2 F.3d 1071 (10th Cir. 1993), 92-4111, United States v. Self

Docket Nº:92-4111.
Citation:2 F.3d 1071
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. Steven M. SELF, Defendant-Appellant.
Case Date:August 24, 1993
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

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2 F.3d 1071 (10th Cir. 1993)

UNITED STATES of America, Plaintiff-Appellee,


Steven M. SELF, Defendant-Appellant.

No. 92-4111.

United States Court of Appeals, Tenth Circuit

August 24, 1993

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Christopher Harris of McCutchen, Doyle, Brown & Enersen, Washington, DC (William F. Hughes of Howrey & Simon, Washington, DC, with him on the brief), for defendant-appellant.

J. Carol Williams, U.S. Dept. of Justice, Environment & Natural Resources Div., Washington, DC (David J. Jordan, U.S. Atty., and Gordon W. Campbell, Asst. U.S. Atty., Salt Lake City, UT, Myles E. Flint, Acting Asst. Atty. Gen., and David C. Shilton, U.S. Dept. of Justice, Environment & Natural Resources Div., Washington, DC, with her on the brief), for plaintiff-appellee.

Before LOGAN, SEYMOUR and BALDOCK, Circuit Judges.

BALDOCK, Circuit Judge.

Defendant Steven M. Self appeals his convictions on four counts of violating the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. Sec. 6928(d), one count of mail fraud, 18 U.S.C. Sec. 1341, and one count of conspiracy to violate RCRA, the Clean Air Act ("CAA"), and the Clean Water Act ("CWA"). 18 U.S.C. Sec. 371. Three of the four substantive RCRA counts (counts 2, 3 and 4) and the mail fraud count (count 7) relate to the diversion of a shipment of natural gas condensate destined for a hazardous waste treatment, storage and disposal facility to a gas station, blending it with gasoline and selling it to the public as automotive fuel. The remaining substantive RCRA count (count 8) relates to the storage of twenty-nine drums of waste material in violation of a RCRA permit. The conspiracy count (count 1) relates to the activity supporting the other counts as well as unpermitted burning of waste and unpermitted dumping of waste water. Defendant raises a number of issues on appeal, and we have jurisdiction under 28 U.S.C. Sec. 1291.


The record reveals the following facts. In 1981, Defendant and Steven Miller formed EkoTek, Inc. Defendant provided most of the capital and became an 85% shareholder and EkoTek's President. Miller held the remaining 15% of the stock and became Vice-President. EkoTek purchased an industrial facility in Salt Lake City, Utah. Using

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Miller's technical expertise, EkoTek began re-refining used oil into marketable products. Defendant and Miller managed EkoTek on a day-to-day basis with Defendant primarily responsible for the financial aspects of the business, and Miller primarily responsible for the technical aspects.

The facility purchased by EkoTek was an authorized RCRA interim status treatment, storage and disposal facility. See 42 U.S.C. Sec. 6925(e)(1). In 1981 and again in 1982, Defendant signed and submitted an updated part A RCRA permit application. See 40 C.F.R. Sec. 270.13 (1992). In 1983, Defendant signed and submitted a part B RCRA permit application. See id. Sec. 270.14. By submitting the permit applications, EkoTek could continue operating as a treatment, storage and disposal facility under RCRA interim status, pending its RCRA permit approval. See 42 U.S.C. Sec. 6925(e)(1). In November 1986, EkoTek began marketing itself as a hazardous waste recycling facility. Defendant and Miller prepared a letter and sent it to hazardous waste brokers and generators which indicated that EkoTek was licensed and prepared to accept a variety of hazardous wastes for recycling at its facility.

In April 1987, a representative of Southern California Gas Company ("SCGC"), met with Miller at EkoTek and discussed EkoTek disposing of SCGC's natural gas pipeline condensate. The parties agreed that the condensate was hazardous waste and should, therefore, be transported and handled under a RCRA manifest. Miller indicated that EkoTek could dispose of the natural gas condensate by burning it as fuel in EkoTek's onsite process heaters or boilers. SCGC subsequently contracted with and agreed to pay EkoTek "to transport, burn, and/or dispose of" natural gas condensate for $2.50 per gallon.

Shortly thereafter, an EkoTek tanker truck driver picked up a shipment of natural gas condensate from a SCGC facility in Los Angeles, California. The driver had been instructed by his supervisor to pick up the shipment and bring it back to EkoTek. As was his routine practice, the driver stopped at a gas station in Barstow, California, which was owned by Defendant, and telephoned his supervisor. On instructions from Defendant, the supervisor told the driver to leave the trailers containing the natural gas condensate at the gas station and return to Los Angeles to pick up an unrelated shipment. Defendant telephoned the gas station manager and instructed him to blend the natural gas condensate with gasoline in a 5-10% mixture and add an octane booster. The gasoline and condensate mixture was then sold to the public as automotive fuel. On Defendant's instructions, Miller told EkoTek's Refinery Operations Manager to sign the manifest to indicate that the natural gas condensate shipment had been received at EkoTek and to falsify EkoTek's operating log accordingly. A copy of the manifest was mailed to SCGC.

In early 1987, EkoTek began receiving fifty-five gallon drums of waste material from different sources. Defendant instructed an employee to store the drums in the south warehouse. When the south warehouse filled up, Defendant instructed the employee to store the drums in the east warehouse. The employee was also instructed by his immediate supervisor to scrape the "hazardous waste" label off of each drum, paint a number on the drum, and list it on an inventory sheet. In July 1987, the State of Utah, pursuant to its delegated RCRA authority, see 42 U.S.C. Sec. 6926(b), granted EkoTek a RCRA permit which prohibited EkoTek from storing hazardous waste in the east warehouse. Defendant discussed this illegal storage practice with Miller. Defendant's office at EkoTek had a view of the doors to the east warehouse which were usually left open and through which stored fifty-five gallon drums were visible. On several occasions, Defendant ordered the doors to the east warehouse closed after being informed that inspectors would be at the facility.

Among the drums stored in the east warehouse were seventeen drums of waste from Avery Label and twelve drums of waste from Reynolds Metals both of which were shipped to EkoTek under RCRA manifests identifying the materials as hazardous wastes. Avery Label's manager of safety and environmental affairs testified that the waste sent to EkoTek was a mixture of ultraviolet

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curer ink waste, solvent ink waste, and cleaning solvent. Ultraviolet curer ink has a flash point exceeding 200? F and is, therefore, not considered hazardous due to ignitability. See 40 C.F.R. Sec. 261.21(a) (1992). Solvent ink, on the other hand, has a flash point well below 140? F and is, therefore, considered hazardous due to ignitability. See id. The Material Safety Data Sheets ("MSDS") for the type of solvent inks that Avery Label used in 1987 indicated that the solvent inks had a flash point of between 16? F and 116? F. According to the Avery Label representative, mixing solvent ink waste with ultraviolet curer ink waste does not raise the flash point because the vapors of the solvent ink waste, which determine its ignitability, rise to the top. In his opinion, the waste sent to EkoTek had a flash point of between 70? F to 100? F. The hazardous waste broker who had arranged for the disposal of the Avery Label waste personally observed the waste sent to EkoTek and recognized it as a solvent-based ink due to its smell.

The RCRA manifest which accompanied the shipment of the Reynolds Metals waste to EkoTek indicated that the material was a mixture of "MEK" (methyl ethyl ketone) and a spray residue. MEK is a listed hazardous waste, see 40 C.F.R. Sec. 261.33(f) (1992), and it has a flash point of 23? F. The spray residue has a flash point of 100? F.

In April 1988, the hazardous waste broker responsible for shipping both the Avery Label and Reynolds Metals wastes to EkoTek visited the EkoTek facility after having been informed that drums of waste which he brokered had never been processed and were being illegally stored at the facility. By this time, EkoTek was no longer in business, and Petro Chemical Recycling, with which Defendant had no affiliation, had taken over operation of the facility. The broker observed "a lot of drums" being stored in the east warehouse, none of which were labeled but were crudely marked with a number. Using EkoTek's inventory sheet and recognizing the drums by their distinctive color, the broker identified the seventeen drums of Avery Label waste and the twelve drums of Reynolds Metals waste. He subsequently arranged for Marine Shale Processors to dispose of these as well as several other drums of waste. On documentation submitted to Marine Shale Processors, the broker indicated that the materials were from four types of waste streams, and he identified the material in twenty-four of the 128 barrels as "UV ink waste." Marine Shale Processors tested a sample from each of the four types of waste streams and determined that each type of identified waste had a flash point below 70? F.


With regard to the substantive RCRA counts and the mail fraud count relating to the diversion of the natural gas condensate to the Barstow gas station (counts 2, 3, 4 and 7), Defendant argues that natural gas condensate, when burned for energy recovery, is not a hazardous waste subject to regulation under RCRA. Therefore, Defendant claims the district court erred by denying Defendant's pretrial motion to dismiss, by denying Defendant's motion for a judgment of acquittal, and in its instruction to the jury...

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