US v. Alcan Foil Products

• Decision Date: 15 September 1988
• Docket Number: Civ. A. No. 87-0434-L(CS).
• Parties: UNITED STATES of America, Plaintiff, v. ALCAN FOIL PRODUCTS, DIVISION OF ALCAN ALUMINUM CORPORATION, Defendant and Third-Party Plaintiff, v. ATLANTIC RICHFIELD COMPANY, Third-Party Defendant.
• Court: U.S. District Court — Western District of Kentucky

694 F. Supp. 1280

UNITED STATES of America, Plaintiff, v. ALCAN FOIL PRODUCTS, DIVISION OF ALCAN ALUMINUM CORPORATION, Defendant and Third-Party Plaintiff, v. ATLANTIC RICHFIELD COMPANY, Third-Party Defendant.

Civ. A. No. 87-0434-L(CS).

United States District Court, W.D. Kentucky, at Louisville.

March 15, 1988.

Opinion on Motion for Reconsideration September 15, 1988.

Richard A. Dennis, Asst. U.S. Atty., Louisville, Ky., Robert Foster, U.S. Dept. of Justice, Lands Div., Environmental Enforcement Section, Washington, D.C., for the U.S.

Lawrence A. Salibra II, Alfred R. Cowger, Jr., Alcan Aluminum Corp., Cleveland, Ohio, for Alcan Foil Products, Div. of Alcan Aluminum Corp.

Marcus P. McGraw, Carolyn M. Brown, Greenebaum Doll & McDonald, Lexington, Ky., for Atlantic Richfield Co.

MEMORANDUM OPINION

SIMPSON, District Judge.

This is an enforcement action brought by the United States on behalf of the Administrator of the United States Environmental Protection Agency ("EPA") pursuant to 42 U.S.C. §§ 7413(b) and 7420 of the Clean Air Act ("Act"), 42 U.S.C. §§ 7401 et seq. In its complaint, the EPA alleges that the defendant, Alcan Foil Products Division ("Alcan"), is producing excessive emissions of volatile organic compounds ("VOCs")¹ in violation of emission standards contained in Regulation 6.29 of the Jefferson County Air Pollution Control District ("JCAPCD").² This matter is presently before the Court on motion by Alcan for summary judgment in its favor pursuant to Rule 56, Fed.R.Civ.P.

Interpreting the evidence in a light most favorable to the EPA, the facts may be stated as follows. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 2513 (1986) (citation omitted). Alcan operates a laminating facility in Louisville, Kentucky, that manufactures products which include cigarette package foil liners, electric cable wrap, air conditioner fin stock, label stock, composite can stock and hood stock for frozen food trays. In connection with production at the facility, Alcan operates ten (10) rotogravure printing presses. Each of these printing presses either emits or has the potential to emit VOCs. On March 3, 1986, a revision to the existing KSIP was submitted by the Kentucky Natural Resources and Environmental Protection Cabinet to the EPA on behalf of the JCAPCD pursuant to 42 U.S.C. § 7410. This proposed KSIP revision included an amended version of JCAPCD Regulation 6.29. Under the existing KSIP, VOC emission compliance at the Alcan facility was determined at each particular emission source. That is, if one emission source exceeded the standards established by JCAPCD Regulation 6.29, then Alcan would be in noncompliance. Under the proposed KSIP revision, Alcan's VOC emissions would be regulated by consideration of all point sources of the facility together under a "bubble concept" rather than on an individual basis. Under the "bubble concept", the entire facility could meet compliance requirements by offsetting emissions at one source within the plant by over-compliance at another source. The EPA has approved application of this bubble concept in certain instances.³

On July 14, 1986, the EPA served notice on Alcan and the JCAPCD that seven (7) rotogravure printing presses were in noncompliance with Regulation 6.29. An inspection of the Louisville plant by the EPA on October 15, 1986, confirmed that VOC emissions from the presses remained excessive and that the emissions violated both Regulation 6.29 and daily emission standards under the proposed KSIP revision.⁴ Following the issuance of the notice of noncompliance, Alcan and the EPA met to discuss the alleged violation as well as the proposed KSIP revision. On December 4, 1986, the EPA issued its revised Emission Trading Policy which established uniform procedures and criteria upon which any approval of bubble plans by the EPA would be predicated.⁵ On February 18, 1987, the EPA informed Alcan of deficiencies in the JCAPCD's proposed bubble plan and recommended certain revisions that were necessary prior to any approval by the EPA. On July 15, 1987, this action was filed at the request of the EPA. On August 26, 1987, EPA's Regional Administrator signed a proposed rule disapproving the JCAPCD's proposed KSIP revision. To date, the EPA has not formally approved or disapproved of the Regional Administrator's action.

In support of its motion, Alcan relies upon the affidavit of the Director of the JCAPCD to establish that it is in compliance with the proposed KSIP revision and has been since November of 1986. See fn. 4, supra. This opinion is based upon monthly operating emission reports provided since March of 1986 by Alcan to the EPA and the JCAPCD. In addition, Alcan has also provided to both the EPA and JCAPCD, a comprehensive engineering report containing emission data for a two-year baseline period from July of 1985 through June, 1987.⁶ On the basis of this information, Alcan relies upon the decision rendered by the Court of Appeals for the Fifth Circuit in American Cyanamid v. U.S. E.P.A., 810 F.2d 493 (5th Cir.1987), in its assertion that summary judgment in its favor is proper. In American Cyanamid, the Court held that, when the EPA issues a notice of noncompliance more than four (4) months after a state has submitted a proposed KSIP revision under which the alleged violator is in compliance, then the EPA may not commence a civil action under 42 U.S.C. § 7420 until it rejects the proposed revision. Id. at 501.

Despite this Court's order granting the EPA an extension of time to file a response to Alcan's motion for summary judgment, the EPA has chosen not to respond. Rather, the EPA has requested that this Court deny Alcan's motion without prejudice in lieu of further discovery by the EPA pursuant to Rule 56(f), Fed.R.Civ.P.⁷ EPA contends that a genuine issue of material fact exists as to whether Alcan's facility is operating in compliance with the proposed KSIP revision. Because no less than eight (8) months have passed since it filed its complaint, the EPA requests that this Court deny Alcan's motion without prejudice to its refiling after the EPA has had an ample opportunity to obtain meaningful discovery on this issue. In an effort to show that its request is made in good faith, the EPA has submitted the affidavit of its Regional Expert for the Air Compliance Branch wherein he states that, in his opinion, Alcan's facility is in noncompliance with the present JCAPCD Regulation 6.29 as well as with the proposed KSIP revision. Other than this conclusory assertion, the EPA has failed to inform this Court of any specific information that would tend to support this opinion. Moreover, the EPA has also failed to state any reason why the emission data already supplied by Alcan is insufficient.

It is the opinion of this Court that whether Alcan's facility is in present compliance with the proposed KSIP revision is a non-issue in this action. EPA's complaint wholly fails to allege that this enforcement action is premised upon any violation of the proposed KSIP revision. This is understandable since the existing KSIP remains the standard against which compliance is measured until the EPA acts upon the revision submitted by the JCAPCD. American Cyanamid, 810 F.2d at 495 (citations omitted). It is equally apparent that, since the EPA's notice of noncompliance was served more than four (4) months after the JCAPCD submitted its proposed KSIP revision, it may not commence enforcement proceedings until it acts upon the proposed revision. Id. at 501.

The EPA seeks to distinguish American Cyanamid from the instant action on the basis that the alleged violator in that case would have complied with Louisiana's SIP on schedule had the EPA approved the revision in four (4) months. The EPA contends that the holding in American Cyanamid stands for the proposition that the EPA is not estopped from initiating enforcement proceedings unless the alleged violator proves it is in compliance with the proposed SIP revision. This narrow view of the Court's holding in American Cyanamid distorts the whole of the opinion.

In American Cyanamid, Circuit Judge Jerre S. Williams aptly stated as follows:

Where, as here, the state has proposed a revision to its SIP which clearly authorizes local businesses to act in accordance with it without running afoul of the Clean Air Act, the interest of the state itself is deeply involved in the required four month approval or disapproval of the proposed revision. It distorts the statutory scheme to place virtually full emphasis upon the business entity involved as a charged "polluter". The emphasis of the statute, rather, is upon the important role which the state plays in defining authorized emissions.... The issue then is not so much pollution by American Cyanamid but the default of the EPA in carrying out the congressional intent to work in close cooperation with the state in implementing standards and enforcing the Clean Air Act. We emphasize the importance of the EPA acting, not for the benefit of American Cyanamid, but for the benefit of the State of Louisiana which is by statute designated to play a significant cooperating role with the EPA.

Id. at 500.

The emphasis, then, is not upon whether Alcan is in compliance with the proposed KSIP revision. Rather, the primary issue is whether the EPA has acted responsibly to avoid a state of regulatory limbo such as exists in this instance. Due to its inaction on the proposed KSIP revision, the EPA may not bring an enforcement action against Alcan under the existing KSIP since Alcan has been operating in reliance upon assurances by the JCAPCD that its emissions are acceptable and in compliance with the proposed KSIP revision. The EPA may not seek to enforce the standards of the proposed KSIP revision since it has failed to take any final action on the proposal. This regulatory quandry is of EPA's own making.

Moreover, the dispute over whether Alcan is in compliance with the...