US v. Aluminum Co. of America

• Decision Date: 28 June 1993
• Docket Number: No. 6:92 CV 564.,6:92 CV 564.
• Citation: 824 F. Supp. 640
• Parties: UNITED STATES of America v. ALUMINUM COMPANY OF AMERICA.
• Court: U.S. District Court — Eastern District of Texas

824 F. Supp. 640

UNITED STATES of America v. ALUMINUM COMPANY OF AMERICA.

No. 6:92 CV 564.

United States District Court, E.D. Texas, Tyler Division.

June 28, 1993.

COPYRIGHT MATERIAL OMITTED

Randi Davis Russell, Asst. U.S. Atty., U.S. Attorney's Office, Tyler, TX, David Fishel, Paul J. Schaeffer, Vicki A. O-Meara, Courtney Ann Johnson, U.S. Dept. of Justice, Environmental Enforcement Section, Washington, DC, Robyn L. Moore, U.S. E.P.A., Asst. Regional Counsel, Region IV, Dallas, TX, for plaintiff U.S.

Herbert A. "Trey" Yarbrough, III, Conner, Gillen, Yarbrough & Anderson, Tyler, TX, Richard Oran Faulk, Akin, Gump, Strauss, Hauer & Feld, Houston, TX, Denise D. Hunkele, Aluminum Company of America, Pittsburgh, PA, Catherine J. McEnearney, Mark P. Fitzsimmons, Cheryl A. Falvey, Luis Rizo Mejia, Akin, Gump, Strauss, Hauer & Feld, Washington, DC, for defendant Aluminum Company of America.

AMENDED MEMORANDUM OPINION

JUSTICE, District Judge.

Pending before the court for consideration and resolution are the government's motion for partial summary judgment on the issue of liability for civil penalties under the Clean Water Act ("CWA"), 33 U.S.C. §§ 1251, et seq., and the cross-motion of the defendant, the Aluminum Company of America ("ALCOA"), for partial summary judgment.¹

I. UNDISPUTED FACTS

In 1973, ALCOA began to construct an aluminum plant at a site which it owned in Anderson County, Texas, approximately eight miles from the City of Palestine. ALCOA began operations at the facility in June 1976. In 1986, ALCOA began to make plans to dismantle the facility. ALCOA completed the dismantling on or about August 1989.²

The manufacture of aluminum at the plant involved treating alumina (an anhydrous form of bauxite) with No. 6 fuel oil and reacting the "coked alumina" with chlorine gas at high temperature. In 1974, ALCOA applied for a National Pollutant Discharge Eliminations System ("NPDES") permit to discharge waste water from the plant to an unnamed ditch which led to Hurricane Creek. The United States Environmental Protection Agency ("EPA") issued NPDES permit no. TX0056341 which was effective in January 1976, to expire in January 1981, authorizing the discharge of designated pollutants to Hurricane Creek.³

In December 1980, ALCOA made its timely application for the renewal of its NPDES permit, which caused the 1976 permit to continue in effect until a new one could be issued. The EPA issued ALCOA a renewed NPDES permit, which became effective on September 24, 1985.⁴ ALCOA's NPDES permit required ALCOA to monitor for pollutants by taking samples, having them analyzed, and reporting the results to the EPA by filing Discharge Monitoring Reports ("DMRs").⁵

Certain external outfalls covered by the NPDES permit are point sources as defined by the CWA, 33 U.S.C. § 1362(14), i.e., Outfalls 002, 003, 005, and 006. Outfall 004, an internal outfall which is located within the ALCOA plant area, is also covered by the permit, which required ALCOA to begin monitoring for pollutants and meeting effluent limitations⁶ for the chlorinated hydrocarbons Decachlorobiphenyl ("DCBP") and Hexachlorobenzene ("HCB") when it "restarted" the plant's 42-inch reactor.⁷ Under the terms of its permit, ALCOA was required to monitor its effluent and meet limitations at Outfall 004 until "six months after close-down of the reactor unit or after 4 consecutive samples for the ... HCB and DCBP show less than the limits for Outfall 004 and less than the limits for Outfalls 002, 003, 005, and 006, whichever is later in time." See Permit TX0056341, at 8, Part I (Attachment E, Exhibit 10, government's motion for partial summary judgment).

Sometime after the 1985 permit was issued, ALCOA began using the 42-inch reactor to revaporize, or purify, aluminum chloride which had been contaminated. ALCOA did not use the reactor to develop new processes or techniques for the production of aluminum chloride. The DMRs filed by ALCOA establish that the permit conditions for Outfall 004 were met by March 11, 1988. The government has stipulated that the permit's monitoring requirements for Outfall 004 ceased on that date.

The government seeks civil penalties for 174 violations of the CWA, beginning in August 1987.⁸ The number of violations was calculated by EPA employee Pamela Teel, who compared the DMRs filed by ALCOA on September 29, 1987, with the limitations set forth in the NPDES permit. See Declaration of Pamela J. Teel (Attachment J, government's motion for partial summary judgment). ALCOA admits that the DMRs accurately reported ALCOA's test results, but denies that the levels reported were actually in excess of the permit limitations, given the statistical confidence intervals inherent in the DMR measurements. ALCOA also asserts a statute of limitations defense, contests the government's use of "daily average" violations as thirty separate violations, and claims that the terms of the permit with regard to monitoring requirements and limitations for Outfall 004 are ambiguous.⁹

II. SUMMARY JUDGMENT STANDARD

Summary judgment is proper under Fed.R.Civ.P. 56(c) when the pleadings and evidence on file show that no genuine issue exists as to any material fact and that the moving party is entitled to judgment or partial judgment as a matter of law. To prevail on a motion for summary judgment, the moving party bears the burden of demonstrating that the pleadings, depositions, answers to interrogatories, and admissions on file, together with any affidavits, show that there is no genuine issue as to any material fact, and that it is entitled to judgment as a matter of law. L & B Hosp. Ventures, Inc. v. Healthcare Int'l, Inc., 894 F.2d 150, 151 (5th Cir.), cert. denied, 498 U.S. 815, 111 S.Ct. 55, 112 L.Ed.2d 30 (1990). Once a movant for summary judgment has established that there is an absence of genuine issue of material fact, the nonmovant must establish each of the challenged essential elements of its case for which it must bear the burden of proof at trial. Brock v. Chevron U.S.A., Inc., 976 F.2d 969 (5th Cir.1992). See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986) (if the movant establishes, prima facie, that there is no genuine issue as to any material fact, "the non-moving party must come forward with specific facts showing a genuine issue for trial.").

The substantive law underlying the claim at issue identifies which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). A factual dispute is "genuine" if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson, 477 U.S. at 248, 106 S.Ct. at 2510. If any such facts are genuinely in dispute, summary judgment is not appropriate. When assessing a motion for summary judgment, the court must make all factual inferences in favor of the party opposing the motion. Matsushita, 475 U.S. at 587, 106 S.Ct. at 1356; Hansen v. Continental Ins. Co., 940 F.2d 971, 975 (5th Cir.1991). However, the judge is not to weigh the evidence, nor engage in credibility determinations. Anderson, 477 U.S. at 249, 106 S.Ct. at 2510-11.

The government argues that summary judgment is particularly appropriate in CWA cases because Congress has decreed that enforcement actions be kept simple and speedy, and, to effectuate this mandate, has imposed a strict liability standard on persons who violate the terms of their NPDES permits. See Chesapeake Bay Foundation v. Bethlehem Steel Corp., 608 F.Supp. 440, 451-52 (D.Md.1985).

III. DISCUSSION

A. Statute of Limitations

The parties have stipulated that the applicable statute of limitations for an action for civil penalties under the CWA is five years from the date the claim accrues. 28 U.S.C. § 2462. The government's complaint was filed on September 22, 1992; thus, a claim which accrued prior to September 22, 1987, is barred. The government's position is that a claim accrues when the violator reports the violation to the EPA, or, in this case, September 29, 1987. ALCOA asserts that a claim accrues on the date the violation actually occurred, and that 129 violations which were reported in September but which occurred in August 1987, are barred by the statute of limitations.

Determining when a claim first accrues is a complex task. The language of a statute of limitations must be "interpreted in the light of the general purposes of the statute and its other provisions, and with due regard to those practical ends which are to be served by any limitation of the time within which an action must be brought." United States v. Core Laboratories, Inc., 759 F.2d 480, 481-82 (5th Cir.1985) (citing Reading Co. v. Koons, 271 U.S. 58, 46 S.Ct. 405, 70 L.Ed. 835 (1926)).

The United States Court of Appeals for the Fifth Circuit has not explicitly addressed the issue of whether a claim for civil penalties accrues upon the actual occurrence of the violation of a provision of an environmental statute such as the CWA, or upon the subsequent report of that violation.¹⁰ However, several other courts have considered the purposes and legislative history of such acts, and have held that such a claim accrues when the appropriate agency receives the statutorily mandated report. See Public Interest Research Group of New Jersey v. Powell Duffryn Terminals, Inc., 913 F.2d 64 (3rd Cir.1990), cert. denied, 498 U.S. 1109, 111 S.Ct. 1018, 112 L.Ed.2d 1100 (1991); Sierra Club v. Union Oil Co. of California, 813 F.2d 1480 (9th Cir.1987), vacated and remanded on other grounds, 485 U.S. 931, 108 S.Ct. 1102, 99 L.Ed.2d 264 (1988), judgment reinstated and remanded, 853 F.2d 667 (9th Cir. 1988); United States v. Windward Properties, Inc., 821 F.Supp. 690 (N.D.Ga.1993); Natural Resources Defense Counsel, Inc. v. U.S. E.P.A., 806 F.Supp. 1263 (E.D.Va.1992); Atlantic States Legal Foundation v. Al Tech Speciality Steel, Corp., 635 F.Supp. 284 (N.D.N.Y....