It’s a lawsuit that’s been years in the making, but the class-action suit against Mountaire Farms may be approaching a $65 million resolution. Rather than face a prolonged jury trial, the poultry processing plant and the citizens who sued them have agreed to a $65 million settlement that could potentially be shared among a huge swath of people.

Incredibly, the proposed settlement could include anyone who has lived or worked full-time in most of Millsboro or Dagsboro, at any time since mid-2000, when the company first acquired the Millsboro poultry processing plant. Although Mountaire does not admit culpability for the alleged groundwater or air contamination there, the company agreed to pay people who may have been affected in a roughly 25-square-mile zone.

The $65 million proposed settlement would offer payments to the Mountaire Settlement Class: any person who “on or after May 1, 2000, owned, leased, resided on, or were employed on a full-time basis” at any property located partly or entirely within either the “Groundwater Area” and/or the “Air Area.” (See the official map at www.MountaireSettlement.com.)

The settlement would resolve the Cuppels family (et al.) lawsuit against Mountaire in Delaware Superior Court. Instead of a big trial, the two parties agreed to a settlement to “avoid the expense, inconvenience and uncertainty of continued litigation.”

The settlement is supposed to compensate people for personal injury and property damage caused by alleged contamination to Millsboro-area groundwater and air. The plaintiffs alleged that Mountaire disposed of contaminated wastewater and liquefied sludge on land near the people’s homes and properties, and that it seeped into the groundwater, “causing nitrates and other contaminants to enter plaintiffs’ drinking water wells, resulting in health effects and reduced property values.” Additionally, the alleged air emissions include hydrogen sulfide and ammonia, which can be a nuisance around homes and a potential health issue.

The lawsuit became a class-action suit because there is a broad enough population potentially with similar claims that they can be lumped together as a “settlement class.” That means all of those people’s legal rights are affected by the settlement, whether they participate in the settlement or not.

Residents impacted on both sides of the Indian River

The environmental concerns bubbled to the surface in November of 2017. That’s when Delaware Department of Natural Resources & Environmental Control (DNREC) announced the plant’s repeated permit violations, including under-treated wastewater being spray-irrigated onto nearby agricultural fields.

But this settlement is pointing back to May of 2000, when Mountaire bought the old Townsend Inc. poultry plant on John J. Williams Highway (Route 24), a mile or so outside of Millsboro town limits. That suggests that the plaintiffs perceive an ongoing history of contamination issues since Mountaire first arrived.

Originally, the groundwater issues seemed limited to a smaller region around Mountaire, but the underground movement of water and the alleged air emissions paint a larger picture of potential impact.

People who live within 5 miles downwind of the plant are eligible for compensation. The settlement map shows a roughly 25-square-mile impact zone, made of two smaller regions that overlap. The “groundwater area” surrounds the Mountaire facility by several miles, stretching east to Oak Orchard, north above Mount Joy Road and almost to Zoar Road, curving westward around Gravel Hill Road (Route 30), and bounded by the Indian River to the south.

The “air area” is larger. It doesn’t reach as far north or east, but it includes a massive area west and south of the river, including the Indian River Power Plant. It swings as far south as the Indian River High School baseball fields and downtown Dagsboro, then wanders up along Route 113, swinging west to include most of Millsboro’s commercial district and the Millsboro ponds.

Individuals could receive money for damages “including, but not limited to personal injuries for air and/or groundwater exposure, property damages, nuisance, negligence … trespass, unjust enrichment, medical monitoring, wrongful death and survival,” according to court documents. “The claims process shall consider past and future out-of-pocket expenses for water testing and alternative water supplies or treatment systems” for families in the groundwater area.

Although the document doesn’t mention adults or children who attended the multiple schools or care centers in that zone, they can also inquire with the claims administrator about registering as part of the settlement class.

Basically, the only people living, working or using facilities in that area who aren’t eligible for the class action are those who already made separate legal agreements with Mountaire; much of the company’s leadership or associates; or employees who were exposed to the alleged hazards because of their work there.

Three companies were named as defendants: Mountaire Corporation (of Arkansas), Mountaire Farms Inc. (of Delaware) and Mountaire Farms of Delaware Inc.

Individuals should respond now

Right now, there are still several steps before the average person gets a check in the mail. People have to register as class members to participate. The court has to consider any objections, and then whether to approve the $65 million settlement. Then the settlement administrator would decide the allocation process: what proof to require for property or personal-injury claims and how to weigh the severity of each. After attorney and court fees, the rest of the escrow account would then be divvied up.

So now, individuals have four options:

  • Participate — Anyone who lived or worked in the eligible areas near Millsboro and Dagsboro (according to the map) and wishes to be considered for a payment must complete a registration form by Monday, March 22. Those who fail to register by this date will not be eligible for settlement compensation.
  •  Object — Anyone who wants to participate in the class-action settlement, but who objects to any part of the proposal, must submit the necessary forms by Monday, Feb. 22.
  • Opt out — Any class member who wishes to be excluded from the class must submit the necessary forms by Monday, Feb. 22. They will not be bound by any court judgments or orders, but neither will they receive settlement money.
  • No action — Anyone who does not take action or register by March 22 will still be bound by the terms of the lawsuit but won’t get to benefit from the settlement. Also, they will not be eligible to participate in any other lawsuit against Mountaire on groundwater contamination or air pollution.

No one is required to attend or speak at the April 12 court date in order to be considered for participation, or to formally object to the proposal.

If the judge approves the settlement, people will probably need to submit more information (such as bills, medical records or any other paperwork) to support their claims. The dollar figure each person receives would depend on the number of total claims and the severity of injuries or damages suffered by each person.

The court will rule on the proposed settlement at the final fairness hearing on Monday, April 12, at 9:30 a.m., at the Sussex County Superior Court Courthouse, located at 1 The Circle in Georgetown. Due to COVID-19, the hearing may be held virtually (such as an online teleconference). Check the website for potential changes (www.MountaireSettlement.com). The Hon. Craig. A Karsnitz did sign a preliminary approval for the settlement on Jan. 11.

Additional costs

The plaintiffs were represented by two law firms, Baird Mandalas Brockstedt LLC of Delaware, and Schochor, Federico & Staton, of Baltimore.

Of the $65 million, attorneys suing Mountaire will also request a 25 percent ($16.25 million) payment, plus expenses of $2.5 million. In the past three years, they conducted hundreds of interviews and hired dozens of experts in wastewater engineering, air emissions, hydrogeology, medicine and more. That’s before the intense back-and-forth legal action in the courts.

“We are honored and humbled that the Millsboro community trusted our firms to litigate this important environmental case,” said plaintiffs’ attorney Chase T. Brockstedt. “I cannot be more proud of our entire team and the incredible effort over the last three years which led to this settlement.”

Also, the seven individual plaintiffs who started and led the class-action suit — especially before it was designated as such — will receive enhancement awards, as a type of bonus for their efforts.

Other lawsuits and legal actions

The class action settlement comes about a year after Mountaire made a private settlement with another group of about 100 citizens, the Balback family and others, represented by Jacobs & Crumplar P.A.

Meanwhile, in terms of actually fixing the problem, Mountaire has signed a consent decree to invest $120 million for wastewater treatment system upgrades, reduction in air emissions and increased reporting on pollution complaints. They must also continue providing bottled water to certain residents; install at least 60 acres of “phytoremediation” to clean up the environment; and establishing a process to respond to odor complaints. Ongoing operations and maintenance will likely cost another $20 million.

That remediation came from a separate federal court case between DNREC and Mountaire. But the Cuppels and company were also intervenors in that case, successfully pushing for Mountaire to make a larger investment than initially proposed in its multi-million-dollar plant upgrades.

“Our sole focus now can be on building our new state-of-the-art wastewater treatment, which has been our goal all along,” said Phillip Plylar, president of Mountaire Farms in Millsboro. “We are ready to move forward.”

Mountaire calls itself a “privately owned, Jesus-centered company with a commitment to the communities in which our employees work and live.” The parent company is based in Arkansas, with operations in Delaware, Maryland, Virginia and North Carolina.

“We thank Mountaire for choosing environmental responsibility and doing what is right for the Millsboro community,” said plaintiffs’ attorney Philip C. Federico. “This settlement is a win-win for Mountaire and those we represent. We wish them well with their upgrades and improvements, and know they will continue to be a vital part of Sussex County and the Eastern Shore for decades to come.”

More information on the Mountaire lawsuit:

  • All details are online at www.MountaireSettlement.com;
  • For questions or documents regarding the settlement, contact Cuppels v. Mountaire Class Action Claims Administrator, RG/2 Claims Administration LLC; P.O. Box 59479; Philadelphia, PA 19102-9479, phone (866) 742-4955, email info@rg2claims.com;
  • For questions about the lawsuit (not the settlement) contact class, contact Chase Brockstedt, Esq., Re: Mountaire Class Action; Baird, Mandalas, Brockstedt, LLC; 1413 Savannah Rd., Ste. 1; Lewes, DE 19958, phone (302) 313-5288.

The public should not contact the Delaware Superior Court or Mountaire’s attorneys.

Staff Reporter

Laura Walter is an award-winning reporter on schools, environment, people and history. A graduate of Indian River High School and Washington College, she has rappelled off a building and assisted a magician, and encourages readers to act on local issues.