Defendant Viacom Inc. ("Viacom") submits this memorandum stating its position with respect to the Federal Defendants' Motion for Summary Judgment filed on January 13, 2003.

Viacom joins in seeking the relief requested in the Federal Defendants' motion - summary judgment dismissing Plaintiffs' federal causes of action because they are barred as untimely under section 1 1 3(h)(4) of the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. . 9613(h)(4), since the U.S. Environmental Protection Agency ("EPA") is investigating and contemplating further response actions at Lemon Lane Landfill, Neal's Landfill and Bennett's Dump.

But Viacom strongly objects to and disputes the assertions the Federal Defendants make in their memorandum of law about Viacom's actions and the positions Viacom has taken with respect to the further work at these sites. In their memorandum of Law, the Federal Defendants present an incomplete, misleading, and false picture of Viacom, its accomplishments in cleaning up the Bloomington sites, and its positions as to further remediation. Viacom is bewildered that the Federal Defendants considered it necessary to engage in a gratuitous and unfounded attack on Viacom in a case in which the United States and Viacom are not adversaries, and at a time when Viacom has been actively working with EPA on the question of additional remedial issues at these sites. Indeed, EPA has just invited Viacom to a global settlement meeting on all issues on April 9, 2003; at the same time, its lawyer is telling this Court that Viacom's involvement in settlement discussions is "too speculative" to take seriously. Viacom wonders, if its participation is so speculative, why EPA wants to meet with it at all, and why EPA has approved Viacom's plans to perform the three Groundwater investigations which EPA has admitted are necessary for it to make decisions about future remedies at Lemon Lane Landfill, Neal7s Landfill, and Bennett's Dump.

The Federal Defendants' counsel in this case has left Viacom with no choice but to submit this memorandum to set forth a more accurate record of the history of response actions at the Bloomington sites, Viacom's legal position with respect to further work, and the work that Viacom continues to do today toward developing possible additional remedies.

A. The Original Consent Decree

In 1985, Viacom's predecessor, Westinghouse Electric Corporation, ¹ entered into a Consent Decree with the United States of America, the State of Indiana, Monroe County and the City of Bloomington, pursuant to sections 106 and 107 of CERCLA, 42 U.S.C. # 9606, 9607, and section 7003 of the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. 6973, to clean up six sites at which polychlorinated biphenyls ("PCBs") had been found. United States, et al. v Viacom Inc. f/k/a CBS Corporation f/k/a Westinghouse Electric Corporation, Nos.IP-82-9-C and IP-91-448-C (S.D. Ind. 1985) (hereinafter "Consent Decree Action"). Declaration of Dorothy M. Alke ("Alke Dec.") 11 3. (A copy of the Consent Decree, as presented to the Court, is attached as Exhibit 1 to the Alke Dec.)

In the Consent Decree, the parties agreed that Viacom would implement remedies at the six sites which included the following components:

• The excavation of contaminated soil and other materials from each of the sites.
• The construction of an incinerator to burn the excavated material. The incinerator would be fueled by burning municipal solid waste (i.e., garbage) supplied by Monroe County and the City of Bloomington, who would pay tipping fees to Westinghouse.
• The construction of water-treatment system at Neal's Landfill, but not at any of the other sites.
• The removal of sediment from certain streambeds connected with various landfills. Sediment removal was to occur in two separate stages: before and after the soil excavation.

Consent Decree pp. 5-19, 42-59; Alke Dec. p. 5.

During the late 1980's and early 1990's, Viacom took the initial steps to meet its Consent Decree responsibilities. Viacom excavated materials from one site (Anderson Road Landfill) and sediments from several streambeds, and constructed an interim storage facility to contain these excavated materials. Viacom also undertook interim remedial measures required under the Consent Decree. Further, Viacom constructed and set in operation the water treatment system required at Neal's Landfill. Alke Dec. paragraph 6.

In addition, Viacom began efforts to construct and obtain permits for the incinerator and a special landfill for incinerator ash. Viacom spent over $50 million on the design and construction of, and the permit applications for, the incinerator and ash landfill. Alke Dec. paragraphe 7.

B. The Operating Principles

As the Seventh Circuit noted, in the early 1990's, the State of Indiana adopted legislation which precluded the construction of the incinerator. Frey v EPA, 230 F.3d 1129, 1130 (7th Cir. 2001).

Because the State's action stopped the implementation of the excavation and incineration remedies, the parties to the Consent Decree initiated a discussion about alternatives to the portions of the Consent Decree remedies relating to the excavation and incineration of contaminated soil. The parties negotiated the "Operating Principles for Considering Remedial Alternatives" (hereinafter "Operating Principles") and filed them with the Court in February 1994. (A copy of the Operating Principles is attached as Exhibit 2 to the Alke Dec.) These Operating Principles served as guidelines for the process of negotiating alternatives to the excavation and incineration requirements of the Consent Decree. Alke Dec. 119 On page 4 of their memorandum, the Federal Defendants give an incomplete and inaccurate description of the Operating Principles. While the Operating Principles called for a remedy-selection process which involved assembling and collecting data, performing risk assessments, and allowing EPA to undertake its Record of Decision, the Operating Principles also provided that no remedy would be chosen unless all Consent Decree parties agreed to it, and that the terms of the Consent Decree would remain in place until the parties had agreed on a Consent Decree amendment. Indeed, the Operating Principles clearly stated on page I that "[i]t is the goal of the Consent Decree parties to reach a consensus that is acceptable to all parties" and "[t]he Parties agree that, during the course of this process, the Consent Decree shall remain in full force and effect, and that each Party retains its rights under the Consent Decree." Alke Dec. paragraph 9.

Thus, under the terms of the Operating Principles, the remedies could not be changed without Viacom's consent, and Viacom maintained its rights under the Consent Decree, including its rights under the Covenant Not to Sue. Viacom has engaged in good-faith discussions and fact-finding efforts consistent with the Operating Principles.

C. The Selection of New Excavation Remedies

Pursuant to the Operating Principles, the Consent Decree parties agreed upon alternative remedies at two sites, Neal's Dump and Winston-Thomas; they also agreed to Consent Decree amendments and stipulations to reflect these new remedies. Viacom performed these cleanups and reported to the Court that this work was completed. Alke Dec. 11 11. The Winston-Thomas cleanup covered a larger area than Viacom would have been required to cleanup under the terms of the original Consent Decree. Alke Dec. paragraph 11.

The Federal Defendants are absolutely wrong, however, when they state on page 4 of their memorandum that in 1999 "the Consent Decree parties could not agree upon an alternative remedy with respect to" Neal's Landfill, Lemon Lane Landfill and Bennett's Dump. As reported at page 3 of the Special Master's Report and Recommendations ("Special Master's Report," attached as Exhibit 3 to the Alke Dec.), the Consent Decree parties had reached consensus on excavation remedies at each of the sites.

But in 1999, EPA had not decided on a final water-treatment or sediment remedy at either Neal's Landfill or Lemon Lane Landfill, and EPA did not even contemplate any such remedy at Bennett's Dump. Alke Dec. paragraph 12. Viacom could not have refused to perform any EPA-selected final water-treatment and sediment remedies because EPA had not selected any such remedies. Rather, the parties reached an impasse because the United States demanded that Viacom agree to a Consent Decree amendment in which it would obligate itself to implement whatever water-treatment and sediment remedies EPA decided upon in the future at Lemon Lane Landfill and Neal's Landfill, before it knew what those remedies would be.² Alke Dec. paragraph 13.

While Viacom was willing then, as it is willing today, to investigate and negotiate about water-treatment remedies, and to implement reasonable ones, it was not prepared in 1999 to sign a blank check to pay for whatever EPA selected in the future, and to give up its rights under the terms of the Consent Decree and under CERCLA itself. Viacom's "unwillingness to concede that it is responsible for implementing whatever remedy EPA selects" was simply a prudent act by a company that wants to know what it is being asked to pay for before agreeing to pay for it. Moreover, Viacom's position is consistent with the Operating Principles, which provide that each party retains its rights under the Consent Decree unless and until a consensus is reached about alternatives.

Special Master Foster resolved the impasse by directing in his Report and Recommendations, which was approved in a subsequent order by Judge Dillin (copies of the Report and Order are attached to the Alke Dec. as Exhibits 3 and 4, respectively), that the excavation work upon which the parties agreed go forward under order of this Court, and finding that the parties had preserved their rights and legal positions, but had agreed to negotiate further about water treatment, sediment and other issues. Special Master Foster's Report (at p. 3) succinctly and accurately summarized Viacom's position: "[Viacom] agrees to negotiate about additional water treatment and sediment removal, and if consensus is reached is willing to undertake water treatment and sediment removal beyond the requirements of the Consent Decree, but [Viacom] does not want to relinquish defenses under the Consent Decree in advance of a consensus."

D. The Implementation of the New Excavation Remedies

In 1999 and 2000, Viacom implemented the excavation remedies at Lemon Lane Landfill, Neal's Landfill and Bennett's Dump. The Federal Defendants' memorandum is wrong when it suggests that only "hot spots" were removed at all three sites. At Bennett's Dump, all of the contaminated soil was removed to bedrock. Alke Dec. 11 15. Hot spot removal was undertaken at Neal's Landfill and Lemon Lane Landfill, consistent with the policy that EPA has followed for landfills of similar size throughout the country. The contaminated soil which remains at Neal's Landfill and Lemon Lane Landfill is consolidated under a Resource Conservation and Recovery Act cap. Alke Dec. paragraph 15.

Water-Treatment Issues at Neal's Landfill and Lemon Lane Landfill

The Federal Defendants are wrong again when they suggest that EPA always contemplated further water treatment as part of the remedies at these sites.

In the original Consent Decree, EPA had selected no water-treatment remedies, except for the construction and operation of the Neal's Landfill water-treatment plant. Consent Decree paragraph 59(a). Rather, the Consent Decree provided that if PCBs were found in off-site wells, Viacom was required to supply residents with alternative drinking water supplies. Consent Decree paragraph 78. The Consent Decree made absolutely clear that "provision by [Viacom] of a permanent alternative potable water supply . . . shall be the exclusive civil or administrative remedy available to the United States . . . to remedy the problem of PCB-contaminated Groundwater for domestic use and human consumption within the 5000-foot radius of the boundaries of Neal s Landfill, Lemon Lane Landfill . . . and Bennett's Dump." Consent Decree paragraph 82.

When the Consent Decree was presented for the Court's approval in 1985, several public commentators suggested that EPA should have provided for more elaborate measures to remedy contaminated groundwater. On page 30 of the "Response of the United States to Public Comments on the Consent Decree and Request to Enter Consent Decree," filed with this Court, the United States acknowledged the presence of PCBs in groundwater near Lemon Lane Landfill and other sites, but stated that "[g]iven the infeasibility of traditional groundwater remedial measures. the proposed settlement adequately addresses potential groundwater problems at the sites." Thus from the beginning, EPA knew of groundwater problems at Neal's Landfill and Lemon Lane Landfill, but chose not to require treatment, except for the facility that Viacom built over a decade ago at Neal's Landfill.

The Indiana legislation which prevented the construction of the incinerator did not bar the operation of the Neal's Landfill water-treatment plant nor did it nullify Viacom's obligation to provide alternate drinking water supplies if necessary. Thus, there was no reason for the Consent Decree parties to renegotiate the portions of the Consent Decree remedy which related to contaminated groundwater, since those provisions were already in operation.

Nonetheless, when EPA proposed the concept of additional water treatment at Neal s Landfill and Lemon Lane Landfill, Viacom was willing to investigate and negotiate about such remedies, and to include them as part of an overall solution. But, because of the complicated hydrological systems near these sites, Viacom has always stressed the need to collect data to be sure that the hydrology is understood before designing treatment systems. Alke Dec. paragraph 16. To that end, Viacom has undertaken a series of groundwater investigations at Neal's Landfill, at Lemon Lane Landfill, and more recently at Bennett's Dump, and continues to study the Groundwater at each of these three sites. Alke Dec. 11 16. Indeed, the Declaration of EPA's Project Manager, Thomas Alcamo ("Alcamo Dec."), submitted by the Federal Defendants, clearly acknowledges that EPA is depending on the Groundwater investigations that Viacom is currently undertaking to devise and evaluate possible new remedies at all three sites. Alcamo Dec. paragraphs 5, 10.

The wisdom of Viacom's approach is demonstrated by EPA's experience in designing and constructing an "interim" water-treatment system at Illinois Central Spring (ICS) near Lemon Lane Landfill. In the summer and fall of 1998, EPA decided to build an "interim" treatment plant at ICS on an expedited basis to address PCBs in Groundwater near the Lemon Lane Landfill, even though EPA had known about these releases for over 13 years. Although Viacom did not agree with EPA about the need for an emergency facility, Viacom devised a plan for a temporary facility which would capture and treat at least 50% of the mass of the PCBs at ICS, while the parties continued to investigate long-term remedies. The virtue of Sitcom s proposal was that its system could be constructed and put in operation in a matter of weeks, at low cost, and could be moved to other locations if necessary. Alke Dec. 11 17. EPA rejected Viacom's approach; instead, it decided to construct a massive treatment plant as its ' interim" remedy. EPA originally estimated the project at $1.3 million for construction costs and planned to have the facility in operation by the summer of 1999. In fact, EPA spent over $5.4 million (going more than 300% over budget) to build the facility, which was not put into operation until the spring of 2000, almost a year behind schedule. Alke Dec. 11 17. Although Viacom recommended to EPA that it build a movable "interim" facility so that it could be relocated if it was more effective to capture the flow at a different location, EPA rejected this advice and built a structure designed to last 20 years \N-ithtwo massive stationary storage tanks. Alke Dec. 11 17. Now, according to Mr. Alcamo's Declaration, EPA is investigating measures to try to capture Groundwater flows closer to the landfill itself. See Alcamo Dec. 117- In light of its daunting experience in building this system, it appears that EPA has finally begun to appreciate the wisdom of Viacom's approach of collecting data on Groundwater behavior before designing treatment systems. As EPA's Mr. Alcamo stated in his Declaration:

At Lemon Lane Landfill, Neal's Landfill, and Bennett's Dump, waste and sediment investigations are in progress and are collecting the information that U.S. EPA needs to better understand the sites' hydrology and to select appropriate remedies. These investigations, which Viacom is conducting, go beyond just monitoring the effects of past work, since the information will be used in the development of remedial alternatives for future water and sediment remedy decisions.

Alcamo Dec. paragraph 5 (emphasis supplied).

Viacom is undertaking these investigations and is looking at remedial approaches at each of the sites, and Viacom hopes to reach consensus with EPA, but Viacom is not giving up its Consent Decree defenses until such a consensus is reached.

Sediment

The issue of sediment removal is much simpler to discuss.

As EPA acknowledged, Viacom has removed sediment in connection with Stout's Creek near Bennett's Dump in September 2000. Alcamo Dec. paragraph 10.

Viacom is obligated under paragraph 51 of the Consent Decree to undertake post- excavation sediment removal at Lemon Lane Landfill and Neal's Landfill.³ At EPA's request, however, Viacom has deferred removing these sediments. Alke Dec. paragraph 18. Viacom understands that EPA would prefer to address the question of sediment removal after more data are collected; at that time. EPA may ask Viacom for modifications to the sediment-removal program in the Consent Decree. Alke Dec. paragraph 15; Alcamo paragraphs 7, 10. Consistent with its commitment to the Operating Principles and the terms of the Special Master's Report, Viacom is committed to assist EPA by collecting data and is willing to negotiate about changes to the sediment-removal program in the Consent Decree.

Bennett's Dump

The Federal Defendants' memorandum makes its appear that EPA was planning additional water treatment and sediment removal at Bennett's Dump back in 1999 and that Viacom refused to undertake this work. This is not the case. The Special Master's Report makes clear that, at the time it was written in 1999, EPA was only contemplating additional water-treatment and sediment removal measures at Neal's Landfill and Lemon Lane Landfill. but not at Bennett's Dump. Special Master's Report at pp. 4-6.

Viacom undertook the excavation work at Bennett's Dump, removing all the contaminated soil, down to bedrock where necessary, and also implemented the sediment- removal measures required by the Consent Decree in connection with that site. Alke Dec. paragraph 15; Alcamo Dec. paragraph 10. Subsequently, very low level contamination has appeared in springs in connection with that site, and EPA asked Viacom to conduct an investigation of that roundwater. which Viacom is doing. Alcamo Dec. paragraph 10.

Although Viacom has completed all work required of it under the Consent Decree at that site, Viacom is willing to discuss the issue of future measures at that site with EPA.

Viacom's Participation in Negotiations with EPA About Additional Remedies Is "Not Speculative"

Although the Federal Defendants describe Viacom's involvement in the process of selecting additional remedies at these sites as "too speculative," the Declaration of EPA s own Remedial Project Manager belies that point. In his Declaration, Mr. Alcamo makes clear that it is Viacom who is conducting the groundwater investigations and collecting the other data upon which EPA expects to rely in future remedial decision-making. Alcamo Dec. paragraphs 5, 10.

Throughout the past several years, Viacom has been submitting reports and communicating extensively with EPA about additional remedial measures. Alke Dec. lT 20. The following is list of some of the investigatory work that Viacom has done during the past years as part of the settlement process.

Alke Dec. paragraph 20. During the year 2002, Viacom's Project Manager, Dorothy Alke, met with Mr. Alcamo and other representatives of the federal government to discuss these investigations and further remedial measures on at least 12 separate days. Alke Dec. paragraph 21.

Viacom has already planned to undertake the following additional activities in 2003 to gather data for additional remedial decision-making:

• At Lemon Lane Landfill:
• Take fish-tissue samples in Clear Creek;
• Conduct a trend analysis for fish-tissue samples;
• Work on an ecological risk assessment;
• Conduct sediment sampling at Illinois Central Spring, Quarry Spring, and Clear Creek.
• At Bennett's Dump:
• Conduct post-storm monitoring to assess hydrological system behavior following a storm.
• At Neal's Landfill:
• Conduct Fish sampling in Conard's Branch and Richland Creek;
• Analyze the trend in fish data;
• Revise ecological risk assessment to include new data;
• Undertake field activities (including dye tracer studies) to gather data on the drainage basin at Neal's Landfill.

All of these activities are in addition to Viacom's ordinary monitoring obligations which it is performing. Alke Dec. 1122. In the last two weeks, EPA invited Viacom to a global settlement meeting scheduled for April 9, 2003. Alke Dec. IT 23.

Given the history of the parties' efforts, and EPA's continued reliance on work that Viacom is performing voluntarily, without any obligation under the Consent Decree. The Federal Defendants' unfounded and gratuitous attacks on Viacom are outrageous.

Nonetheless, the relief they seek - summary judgment dismissing Plaintiffs, federal claims under section 113(h)(4) of CERCLA - is wholly appropriate, and Viacom joins in the Federal Defendants' Motion for Summary Judgment to that extent.

Footnotes

¹ For convenience, the term "Viacom" will be used to refer to Viacom itself and its two predecessors, Westinghouse Electric Corporation and CBS Corporation.

^2. The United States also wanted Viacom to agree to pay its past costs and natural resource damage claims, even though the Covenant Not to Sue in the Consent Decree protected Viacom from such claims. Alke Dec. paragraph 13.

3 In the Court's recent decision in Taylor Farm L.L.C. v. Viacom, Inc., No. IP 01-1734 C M/S (S.D. Ind. Dec. 24, 2002), Judge McKinney stated in dicta that this provision of the Consent Decree was no longer in force because the parties had amended this provision. With all due respect, Judge McKinney was in error on that point. This provision remains in effect and has not been modified.