Iowa manufacturer headed to court over environmental cleanup

A southern Iowa military supplier that has been accused of endangering U.S. troops and contaminating Union County groundwater is now locked in a legal battle over the cost of cleaning up the manufacturing site.

The site in question is the Wellman Dynamics manufacturing plant in Creston. For decades, Wellman Dynamics has done business as an aerospace supplier that manufactures large magnesium and aluminum castings for the defense industry.

Court records indicate that in 2018, while mired in bankruptcy, Wellman Dynamics was purchased by the newly formed entity WDC Acquisitions. As part of that purchase, WDC Acquisitions assumed the responsibility of cleaning up the site, which had been heavily contaminated in the mid-1960s by the site’s then-owner, Hills McCanna Co.

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Hills McCanna had allegedly discharged radioactive material containing thorium, as well as waste acids, chlorinated solvents, wastewater treatment sludge, and various heavy metals into the soil and groundwater at the company site in Creston.

In 1967, Hills McCanna was acquired by Wallace & Tiernan Inc., which operated the site until 1969, during which time the site continued to be contaminated through the release of hazardous substances into the soil and groundwater.

In 1969, the Pennwalt Corporation acquired Wallace & Tiernan, but the release of hazardous substances allegedly continued. From 1970 to 1976, thorium-containing wastes from specialty castings manufactured by the company were buried on site. In addition, an on-site, industrial-waste landfill was used in the 1970s for the disposal of other forms of waste, including foundry sand and treated magnesium waste.

In 2022, the Pennsylvania company Arkema acquired Pennwalt Corporation.

As a part of a newly filed lawsuit in U.S. District Court for the Southern District of Iowa, WDC Acquisitions alleges that Arkema, as the successor to past owners of the plant, owes a duty to WDC to dispose of solid and hazardous wastes in a manner that prevents their release into the environment, and that it has failed to remediate all known contamination in a timely and effective manner.

The lawsuit claims Arkema is now responsible, in whole or in part, for the release of the hazardous materials at the site, and it seeks to recover WDC’s unspecified expenses related to the cleanup. The lawsuit seeks a court order holding Arkema liable for those costs. Arkema has yet to file a response to the lawsuit.

The current dispute over the responsibility of dealing with decades-old contamination may be tied to last year’s acquisition of WDC by TRM Equity II, a Michigan-based private equity fund that takes over companies and imposes operational changes of its own design.

Within days of that sale taking place last year, the Department of Justice announced it had reached a settlement with WDC Acquisitions over allegations that it endangered U.S. troops by failing to conduct contractually required testing for parts in military aircraft and had also falsified test results. The company agreed to pay $500,000 to settle the case.

The settlement amount was based not on the actual claim of damages, which was close to $30 million, but on the company’s limited ability to pay damages. The case was initiated by Wellman employee Bradley Keller, a lab technician for quality control in Wellman’s metallurgical laboratory.

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