United States v. Reserve Mining Company

• Decision Date: 18 October 1974
• Docket Number: No. 5-72 Civ. 19.,5-72 Civ. 19.
• Citation: 394 F. Supp. 233
• Parties: UNITED STATES of America, Plaintiff, The State of Michigan et al., Plaintiffs-Intervenors, State of Minnesota and Minnesota Pollution Control Agency, Plaintiffs, v. RESERVE MINING COMPANY et al., Defendants, Northeastern Minnesota Development Association et al., Defendants-Intervenors.
• Court: U.S. District Court — District of Minnesota

394 F. Supp. 233

UNITED STATES of America, Plaintiff, The State of Michigan et al., Plaintiffs-Intervenors, State of Minnesota and Minnesota Pollution Control Agency, Plaintiffs, v. RESERVE MINING COMPANY et al., Defendants, Northeastern Minnesota Development Association et al., Defendants-Intervenors.

No. 5-72 Civ. 19.

United States District Court, D. Minnesota, Fifth Division.

October 18, 1974.

COPYRIGHT MATERIAL OMITTED

Robert G. Renner, U. S. Atty., Minneapolis, Minn., John P. Hills, Council on Environmental Quality, Washington, D. C., for plaintiff, United States.

Thomas F. Bastow, Washington, D. C., for plaintiff, United States Environmental Protection Agency.

Warren Spannaus, Atty. Gen., Jonathan H. Morgan, Sol. Gen., Peter W. Sipkins, Asst. Atty. Gen., Byron E. Starns, Chief Deputy Atty. Gen., Philip J. Olfelt, Asst. Atty. Gen., James M. Schloessler, Eldon G. Kaul, Sp. Asst. Attys. Gen., St. Paul, for plaintiffs-intervenors, State of Minnesota, Minnesota Pollution Control Agency.

Howard J. Vogel, Minneapolis, Minn., for plaintiffs-intervenors, Minnesota Environmental Law Institute, Northern Environmental Council, Save Lake Superior Association, Michigan Environmental Student Confederation.

Robert W. Warren, Atty. Gen., Robert B. McConnell, Asst. Atty. Gen., John E. Kofron, Asst. Atty. Gen., State of Wisconsin, Madison, Wis., for plaintiff-intervenor, State of Wisconsin.

Frank J. Kelley, Atty. Gen., Robert A. Derengoski, Sol. Gen., Jerome Maslowske, Clive Gemmill, Asst. Attys. Gen., State of Michigan, Lansing, Mich., for plaintiff-intervenor, State of Michigan.

Scott H. Lang, Philip J. Mause, The Environmental Defense Fund, Inc., Washington, D. C., for plaintiff-intervenor, Environmental Defense Fund, Inc.

William P. Dinan, City Atty., Robert E. Asleson, Duluth, Minn., for plaintiff-intervenor, City of Duluth, Minnesota.

William A. Hammann, City Atty., Superior, Wis., for plaintiff-intervenor, City of Superior, Wisconsin.

Maclay R. Hyde, Lindquist & Vennum, Minneapolis, Minn., Edward T. Fride, Hanft, Fride, O'Brien & Harries, Duluth, Minn., for defendant, Reserve Mining Co.

William T. Egan, Rider, Bennett, Egan, Johnson & Arundel, Minneapolis, Minn., for defendant, Republic Steel Corp.

G. Alan Cunningham, Faegre & Benson, Minneapolis, Minn., for defendant, Armco Steel Corp.

Steven J. Seiler, Joseph B. Johnson, Reavill, Neimeyer, Johnson, Fredin & Killen, Duluth, Minn., for defendant-intervenor, Northeastern Minnesota Development Association.

John M. Donovan, Applequist, Nolan, Donovan, Larson, Barnes & Mathias, Duluth, Minn., for defendant-intervenor, Duluth Area Chamber of Commerce.

Fred Cina, Aurora, Minn., for defendants-intervenors, Village of Babbitt, Range League of Municipalities and Civic Associations.

Wayne G. Johnson, Johnson & Thomas, Silver Bay, Minn., for defendants-intervenors, Village of Beaver Bay, Silver Bay Chamber of Commerce, Village of Silver Bay, Town of Beaver Bay, Lax Lake Property Owners Association.

Keith M. Brownell, Bruce L. Anderson, Duluth, Minn., for defendant-intervenor, St. Louis County.

Mitchel H. Costley, Two Harbors, Minn., for defendant-intervenor, Lake County, Minnesota.

Ronald W. Thomas, Silver Bay, Minn., for defendant-intervenor, Town of Beaver Bay.

John G. Engberg, Helgesen, Peterson, Engberg & Spector, Minneapolis, Minn., for defendant-intervenor, United States Steel Workers.

MEMORANDUM

MILES W. LORD, District Judge.

The Court has before it certain claims for relief that were for various reasons taken under advisement and not resolved prior to the issuance of the injunction in this case. The matters are largely cumulative and obviously had no effect on the issuance of the injunction on April 20, 1974. However, in an effort to accommodate the desires of the Court of Appeals, this Court has made and will continue to make an effort to arrive at a resolution of all of the claims asserted by the various parties to this litigation as expeditiously as possible. In that regard, the Court hereby issues the following Memorandum which shall become part of the Court's Findings of Fact and Conclusions of Law in this matter.

Refuse Act Claim

In the Supplemental Memorandum of May 11, 1974, the Court deferred ruling on the plaintiffs' allegations that Reserve's discharge into Lake Superior is in violation of the Refuse Act, 33 U.S.C. § 407, since the Court had restricted the parties on the presentation of this claim in an effort to reach a speedy resolution of the public health issue. In that Memorandum, the Court indicated its willingness to hear further testimony on these issues if necessary. However, at the hearing on August 23, 1974, both parties agreed that the matter had been fully submitted and was ripe for adjudication by this Court, without the necessity of further evidence.

It is Reserve's claim that they are in compliance with the statute since they have a presently valid Refuse Act permit. It is the plaintiffs' position that Reserve has no valid permit that could serve as a defense to the alleged Refuse Act violations.

The plaintiffs argue that the permit Reserve was issued was authorized under Section 10 of the Rivers and Harbors Act, 33 U.S.C. § 403, and not Section 13 (the Refuse Act), that even if the permit was a Refuse Act permit, it has been revoked. Finally, it is argued that the permit Reserve possesses does not sanction the specific conduct alleged to be in violation of the Act.¹

The issue of whether or not Reserve has a Refuse Act permit was raised in various pretrial motions for dismissal and summary judgment. In the Memorandum and Order of November 30, 1972, the Court recognized that the Refuse Act set forth no procedural requirements or administrative machinery for considering permit applications. According to the statute, the only prerequisite to obtaining a Refuse Act permit was the permission of the Secretary of the Army upon the recommendation of the Chief of the Army Corps of Engineers. Reserve's permit, although by its terms a Section 10 permit, also met the underlying pre-requisites for a Section 13 permit when issued since it was issued by the Secretary upon approval of the Chief of the Army Corps of Engineers. Although the thrust of the Secretary's concern might vary slightly when considering a Section 13 permit (dumping refuse) as opposed to Section 10 (building a wharf), the terms of the permit appear broad enough to afford some protection under both sections. However, before Reserve can set forth this permit as a defense to an alleged Refuse Act violation, it must be determined if the terms of the permit sanction the specific conduct that is challenged by the plaintiffs.

As was discussed in the Court's Memorandum of November 30, 1972, the Refuse Act has been consistently construed by the administrative agencies as to be applicable only to those discharges impeding navigation. See, 33 C.F.R. §§ 209, 395 (1968). Recently the Courts have given the Refuse Act a broader construction and extended its coverage to discharges that are harmful without respect to their effect on navigability. United States v. Pennsylvania Chem. Corp., 411 U.S. 655, 93 S.Ct. 1804, 36 L.Ed.2d 567 (1973); United States v. Standard Oil, 384 U.S. 224, 86 S.Ct. 1427, 16 L.Ed.2d 492 (1966). In United States v. Pennsylvania Chem. Corp. (PICCO), criminal charges were brought against PICCO alleging that on four separate occasions PICCO deposited industrial refuse in violation of the Refuse Act. PICCO was convicted on each count and assessed the maximum fine, $2,500.00 for each violation. 329 F.Supp. 1118 (W.D.Pa.1971).

The conviction was reversed on appeal, 461 F.2d 468 (3rd Cir. 1972), on two grounds:

1. The absence of a formal permit program precluded enforcement of the Act.

2. PICCO should have been permitted to prove that they were affirmatively misled by the Corps of Engineers into believing that the Refuse Act was inapplicable to their type of discharge.

On petition to the Supreme Court, the Court rejected the first ground relied upon by the Court of Appeals determining that the terms of the statute did not require a formal permit procedure. However, the Supreme Court agreed with the Court of Appeals as to the second point and upheld the reversal of the conviction remanding the matter to the District Court to permit PICCO to prove its defense of estoppel.

The Supreme Court traced the history of administrative approach to the Refuse Act. The Court stated 411 U.S. at pp. 672, 673, 93 S.Ct. at p. 1815:

Nevertheless, it is undisputed that prior to December 1970 the Army Corps of Engineers consistently construed § 13 as limited to water deposits that affected navigation.

. . . . . .

In December 1968, the Corps of Engineers published a complete revision of the regulations pertaining to navigable waters. The new regulations pertaining to §§ 9 and 10 of the Rivers and Harbors Act of 1899, dealing with construction and excavation in navigable waters, stated for the first time that the Corps would consider pollution and other conservation and environmental factors in passing on applications under those sections for permits to "work in navigable waters." 33 CFR § 209.120(d) (1969). But notwithstanding this reference to environmental factors and in spite of our intervening decision in Standard Oil, the new regulation pertaining to § 13 of the 1899 Act continued to construe that provision as limited to water deposits that affected navigation.²

Reserve's permit was originally issued in 1948 and modified in 1950 and 1960. At all times when Reserve's permit was considered, the prevailing view of the law was that the only proper consideration under the Refuse Act was the effect a particular discharge might have on navigability. Yet it is now claimed that this permit sanctions general pollution as well as obstruction to navigation. Looking to the specific terms of the permit, such an argument cannot stand. At the top of the original permit, it...