Dover – Delaware’s Department of Natural Resources and Environmental Control (DNREC) and Perdue AgriRecycle, LLC (Perdue) have entered into a settlement agreement that resolves environmental violations arising from operations under Composting Permit SW-18/03, DNREC Secretary Shawn M. Garvin announced today. Under this permit, Perdue operates a composting facility in Seaford using agricultural wastes and residues from their operations as feedstock for the company’s compost production.

Perdue’s permit requires quarterly reporting of analytical testing of compost batches to ensure that it is fit to be sold. Issues arose from lab reports being provided in a piecemeal manner to DNREC. Additionally, the reports were missing key data points, and DNREC’s Division of Waste & Hazardous Substances questioned the compost batch samples and their chain-of-custody. Chain-of-custody helps to make sure a sample is handled in such a way as to maintain quality control and prevents introducing potential contamination into the process of moving the sample from the field to the lab.

In addition to the piecemeal data reporting, there were other instances where incorrect data was provided to DNREC as part of Perdue’s quarterly reporting process. In these instances, subsequent review of data showed that the material in question exceeded allowable levels of chemicals including chromium VI and fecal bacteria.

The settlement agreement directs Perdue to change how they are reporting as well as to clarify how reports will be provided to DNREC. Additionally, it focuses on ensuring that the quality of finished product is high and conforms to the standards within Permit SW-18/03 and that “unfinished” product will no longer be distributed by Perdue AgriRecycle, LLC.

Through the settlement agreement, DNREC Secretary Garvin issued an Administrative Penalty to Perdue AgriRecycle, LLC for the violations of Delaware’s Regulations Governing Solid Waste. The Settlement Agreement assesses a penalty of $179,429, which includes $4,429 from Perdue AgriRecycle, LLC for DNREC cost recovery. Perdue has accepted obligations set forth by DNREC and agreed to corrective actions required by the Department.

The settlement agreement can be found on the DNREC website at dnrec.alpha.delaware.gov/secretarys-orders/.

Media Contact: Michael Globetti, DNREC Public Affairs, 302-739-9902

DOVER – The Delaware Department of Natural Resources and Environmental Control (DNREC) and Croda, Inc. have entered into a settlement agreement that resolves environmental violations arising from the Nov. 25, 2018 ethylene oxide release (EO) at Croda’s Atlas Point facility.

Croda, Inc.’s facility located at 315 Cherry Lane, New Castle, Del., manufactures surfactants that promote mixing of oil- and water-based ingredients in consumer products such as pharmaceuticals and shaving cream. At 4:23 p.m. on Sunday, Nov. 25, the EO release by Croda was responsible for a seven-hour shutdown of the Delaware Memorial Bridge while emergency responders – including DNREC’s Emergency Prevention and Response Section and Environmental Crimes Unit – worked throughout the area to ensure that there was no threat to public health and safety.

Croda’s subsequent investigation found that the release was due to the failure of a gasket made of unsuitable material for processing EO at the plant. The accidental release resulted in 2,688 pounds of the highly flammable EO gas escaping into the environment. A water deluge system, deployed by Croda to minimize the risk of ignition or explosion of the EO that was released, caused almost 700,000 gallons of deluge water to overflow a spill sump and to discharge into the ground and a wooded area behind the sump.

The settlement agreement includes a DNREC Secretary’s Order issued on March 4, 2019, citing Croda for Division of Air Quality violations for the EO release and for the improper maintenance and operation of the Atlas Point facility. The Division of Water cited Croda for the unpermitted release of deluge water in violation of its NPDES (National Pollutant Discharge Elimination System) permit. The settlement agreement also directs Croda to pursue a plan of sampling and remediation, pursuant to HSCA (the Delaware Hazardous Substance Cleanup Act), administered by the Division of Waste and Hazardous Substances’ Site Investigation and Restoration Section (SIRS).

Through the settlement agreement, DNREC Secretary Shawn M. Garvin issued a Notice of Penalty Assessment and Order to Croda, Inc., for the violations of Delaware air quality regulations and the company’s NPDES permit. The Secretary’s Order assesses a penalty of $246,739 to Croda, which includes $16,489 for DNREC cost recovery from responding to and investigating the incident.

In the settlement with the State of Delaware and DNREC, Croda, Inc. also has agreed to resolve all violations arising from the operation of Croda’s new EO plant as permitted by DNREC, both prior to and including the Nov. 25 incident. The settlement agreement also calls for DNREC and Croda to define further Croda’s environmental obligations for the Atlas Point facility. With Croda having accepted those obligations set forth by DNREC and agreed to necessary remedial actions required by the Department for public health and safety, the settlement with DNREC provides a path forward to resume production of ethylene oxide at the Atlas Point facility upon final approval from DNREC.

The settlement agreement and Secretary’s Order can be found on the DNREC website at https://dnrec.alpha.delaware.gov/secretarys-orders/.
A DNREC Q&A about the Nov. 25 incident and the Department’s investigation into it can be found at https://dnrec.alpha.delaware.gov/croda-questions-answers/.

Media contact: Michael Globetti, DNREC Public Affairs, 302-739-9902.

Vol. 49, No. 65

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The Delaware Department of Justice, 48 other state attorneys general, the District of Columbia and over 45 state mortgage regulators have reached a settlement with New Jersey-based mortgage lender and servicer PHH Mortgage Corporation over improper loan servicing. Approximately 123 Delawareans are eligible for a payment as a result of the settlement.

The settlement resolves allegations that PHH, the nation’s ninth largest non-bank residential mortgage servicer, improperly serviced mortgage loans from January 1, 2009 through December 31, 2012, including failing to properly apply or amortize payments, charging authorized fees for defaults, failing to maintain complete loan files, robosigning affidavits used in foreclosures, referring matters to foreclosure improperly, losing or failing to timely process loss mitigation applications and paperwork, and other actions. The agreement requires PHH to adhere to comprehensive mortgage servicing standards, to conduct audits, and to provide audit results to a committee of states. The settlement does not release PHH from liability for conduct that occurred beginning in 2013.

“The settlement holds PHH accountable for harms homeowners suffered from improper loan servicing and shows our continued dedication to this area,” Attorney General Matt Denn said. “The agreement requires new servicing standards to help ensure that PHH doesn’t repeat conduct that led to improper mortgage servicing, and to provide financial relief to aggrieved homeowners.”

Borrowers who were subjected to PHH foreclosures during the eligible period will qualify for a minimum $840 payment, and borrowers who faced foreclosures that PHH initiated during the eligible period, but did not lose their home, will receive a minimum $285 payment. A settlement administrator will contact eligible payment recipients, including those in Delaware, at a later date.

The settlement includes $31.4 million in payments to borrowers, plus administrative penalties paid to state mortgage regulators (Delaware’s $159,000 went to the state General Fund), and additional payments to the 12 state attorneys general who led the investigation and negotiations.

Deputy Attorney General Gillian Andrews handled the matter on behalf of the Delaware DOJ Consumer Protection Unit.

Delaware and the attorneys general of 49 other states and the District of Columbia have reached a settlement with Boehringer Ingelheim Pharmaceuticals, Inc. (“BIPI”) regarding alleged off-label marketing and deceptive and misleading representations made in BIPI’s promotion of four of its prescription drugs: Micardis®, Aggrenox®, Atrovent®, and Combivent®.

The settlement resolves allegations that BIPI engaged in a course of trade or commerce that constitutes unfair, deceptive, or misleading practices, by making misrepresentations about the above-mentioned prescription drugs and by representing that the prescription drugs had sponsorship, approval, characteristics, ingredients, uses, benefits, quantities, or qualities that they did not have.

Specifically, the States allege BIPI: (1) misrepresented that its antiplatelet drug, Aggrenox®, was effective for many conditions “below the neck,” such as heart attacks and congestive heart failure, and that it was superior to Plavix® without evidence to substantiate that claim; (2) misrepresented that Micardis® protected patients from early morning strokes and heart attacks and treated metabolic syndrome; (3) misrepresented that Combivent® could be used as a first-line treatment for bronchospasms associated with chronic obstructive pulmonary disease (COPD); and (4) falsely stated that Atrovent® and Combivent® could be used at doses that exceeded the maximum dosage recommendation in the product labeling and that they were essential for treatment of COPD.

The settlement requires BIPI to ensure that its marketing and promotional practices do not unlawfully promote these prescription drug products. Specifically, BIPI will:

• Limit product sampling of the four drugs to health care providers whose clinical practice is consistent with the product labeling;
• Refrain from offering financial incentives for sales that may indicate off-label use of any of the four drugs;
• Ensure clinically relevant information is provided in an unbiased manner that is distinct from promotional materials; and
• Provide that requests for off-label information regarding any of the four drugs are referred to BIPI’s Medical Division.

The settlement also requires BIPI to make payments to the states and the District Columbia that brought the case. For Delaware, about $137,000 will go into the state’s Consumer Protection Fund, which pays for the Delaware Department of Justice’s work on consumer fraud and deceptive trade practice matters and other consumer-oriented investigations and legal actions.

Deputy Attorney General Gina Schoenberg led Delaware’s efforts on this matter, with assistance from Consumer Protection Director Christian Douglas Wright and Deputy Attorney General James Vadakin.

General Motors Company (“GM”) and 50 attorneys general, including Delaware, have settled allegations GM concealed safety issues related to ignition-switch-related defects in GM vehicles, resulting in changes to the way the company represents cars to be “safe” as well as payments to the states.

General Motors Company (“GM”) and 50 attorneys general, including Delaware, have settled allegations GM concealed safety issues related to ignition-switch-related defects in GM vehicles, resulting in changes to the way the company represents cars to be “safe” as well as payments to the states. The settlement, reached between the attorneys general of 49 states and the District of Columbia, and GM concludes a multistate investigation into the auto manufacturer’s failure to timely disclose known safety defects associated with unintended key- rotation-related and/or ignition-switch-related issues in several models and model years of GM vehicles.

In 2014, GM issued seven vehicle recalls in response to unintended key-rotation-related and/or ignition-switch-related issues, which have affected over 9 million vehicles in the U.S. The recalls involved a defective ignition switch that, under certain conditions, could move out of the “Run” position to the “Accessory” or “Off” position. If this occurs, the driver experiences a loss of electrical systems, including power steering and power brakes.  If a collision occurs while the ignition switch is in the “Accessory” or “Off” position, the vehicle’s safety airbags may also fail to deploy, increasing the risk of serious injury or death in certain types of crashes in which the airbag was otherwise designed to deploy.

As the states alleged, certain employees of GM and General Motors Corporation (which went through bankruptcy in 2009), knew as early as 2004 that the ignition switch posed a safety defect because it could cause airbag non-deployment. However, despite this knowledge, GM personnel decided it wasn’t a safety concern and delayed making recalls. GM continued to market the reliability and safety of its motor vehicles that were equipped with this defective ignition switch.

The states alleged that these actions were unfair and deceptive and that the automaker’s actions violated state consumer protection laws, including Delaware’s Consumer Fraud statute.

Under a Cease and Desist Order by Agreement, GM shall:

• Not represent that a motor vehicle is “safe” unless they have complied with the Federal Motor Vehicle Safety standards applicable to the motor vehicle at issue.
• Not represent that certified pre-owned vehicles that GM advertises are safe, have been repaired for safety issues, or have been subject to rigorous inspection, unless such vehicles are not subject to any open recalls relating to safety or have been repaired pursuant to such a recall.
• Instruct its dealers that all applicable recall repairs must be completed before any GM motor vehicle sold in the U.S. and included in a recall is eligible for certification and, if there is a recall on any certified pre-owned vehicle sold in the U.S., the required repair must be completed before the vehicle is delivered to a customer.

Delaware will receive $1.12 million as part of the settlement with GM, which will go into the Consumer Protection Fund, which pays for the Attorney General’s work on consumer fraud and deceptive trade practice matters and other consumer-oriented investigations and legal actions. The total amount of money paid to the states as part of the settlement is $120 million.

Deputy Attorney General Stephen McDonald led Delaware’s efforts in this investigation.