AVX Corp. on Monday reached a confidential settlement with an adjacent land owner over groundwater contamination near the manufacturer's facility on 17th Avenue South in Myrtle Beach, bringing an end to a dispute that started in late 2007.
The settlement was announced during what would have been the fourth day of testimony in a jury trial in federal court over contamination discovered on property owned by Horry Land Co.
Lawyers for AVX and Horry Land declined to comment on the settlement agreement.
The trial will move into a second phase beginning Thursday, when Judge Terry Wooten will decide whether the U.S. military contributed to the groundwater contamination on Horry Land's site.
Horry Land had been seeking about $5 million in actual damages and unspecified punitive damages, claiming the pollution ruined its property's value and made it impossible to develop on the site. An Horry Land official said last week the company had an agreement with the Catawba Indian Nation, which wanted to build a casino on the site, that had to be canceled because of the pollution.
AVX has admitted it contaminated Horry Land's groundwater with trichloroethylene, a degreaser commonly used by the military and businesses in the 1960s and '70s.
However, AVX says some of the contamination could have come from the Myrtle Beach Air Force Base, which is adjacent to the manufacturer. The military also used large amounts of trichloroethylene, or TCE, and there are several areas on the former base where groundwater is polluted by the chemical.
AVX said last week it will cost about $5 million to clean up the groundwater pollution on the Horry Land site. The company said it already has spent about $1 million on environmental tests at the site. AVX wants the military to share in some of those costs.
AVX did not present any witnesses or evidence in its trial with Horry Land. Testimony during the first three days included opinions by a pair of geologists who said the contamination on Horry Land's property could only have come from AVX because surface water and groundwater from the base moves in opposite directions.
Horry Land also presented reports from AVX consultants that showed the manufacturer knew as early as 1981 that TCE contamination was migrating off its property and toward adjacent land owners. The company did not try to stop the migration and did not inform the adjoining land owners, city, state or federal officials about the problem.
Instead, AVX tried to secretly clean up the contamination on its own property for 14 years before reporting the contamination to the S.C. Department of Health and Environmental Control. Dennis Oldland, the company's environment and safety manager, said AVX reported the problem to DHEC because its cleanup efforts weren't working.
The consultants' reports were among 1,500 documents that AVX had tried to keep secret before the jury trial started. Wooten, however, told the company last year that it must turn those documents over to Horry Land.
Horry Land also was prepared to show the jury videotaped depositions from AVX executives - including former Chief Executive Dick Rosen - discussing the contamination and the company's efforts to clean up its property in the 14 years leading up to 1995, when the company informed DHEC of the pollution.
DHEC hydrogeologist Carol Minsk also was expected to testify that all of the pollution on Horry Land's site came from AVX. Minsk is the state regulator overseeing cleanup of the Horry Land property and contamination that has spread to groundwater in a roughly 10-block neighborhood near the manufacturer.
Two additional lawsuits have been filed by property owners in that 10-block area - a class-action case in which dozens of owners say the pollution has ruined property values and a lawsuit by a developer who claims the pollution scuttled plans for a condominium project. Both of those lawsuits are still pending in state court.
Oldland said last week that AVX now regrets its decision to keep the contamination secret for more than a decade.
"If we had the knowledge we had today and knew the issues, we would have contacted DHEC as soon as we had the knowledge to get a better remediation program going and just to be a better neighbor," he said.
Federal regulators say TCE has been shown to cause cancer, but the pollution on Horry Land's site is not considered a health hazard because it is not used for drinking water.
Environmental tests have shown TCE levels as high as 18,200 parts per billion in groundwater on the Horry Land site. The U.S. Environmental Protection Agency has set a maximum safe limit of five parts per billion for drinking water. Although the groundwater is not used for drinking water, it must be cleaned to that standard to meet state and federal regulations.
A part per billion is a scientific measurement equivalent to 3 seconds out of a century or one pinch of salt in 10 tons of potato chips.
Experts disagree over how long it will take to clean up the groundwater near AVX. The company's consultants say it can be cleaned within five years, while Horry Land's consultants say a cleanup could take decades.
AVX has been paying for studies to determine the best way to clean up the pollution and expects to use a process called enhanced reductive chlorination, in which a substance similar to molasses is injected into the groundwater. The molasses-like mixture creates bacteria that eat the TCE, breaking it down into harmless matter.