filed Tuesday in U.S. District Court for the Western District of Oklahoma.
The lawsuit is the latest chapter in a long-running dispute between federal regulators and the Minnesota company. The dispute demonstrates the long arm of the Superfund law, established by Congress in 1980 to clean up sites contaminated with hazardous wastes and pollutants.
Arden Hills-based Land O’Lakes, in a 2015 federal lawsuit against the government, claims it has met its cleanup obligations for the Oklahoma refinery, a Superfund site.
Land O’Lakes never operated the Cushing, Okla., refinery — or any oil refinery — but was stuck with a cleanup liability due to its 1982 merger with Midland Cooperatives.
Midland, which was based in Minneapolis, owned and operated the Oklahoma refinery from 1943 to 1977. Midland sold it to Hudson Oil Co., which closed the refinery in 1982 and went bankrupt two years later.
Some environmental remediation was done at the site in the 1980s. A trust representing the bankrupt Hudson company stated in 1993 that it had complied with a federal consent order and that the Cushing site was “environmentally sound,” according to the 2015 suit filed by Land O’Lakes against the government. The Environmental Protection Agency did more cleanup in the late 1990s and early 2000s — and then decided the job still wasn’t done.
In 2009, the EPA issued a “unilateral administrative order” to Land O’Lakes — by then Hudson Oil was dead and gone — to clean up the site. An article in the Tulsa World at the time said the cleanup project included removing contaminated soil and cleaning out wastewater ponds.
Land O’Lakes performed the cleanup work it was ordered to do between 2009 and 2015, according to court filings.
But the company is still liable for “more than $23.4 million in unrecovered past costs associated with response actions performed at the site, and any other costs EPA either has incurred, or may incur with respect to response actions at the site,” the government claimed in a court filing.
The government’s suit was filed less than two weeks after a federal district court judge in western Oklahoma dismissed the 2015 suit by Land O’Lakes against the government, citing lack of jurisdiction.
Land O’Lakes had sued to get a court declaration of non-liability for the Cushing refinery site. The company claimed in the suit that the U.S. government had violated earlier court agreements by forcing Land O’Lakes to do remediation and pay for the government’s past cleanup costs.
The government “has done an end-run around [court] protections afforded to Land O’Lakes,” the company said in a filing.