Court: Co. Not Liable in Mead Cleanup

3 Nov 2023

LINCOLN, Neb. (DTN) -- A federal judge in Nebraska ruled one of the business entities connected to a company that owned and operated a now-closed ethanol plant in the state will not be held responsible for paying to help in an ongoing environmental cleanup.

U.S. District Judge Brian C. Buescher, in the U.S. District Court for the District of Nebraska, dismissed claims that Gubbels Ventures LLC should in part be held liable for cleanup costs. Bayer U.S. LLC had asked the court to require Gubbels to help pay for cleanup at the defunct ethanol plant.

Bayer obtained a court order to freeze all AltEn LLC assets in February 2023 and filed an amended complaint in June 2023, to include all business entities wrapped up in the AltEn structure, including Gubbels Ventures.

Bayer is in the process of trying to recover at least some of the $28 million spent on environmental cleanup in Mead.

Buescher said in his ruling last week that Gubbels Ventures was not one of the businesses covered by a preliminary injunction issued by the court to prevent the sale, concealment and transfer of company assets that could be used toward paying for the cleanup.

The court's injunction named the following AltEn-related entities: Earth Energy and Environment LLC, AltEn Operating Company, Greencycle Solutions, Integrated Recycling LLC, E3 Biofuels LLC, Falcon Energy LLC and Mead Acquisition Company LLC.

"Gubbels Ventures is conspicuous by its absence from this list," Buescher said in the court's Oct. 27 order.

"Indeed, there is no mention of Gubbels Ventures anywhere in the court's memorandum and order. Thus, to suggest that Gubbels Ventures is a 'related entity' or is part of the 'web' of 'intertwined' companies found by the court is a mischaracterization of the court's prior ruling. The court has never found or suggested that Gubbels Ventures is or even might be an entity against which Bayer could assert any of its claims."

Bayer had alleged Integrated Recycling consists of a 50-50 business entity owned by E3 and Gubbels Ventures. Integrated Recycling was responsible for debagging, recycling and composting materials at the AltEn plant, Bayer said in its brief filed previously.

AltEn shut down its plant in early February 2021 after the Nebraska Department of Environment and Energy issued an emergency order to cease operations at the plant on Feb. 4 following numerous environmental violations. AltEn completed the shutdown on Feb. 8, 2021.

However, cold weather several days later led a pipe to burst at the plant, causing 4 million gallons of pesticide-filled water to flow downstream. The plant used pesticide-treated seed to produce ethanol, leaving behind at the plant site large volumes of distillers grains contaminated with neonicotinoids.

Back in February 2022, seed companies led by Bayer filed lawsuits against AltEn attempting to force the company to help pay for cleanup of the site.