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Kalamazoo River Oil Spill Prompts $6.8M Settlement Proposal

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By Brett Snider, Esq. on December 11, 2014 2:26 PM

A 2010 oil spill in the Kalamazoo River area has prompted the company responsible to propose forking over $6.8 million in settlement funds.

Enbridge, a Calgary-based energy company, has offered to pay to settle a class-action lawsuit by those who lived within 1,000 feet of the affected river, offering more to those who live closest to the spill area. The Battle Creek Enquirer reports that Enbridge has already settled with dozens of other plaintiffs, although four more spill-related cases are set for trial next year.

What are the terms of this proposed settlement?

$2.2M to Residents, Land Owners

As part of its proposed settlement, Enbridge has offered to pay $2.2 million to those within 1,000 feet of the Kalamazoo River. According to the National Transportation Safety Board, in July 2010, a section of Enbridge pipeline ruptured, spilling an estimated 843,444 gallons of crude oil into a marshy area that ultimately fed into the Kalamazoo River.

According to the proposed settlement agreement, residents or land owners with non-commercial property will receive different payouts based on their proximities to the Kalamazoo River. For example, residents within 200 feet of the river will split a lump sum of $250,000, while all parcels within 801 to 1,000 feet of the river will receive $300 (to be paid in gift cards).

The remaining funds will be accounted for by:

  • A $1.5 million general claims fund,
  • A $50,000 program to fund well-water sampling, and
  • $1.9 million in fees to the class representatives.

Not a Done Deal Yet

Before you start seeing this as an Enbridge over troubled waters, remember that the settlement won't be final until a judge approves it. The court could end up rejecting the proposed settlement if it finds that the amount is less than adequate to support the potential claimants.

Also, because this is a class-action settlement, if not enough of the class members choose to opt-in to the settlement, the deal may be off. The proposed settlement agreement allows Enbridge to duck out of the deal if 10 percent or more of the claimants don't agree to the settlement.

While the Enquirer reports that the Kalamazoo River cleanup is now complete, for many residents, settling this case may bring more lasting closure.

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