During 2006, Cole Schotz represented a client in the sale of the property in Lodi, NJ where a major explosion occurred in 1995 during the operations of his tenant, Napp Technologies, Inc.

Immediately after the explosion, Cole Schotz, on behalf of the client, negotiated an agreement to allow Napp to conduct the cleanup of the property under the supervision of the New Jersey Department of Environmental Protection.  After many years of minimal progress in Napp's cleanup of the site, the client decided to undertake the cleanup so that it could be redeveloped.

In order to expedite the cleanup of the site, Cole Schotz negotiated a guaranteed cleanup cost contract with an environmental consultant to perform the remediation of the property for not more than $2.7 million.  Using that contract, Cole Schotz assisted the client with applying for an environmental insurance policy from AIG Environmental.  That policy covered cost overruns incurred in cleaning up the known contamination, as well as the cost to cleanup any newly discovered contamination, either on- or off-site.  The policy also provided coverage if any third party sued the client for property damage or bodily injury, occurring on- or off-site.

While the cleanup was pending, Cole Schotz filed a lawsuit against former owners and operators of the property.  He also notified his insurance companies that provided general business liability insurance during the time he owned the property.  Using the guaranteed cleanup cost as the basis for starting negotiations, Cole Schotz negotiated a settlement that reimbursed the client for most of his cleanup costs.

During 2006, the cleanup of the property had progressed to the point where the NJDEP decided that the soil was clean enough to allow the buyer's development of a supermarket to proceed.  The sale closed during August.  Since then, the buyer has been constructing a supermarket on the site.  The remediation of the groundwater by the client's consultant will likely continue for at least several more years.