U.S. v. Cinergy Corp.

• Decision Date: 18 June 2007
• Docket Number: No. 1:99-cv-1693-LJM-JMS.,1:99-cv-1693-LJM-JMS.
• Citation: 495 F.Supp.2d 909
• Parties: UNITED STATES of America, Plaintiff, State of New York, State of New Jersey, State of Connecticut, Hoosier Environmental Council, and Ohio Environmental Council, Plaintiff-Intervenors, v. CINERGY CORP., PSI Energy, Inc., and The Cincinnati Gas & Electric Company, Defendants.
• Court: U.S. District Court — Southern District of Indiana

495 F.Supp.2d 909

UNITED STATES of America, Plaintiff State of New York, State of New Jersey, State of Connecticut, Hoosier Environmental Council, and Ohio Environmental Council, Plaintiff-Intervenors, v. CINERGY CORP., PSI Energy, Inc., and The Cincinnati Gas & Electric Company, Defendants.

No. 1:99-cv-1693-LJM-JMS.

United States District Court, S.D. Indiana, Indianapolis Division.

June 18, 2007.

Crissy Lyn Pellegrin, Gaylene Vasaturo, United States Environmental Protection Agency, Chicago, IL, Cynthia Marie Ferguson, Deborah Nicole Behles, James A. Lofton, Jeffrey K. Sands, Katherine Lynn Vanderhook, Larry Martin Corcoran, Richard Mark Gladstein, Sarah Dale Himmelhoch, Steven David Ellis, US Department of Justice — Environment & Natural Resources, Washington, DC, Thomas E. Kieper, United States Attorney's Office, Indianapolis, IN, for Plaintiff.

Eugene J. Kelly, Jr., J. Jared Snyder, New York State Attorney General, Michael Joseph Myers, New York State Department of Law, Environmental Protection Bureau, Robert T. Rosenthal, New York Attorney General's Office, Albany, NY, R. Keith Guthrie, Elizabethtown, IN, Carmel Alicia Motherway, Kimberly P. Massicotte, Connecticut Attorney General, Hartford, CT, Christine F. Lewis, Christopher D. Ball, Maurice A. Griffin, New Jersey Office of the Attorney General, James A. Murphy, Kevin P. Auerbacher, Mary E. Costigan, Stefanie A. Brand, R. J. Hughes Justice Complex, Jean Patrice Reilly, Jon

C. Martin, Trenton, NJ, for Plaintiff-Intervenors.

David T. Buente, Frank R. Volpe, Kathryn B. Thomson, Mark D. Hopson, Samuel B. Boxerman, Stephen M. Nickelsburg, Thomas Charles Green, Sidley Austin Brown & Wood LLP, Washington, DC, James A. King, Scott E. North, Porter Wright Morris & Arthur LLP, Columbus, OH, Barbara Fruehling Gambill, Cinergy Services Inc., Cincinnati, OH, Julie L. Ezell, Duke Energy Legal Department, Plainfield, IN, Debra McVicker Lynch, John D. Papageorge, Robert R. Clark, Scott R. Alexander, Sommer Barnard Attorneys, PC, Indianapolis, IN, for Defendants.

ORDER ON MOTIONS FOR PARTIAL SUMMARY JUDGMENT REGARDING THE APPLICATION OF THE ROUTINE MAINTENANCE REPAIR AND REPLACEMENT EXCLUSION AT BECKJORD, CAYUGA, GALLAGHER, GIBSON, AND MIAMI FORT PLANTS

McKINNEY, Chief Judge.

This cause is before the Court on various motions for partial summary judgment filed by the plaintiff's, United States of America ("USA"), and the plaintiff-intervenors, State of New York, State of New Jersey, State of Connecticut, Hoosier Environmental Council, and Ohio Environmental Council (both the plaintiff and the plaintiff-intervenors collectively, "Plaintiffs"). Specifically, Plaintiffs seek a ruling that various construction activities conducted by the defendants, Cinergy Corp., PSI Energy, Inc. ("PSI"), and the Cincinnati Gas & Electric Company ("CG & E") (all three defendants collectively, "Cinergy"), at Beckjord, Cayuga, Gallagher, Gibson, and Miami Fort plants do not fall within the narrow range of activities excluded from pollution control requirements by the routine maintenance, repair or replacement ("RMRR") exclusion of the Clean Air Act ("CAA").¹ Cinergy contends that partial summary judgment is inappropriate because there are genuine issues of material fact about whether Cinergy's projects were "routine," and therefore the question of whether the projects qualify for the RMRR exclusion must be submitted to a jury for its consideration. The parties have fully briefed the pending motions and they are now ripe for ruling.

For the reasons stated herein, Plaintiffs' motions for partial summary judgment are GRANTED.²

I. PRELIMINARY EVIDENTIARY CONSIDERATIONS

As an initial matter, Plaintiffs take issue with some of Cinergy's exhibits, arguing that the exhibits are not admissible. Specifically Plaintiffs reference (1) Cinergy's Joint Exhibit 128, a report issued by the Tennessee Valley Authority ("TVA") and referred to as "the Golden Report"; (2) Cinergy's Joint Exhibits 96A through 961, and Cinergy's Miami Fort Exhibit 14a, summary reports from Cinergy's maintenance databases; (3) Cinergy's Joint Exhibits 76 and 81 through 87, "experience lists" or bids from vendors who have supplied or installed replacement components; and (4) Cinergy's Joint Exhibit 79, a chart prepared by defense counsel of replacement projects at other Cinergy's facilities that Cinergy claims are similar to the projects at issue in the instant motions for partial summary judgment. The Court interprets Plaintiffs' arguments as requests to strike the exhibits. As explained below, the Court declines to strike these exhibits at this time and, to the extent that they are relevant, will consider them for purposes of the partial summary judgment motions.³

The first exhibit that Plaintiffs challenge is the Golden Report. The Golden Report contains data gathered from other utilities regarding their maintenance, repair, and replacement activities. See Cinergy's Joint Ex. 128. Of the utilities surveyed, the report concluded that there had been 121 % replacement of reheaters, with some facilities replacing that component more than once. See id. The Golden Report opined that deterioration of components at some facilities was due to unforeseen problems that arose because of different operating environments and the use of different and cheaper metals, which industry originally thought would be satisfactory. See id. Finally, noting that the ages of the facilities that had been required to do reheater repairs ranged from five to fortyfour years and that the mean age was 25.1 years, the Golden Report concluded that factors other than age determined the need for replacement. See id. The report was printed in the Federal Register. See 65 Fed.Reg. 35,154 (2000).

The Court has previously concluded in another case that the Golden Report may be relevant to the issue of whether repair and replacement projects are routine, at least as it bears on the factor of frequency of industry practice. See United States v. S. Ind. Gas & Elec., Co., 245 F.Supp.2d 994, 1004 n. 7 (S.D.Ind.2003). The Court sees no reason to conclude differently in this case. Plaintiffs nonetheless argue that the Court should exclude the Golden Report from its consideration because the report contains hearsay and was generated solely for the purposes of litigation. The Court finds that the Golden Report is admissible under Federal Rule of Evidence 803(8) pursuant to the public records hearsay exception. Even though the TVA has extensive independence from the federal government, it is still, an instrumentality of the United States. See 16 U.S.C. § 831. Moreover, even though the TVA has not been granted express statutory authority to conduct the investigation that it did, express statutory authority is not required under the public records exception. See MUELLER & KIRKPATRICK, § 8.50 at 1228 (stating that "[e]xpress statutory authority to investigate or make records is not required, and the exception can apply if the agency investigates and reports on matters within its general area of responsibility."). Here, an investigation into the maintenance practices and projects of other plants within the electric energy industry is within the general area of responsibility given to TVA by Congress. See 16 U.S.C. § 831m. Accordingly the Court concludes that the public records exception applies, and the Court will consider the Golden Report for partial summary judgment purposes.

The second category of materials to which Plaintiffs object are summary reports from Cinergy's maintenance databases. See Cinergy's Joint Exs. 96A through 961 and Cinergy's Miami Fort Ex. 14a. Plaintiffs object to these exhibits on the alleged basis that Cinergy failed to comply with its discovery obligations by providing Plaintiffs with a workable copy of the database. Based on the materials submitted by the parties, including various correspondences, the Court is unable to conclude at this stage that Cinergy failed to satisfy its discovery obligations. Further, the Court notes that Cinergy submitted an affidavit discussing the databases and explaining how the summaries were generated, thereby providing some authentication for the summary reports. See White Aff., ¶¶ 11-19. This affidavit was corroborated by another affiant, who indicated that he was familiar with the databases and had reviewed the summary reports. See Faulkner Aff., ¶¶ 7-8, 20. Under these circumstances, the Court declines to strike the summary reports.

The third set of materials that Plaintiffs challenge are "experience lists" or bids Cinergy received from outside vendors who have supplied or installed replacement components. See Cinergy's Joint Exs. 76 and 81 through 87. Cinergy failed to respond to Plaintiffs' objection regarding these materials. See Cinergy's Surreply on Evid. Objs. & New Evid. (Docket No. 842). Nonetheless, the Court is unwilling to strike these materials. As explained more fully below, one of the factors that the Court must analyze in order to determine whether the changes made to Cinergy's facilities were "routine" is the frequency of repair or replacement of components within the industry. The "experience lists" and bids have some bearing on that factor, and therefore the Court will consider the exhibits.

The final exhibit with which Plaintiffs take issue is a chart prepared by defense counsel of repair and replacement projects at Cinergy facilities. See Cinergy's Joint Ex. 79. Plaintiffs complaint that Cinergy has not submitted a sponsoring affidavit for the chart that identifies the source of the chart's information. However, as Cinergy notes in response, the affidavit of Robert E. Batdorf ("Batdorf") specifically refers to Joint Exhibit 79. See Batdorf Aff., ¶ 37.⁴ Moreover, Batdorf indicates that he participated in generating the chart from Cinergy's maintenance records that had been provided to Plaintiffs. See id.

Federal Rule of Evidence 1006 permits the use of summaries of voluminous...