US-Israel Nuclear Front’s Accountability Drives Fall Apart

Truth could still yield reconciliation

by , August 11, 2012

Since late 2010 almost 70 plaintiffs have sued Atlantic Richfield Corporation and Babcock &Wilcox Power Generation Group, Inc. in a round of Pennsylvania U.S. District Court suits seeking hundreds of millions in damages [pdf]. The civil claims center on radiation exposure-related cancers that plaintiffs allege were caused by the Nuclear Materials and Equipment Corporation (NUMEC).  NUMEC was a severely undercapitalized nuclear fuel processing plant that launched operations in an old steel mill in the heart of Apollo, PA in the late 1950s.  In the early 1960s NUMEC opened a plutonium facility and toxic waste dump in nearby Parks Township and later operated a secretive US government-owned Boron-10 facility in Niagara, NY.  NUMEC’s primary customer was the U.S. government.  Founder Zalman Shapiro leveraged his close ties to Admiral Hyman Rickover, the head of the U.S. Navy nuclear propulsion program, to win lucrative Cold War fuel contracts for nuclear-powered surface ships and submarines.

The plaintiffs filed their first expert report [pdf] substantiating NUMEC’s pollution record in court October of 2011. In the filing Joseph Ring, a Harvard University radiation safety expert, reviewed corporate and regulatory documents claiming NUMEC’s "operational, health, and safety practices were well below industry standards…"  Ring noted the Nuclear Energy Liability Insurance Association’s 1966 memo calling NUMEC "one of the hottest risks on our books." The Atomic Energy Commission, predecessor to the Nuclear Regulatory Commission — noted Ring — once opened a meeting stating "NUMEC has been the worst offender [of] AEC regulations over the years."  Ring filed documents that the inadequacy of NUMECs facilities in Apollo and Parks, PA led to NUMEC’s loss of "30 kilograms" of weapons-grade uranium — damning evidence of environmental negligence.

During the mid-1960s, NUMEC was investigated over its excessive losses of government-owned bomb-grade U-235 supplied for processing into Navy fuel.  After fining NUMEC for the cost of the missing materials, the embarrassed Atomic Energy Commission conditioned Atlantic Richfield’s 1967 bid for a lucrative cost-plus five-year contract to run the AEC’s sprawling Hanford facility on its acquisition of the now bankrupt NUMEC.  Shapiro and the other key NUMEC shareholders made sure that ARCO also assumed all of NUMECs past liabilities, even as they pocketed $8 million in ARCO shares.  ARCO quickly spun off NUMEC to Babcock & Wilcox (now B&W Technologies) at a substantial loss as it successfully renewed its Hanford contracts for another five years.

On January 19, 2012 the two corporate defendants fired back.  They claimed it was court precedent that each individual would have to provide "plaintiff-specific" evidence of radiation exposure.  The attorneys representing Atlantic Richfield (now owned by BP) and B&W claimed that through discovery they learned most of the plaintiffs in the suit had been assembled by community environmental activist Patty Ameno.  Ameno identified plaintiffs through comment cards at public meetings on the basis of each cancer patient’s proximity to NUMEC facilities.  The court — claimed defendants — would not be able to distinguish between environmental and "lifestyle" related afflictions since plaintiffs claimed "over forty types" of cancers. This required "case management" exposure records for each plaintiff, argued the defendants.  After the judge accepted the defendant’s "case management" argument, a dozen plaintiffs quickly dropped out. 

In a closely related development, the U.S. Army Corps of Engineers continues its attempt to deal with NUMEC’s toxic waste dump in Parks Township by soliciting broader input and information about what really happened at NUMEC. USACE was forced to halt material removal in October of 2011 after a contractor encountered unexpected materials and dangers at the site, now patrolled by automatic weapons-toting government agents. On June 26, 2012 USACE hosted a public meeting [pdf] to collect and document the concerns [pdf] of local residents affected by the toxic cleanup — which could cost up to half a billion dollars if it is allowed to proceed. On June 21, 2012 USACE representatives attended a status meeting in the Eisenhower Executive Office Building in Washington.  Representatives from the CIA, FBI, National Security Council, NSA, Justice Department and EPA were also in attendance.  Although no details of the secret discussions have yet been publicly revealed, the agencies involved signal that the nagging decades-old question of what really happened at NUMEC is once again a top-level concern in Washington.

Neither the USACE nor civil suit plaintiffs have yet to publicly ask the four basic questions that might allow them to understand the NUMEC crisis.  Why was NUMEC — a flyspeck among industry giants — even created?  Why was NUMEC located in the heart of a quaint borough in such tragically inadequate facilities?  Who brought it into being? If environmental and worker safety were of no concern to NUMEC’s operators (picked up on wiretaps discussing illegal storage leading to spills) what was its core hidden purpose?

David Lowenthal, a smuggler and fighter in Israel’s war of Independence with close ties to Israeli intelligence, was key to organizing NUMEC’s venture capital.  Zionist Organization of America Chapter President Zalman Shapiro frequently misled US regulators and regulators about his own dealings with Israeli intelligence operatives in the U.S. and their roles in Israel’s secret nuclear weapons program.  An impartial review of the growing online documentary archive reveals NUMEC was created and operated as yet another in a line of smuggling fronts in the mold of such predecessors as Materials for Palestine, Service Airways, and Martech — only NUMEC was designed to illegally obtain access to weapons-grade material rather than conventional arms.  Like successor U.S. nuclear technology smuggler Telegy Inc [pdf] NUMEC was wholly bankrupt and quickly discarded by its founders after it had served its primary purpose. 

Because plaintiffs never addressed NUMEC’s clandestine history, they stood little chance of correctly targeting their civil suits.  This is regrettable, since during the time of uranium theft and before it was acquired, NUMEC did severely pollute the environs of Apollo and Parks.  Plaintiff health suit leader Ameno claims "Patty has been able to establish to a much higher degree and with documented evidence, that the alleged diversion of nuclear material from NUMEC to Israel never happened…The loss of nuclear material continued at NUMEC under the new ownerships of ARCO and Babcock & Wilcox, long after the former founder and president of NUMEC, Dr. Zalman Shapiro left the company. An NRC Task Force Report dated April 25, 1977, on Material Unaccounted For confirms this." Unfortunately for Ameno and her followers, a thorough 2001 Department of Energy audit determined that most of NUMEC’s weapons-grade uranium losses occurred while Shapiro was still at the helm of NUMEC, and only returned to industry norms after he was forced out of the company. An authoritative Bulletin of Atomic Science article confirms the DOE findings.

Incidents of fires, materials releases, employee radiation exposures, visits of Israeli nuclear scientists and undercover spies at the invitation of Zalman Shapiro during his time at NUMEC (1956-1970) are all now well-documented.  Even more damning information may be on its way.  On July 17, the Interagency Security Classification Appeals Panel (ISCAP) finally agreed to review top-secret NUMEC documents from the LBJ administration for public release.  The top-secret documents purportedly deal with the CIA’s initial urgent warnings to the President Johnson that Israel was diverting vast quantities of weapons-grade nuclear material from NUMEC, as well as the president and NSC’s strategy for dealing with the crisis.  While the CIA has denied all previous Freedom of Information Act and Mandatory Declassification Review requests for NUMEC-related documents, the ISCAP has the authority to overrule, as it has done in the majority of release cases.  A successful document release could allow Parks and Apollo residents to finally seek hefty court-ordered damages from the true perpetrators (or their estates) who have long been shielded from the consequences of their lucrative crimes at NUMEC — Zalman Shapiro, NUMEC’s board members and the Israeli government.

While the defendants could easily argue in court that NUMEC’s liability policies (PDF) did not cover long-term fallout from the premeditated theft of nuclear material occurring before NUMEC changed ownership, they have refrained from doing so. A conflict of interest may be the reason.  Co-defendant ARCO is currently represented by Arnold & Porter LLP.   The mega-firm is also the longest-serving registered foreign agent of the Israeli government in the United States.  In 2010, even as it represented ARCO, Arnold & Porter signed a $10,000 per month retainer with the Israeli government for legal and advisory services and "special projects." Arnold & Porter lawyers have also represented Zalman Shapiro since the early 1970s, including his 2009 bid to force the Nuclear Regulatory Commission to issue a blanket exoneration of Shapiro for nuclear diversion.

If information regarding NUMEC’s history as a criminal enterprise is not declassified, NUMEC’s indirect victim pool will likely expand.  While some of those directly harmed will at least obtain health benefits, it will be from the same source of funding as the problematic USACE mega-cleanup — unwitting U.S. taxpayers who have been kept in the dark about NUMEC for half a century.

Read more by Grant Smith