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Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 1 of 14
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
LOCKHEED MARTIN CORPORATION
6801 Rockledge Drive
Bethesda, MD 20817
Blue Bell, PA 19424
UNITED STATES OF AMERICA,
Civil Action No.
COMPLAINT FOR RECOVERY OF RESPONSE COSTS
AND DECLARATORY RELIEF
Lockheed Martin Corporation ("Lockheed Martin") and Unisys Corporation
("Unisys") (Lockheed Martin and Unisys will hereafter be referred to as "Plaintiffs") hereby
complain against the United States of America ("the United States" or "the Government") to
recover response costs pursuant to Section 107 of the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 ("CERCLA"), as amended, 42 U.S.C. § 9607. These
claims involve a military equipment manufacturing facility at 365 Lakeville Road in Great Neck,
New York (the "Great Neck Manufacturing Facility"), at which hazardous substances, including,
without limitation, trichloroethylene ("TCE") and tetrachloroethylene ("PCE"), have been
detected in the soil and groundwater underneath and surrounding the facility. Plaintiffs seek to
recover certain remediation and cleanup costs, including, but not limited to, all costs incurred in
the past and to be incurred in the future to clean up the groundwater and soil at and around the
Great Neck Manufacturing Facility.
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 2 of 14
Plaintiff Lockheed Martin is a Maryland corporation. Lockheed Martin is the
corporate parent of Lockheed Martin Tactical Systems, a wholly owned subsidiary. Lockheed
Martin Tactical Systems was formed in 1996 when LAC Acquisition Corporation merged with
the Loral Corporation.
Plaintiff Unisys is a Delaware corporation. Unisys was formed in 1986 by the
merger of Sperry Rand Corporation and Burroughs Corporation. Sperry Rand Corporation, in
turn, was formed by the merger of Sperry Corporation and Remington Rand in 1955. The
predecessor of Sperry Corporation, Sperry Gyroscope Company, was founded in 1910. In 1995,
Loral Corporation purchased certain assets of Unisys, including the Great Neck Manufacturing
Defendant United States resides, may be found, and has its principal office in the
District of Columbia. The Government conducts business through its various agencies, including
the General Services Administration; the Departments of Defense, including the Army, the Air
Force, the Navy, and their predecessors in interest; and through its former agencies, including the
War Assets Administration, the Defense Plant Corporation, and the Reconstruction Finance
1 The Reconstruction Finance Corporation was a Government corporation established by
Congress in 1932. H.R. 7360, 72d Cong., 1st Sess., ch. 8, Pub. L. No. 2, 47 Stat. 5-12 (Jan. 22,
1932). The Reconstruction Finance Corporation established the Defense Plant Corporation as a
subsidiary on August 23, 1940, pursuant to Section 5-d of the Reconstruction Finance Act. After
World War II, pursuant to a joint resolution of Congress, the Reconstruction Finance
Corporation succeeded to all functions, rights and assets of the Defense Plant Corporation, S.
Con. Res. 65, 79th Cong., 2d Sess., ch. 215, Pub. L. No. 109 (June 30, 1945). The
Reconstruction Finance Corporation continued to act by and through the General Services
Administrator pursuant to the Surplus Property Act of 1944, H.R. 5125, 78th Cong., 2d Sess., ch.
479, Pub. L. No. 457, 58 Stat. 764, the Federal Property and Administrative Services Act of
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 3 of 14
JURISDICTION AND VENUE
This Court has jurisdiction pursuant to Sections 107(a) and 113(b) of CERCLA,
42 U.S.C. §§ 9607(a) and 9613(b), and 28 U.S.C. §§ 1331.
Venue is proper in this judicial district pursuant to Section 113(b) of CERCLA,
42 U.S.C. § 9613(b), and 28 U.S.C. § 1391(b) and (e), because the defendant resides, may be
found, or has its principal office within this district.
GOVERNMENT OWNERSHIP AND CONTROL OF OPERATIONS AT
THE GREAT NECK MANUFACTURING FACILITY
Prior to World War II, Sperry Gyroscope Company was a producer of maritime
gyrocompasses. At the direction of Army Air Forces personnel, Sperry expanded its research
and development activities and manufacturing to include bombsights, fire control systems and
other necessary wartime equipment and materials.
In 1941, the United States War Department determined that "the substantial
expansion of the existing capacity for the production of scientific equipment for navigation,
communication and fire control, and other products required by the Government for its National
Defense Program is essential," and, accordingly, "the establishment of an additional plant at or
near North Hempstead, Long Island, New York for operation by Sperry Gyroscope Company,
Inc. (hereinafter called 'Sperry') and the acquisition of machinery and equipment for use by
Sperry in said plant are required." The War Department agreed to reimburse the Defense Plant
Corporation for acquisition of property and construction of the new plant.
1949, H.R. 4754, 81st Cong., 1st Sess. ch. 288, Pub. L. No. 152, 63 Stat. 377, and regulations
and orders promulgated thereunder.
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 4 of 14
After a wide-ranging search for a suitable plant location, the United States
Defense Plant Corporation identified approximately 130 acres of undeveloped land owned
primarily by individual landowners around Lake Success, New York as the best available site for
a new aeronautical equipment plant. The individual landowners sold or donated their parcels of
land to the Government to allow the war production plant to be built.
In July of 1941, the Defense Plant Corporation entered into a contract and lease
with Sperry Gyroscope Company under which Sperry, acting expressly as an agent for the
Defense Plant Corporation, hired Stone Weber Guy, Inc. to construct the Great Neck
Manufacturing Facility on the Lake Success property. Under the contract between Sperry
Gyroscope Company and the Defense Plant Corporation, the United States reviewed and
approved all construction and equipment plans for the Great Neck Manufacturing Facility.
Construction on the Great Neck Manufacturing Facility was completed at a cost of almost
$40,000,000, and the facility began war production in February of 1942.
The Great Neck Manufacturing Facility
lease between Sperry and
Government prohibited Sperry from performing any non-governmental work at the facility
without prior approval from the Government. That lease also provided that all of the equipment
used at the Great Neck Manufacturing Facility was Government owned.
During World War II, the Government controlled every aspect of the Great Neck
Manufacturing Facility's day-to-day operations, including the following:
The Government determined the products, rate of production and delivery of
military equipment from Sperry;
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 5 of 14
The Government required Sperry to use particular subcontractors to facilitate
The Government controlled the price and supply of raw materials, including
solvents such as TCE and PCE, used at the Great Neck Manufacturing Facility;
The Government controlled the price Sperry would be paid for its finished
products by, among other things, requiring Sperry to renegotiate its supply
contracts with third parties under the Renegotiation Act, P.L. 77-528, § 403, 56
Stat. 245 (April 28, 1942), and other price control legislation;
The Government controlled Sperry's labor force by, among other things,
controlling employee hours and pay rates at the Sperry facility, handling
personnel issues at the Sperry facility, and obtaining draft deferrals for certain key
13. More than 100 military personnel were stationed at the Great Neck Manufacturing
Facility throughout most of World War II. These military personnel took over many of the
traditional functions of management including, without limitation, controlling the source of raw
materials; expediting materials to Sperry; inspecting and testing raw materials, manufacturing
processes and completed equipment; and providing security for the facility.
In October of 1950, Sperry Corporation, the successor to the Sperry Gyroscope
Company, purchased the Great Neck Manufacturing Facility from the Reconstruction Finance
Corporation, the successor to the Defense Plant Corporation.
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 6 of 14
The Government required the sale of the Great Neck Manufacturing Facility to be
subject to a National Security Clause, which was affixed to the deed for the property pursuant to
the National Industrial Reserve Act of 1948, Pub. L. No. 80-883, 62 Stat. 1225 (1948). That
National Security Clause expressly reserved to the Government an ownership interest in the
Great Neck Manufacturing Facility for a period of twenty years. The Government maintained
this ownership interest in the Great Neck Manufacturing Facility from October of 1950 until
December 2, 1970.
At various times between 1950 and 1970, the Government exercised its property
rights under the National Security Clause. The Government refused to allow Sperry to install a new sewer connector to the Great Neck Manufacturing Facility until Sperry paid the Government to release the clause. The Government also refused to allow Sperry to sell an unused, outdated building on the site without prior government approval.
After Sperry purchased the plant in 1950, the vast majority of the work at the
Great Neck Manufacturing Facility continued to be performed under Government contracts.
The Government assigned permanent resident military representatives to the
Great Neck Manufacturing Facility to oversee each contract. After World War II, the number of resident military representatives located at the Great Neck Manufacturing Facility varied.
The Government controlled which customers could purchase equipment produced
at the Great Neck facility after World War II by, among other things, preventing Sperry from exporting equipment it manufactured. 6
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 7 of 14
Pursuant to federal procurement regulations and procurement contracts with the
Government, all equipment, parts, tooling, supplies, and other materials acquired or
manufactured at the Great Neck Manufacturing Facility in connection with a contract, the cost of which was chargeable to the contract, became the property of the Government. Under these regulations and contracts, the Government owned the raw materials, including solvents such as TCE and PCE, trichloroethylene (TCE) tetrachloroethylene (PCE) used to manufacture aeronautical equipment. The Government also owned all scrap material generated from any government furnished material.
Upon completion of a production contract, personnel at the Great Neck Manufacturing Facility were required to obtain the Government's approval for the disposition of
all Government property, return it to the Government, or use the property on another
Government contract. All proceeds for the sale of surplus Government property were paid to the Government.
Government contracts required the use of Government-owned or Government-
specified materials in connection with the production of aeronautical equipment at the Great
Neck Manufacturing Facility.
23. During the entire period of operations at the Great Neck Manufacturing Facility, the Government promulgated technical, operational and material specifications for
manufacturing processes and materials. Compliance with military specifications was mandatory for every contract with the Government. In order to deviate from a military specification, formal written approval was required from the Government. Internal process standards and reliability standards at the Great Neck Manufacturing Facility were based on military specifications.
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 8 of 14
24. Many of the military specifications governing production at the Great Neck
Manufacturing Facility required the use of TCE and PCE in the manufacturing process.
25. TCE or PCE was used in vapor degreasing operations and in other manufacturing
processes from 1942 through 1979. After 1969, the use of TCE was largely replaced by PCE. Manufacturing activities at the Great Neck Manufacturing Facility slowed significantly in the 1970s and 1980s.
PLAINTIFFS' RESPONSE TO THE RELEASE OF HAZARDOUS
SUBSTANCES FROM THE GREAT NECK MANUFACTURING
26. The "Great Neck Site" is the area of soil and groundwater contamination, including, without limitation, TCE, PCE, and/or other volatile organic compounds, presently located at, under or around the Great Neck Manufacturing Facility in Nassau County, New York, and includes any areas to which such groundwater and soil contamination may migrate.
27. Hazardous substances, including, without limitation, TCE, PCE, and/or other volatile organic compounds, were released in the course of operations at the Great Neck
Manufacturing Facility. As the result of these releases, hazardous substances, including, without limitation, TCE, PCE and other volatile organic compounds, have come to be located in the groundwater and real property at the Great Neck Site.
28. In 1978, solvent contamination was discovered outside the southeast corner of the
manufacturing building in the area where a dry well was located. The dry well was part of the original design and construction of the facility in 1941 and 1942, and was connected to floor 8
Case 1:06-cv-01438-RJL Document 1 Filed 08/15/2006 Page 9 of 14
drains throughout the manufacturing building. In response to this discovery, working with the
Nassau County Department of Health, Unisys plugged the drains leading to the dry well.
29. In 1988, as a result of a voluntary investigation, Unisys
notified state environmental regulators of possible soil and
groundwater contamination in the area of the former dry well.