US EPA v. Environmental Waste Control, Inc., S87-55.

Citation710 F. Supp. 1172
Decision Date17 April 1989
Docket NumberNo. S87-55.,S87-55.
PartiesUNITED STATES OF AMERICA (EPA), Plaintiff, and Supporters to Oppose Pollution, Inc., Intervenor-Plaintiff, v. (1) ENVIRONMENTAL WASTE CONTROL, INC., d/b/a Four County Landfill; (2) Steven W. Shambaugh; (3) James A. Wilkins; and (4) West Holding Company, Defendants.
CourtUnited States District Courts. 7th Circuit. United States District Court of Northern District of Indiana

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Robert Oakley, F. Henry Habicht, Frank Bentkover, Sam Boxerman, Environmental Enforcement Section, Land & Natural Resources Div., U.S. Dept. of Justice, Anna Thode, Office of Enforcement & Compliance Monitoring, U.S. Dept. of Justice, Washington, D.C., Victor A. Franklin, Asst. Regional Counsel, U.S. E.P.A., Region V, Chicago, Ill., Andrew A. Baker, Jr., Asst. U.S. Atty., Hammond, Ind., Clifford D. Johnson, Asst. U.S. Atty., South Bend, Ind., for the U.S.E.P.A.

John C. Hamilton, South Bend, Ind., Charles Tebutt, Syracuse, N.Y., for Supporters to Oppose Pollution, Inc.

George W. Pendygraft, George Plews, Indianapolis, Ind., James H. Pankow, South Bend, Ind., for all defendants.

MEMORANDUM AND ORDER

MILLER, District Judge.

This cause came before the court for trial without intervention of jury commencing December 5, 1988. Following thirty-one days of evidence and argument, the court now enters this memorandum opinion intended to comply with Fed.R.Civ.P. 52(a).

The case involves several issues of law on which no court has ruled before. The United States Environmental Protection Agency ("EPA") and a citizens' group known as Supporters to Oppose Pollution, Inc. ("STOP") claim that federal statutes and regulations have been violated in the operation of a hazardous waste disposal facility known as the Four County Landfill. The EPA and STOP bring their claims under the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq. ("RCRA"), and its implementing regulations. The court holds that the EPA has proven that the Landfill has operated illegally since November 8, 1985 and so can operate no longer in its present status. Further, hazardous waste constituents buried at the Landfill have been released into the groundwater and air. Based on those and other violations of federal law, as well as the history of the Landfill's operation, the court concludes that the Landfill should be closed permanently, that a civil penalty of $2,778,000 should be assessed against the defendants, and that the defendants should be ordered to implement a plan of action to correct their release of hazardous waste constituents into the groundwater.

In Part I of this memorandum, the court sets forth the claims brought by the EPA and STOP and describes the location and geography of the Four County Landfill, the relationship between the defendants, and the regulatory history of the Landfill. In conjunction with the Landfill's regulatory history, Part I of the memorandum also discusses the general regulatory scheme of RCRA.

Part II of the memorandum discusses the defendants' various technical challenges to the suit. In Part II, the court concludes: (A) that it has jurisdiction over the EPA's suit although Indiana is an "authorized state" for purposes of RCRA enforcement; (B) that STOP's asserted failure to give notice to the defendants or to the State of Indiana does not deprive the court of jurisdiction over its claims; (C) that the doctrines collectively described as "primary jurisdiction" do not preclude consideration of the claims brought by the EPA and STOP; and (D) that principles of collateral estoppel do not preclude the claims brought by the EPA and STOP, notwithstanding an earlier agreed order in state administrative proceedings.

Part III addresses whether defendant Stephen Shambaugh may be held liable under RCRA as an "operator" of the Landfill although a corporate defendant also is an operator, and the court determines that he may be held liable.

Part IV of the memorandum addresses the EPA's claims.

Part IV-A addresses the EPA's claim that the Landfill has lost its interim status (its basis for operation pending final determination of its application for a permit to operate) because the certificate of compliance the defendants filed pursuant to RCRA was false. In Part IV-A-1, the court concludes that the mere filing of a certificate does not satisfy RCRA. The certificate must have been true.

In Part IV-A-2, the court holds that the Landfill's certificate was false because its insurance coverage was insufficient to meet the financial responsibility requirements that applied at the time of the certification. In reaching that conclusion, the court rejects the defendants' arguments that its insurance coverage amounted to the level the EPA maintains was required, determines that the EPA's interpretation of the regulatory requirements is correct, rejects the defendants' argument that the EPA is estopped from enforcing the regulations because of misinformation provided to the Landfill's insurance agent over the EPA's "hot line", and rejects the defendants' argument that its good faith constitutes a defense to the EPA's claim.

In Part IV-A-3, the court concludes that the Landfill's certificate of compliance was false because its groundwater monitoring system was inadequate at the time of its certification in November, 1985. In reaching that conclusion, the court rejects the defendants' argument that the regulations upon which the EPA relies were inapplicable because the Landfill was in "assessment mode" rather than "detection mode", rejects the defendants' argument that a state administrative order and subsequent state inaction prevented them from complying with the regulations, rejects the defendants' argument that their groundwater monitoring wells actually were in the best location to detect migrating hazardous waste constituents, and rejects the defendants' argument that the EPA has mischaracterized the "waste management area" for purposes of placement of monitoring wells. The court also concludes that one monitoring well critical to compliance with the regulations was inadequate under the regulations because it was sealed improperly.

Part IV-B of the memorandum discusses the EPA's claim that the defendants violated RCRA by placing hazardous waste in unlined cells for a period of several months. The court earlier held, on summary judgment, that the defendants had violated that provision.

In Part IV-C of the memorandum, the court addresses the EPA's contention that the Landfill's groundwater monitoring system failed, even in 1988, to satisfy RCRA requirements. In that portion of the memorandum, the court holds that because of defects in the depth and construction of the defendants' monitoring wells, and because of the defendants' failure to determine both the extent of the uppermost aquifer and the permeability of the materials beneath the Landfill, the defendants have violated that RCRA regulation requiring an adequate groundwater monitoring system.

In Part IV-D of the memorandum, the court finds that hazardous waste constituents have been released into the groundwater beneath the Four County Landfill and that corrective action is required.

Part V of the memorandum addresses the additional claims raised by the intervenor, STOP.

Part V-A addresses STOP's various claims that hazardous waste constituents have been released into the environment beyond the Four County Landfill's boundaries. In that portion of the memorandum, the court finds that STOP has not proven that hazardous waste constituents have left the landfill site through the groundwater, but that STOP has proven that hazardous waste constituents have been spread to areas surrounding the Four County Landfill by wind dispersal and by surface water leaving the landfill site after coming into contact with hazardous waste.

The remaining portions of Part V address, and reject, STOP's other claims. In Part V-B, the court discusses STOP's claim that the defendants improperly accepted ignitable waste. Part V-C analyzes STOP's claim that the defendants improperly accepted free liquids. Part V-D addresses STOP's contention that the defendants handled barrels of hazardous waste negligently. Part V-E discusses STOP's claim that the defendants improperly accepted hazardous waste that was not listed on the manifests that accompanied the waste. In each of these parts, the court concludes that STOP has not proven its claim by a preponderance of the evidence.

Part VI addresses the penalties to be imposed on the defendants for the violations that are found to have occurred. In that portion of the memorandum, the court determines that the Four County Landfill must be closed immediately because its failure to have sufficient insurance and an adequate groundwater monitoring system in November, 1985 ended its right to continue to operate under "interim status", that is until its final application for a permit is granted. The court also determines in Part VI that the seriousness of the violations and the defendants' poor performance record warrant closing the Four County Landfill permanently. In Part VI, the court also concludes that the defendants must undertake a corrective action plan to address the release of hazardous waste constituents into the groundwater, must pay civil penalties amounting to $2,778,000, and must pay the reasonable attorney fees and expenses incurred by STOP.

I. BACKGROUND

The EPA initiated this action pursuant to the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901, addressing a hazardous waste landfill known as the Four County Landfill ("the Landfill") located in Fulton County, Indiana. Pursuant to 42 U.S.C. § 9613(i), the court allowed intervention by a citizens' organization known as Supporters to Oppose Pollution, Inc., or "STOP".

The four defendants are the Landfill's alleged owners...

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