Honeywell 2007 Annual Report Download - page 118

HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
operations, operating cash flows or financial position. Provision also has been made in our financial statements
for the estimated costs of implementing related groundwater remedial plans approved by the court, as well as
sediment remedial plans which are presently under review by the court in which litigation concerning the site is
pending. The ultimate cost of remediating the river sediments may be reduced as numerous third parties could
be responsible for an as yet undetermined portion of these costs.
The above-referenced site is the most significant of the twenty-one sites located in Hudson County, New
Jersey that are the subject of an Administrative Consent Order (ACO) entered into with the New Jersey
Department of Environmental Protection (NJDEP) in 1993. Remedial investigations and activities consistent with
the ACO have been conducted and are underway at the other sites (the "Honeywell ACO Sites"). We have
recorded reserves for the Honeywell ACO Sites where appropriate under the accounting policy described above.
On May 3, 2005, NJDEP filed a lawsuit in New Jersey Superior Court against Honeywell and two other
companies seeking declaratory and injunctive relief, unspecified damages, and the reimbursement of unspecified
total costs relating to sites in New Jersey allegedly contaminated with chrome ore processing residue. The claims
against Honeywell relate to the activities of a predecessor company which ceased its New Jersey manufacturing
operations in the mid-1950's. While the complaint is not entirely clear, it appears that approximately 100 sites are
at issue, including 17 of the Honeywell ACO Sites, sites that the other two companies have agreed to remediate
under separate administrative consent orders, as well as approximately 53 other sites (identified in the complaint
as the "Publicly Funded Sites") for which none of the three companies has signed an administrative consent
order. In addition to claims specific to each company, NJDEP claims that all three companies should be
collectively liable for all the chrome sites based on a "market share" theory. In addition, NJDEP is seeking treble
damages for all costs it has incurred or will incur at the Publicly Funded Sites. Honeywell believes that it has no
connection with the sites covered by the other companies' administrative consent orders and, therefore, has no
responsibility for those sites. At the Honeywell ACO Sites, we are conducting remedial investigations and
activities consistent with the ACO; thus, we do not believe the lawsuit will significantly change our obligations with
respect to the Honeywell ACO Sites.
Lawsuits have also been filed against Honeywell in the District Court under the Resource Conservation and
Recovery Act (RCRA) by Jersey City and two of its municipal utilities seeking the cleanup of chromium residue at
two Honeywell ACO Sites. In January 2008, Honeywell and Jersey City agreed to settle these claims, which
settlement will become effective only upon the receipt of NJDEP approval of the remedial action workplan for
these sites, classification by Jersey City of these and other related sites as an area in need of redevelopment and
approval of the related redevelopment plan and agreement, and Court approval of this settlement. The remedial
actions contemplated by this settlement are consistent with our recorded reserves.
RCRA litigation has also been filed against Honeywell by a citizens' group and thirteen other defendants with
respect to contamination on about a dozen of the Honeywell ACO Sites. For the reasons stated above, we do not
believe this lawsuit will significantly change our obligations with respect to the Honeywell ACO sites.
Although it is not possible at this time to predict the ultimate outcome or resolution of the litigation and
administrative proceedings discussed above, we do not expect that these matters will have a material adverse
effect on our consolidated financial position. While we expect to prevail on or settle these claims, an adverse
litigation outcome could have a material adverse impact on our consolidated results of operations and operating
cash flows in the periods recognized or paid.
Dundalk Marine Terminal, Baltimore—Chrome residue from legacy chrome plant operations in Baltimore
was deposited as fill at the Dundalk Marine Terminal ("DMT"), which is owned and operated by the Maryland Port
Administration ("MPA"). Honeywell and the MPA have been sharing costs to
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