LOCKHEED FEARED JURY DAMAGES, JUDGE SAYS.

Byline: Lee Condon Daily News Staff Writer

The judge who mediated the Lockheed Martin $60 million settlement with Burbank residents gave the first official version of the deal Friday, saying the company was afraid a jury might award high damages even though it insisted there were no health risks.

Retired state appellate justice John Trotter said lawyers for both the company and the 1,357 residents asked him to provide details of the confidential settlement after the Daily News disclosed the terms Aug. 4.

He said the parties wanted to end concern in the community that historical emissions from the plant might pose a danger to their health. Lockheed has repeatedly said its aircraft manufacturing plant, known as B-1, never threatened the community.

``The residents of Burbank are making some wrong assumptions that the potential for injury is great,'' Trotter said.

Residents left out of the settlement have filed a federal class-action lawsuit, alleging property damages and property value declines as a result of operations at the plant, which was closed in 1990 after six decades of operation.

Los Angeles attorney Patrick Grannan said the lawsuit will continue.

``We would not have filed the case if we did not think we had a good case,'' Grannan said. ``We expect Lockheed to put us to our proof. But I would think if they were fearful of a big jury award (in the settlement deal) they would have the same fear in this case.''

Lockheed spokesman Maureen Curow said the company had no comment on either the settlement or Trotter's comments.

``We are still bound by the confidentiality agreement,'' said Curow. ``We and the residents' lawyers agreed the judge would just talk about the dispute-resolution process.''

Tarzana attorney David Casselman, who represented the Burbank residents, also had no comment, a spokesperson for the law firm said.

Trotter said Lockheed was concerned about a jury verdict because of previous air emissions of a carcinogen, hexavalent chromium, even though no link was established between those emissions and cancers among the plant's neighbors.

``If there was no hexavalent chromium I doubt it would have (been) settled at this level,'' Trotter said. ``Who knows what a jury is going to do? People buy certainty by settling. Some of the evidence isn't flattering to Lockheed. Lockheed did cause pollutants to go into the water and the air.''

Without admitting any liability, the company agreed to pay some 80 families who had cancer illnesses or who had relatives die of cancer, Trotter said.

Trotter said he believes the plaintiffs did better in mediation than they would have in court, because much of their evidence was speculative and could have been thrown out by a trial judge.

``In my opinion they would not have won this case in Superior Court,'' Trotter said. ``There's no evidence that there is an increase in cancer. There's no causative relationship.''

He said the most important thing to most residents was not their individual checks, but the medical monitoring system that Lockheed Martin set up for them.

``The only thing that really settled the case was not the money, but the medical monitoring,'' Trotter said. ``It answered the community's fears.''

Lockheed agreed to the dollar amount, but did not specify how the money would be doled out to the plaintiffs, Trotter said. That was left to the residents' lawyers who created a formula to determine the amount each of their clients would receive.

Plaintiffs were awarded points in the formula if they had cancer, if they drank out of contaminated wells for 20 years or more or if they lived downwind from the plant. They also received points if a relative died of cancer.

There were other points based on homes' distance from the plant. The closer people lived to the plant, the more points they received.

``The people with the most points got the most money,'' Trotter said.

The highest award was $300,000; the lowest, $2,500.

Trotter said he held several meetings, attended by hundreds of plaintiffs each time, at the local Pickwick banquet hall.

``The greatest concern I heard from plaintiffs is not that they were sick,'' Trotter said. ``They were fearful of becoming sick.''

But he noted that plaintiffs in California cannot be compensated for the fear of cancer, except under a very narrowly defined set of circumstances.

To deal with the fear, Lockheed agreed to create the medical monitoring system that makes each plaintiff eligible for checkups for cancer and other illnesses on a yearly basis. If anyone contracts any of the cancers, the illness will be covered under a medical insurance policy, Trotter said.

He said Lockheed allowed all forms of cancer to be on the list, even though there is no evidence linking most of them to the chemicals that the company used.

``The medical monitoring addressed people who didn't have a disease, but were fearful,'' Trotter said.

Lockheed's position was that if the plaintiffs sued in Superior Court, the company would argue that the claims should be rejected because the statute of limitations had run out for the residents to file. Lockheed contended that residents knew about the contamination for years because of press coverage of the company's environmental problems. The statute of limitations was waived as Lockheed went into mediation, but company officials warned that they would not waive it again, Trotter said.

``They wanted to end this,'' Trotter said, adding that the 1-1/2-year mediation process was much cheaper than courtroom litigation.

When Trotter was hired in February 1995, there were 250 plaintiffs, but the number grew to 1,357 by the time the final settlement was reached in July. Trotter said he and the lawyers met in more than 100 sessions and heard testimony from ``world-class'' experts on groundwater and air contamination, the possible health effects from chemicals used at the plant and the effects of the plant on local real estate markets.

It was established that contamination existed in both the groundwater and the air. Both tricholroethylene and perchloroethylene, known as TCEs and PCEs, were in the groundwater, he said. Air emissions over the years had included TCEs, PCEs and hexavalent chromium, he said.

But after expert testimony was given, both sides agreed there was a chance of ill health effects only if a plaintiff had been exposed to the water and air contamination for a minimum of 20 years.

Since Burbank shut down its wells in the late 1970s, only people who lived continuously in the affected area in the 20 years before the wells shut down were considered exposed to groundwater contamination. Similarly only people who lived downwind, or southeast, of the B-1 plant for 20 years before it closed in 1991 were considered exposed to the air toxins, Trotter said.

``You had to have lived in the area where the wind blew since 1971,'' Trotter said.

A Lockheed assessment of its own emissions back in 1989, required under the Air Toxics Hot Spots Information Act of 1987, detailed the air toxics released from the plant. That information was combined with detailed records from Burbank Airport that said the wind was blowing southeast, away from the plant.

The most serious contaminant was considered to be hexavalent chromium, which unlike the other toxics is a known carcinogen and has been linked to lung and throat cancer.

As for the property-value claims, the plaintiff's lawyers argued that real-estate prices in the area would drop because of disclosure of a planned vapor-extraction system to clean contaminated soils at the old B-1 site, Trotter said.

Plaintiffs were given points for property-value decline even though several Burbank real estate agents gave expert testimony that there had been no decline in the real estate market in the area as a result of the toxic contamination, Trotter said.

``We had a variety of Burbank Realtors in this room who said they saw no (decline) in the value of the homes,'' Trotter said.