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Attorney general files suit against Shell Oil to reclaim millions in cleanup costs

CONCORD - Attorney General Joseph Foster has filed
a lawsuit against Shell Oil Company, seeking to reclaim more than $2.4 milllion in cleanup costs incurred at several sites over the past 25 years.

Foster said in a petition filed in Merrimack County Superior Court that the costs were paid by the state's Oil Discharge and Disposal Cleanup Fund (ODD) for cleanups at sites once owned by Shell, and that the company is financially responsible for the costs under state law.

The petition indicates the suit involves leaking underground storage tanks that were located at former Shell gas stations across the state. The attorney general alleged that the ODD fund paid for the cleanups, but Shell failed to disclose it had insurance to cover such leaks. Instead, the company submitted claims to the state and sued its own insurers for sites around the country, eventually winning $414 million in a settlement.

The suit states, "Because Shell deliberately misled the fund into reimbursing expenses which should not have been reimbursed, and because the fund has a subrogation right with respect to the divested sites at which Shell retains primary liability for pollution, the fund has filed this lawsuit to recover its expenditures, including interest and attorney fees and seeks enhanced compensatory damages."

The Attorney General's Office said the ODD fund was established by legislation in 1988 to provide a source
of funds for the cleanup of discharges of oil from underground and bulk storage tanks. The ODD fund serves as excess insurance and reimburses tank owners for their cleanup costs to the extent the costs exceed any available insurance coverage. The ODD fund is funded by a fee imposed on all imported oil.

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