KW Thompson Tool Co., Inc. v. US, Civ. No. 86-111-D.

• Decision Date: 24 March 1987
• Docket Number: Civ. No. 86-111-D.
• Citation: 656 F. Supp. 1077
• Parties: K.W. THOMPSON TOOL COMPANY, INC. v. UNITED STATES of America; United States Environmental Protection Agency; Lee Thomas, Administrator; Michael Deland, Regional Administrator; Philip Andrew, Investigator; William Ruckelshaus, Former Administrator; Lester Sutton, Former Regional Administrator.
• Court: U.S. District Court — District of New Hampshire

656 F. Supp. 1077

K.W. THOMPSON TOOL COMPANY, INC. v. UNITED STATES of America; United States Environmental Protection Agency; Lee Thomas, Administrator; Michael Deland, Regional Administrator; Philip Andrew, Investigator; William Ruckelshaus, Former Administrator; Lester Sutton, Former Regional Administrator.

Civ. No. 86-111-D.

United States District Court, D. New Hampshire.

March 24, 1987.

John Wall, Boston, Mass., Steven M. Gordon, Esq., Concord, N.H., for plaintiff.

Richard V. Wiebusch, U.S. Atty., Concord, N.H., Elaine Marzetta Lacy, Dept. of Justice, Washington, D.C., for defendants.

MEMORANDUM OPINION AND ORDER

DEVINE, Chief Judge.

This is an action brought pursuant to the Federal Tort Claims Act ("FTCA"), 28 U.S.C. §§ 1346(b), 2671, et seq.,¹ wherein plaintiff K.W. Thompson Tool Company, Inc. ("KWT"), brings suit against defendants United States of America, United States Environmental Protection Agency ("EPA"), and six individual former or present employees of EPA, who are sued only in their official capacities.² Plaintiff seeks $10,000,000 in compensatory damages for defendants' allegedly wrongful actions surrounding the prior criminal prosecution of plaintiff and three of its officers docketed in this court as Cr. Nos. 8500008-01, 02, 03, and 04-L (indictment filed March 18, 1985). This matter is presently before the Court on defendants' Motion to Dismiss Plaintiff's Amended Complaint or in the Alternative, For Summary Judgment,³ and Motion for Sanctions Pursuant to Rule 11, Federal Rules of Civil Procedure, and plaintiff's partial objection thereto.⁴ Plaintiff objects to the United States' Motion to Dismiss and for Sanctions.

I. United States' Motion to Dismiss

In considering a motion to dismiss, the Court follows the established requirement in ruling on such motion that "the material facts alleged in the complaint are to be construed in the light most favorable to the plaintiff and taken as admitted, with dismissal to be ordered only if the plaintiff is not entitled to relief under any set of facts he could prove." Chasan v. Village Dist. of Eastman, 572 F.Supp. 578, 579 (D.N.H. 1983) (citations omitted), aff'd without opinion, 745 F.2d 43 (1st Cir.1984). In reviewing motions to dismiss, the Court's focus is limited to the allegations contained in the complaint itself. Litton Industries v. Colon, 587 F.2d 70, 74 (1st Cir.1978). The standard for granting a motion to dismiss is not the likelihood of success on the merits, but is whether plaintiff is entitled to offer evidence to support his claim. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974). The relevant facts as alleged by KWT in its amended complaint and the background of this litigation are as follows.

KWT is a New Hampshire corporation with its principal place of business in Rochester, New Hampshire ("the facility"). Firearms are KWT's principal product, specifically those types of weapons popular with target shooters and hunters. Metal casting and firearms manufacturing are carried out at the facility, which is on or near various unnamed ditches and streams which flow into the Cocheco River. In the course of its manufacturing, KWT apparently discharges various substances into these ditches and streams, which are regulated under both state and federal environmental laws.

Beginning in 1980, plaintiff had various contacts with the New Hampshire Water Supply and Pollution Control Commission ("NHWSPCC") regarding its compliance with the environmental laws. The amended complaint details these contacts at great length, which the Court declines to repeat as they are only minimally related to the claims at issue here. Suffice it to say that KWT's interactions with the NHWSPCC, as well as notification from the EPA that KWT was illegally discharging pollutants, led plaintiff to apply for a National Pollutant Discharge Elimination System ("NPDES") permit⁵ from the EPA on November 12, 1982. In February 1983, the EPA returned KWT's permit application with the request that answers to certain questions be changed, even though KWT alleges that it was guided by information supplied by EPA employees in initially answering these questions. The revised permit application was submitted on or about April 1, 1983, and plaintiff's NPDES permit was issued in preliminary form on October 28, 1983. On March 14, 1984, the EPA issued to plaintiff in final form NPDES permit # NH 0021202.

Plaintiff claims that in issuing this permit to KWT the EPA "abused the NPDES permitting system by wrongfully, negligently and recklessly relying upon specific data which they knew, or should have known, was false." Amended Complaint ¶ 28. Specifically, plaintiff alleges that the EPA used outdated, overly restrictive standards in setting KWT's permit limits for the discharge of cadmium, failed to use available flow data relating to the Cocheco River, and knowingly used erroneous cyanide data.

Despite plaintiff's alleged efforts to bring itself into compliance with all applicable environmental laws, the EPA instituted a criminal investigation of plaintiff, which culminated in the previously-mentioned prosecution in this court, Cr. Nos. 8500008-01, 02, 03, and 04-L. Plaintiff contends that this criminal prosecution was contrary to agency policy in that plaintiff was simultaneously involved in voluntary compliance efforts, and that the prosecution was the result of improper training, supervisory lapses, a panic reaction to delays and errors of the EPA itself, and an implementation of William Ruckelhaus's supposedly well-known anti-gun views.⁶

The grand jury returned its fifty-count indictment against KWT and three of its corporate officers on March 18, 1985. The indictment charged violations of the FWPCA; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq.; the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601, et seq.; and the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq. Prior to trial, the criminal defendants moved to dismiss the indictments on the basis of, inter alia, selective prosecution, vagueness, overbreadth, and due process violations. These motions were all denied. In the instant action, KWT alleges that prior to a scheduled jury view in the criminal matter, an EPA employee, Philip Andrew, obstructed justice by destroying exculpatory evidence and intimidating witnesses.

On July 1, 1985, pursuant to a plea agreement, KWT pled guilty to Counts 4-18 (negligent discharge of pollutants into a water of the United States, in violation of 33 U.S.C. §§ 1311(a) and 1319(c)(1)), Count 44 (disposal of hazardous substances without a permit, in violation of 42 U.S.C. § 9603(c)), and Count 46 (failure to notify appropriate government agency of release of specified hazardous substances without a permit, in violation of 42 U.S.C. § 9603(b)). In exchange for these guilty pleas, the United States dismissed with prejudice Counts 1, 2, 3, 19-43, 45, and 47-50 with respect to KWT, and all counts were dismissed with respect to the corporate officers. KWT was ordered to pay a total fine of $75,000 and was placed on probation for a period of one year or until the fine was paid. KWT contends that its decision to plead guilty to the above-detailed counts was a "business judgment" made to avoid loss of its federal license to manufacture firearms and to avoid further expense and loss of employee time and effort. KWT does not concede that it was, in fact, guilty of these or any of the charges on which it was indicted.

After resolution of the criminal matters, KWT brought the instant suit against the United States and various other persons and entities involved in the criminal prosecution. As this action presently stands,⁷ plaintiff in its twelve-count amended complaint challenges the EPA's institutional and technological incompetence which led to the issuance of KWT's NPDES permit and the decision to prosecute, as well as defendant's actions, through its agents, which plaintiff characterizes as destroying exculpatory evidence and intimidating witnesses.

Defendant has moved to dismiss plaintiff's amended complaint on the basis that the Court lacks subject matter jurisdiction over this matter. Rule 12(b)(1), Fed.R. Civ.P. Specifically, defendant contends that all of plaintiff's claims come within the "discretionary function exception" to the United States' waiver of sovereign immunity under the FTCA, 28 U.S.C. § 2680(a), and defendant further argues that those counts of the amended complaint which challenge the EPA's actions surrounding the issuance of the NPDES permit may only be reviewed in the appropriate circuit court of appeals pursuant to 33 U.S.C. § 1369(b)(1). For the following reasons, the Court agrees with defendant that it does not have subject matter jurisdiction over this matter.

A. The FTCA and the Discretionary Function Exception

Enacted as a waiver of the federal government's immunity for torts committed by its employees under certain circumstances, the FTCA provides that the United States shall be liable

for injury or loss of property, or personal injury or death caused by the negligent or wrongful act or omission of any employee of the Government ... under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

28 U.S.C. § 1346(b). As the Supreme Court recently noted, the FTCA "did not waive the sovereign immunity of the United States in all respects ...; Congress was careful to except from the Act's broad waiver of immunity several important classes of tort claims." United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S. 797, 808, 104 S.Ct. 2755, 2761, 81 L.Ed.2d 660 (1984) hereinafter "Varig". One such exception, 28 U.S.C. § 2680(a), provides in relevant part that the FTCA does not embrace "any claim ... based upon the exercise...