U.S. v. Hartsell

• Decision Date: 06 October 1997
• Docket Number: 94-5804,94-5797,Nos. 94-5796,s. 94-5796
• Citation: 127 F.3d 343
• Parties: , 28 Envtl. L. Rep. 20,153 UNITED STATES of America, Plaintiff-Appellee, v. Gene Wesley HARTSELL, a/k/a Gene Wesley Gabe Hartsell, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Keith Norland EIDSON, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. CHEROKEE RESOURCES, INCORPORATED, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 343

127 F.3d 343

45 ERC 1356, 28 Envtl. L. Rep. 20,153

UNITED STATES of America, Plaintiff-Appellee, v. Gene Wesley HARTSELL, a/k/a Gene Wesley Gabe Hartsell,

Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Keith Norland EIDSON, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. CHEROKEE RESOURCES, INCORPORATED, Defendant-Appellant.

Nos. 94-5796, 94-5797, 94-5804.

United States Court of Appeals Fourth Circuit.

Argued Feb. 2, 1996.

Decided Oct. 6, 1997.

ARGUED: Dale Stuart Morrison, Law Offices of Dale S. Morrison, Charlotte, NC, for Appellants Eidson and Cherokee Resources; Edward Anthony Fiorella, Jr., Harkey, Lambeth, Nystrom & Fiorella, Charlotte, NC, for Appellant Hartsell. Ellen J. Durkee, Environment & Natural Resources Division, United States Department of Justice, Washington, DC, for Appellee. ON BRIEF: Lois J. Schiffer, Assistant Attorney General, David C. Shilton, Environment & Natural Resources Division, United States Department of Justice, Washington, DC; Mark T. Calloway, United States Attorney, Peter Crane Anderson, Assistant United States Attorney, Charlotte, NC, for Appellee.

Before ERVIN and MOTZ, Circuit Judges, and BLAKE, United States District Judge for the District of Maryland, sitting by designation.

Affirmed by published opinion. Judge ERVIN wrote the opinion, in which Judge MOTZ and Judge BLAKE joined.

OPINION

ERVIN, Circuit Judge:

Appellants, Cherokee Resources, Inc., Keith Norland Eidson and Gene Wesley Hartsell were convicted, following a jury trial, of numerous violations of the Clean Water Act (CWA), 33 U.S.C. § 1311 et seq. They appeal their convictions and their sentences, raising dozens of challenges to the validity of their trials. For the reasons hereinafter explored, we affirm in all respects.

I

Both the factual history and the statutory and regulatory scheme in this case are quite complex, and a brief overview of both is necessary. Cherokee Resources, Inc., (Cherokee) operated a wastewater treatment and oil reclamation business in Charlotte, North Carolina. Eidson was the president of Cherokee and Hartsell was the vice-president and sole shareholder. Both were involved in overseeing Cherokee's compliance with environmental regulations including the CWA.

In the course of its business, Cherokee accepted oil and industrial wastewater from its customers, processed the oil for re-use and treated the wastewater, and periodically released treated wastewater into the public sewer system. Cherokee's discharges flowed through the sewer to the Irwin Creek Sewage Treatment Plant. This plant is considered a publicly owned treatment works, "POTW," in the CWA statutory and regulatory scheme. The plant is operated by the Charlotte-Mecklenburg Utility Department (CMUD). The water treated at Irwin Creek Plant eventually flows into Irwin Creek and then into the Catawba River. The river then continues on into South Carolina, emptying into the Atlantic Ocean in Charleston.

The CWA and its interpretive regulations require POTWs, including Irwin Creek, to issue pretreatment permits to industrial sources specifying levels at which those sources can discharge certain pollutants into the public sewer system. The authority to administer the permit program and issue necessary permits was delegated to North Carolina and its agencies pursuant to the CWA. See 33 U.S.C. § 1342(c). The program pursuant to which the permits are issued is designed to monitor and limit pollutants in industrial wastewater and is overseen by the Environmental Protection Agency (EPA) and the North Carolina Department of Health, Environment and Natural Resources. Discharge permits issued to industrial dischargers generally last for one to three years.

On May 15, 1990, CMUD issued Cherokee a pretreatment permit limiting the quantities and concentrations of specific pollutants Cherokee could discharge into the sewer. A second permit was issued on June 3, 1991, and a third permit was issued on November 1, 1992. North Carolina law allows regulated parties a thirty day period within which to comment about or object to the limits contained in a pretreatment permit. See 15 N.C.A.C. 2H.0900 (1987). Cherokee never made any response to any of the permits issued to it.

Cherokee's discharge permits contained several provisions including (1) a general prohibition against "bypassing" water treatment and discharge monitoring facilities; (2) sampling and monitoring requirements to insure Cherokee's compliance with the permit; and (3) limitations on amounts and concentrations of specific pollutants discharged. Pursuant to the CWA scheme and the permits, Cherokee was required to self-monitor its discharges and it hired outside private laboratories to conduct its self-monitoring. CMUD also conducted routine tests of Cherokee's discharges.

In the summer of 1990, CMUD tests and Cherokee's self-monitoring both revealed excessive levels of certain toxic pollutants in Cherokee's discharges including cadmium, chromium, copper, lead, nickel and zinc. Every time tests were conducted, either by Cherokee's self-monitoring process or by CMUD with Cherokee's knowledge, excessive discharges were discovered. As these violations of Cherokee's permits were discovered, CMUD sent notices of the violations to inform the company that it was discharging in substantial excess of the legal limits imposed by its permits. The violation notices also required Cherokee to do four consecutive days of self-monitoring within thirty days of receipt of the notice, in addition to the occasional self-monitoring already required of all industrial dischargers. However, Cherokee's discharges of illegal levels of toxic pollutants did not end, despite the repeated notices.

In 1990, CMUD's Systems "Protection Division Manager and Pretreatment Coordinator," Robert Griffin, began to suspect that Cherokee's repeated and severe permit violations were the result of illegal or abnormal operations. Griffin notified Federal Bureau of Investigation (FBI) Special Agent Thomas Burleson of his concerns. The FBI began its investigation of Cherokee in early 1991.

In addition to the FBI investigation, CMUD increased its monitoring of Cherokee's discharges, conducting surreptitious hourly monitoring for several days in the spring of 1991. During these tests CMUD took samples of water upstream of Cherokee's "tap" or discharge point and downstream of the tap, so that it could be determined precisely what pollutants Cherokee had put in the water. Before this set of tests was conducted, CMUD cleaned out the sewer line with a high pressure water spray to remove debris and buildup and secure an accurate reading. These careful tests showed that Cherokee was repeatedly and substantially violating its permit levels and that it was often doing so during the night.

In the summer of 1991, Agent Burleson compiled the evidence of Cherokee's violations and submitted an affidavit in support of a request for a search warrant of Cherokee's plant and offices. Burleson first described the regulatory scheme of the CWA. He then listed the results of the many tests done by CMUD and the results of Cherokee's self-monitoring in his affidavit.

Burleson next discussed the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. § 6901 et seq., which regulates disposal, treatment, storage and transportation of hazardous wastes. Burleson described surveillance of a hazardous waste site apparently owned and run by Cherokee; the surveillance suggested that Cherokee, which had not been issued any proper permits by state or federal agencies, may have been illegally treating, storing and disposing of hazardous wastes.

On the basis of Burleson's affidavit, a search warrant was issued on July 19, 1991, allowing search of both Cherokee's main plant and of the suspected hazardous waste disposal site. The search was conducted between July 17 and July 19, 1991.

Following the search, CMUD and Cherokee entered into preliminary negotiations regarding a compliance agreement, pursuant to which Cherokee would agree to conform its behavior to its discharge permit and to environmental laws and regulations. However, CMUD's monitoring revealed continued severe and frequent permit violations by Cherokee. In addition, following the search, several Cherokee employees came forward and began to describe to authorities the illegal discharge practices engaged in by Cherokee.

Ultimately, the evidence gathered by the investigation of Cherokee and the testimony of the Cherokee employees revealed that the company used several illegal disposal methods, known as "bypass methods" because such practices bypass treatment and monitoring devices and clandestinely discharge pollutants directly into the sewer line. Employees revealed that illegal dumping occurred because Cherokee accepted far more wastewater and waste oil than it could handle and therefore it often dumped completely untreated water and oil into the sewer system. In one bypass method, Hartsell and Eidson directed employees to pump wastewater through the employees' toilet. Another illegal technique used by Cherokee was to pump untreated water into a storage tank which had a special valve for rapid discharge and then discharge those pollutants directly into the sewer.

Hartsell, Eidson and Cherokee were charged, in a multi-count indictment, with conspiracy to knowingly violate the CWA, knowingly violating pretreatment standards, and tampering with a pollutant monitoring device. The defendants were tried in April 1994, but that resulted in a mistrial because the jury could not reach a verdict. Following a second trial in June 1994, Hartsell, Eidson and Cherokee were each convicted of conspiracy and of several substantive counts of knowingly violating pretreatment standards, and Eidson and Cherokee were also convicted of tampering with a monitoring device. The court imposed a $50,000 fine on Cherokee, along with a $1400 special...