United States v. General Motors Corporation

Decision Date24 October 1975
Docket NumberCiv. No. H-74-314.
CourtU.S. District Court — District of Connecticut

Henry S. Cohn, Asst. U. S. Atty., Hartford, Conn., for plaintiff.

Ralph Dixon, Robert P. Knickerbocker, Jr., Day, Berry & Howard, Hartford, Conn., for defendant.


CLARIE, Chief Judge.

This case has been submitted on cross-motions for summary judgment under Fed.R.Civ.P. 56 and the defendant's alternative motion to dismiss pursuant to Fed.R.Civ.P. 12. The facts have been stipulated, and the Government has filed the Coast Guard's administrative record at the Court's request.1

The case involves the United States Coast Guard's assessment of a $1,200 civil penalty against the defendant as a result of an oil spill at its New Departure Hyatt Bearing Division plant in Bristol, Connecticut. The defendant refused to pay the assessment voluntarily, and the United States brought this action to enforce its collection. The Court has jurisdiction by virtue of 28 U.S.C. § 1355, which vests the district courts with original jurisdiction in "any action or proceeding for the recovery or enforcement of any fine, penalty, or forfeiture, pecuniary or otherwise, incurred under any Act of Congress."

Title 33 U.S.C. § 1321(b)(6) authorizes the imposition of a civil penalty in appropriate cases; however, the application of the statute requires that each case be examined on its own facts to determine the culpability, if any, and the penalty to be imposed. In the present case, the Court finds from the stipulated facts that the defendant was completely free from material negligence or fault in connection with the acts of vandalism which resulted in the discharge of oil. Since this finding does not support the imposition of more than a nominal penalty, the Court grants the plaintiff's motion for summary judgment and modifies the imposition of the penalty to the nominal sum of one dollar.


The defendant, a Delaware corporation, operates its Hyatt Bearing Division in Bristol, Connecticut. In December 1971 the defendant ceased manufacturing operations at its Northside plant, and prepared to offer it for sale. The fuel oil storage tanks at Northside were drained, except for a reserve needed to keep the plant operable and to protect machinery in extremely cold weather. Thereafter, the defendant's purchasing and engineering personnel visited the site frequently, and security personnel patrolled the premises. At the time of the incidents on which the Government predicates defendant's liability, these security patrols were being made three times per day, seven days per week. In addition, at the defendant's request the Bristol Police Department had increased its patrols of the plant in response to several thefts there.

In the early afternoon of Wednesday, April 18, 1973, the Bristol Police Department notified the defendant that a heavy oil discharge observed that morning had been traced to the Northside plant. Investigation disclosed that unidentified vandals had managed to reach the plant's oil storage tanks, apparently by scaling two fences. One fence, 12 feet high and topped with barbed wire, surrounded the plant, while another, 10 feet high and topped with barbed wire, enclosed the tanks. The gates of both fences were securely chained and pad-locked.

The valves on the storage tanks were not locked,2 and the vandals opened at least two of them, releasing a quantity of No. 6 fuel oil from the main oil storage tank through an underground pipe into an underground day tank, thereby causing it to overflow onto the ground. The oil thereafter drained into a manhole and proceeded through a storm sewer into North Creek, which flowed into the Pequabuck River.

When the defendant acquired knowledge of the spill, it promptly notified the Connecticut Department of Environmental Protection, the United States Environmental Protection Agency and the United States Coast Guard. Its action complied with 33 U.S.C. § 1321(b)(5), which provides for the imposition of criminal penalties for failure to immediately notify the appropriate federal agency of any such discharge. The defendant dispatched employees to the area of the spill, to initiate containment and clean-up operations, and supplemented these efforts by engaging an outside contractor. These clean-up operations lasted 10 days, at a total cost to the defendant of $16,202.48.

As a result of the spill, between 6,000 and 8,000 gallons of oil collected on the ground surface, and approximately 1,000 gallons of this amount made its way into North Creek. The containment operations kept all but about 50 gallons from escaping downstream from the immediate plant area. It is estimated that only about 25 gallons of this oil ultimately reached the Pequabuck River. Substantially all the spilled oil, including that which reached the creek and river, was eventually removed during the clean-up operations.

Seven months later, the Commander of the Third Coast Guard District notified the defendant that, subject to the latter's right to a hearing, a civil penalty of $2,000 would be assessed for the discharge, pursuant to the provisions of 33 U.S.C. § 1321(b)(6). After an informal hearing in January 1974, at which no transcript was made, the defendant was notified that a penalty of $1,200 had been imposed by order of the Coast Guard District Commander. In assessing the penalty, the Coast Guard relied on the information provided by the defendant when it notified federal authorities of the spill as required by 33 U.S.C. § 1321(b)(5), and the information obtained from the Connecticut Department of Environmental Protection and the Bristol Police Department, after defendant's notification.

In March 1974, the defendant appealed to the Commandant of the Coast Guard requesting a review of the penalty assessment, buttressing its request with substantially the same arguments as made in the present action, namely: (1) that no penalty could be assessed where the discharge resulted solely from the act of a third party; (2) that the requirement that the size of the discharger's business be considered in assessing the penalty violated the defendant's constitutional right to equal protection under the law; (3) that the civil penalty provisions are actually criminal in nature, and accordingly the Coast Guard hearing procedures violated the defendant's right to due process of law; and (4) that the use immunity provision of 33 U.S.C. § 1321(b)(5) prohibits the imposition of such a penalty.

The request for review was denied by Rear Admiral R. A. Ratti, Chief Counsel of the Coast Guard. He based his ruling on the following principles: (1) that the third party responsibility for the discharge was irrelevant to the civil penalty provisions of 33 U.S.C. § 1321(b)(6); (2) that no immunity from such a penalty was conferred by the statute because the defendant had properly reported the discharge; (3) that the defendant's constitutional rights to due process and equal protection were not violated by the civil penalty procedures; and (4) that the amount of the penalty assessed was proper. Payment was ordered by May 22, 1974, which deadline was subsequently extended to June 15, 1974. Said payment not having been timely made by the defendant, the Government brought this action on October 8, 1974, requesting that judgment in the amount of $1,200 be entered in favor of the Government.

Applicable Statutes

The statutory provisions challenged in this litigation are a part of the Federal Water Pollution Control Act (FWPCA), a comprehensive statutory scheme designed "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a) (Supp.1973).3 As part of the overall plan, 33 U.S.C. § 1321 regulates the discharge into navigable waters of oil and other substances harmful to the environment. The declared policy of the Congress in enacting Section 1321 was "that there should be no discharges of oil or hazardous substances into or upon the navigable waters of the United States . . .." 33 U.S.C. § 1321(b) (1). The statute employs several devices to accomplish this goal, including the following:

(1) It makes it a crime for the "person in charge" of a vessel or facility to fail to inform the appropriate federal agency immediately of any discharge of oil or a hazardous substance, but provides use immunity from prosecution "in any criminal case" except perjury or giving a false statement. 33 U.S.C. § 1321(b)(5).4
(2) It authorizes the President to act to remove or arrange for the removal of such oil or hazardous substance unless he determines that the owner of the vessel or facility from which the discharge occurs will remove it properly. 33 U.S.C. § 1321(c)(1).5
(3) Subject to specified limits and defenses, including the defense that a third party was the sole cause of the discharge, it makes the owner of a facility from which oil or a hazardous substance is discharged liable to the United States Government for the actual costs incurred in clean-up operations. 33 U.S.C. § 1321(f)(2).6
(4) Subject to the same defenses, it makes the owner of a facility from which a hazardous substance determined to be non-removable is discharged liable for a "civil penalty," varying in amount in relation to such factors as toxicity, degradability and dispersal characteristics of the substance and the amount discharged. 33 U.S.C. § 1321(b)(2)(B)(ii)-(iv).7
(5) Subject to specified defenses and limits, it makes third parties who were solely responsible for a discharge of oil or a hazardous substance liable to the United States for the actual costs incurred in clean-up operations. 33 U.S.C. § 1321(g) and (h).8
(6) It authorizes the owner of a facility from which oil or a hazardous substance was discharged to bring suit in the Court of Claims and recover from the United

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