United States v. Certified Envtl. Servs., Inc.
| Decision Date | 28 May 2014 |
| Docket Number | Docket No. 11-4877(Con),Docket No. 11-4974(Con),Docket No. 11-4972(XAP),Docket No. 11-4968(XAP),Docket No. 11-4872(Lead),Docket No. 11-4969(XAP),Docket No. 11-4976(Con),Docket No. 11-4875(Con) |
| Parties | UNITED STATES OF AMERICA, Appellee-Cross-Appellant, v. CERTIFIED ENVIRONMENTAL SERVICES, INC., NICOLE COPELAND, ELISA DUNN, Defendants-Appellants-Cross-Appellees, BARBARA DUCHENE, THOMAS JULIANO, Defendants, SANDY ALLEN, FRANK ONOFF, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Second Circuit |
Before:
1
Appeals and cross-appeal from judgments of conviction and sentence entered by the United States District Court for the Northern District of New York (Hurd, J.) on November 3, 2011. The defendants, consisting of an asbestos air monitoring company, five of its employees, and an employee of an asbestos abatement contractor, were convicted, collectively, of fifteen counts of conspiracy, mail fraud, and false statements. The charges related to a scheme by which the defendants undertook to violate various state and federal environmental regulations and to certify that proper air monitoring had been conducted when it had not. Defendants-Appellants-Cross-Appellees Certified Environmental Services, Inc. ("CES"), Nicole Copeland, and Elisa Dunn appeal their convictions, arguing that the district court improperly excluded evidence that the defendants acted in the good-faith belief that they were complying with applicable state regulations, and that the prosecutors engaged in misconduct. The Government appeals the sentences given to Defendants-Appellees Sandy Allen and Frank Onoff, arguing that the district court miscalculated the amount of restitution, committed procedural errors in determining the applicable advisory guidelines ranges, and imposed sentences that were substantively unreasonable.
We hold that the district court erred in excluding the proffered evidence of the defendants' good faith, and that, as the Government concedes on appeal, the prosecutors committed multiple instances of misconduct throughout the trial. We further hold that the prejudice resulting from the district court's erroneous evidentiary ruling and the prosecutors' misconduct was sufficient to violate the defendants' right to a fair trial. We therefore vacate the judgments of conviction of CES, Copeland, and Dunn, and remand for a new trial as to them. With respect to the Government's appeal from the sentences of Allen and Onoff, wehold that the district court erred in calculating the amount of restitution and in calculating the advisory guidelines range. We therefore vacate the sentences of Allen and Onoff and remand for resentencing as to them.
VACATED and REMANDED.
Gabriel M. Nugent (Daniel J. French, on the brief) Hiscock &
Defendant-Appellant-Cross-Appellee Certified Environmental
BRIAN J. FISCHER , MATTHEW D. CIPOLLA, Jenner & Block LLP,
LLP, Albany, NY on the brief), for
DENNIS B. SCHLENKER, ESQ., Albany, NY, for
CRAIG A. BENEDICT, Assistant United States Attorney (Rajit S.
Dosanjh, Assistant United States Attorney, on the brief), for
Richard S. Hartunian, United States Attorney for the Northern
District of New York, Syracuse, NY, for
JAMES R. MCGRAW, ESQ., Syracuse, NY, for Defendant-Appellee
Certified Environmental Services, Inc. ("CES"); Nicole Copeland, former CES Technical Services Manager; and Elisa Dunn, former CES air monitor and field supervisor, appeal from their convictions of conspiracy, aiding and abetting violations of the Clean Air Act, mail fraud, and making false statements to federal officials. Seeking a new trial, these defendants contend that the district court improperly excluded evidence that they acted under a good-faith belief that they were complying with state law and that, in any event, their convictions and sentences were irreparably tainted by prosecutorial misconduct. The Government cross-appeals the sentences given to CES, Copeland, and Dunn, and appeals from the sentences given to Sandy Allen, a CES air monitor, and Frank Onoff, a supervisor at a contractor that performed improper asbestos abatement work. The Government argues that the district court erred in determining restitution, erred in calculating loss, misapplied the advisory sentencing guidelines, and imposed sentences that were substantively unreasonable.
For the reasons that follow, we vacate the convictions of CES, Copeland, and Dunn, and remand for a new trial. We also vacate the sentences of Allen and Onoff and remand for resentencing.
Certain technical state and federal regulations governing the removal of asbestos underlie the charges in this case. Asbestos is severely toxic, and "medical science has not established any minimum level of exposure to asbestos fibers which is considered to be safe." 20 U.S.C. § 3601(a)(3). Its complete removal is therefore required by both federal and state regulations.
Under the Clean Air Act, 42 U.S.C. §§ 7401-7515, the Environmental Protection Agency ("EPA") is authorized to adopt what the agency has called "national emission standards for hazardous air pollutants," including asbestos. See 40 C.F.R. pt. 61; 42 U.S.C. § 7412(c) & (d). The standards for asbestos are enforced in part by work-practice standards that govern covered renovation and demolition activities involving asbestos. See 40 C.F.R. § 61.145; see also 42 U.S.C. §7412(h). As relevant here, these work-practice standards provide that, when removing regulated asbestos-containing material, the site owner or operator must wet the material to prevent it from escaping into the air and must ensure that the material remains adequately wetted until it is packed and sealed in leak-tight containers. See 40 C.F.R. §§ 61.145(c)(6)(i), 61.150. Asbestos-containing material is not adequately wetted "[i]f visible emissions are observed coming from [the] material." Id. § 61.141. The owner or operator also must ensure that no visible emissions are discharged to the outside air and must deposit the material with an authorized disposal site as soon as practicable. Id. § 61.150(a)-(b). The Clean Air Act provides criminal penalties for any person who knowingly violates these work-practice standards. See 42 U.S.C. § 7413(c)(1).
Under the Toxic Substances Control Act ("TSCA"), 15 U.S.C. §§ 2601-2697, the EPA has promulgated additional regulations governing asbestos removal from elementary and secondary school facilities. See 40 C.F.R. pt. 763, subpt. E; see also 15 U.S.C. § 2643. As relevant here, these regulations require that, after any asbestos abatement project is completed, the school must confirm that the area is free of asbestos by, among other things, designating a person to "collect airsamples using aggressive sampling." 40 C.F.R. § 763.90(i)(2)(i). "[A]ggressive sampling" involves taking steps before and during sample collection to dislodge asbestos particles that may have settled on the surfaces in the work area. Beforehand, the "floors, ceiling and walls [must] be swept with the exhaust of a . . . leaf blower," and during collection, "[s]tationary fans" must be situated, one for each ten thousand cubic feet of worksite, with the "[f]an air . . . directed toward the ceiling." Id. pt. 763, subpt. E, App. A, III.B.7(d)(iii), (iv).
EPA regulations under the TSCA also contain provisions to avoid conflicts of interest. The regulations provide that "[s]ampling operations must be performed by qualified individuals completely independent of the abatement contractor." Id. II.B.2, III.B.1. Similarly, "[a]ll sample preparation and analysis [must] be performed by a laboratory independent of the abatement contractor." Id. II.E.1.
Asbestos abatement activities are also regulated by the Occupational Safety and Health Administration ("OSHA") under the Occupational Safety and Health Act. See 29 C.F.R. § 1926.1101; 29 U.S.C. § 655. OSHA regulations impose numerous requirements on employers to ensure the wellbeing of employees whoperform abatement work. See 29 U.S.C. § 654(a). For example, the regulations require employers to "provide or require the use of protective clothing, such as coveralls or similar whole-body clothing, head coverings, gloves, and foot coverings." 29 C.F.R. § 1926.1101(i)(1). Employers must ensure that their employees enter and exit the work area through "[d]econtamination areas" designed to prevent asbestos from escaping into the surrounding environment. Id. § 1926.1101(j)(1)(i). Employers must also provide respirators to employees who work with certain categories of asbestos-containing materials. Id. § 1926.1101(h).
In addition, OSHA regulations require employers to "perform monitoring to determine accurately the airborne concentrations of asbestos to which employees may be exposed." Id. § 1926.1101(f)(1)(i). Employees must wear air sampling devices to collect representative "breathing zone air samples," id. § 1926.1101(f)(1)(ii), which are then subjected to laboratory analysis to determine each employee's asbestos exposure. Individuals who perform this analysis must receive specialized training. See id. § 1926.1101, App. A.II.3.
Asbestos abatement activities in New York are also subject to state regulation under New York Industrial Code Rule 56 (the "Code Rule"), 12 N.Y.C.R.R. pt. 56 (1994), enforced by the New York State Department of Labor ("DOL"). The Code Rule at times mirrors federal requirements and at times is stricter. As relevant here, the Code Rule imposes requirements for preparing the work area, for...
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