U.S. v. Bp Exploration & Oil Co.

• Decision Date: 29 August 2001
• Docket Number: No. 2:96-CV-95.,2:96-CV-95.
• Citation: 167 F.Supp.2d 1045
• Parties: UNITED STATES of America, Plaintiff, The State of Indiana, the State of Ohio, and the Northwest Air Pollution Authority, Plaintiff-Intervenors, v. BP EXPLORATION & OIL CO., Amoco Oil Company, and Atlantic Richfield Company, Defendants.
• Court: U.S. District Court — Northern District of Indiana

167 F.Supp.2d 1045

UNITED STATES of America, Plaintiff The State of Indiana, the State of Ohio, and the Northwest Air Pollution Authority, Plaintiff-Intervenors, v. BP EXPLORATION & OIL CO., Amoco Oil Company, and Atlantic Richfield Company, Defendants.

No. 2:96-CV-95.

United States District Court, N.D. Indiana, Hammond Division.

August 29, 2001.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Carol A. Davilo, United States Attorneys Office, Dyer, IN, Frances M. Zizila, Adam Kushner, U.S. Department of Justice, Environmental Enforcement Section, Environment and Natural Resources Division, Washington, DC, Steven D. Griffin, Indiana Attorney General, Indiana Government Center South, Indianapolis, IN, Bryan F. Zima, Attorney General's Office, Environmental Enforcement Section, Columbus, OH, Laughlan H. Clark, Visser Zender and Thurston, Bellingham, WA, for plaintiffs.

William L. Patberg, Shumaker Loop and Kendrick, Toledo, OH, Robert M. Olian, Sidley Austin Brown & Wood, James Nolan, Office of General Counsel, Amoco Oil Company, Chicago, IL, Angus Macbeth, Sidley and Austin, Washington, DC, for defendants.

ORDER

LOZANO, District Judge.

This matter is before the Court on United States of America's Motion for Entry of Consent Decree, filed on April 26, 2001. For the reasons set forth below, the motion is GRANTED. The Court notes that it previously granted the Government's motion for substitution of pages to the consent decree during the June 5, 2001, hearing. Accordingly, the revised pages attached to the motion for substitution of pages have been inserted into the final consent decree.

BACKGROUND

The Government seeks entry of a proposed consent decree that resolves each of the claims involved in this litigation. The decree sets forth a comprehensive program of compliance measures which BP Exploration & Oil Company ("BP") will undertake to dramatically reduce emissions of oxides of nitrogen ("NO_x"), sulfur dioxide ("SO₂"), particulate matter ("PM"), carbon monoxide ("CO"), benzene, and volatile organic compounds ("VOCs") from each of BP's domestic refineries. Specifically, pursuant to the decree, BP will: (1) install and operate pollution control technologies that will reduce emissions of NO_x and SO₂; (2) operate sulfur recovery plants in compliance with new source performance standards ("NSPS"); (3) where necessary, install tail gas units; (4) adopt and implement enhanced monitoring and repair programs to reduce benzene emissions; (5) essentially eliminate excess flaring of hydrogen sulfide gases through a protocol for identifying and correcting the cause of such flaring; (6) undertake measures to ensure CO emissions from its fluidized catalytic cracking units meet NSPS on a permanent basis; (7) monitor performance and install monitoring controls under NSPS; (8) install PM controls to comply with NSPS emissions limit; and (9) obtain permits to incorporate the emissions limits and schedules set forth in the decree in federally enforceable permits. BP will also pay a $10 million civil penalty and be required to invest another $10 million in implementing five environmentally beneficial projects.

On March 29, 1996, the Government filed a 13-count complaint against Amoco Oil Company ("Amoco") for alleged violations of the Resource Conservation and Recovery Act ("RCRA"), the Clean Air Act ("CAA"), the Emergency Planning and Community Right-to-Know Act ("EPCRA"), and the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") arising from Amoco's Whiting, Indiana facility. On June 30, 1998, the Government filed a first amended complaint in which it added four new claims under the CAA.

BP, which subsequently purchased the Whiting facility, entered negotiations with the Government to resolve the litigation. During the course of negotiations, the parties sought to remedy alleged violations at facilities in seven other states, including: Ohio, Washington, Texas, Virginia, North Dakota, Utah, and California.

On January 22, 2001, the Government filed a second amended complaint which included the allegations regarding the facilities in the additional states. Contemporaneously with filing the second amended complaint, the Government lodged a proposed consent decree. The Government published a notice of lodging of the consent decree in the Federal Register and signified its intent to receive comments from the public regarding the proposed consent decree for a 30-day period.

The Government received three letters in opposition to the proposed consent decree. Of these three letters, only one letter contained substantive comments. One letter merely listed additional parties who wished to join the substantive comments outlined in the first letter. The third letter concerned a refinery not governed by the proposed consent decree.¹

The Government subsequently moved for entry of the consent decree and responded to each of the commenters' objections. On June 5, 2001, this Court held a hearing regarding the consent decree and heard arguments from each party and the commenters' counsel. At the conclusion of the hearing, this Court notified the parties and commenters that it was satisfied that each of the requirements to approve the consent decree had been met with the exception of the notice requirement. This Court informed the parties of its concern regarding whether the notice requirement had been met and ordered further briefing on the issue.

One June 13, 2001, the Government requested an extension of time in which to submit its notice brief. The Government explained that it had sent notice to each state with facilities governed by the consent decree on June 12, 2001, and that it intended to file a third amended complaint reflecting that it had given such notice. On June 19, 2001, the commenters filed a memorandum with this Court stating that they would no longer have objection to entry of the proposed consent decree based upon the Government's issuance of notice and filing of a third amended complaint.

The Government has now filed its notice brief and third amended complaint.

DISCUSSION

This Court must review a consent decree to assure that it is fair, reasonable, adequate, and consistent with applicable law. See United States v. Union Elec. Co., 132 F.3d 422, 430 (8th Cir.1997); United States v. Akzo Coatings of Am., Inc., 949 F.2d 1409, 1435 (6th Cir.1991); United States v. Cannons Eng'g Corp., 899 F.2d 79, 84 (1st Cir.1990); Metropolitan Housing Dev. Corp. v. Village of Arlington Heights, 616 F.2d 1006, 1014 (7th Cir. 1980). The underlying purpose of this review is to determine whether the decree adequately protects and is consistent with the public interest. United States v. Seymour Recycling Corp., 554 F.Supp. 1334, 1337 (S.D.Ind.1982). In other words, a consent decree will not be approved where the agreement is illegal, a product of collusion, inequitable, or contrary to the public good. Kelley v. Thomas Solvent Co., 717 F.Supp. 507, 515 (W.D.Mich.1989). In reviewing a consent decree, this Court need not inquire into the precise legal rights of the parties, nor reach and resolve the merits of the parties' claims. Metropolitan, 616 F.2d at 1014. Rather, it is ordinarily sufficient if this Court determines whether the consent decree is appropriate under the particular facts of the case. Id.

In its review, the Court must keep in mind the strong policy favoring voluntary settlement of litigation. Id. at 1014; Cannons, 899 F.2d at 84; United States v. Hooker Chem. & Plastics Corp., 776 F.2d 410, 411 (2d Cir.1985). This presumption is particularly strong where a consent decree has been negotiated by the Department of Justice on behalf of a federal agency, like the Environmental Protection Agency ("EPA"), which enjoys substantial expertise in the environmental field. See Akzo, 949 F.2d at 1426; Hooker, 776 F.2d at 411; SEC v. Randolph, 736 F.2d 525, 529 (9th Cir.1984); Kelley, 717 F.Supp. at 515-16. Although this Court should pay deference to the judgment of the government agency which has negotiated and submitted a proposed decree, this Court must avoid any rubberstamp approval in favor of an independent evaluation. Kelley, 717 F.Supp. at 515; Seymour, 554 F.Supp. at 1337-38. However, this Court must not substitute its judgment for that of the parties nor conduct the type of detailed investigation required if the parties were actually trying the case. Akzo, 949 F.2d at 1434; United States v. County of Muskegon, 33 F.Supp.2d, 614, 621 (W.D.Mich.1998); Kelley, 717 F.Supp. at 515; Seymour, 554 F.Supp. at 1338 (citing Airline Stewards v. American Airlines, 573 F.2d 960, 963 (7th Cir.1978)). The test is not whether this Court would have fashioned the same remedy nor whether it is the best possible settlement. Cannons, 899 F.2d at 84; Kelley, 717 F.Supp. at 515 (citing Armstrong v. Board of School Directors, 616 F.2d 305, 315 (7th Cir.1980), overruled on other grounds, Felzen v. Andreas, 134 F.3d 873 (7th Cir. 1998)).

As an initial matter, the Court notes that the commenters no longer have any objection to entry of the proposed decree; however, this Court will nonetheless address their previous objections. The commenters alleged that this Court lacked subject matter jurisdiction because the consent decree imposed obligations and released BP from liability for eight refineries when not all eight were listed in each count of the second amended complaint. The Supreme Court has explained that a court cannot approve a consent decree unless: (1) it springs from and serves to resolve a dispute within the court's subject matter jurisdiction; (2) it comes within the general scope of the case made by the pleadings; and (3) it furthers the objectives of the law upon which the complaint was based. Local No. 93, Int'l Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501, 525, 106 S.Ct. 3063, 92 L.Ed.2d 405 (1986). Commenters' initial claim concerned the second factor — scope of the case made by...