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At the gym yesterday, I read an article in Forbes by Peter Huber which discusses how the system employed to record real property title, security interests, etc. is and should change due to technology.  I would also note that for reasons having nothing to do with digital data and electronic communications, title insurance isn’t used in many civilized countries outside the USA.

Mr. Huber’s article brought to mind a company Andrew Craig and I have been working with.  That company has a business that scrapes electronic and paper records to create alerts of threats to institutional and engineering environmental controls for historically-contaminated real property.

It works like this:  if you were to remedy historical contamination by placing a physical cap and recording a deed restriction, but then not be in a position to observe whatever may go on at the property thereafter (most likely you sell or close the factory and move away), as a subscriber to the tracking service you would receive an alert, by way of example, if reporting on the control goes out of compliance or someone applies for a permit that could interfere with it.   I think that one of Andrew’s clients or a responsible party predecessor at a remediated site is considering subscribing to the service for its site(s).  Mike and I are involved in a discussion with a similar company about how the information technology they have developed may have application to insurance claims.

What I think we are seeing is that these companies have cool products in search of drivers to make a market that is emerging.

Obviously, information technology is a game-changer for an information business like law.  Today’s consumer of legal services is increasingly unwilling to pay lawyers’ fees for service the consumer perceives to be at best “paperwork” and, at worst, clerical repackaging of data and analysis that already exists.  (Cisco’s general counsel, Mark Chandler, made a well-publicized speech addressing these themes.)   As Mr. Huber discusses, today’s technologies provide cost-effective means of performing that work and the law will adopt them.

Cuyler Burk, P.C., a New Jersey Law Firm, congratulates its partners, Rich Crooker and Ed Collins, its client, International Risk Group, LLC, the City of Downey (California), the National Aeronautics and Space Administration (NASA), the General Services Administration (GSA) and the other stakeholders and their advisors on the Downey, California redevelopment project’s receipt of the Phoenix Award for Region 9 of the USEPA at the Brownfields 2008 Conference in Detroit, May 5-7, 2008. The Phoenix Award is recognized as a top environmental award for development of significant brownfields sites using innovative and practical remediation processes to restore contaminated sites to productive use with positive impact for their communities.

This award stems from the successful return of the Former NASA/Downey Industrial Plant in Downey to productive use. The work, which has been progressing since 2003, involves environmental remediation and redevelopment of 160 acres of property located approximately 15 miles east of Los Angeles International Airport. The property was used by the military for airplane assembly during the World War II era and later by NASA in its Apollo and Space Shuttle programs. The property then became excess to NASA’s mission but remained contaminated, principally with solvents in soil and groundwater incidental to the work performed there over the years.

The transaction provides an illustration of Early Transfer of contaminated federal property in accordance with CERCLA. The structure demonstrates how vital site-controls needed for effective privatization of historical environmental clean up cost on a fixed budget must be balanced with the realities of real estate development, requiring that all stakeholders perform with a sound understanding of the degree to which all rights and interests are intertwined.

Mr. Crooker’s client, International Risk Group, worked closely with the GSA, NASA, the City and other stakeholders to build the required relationships and agreements. The Governor of California, advised by state regulators, then signed off on the transaction, setting in motion the process whereby the real property and improvements were transferred from Federal Government ownership to the City prior to completion of environmental cleanup with private ownership and redevelopment commencing simultaneously.

Private redevelopment includes the Downey Studios (a major motion picture and television studio), a retail power center (Downey Landing) and a Kaiser Permanente regional hospital center and related complex. The transaction was facilitated by an environmental risk assumption agreement undertaken by a subsidiary of International Risk Group, by which it agreed to perform the required environmental clean up to no further action and to insulate the exiting federal government and incoming stakeholders, including the City of Downey, from financial risk associated with historical environmental conditions. Manuscripted environmental insurance products were utilized to secure these obligations.

Since the real estate and environmental risk assumption transaction closed in 2003, numerous major films, as well as the television series Smash Lab, have been made at the Studio, the retail center has opened and continues to operate at or near full occupancy, and construction of the hospital complex continues. Kaiser Permanente’s medical facilities are scheduled to commence full operations in 2010. Development has occurred simultaneously with ongoing environmental remediation at the site.

For further information, contact Richard Crooker at 973.734.3200 or rcrooker@cuyler.com.