Criminal Sentencing in Clean Air Act Case

The former project manager at an oil processing plant that exploded in Montana in 2012 injuring three employees was sentenced today to two years of probation and fined $5,000. Mark Hurst pleaded guilty on February 27th to negligent endangerment under the federal Clean Air Act.

On September 27th, a jury convicted co-defendant Peter Margiotta of all three counts against him related to the plant explosion. The jury found Margiotta guilty of conspiracy and two violations of the Clean Air Act (general duty and knowing endangerment). Margiotta was president and director of Custom Carbon Processing, Inc., a Wyoming company that constructed the Michels Disposal Well and Oil Processing facility in Wibaux in 2012. Hurst testified against Margiotta at trial.

Although Hurst had notified his superiors of serious problems at the plant, he continued to operate the plant and kept it open. Simply notifying management of problems is not sufficient to avoid criminal liability under federal environmental laws.

Pennsylvania Coke Manufacturer Settles with EPA

Shenango Inc., a Pennsylvania coke manufacturer, has settled alleged air and water pollution violations with EPA, state and local environmental agencies.  The consent decree requires the company to pay $1.75 million in civil penalties and to make significant upgrades to the plant, which is located approximately five miles north of downtown Pittsburgh.

According to EPA, the facility had a history of non-compliance with federal, state and county environmental and public health regulations.  Federal consent orders entered into with previous owners in 1980, 1993 and 2000 required the facility to come into compliance, but violations continued.  DTE Energy Services purchased the facility in 2008.  Gary Gross, DTE vice president, said "When we acquired the facility, we were well aware of its history. We would not have proceeded with the purchase unless we had confidence that we could dramatically improve performance and establish Shenango as a good neighbor and a valuable asset to the community."  In the first seven months of 2011, Shenango had 114 air quality violations and paid a $114,000 fine to the health department

As part of the settlement, the company must take actions to reduce visible particular emissions to meet Clean Air Act standards by making repairs to the plant's coke ovens.  The company also has to bring the plant into compliance with the Clean Water Act by building a new wastewater treatment plant, upgrading its current treatment processes, and constructing a coal pile runoff management system.

The civil penalties include $1.25 million to be divided equally between the United States and Allegheny County for the facility's Clean Air Act violations, as well as $500,000 in Clean Water Act penalties to be divided between the United States and Pennsylvania.  As with all environmental consent decrees, it is subject to federal court approval following a 30-day public comment period.

The Shenango coke facility opened in 1962, employs about 150 workers and operates one coke oven battery with 56 ovens that produce approximately 380,000 tons of metallurgical coke a year.

Read more at the Pittsburgh Post-Gazette here.

Shenango coke plant, Neville Island, PA.

BP Agrees to Add $400M+ in Pollution Controls at Indiana Refinery Plus $8M Penalty

DOJ and EPA announced today that BP North America Inc. has agreed to pay an $8 million penalty and invest more than $400 million in state-of-the-art pollution controls and cutting emissions from its petroleum refinery in Whiting, Indiana.  The settlement is in response to a complaint that alleges violations of the Clean Air Act related to construction and expansion of the refinery, as well as violations of a 2001 consent decree with the company that covered all of BP's refineries and was entered into as part of EPA's Petroleum Refinery Initiative.  The agreement imposes some of the lowest emission limits in refinery settlements to date, enhancing controls on wastewater containing benzene, and providing for an enhanced leak detection and repair system.

Negotiations included several environmental groups, including Save the Dunes, the Hoosier Chapter of the Sierra Club, the Hoosier Environmental Council, the Natural Resources Defense Council, and the Environmental Law and Policy Center, as well as state and federal environmental enforcement agencies.

The Whiting Refinery has a refining capacity of approximately 405,000 barrels per day, and is the 6th largest refinery in the United States.

Indiana Wastewater Treatment Operator and Managers Charged with Conspiracy and Violating the Clean Water Act

United Water Services Inc. (UWS), the former contract operator of the Gary Sanitary District wastewater treatment works in Gary, Ind., and two of its employees, were charged today with conspiracy and felony violations of the Clean Water Act (CWA) in a 26-count indictment returned by a federal grand jury, the Justice Department announced today.

UWS and employees Dwain L. Bowie, and Gregory A. Ciaccio, have been charged with manipulating daily wastewater sampling methods by turning up disinfectant treatment levels shortly before sampling, then turning them down shortly after sampling.

UWS entered into a 10-year contract to operate the Gary Sanitary District wastewater treatment works in 1998, in exchange for $9 million annually. UWS’s contract was renewed in May 2008. As contract operator, UWS handled the operation and maintenance of the treatment works, and was responsible for environmental compliance. To ensure compliance with the discharge permit, UWS was required to take periodic representative wastewater samples, including a daily sample to determine the concentration of E. coli bacteria in the wastewater.

According to the indictment, the defendants conspired to tamper with E. coli monitoring methods by turning up levels of disinfectant dosing prior to E. coli sampling. The indictment states that the defendants would avoid taking E. coli samples until disinfectants had reached elevated levels, which in turn were expected to lead to reduced E. coli levels. Immediately after sampling, the indictment alleges, the defendants turned down disinfectant levels, thus reducing the amount of treatment chemicals they used.

Dwain Bowie was UWS’s Project Manager for the Gary facility beginning in 2002, and was in charge of the Gary operation. Gregory Ciaccio joined Bowie’s staff in July 2003, and eventually was made the Plant Superintendent, in charge of day-to-day operations.

The CWA makes it a felony to tamper with required monitoring methods at a permitted facility like the Gary Sanitary District. If convicted, Bowie and Ciaccio face up to five years in prison on the conspiracy count and two years on each of the CWA counts, as well as a criminal fine of up to $250,000 for each count. The company may also face fines and/or probation.

The allegations in the indictment are mere accusations and all persons are presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.

The case was investigated by the Northern District of Indiana Environmental Crimes Task Force, including agents from the Criminal Investigation Division of the U.S.E.PA., the FBI and the Indiana State Police. The case is being prosecuted by the U.S. Attorney’s Office for the Northern District of Indiana and the Justice Department’s Environmental Crimes Section.

Asbestos Convictions in New York

Let's get the ball rolling here. We'll start with a simple announcement about an enforcement action to ease our way into blogging.

Earlier this month, a federal judge sentenced two operators of asbestos abatement companies to prison for illegally removing and disposing of asbestos in upstate New York. John Wood was sentenced to four years in prison, required to pay restitution of $854,166.06 to victims, and placed on supervised release for three years following the completion of his prison term. Curtis Collins was sentenced to two years in prison, required to pay restitution of $114,902.89, and ordered to serve three years of supervised release.

Both defendants pleaded guilty to conspiring to violate the federal Clean Air Act and the mail fraud statute. Wood also pleaded guilty to contempt of court for numerous new asbestos-related crimes which he committed while awaiting trial on the original charges. (Can you say "Darwin Awards candidate"??)

In 2005, after being released from prison for unrelated felonies, Wood began operating an asbestos abatement company. He directed his employees to remove asbestos in a way which, rather than removing all asbestos, dispersed it and left substantial quantities behind, significantly contaminating numerous businesses and homes. Some of asbestos which was removed was buried on a farm which was cleaned up using Superfund monies.

In order to deceive clients into believing that the asbestos had been removed from their properties, Wood used Mark Desnoyers, a licensed air monitor. Desnoyers falsified air samples so that laboratory results appeared to prove that all asbestos had been removed from homes and business when, in fact, they remained seriously contaminated. Wood previously testified against Desnoyers at trial.

Collins worked for Wood and also ran his own asbestos abatement company. He pleaded guilty and cooperated with prosecutors by testifying against Desnoyers at trial.

Desnoyers was convicted on all counts of an indictment charging him with conspiracy to commit mail fraud and Clean Air Act violations, as well as related substantive violations. Desnoyers is scheduled to be sentenced next month.

This just goes to show that you've got to be careful who you hire to remove asbestos from your properties. The property owners who hired Wood and Collins had to pay a lot more to remediate their properties than they would have spent had they hired a competent, reputable contractor in the first place. They will likely never recover the money Wood and Collins have been ordered to pay in restitution.