US v. Eastern of New Jersey, Inc., Civ. A. No. 90-3809.

• Decision Date: 24 July 1991
• Docket Number: Civ. A. No. 90-3809.
• Parties: UNITED STATES of America, Plaintiff, v. EASTERN OF NEW JERSEY, INC., and Eastern of New Jersey Terminals, Inc., Defendants.
• Court: U.S. District Court — District of New Jersey

770 F. Supp. 964

UNITED STATES of America, Plaintiff, v. EASTERN OF NEW JERSEY, INC., and Eastern of New Jersey Terminals, Inc., Defendants.

Civ. A. No. 90-3809.

United States District Court, D. New Jersey.

July 24, 1991.

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Michael Chertoff, U.S. Atty., Jerome L. Merin, Asst. U.S. Atty., Newark, N.J., for the Government.

Richard B. Stewart, Asst. Atty. Gen., Peter M. Flynn, Trial Atty., U.S. Dept. of Justice, Environmental and Natural Resources Div., Washington D.C., for the Government.

Jerome Stein, Stein, Bliablias, McGuire, Pantages & Gigl, Livingston, N.J., Christopher Harris, Gary Fremerman, Thelen, Marrin, Johnson & Bridges, Washington D.C., for defendants.

OPINION

LECHNER, District Judge.

This is an action brought by the United States of America (the "Government") against Eastern of New Jersey, Inc. and Eastern of New Jersey Terminals, Inc. (collectively, "Eastern") for injunctive relief and civil penalties pursuant to the Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. §§ 6921 et seq., and the regulations promulgated thereunder.¹ Jurisdiction is alleged pursuant to 42 U.S.C. § 6928 and 28 U.S.C. §§ 1331, 1345 and 1355 and appears to be appropriate.

Currently before the court are several motions by the Government and Eastern for summary judgment pursuant to Fed. R.Civ.P. 56. Eastern moves for summary judgment on all Claims in the Amended Complaint except the Twelfth Claim. The Government moves for summary judgment on all Claims in the Amended Complaint.² For the reasons set forth below, both the Government's and Eastern's motions for summary judgment with respect to the First through Ninth Claims are denied. Summary judgment is granted in favor of the Government dismissing Eastern's defense of estoppel. Summary judgment is further granted in favor of the Government with respect to the Tenth Claim. Both the Government's and Eastern's motions for summary judgment with respect to the Eleventh, Twelfth and Thirteenth Claims are denied. Summary judgment is granted in favor of the Government with respect to the Fourteenth Claim to the extent it alleges Eastern failed to maintain a log pursuant to 40 C.F.R. § 266.43(b)(6)(i); summary judgment is granted in favor of Eastern with respect to the Fourteenth Claim to the extent it alleges Eastern failed to retain analyses pursuant to 40 C.F.R. § 266.43(b)(6)(i). In addition, the Fifteenth Claim is dismissed as having been withdrawn.

Facts

Eastern of New Jersey, Inc. and Eastern of New Jersey Terminals, Inc. are corporations organized under the laws of New Jersey. They jointly own, maintain and operate a place of business (the "Facility") in Jersey City, New Jersey. Eastern markets fuel oil to industrial and non-industrial fuel oil consumers, or "burners," and other fuel oil marketers. Eastern's customers include school, churches, geriatric centers, apartment buildings and public agencies. Eastern also purchases reprocessed used or waste oil, which is then blended with virgin oil at the Facility and resold. Eastern receives used oil from several suppliers, including Lionetti Oil Recovery, Inc. ("Lionetti"), L & L Oil Service Inc. ("L & L") and B & L Oil Corp ("B & L").

It is uncontroverted Eastern was not regulated under RCRA until 1985, when the regulations promulgated under RCRA were issued. See 40 Fed.Reg. 49,164 (1985) (codified at 40 C.F.R. pts. 261, 264, 265, 266 & 271). As part of its effort to ensure compliance with the RCRA regulations, on 8 April 1987, the Environmental Protection Agency (the "EPA") conducted an inspection of the Facility. The EPA collected several samples of oil from tanks at the Facility. See Def. Motion Brief, Exhibit C (EPA report on inspection of Eastern). For example, the EPA collected a sample from Tank Number 30 at the Facility. Tank Number 30 contained reprocessed used oil which Eastern obtained from its suppliers and intended to blend with virgin oil. A test of that sample purportedly indicated the sample contained halogens in amounts greater than one thousand parts per million ("ppm"). See Def. Motion Brief, Exhibit C (EPA report, dated July 1988, regarding 8 April 1987 inspection of Facility); see also Flynn Decl., Exhibit E. That sample also allegedly contained significant concentrations of individual chlorinated solvents such as tetrachloroethylene and 1,1,1-trichloroethane. The sample also purportedly contained concentrations of lead in excess of the specification requirement for lead pursuant to 40 C.F.R. § 266.40(e).

On 7 July 1987, Eastern notified the EPA pursuant to 40 C.F.R. § 266.43(b)(3) of its used oil management activities. Answer, ¶ 92. Subsequently, the EPA sent to Eastern a questionnaire, dated 14 February 1989, pursuant to 42 U.S.C. § 6927,³ seeking information regarding Eastern's used oil marketing activities. See Def. Brief, Exhibit R (questionnaire and Eastern's response). On 28 February 1989, the EPA conducted a second inspection of the Facility. See Def. Brief, Exhibit B ("Wilk Deposition") at 26-27.

Eastern concedes receiving used oil which was "off-specification used oil fuel." Off-specification used oil fuel means the used oil contained amounts of certain hazardous materials in excess of the amounts set forth in 40 C.F.R. § 266.40(e). Eastern, however, contends none of the oil sold to their customers was off-specification used oil fuel. Answer, ¶ 47. In contrast, the Government alleges the oil marketed to Eastern's customers was off-specification used oil fuel. Amended Complaint, ¶ 50.

The Government has brought fifteen Claims against Eastern in the Amended Complaint. The first nine Claims are brought under 40 C.F.R. Part 266, Subpart D, which governs the burning of hazardous waste for energy recovery. In the First Claim, the Government contends Eastern failed to notify the EPA of its hazardous waste fuel activities pursuant to 40 C.F.R. § 266.34(b) and 50 Fed.Reg. 49,164. Amended Complaint, ¶¶ 55-56. In the Second Claim, the Government contends Eastern failed to obtain from its customers the required certifications pursuant to 40 C.F.R. § 266.34(e)(1). Amended Complaint, ¶¶ 59-60. Under 40 C.F.R. § 266.34(e)(1), Eastern's customers would have to certify either that they have notified the EPA of their use of hazardous waste as fuel or that, if the customer is a burner, then the hazardous waste oil sold by Eastern will be burned only in an industrial furnace or boiler identified in 40 C.F.R. § 266.31(b). See Amended Complaint, ¶ 59.

In the Third Claim, the Government contends Eastern failed to provide the required certification to other oil marketers from whom Eastern accepted waste fuel that Eastern has notified the EPA of its hazardous waste fuel activities pursuant to 42 U.S.C. § 6930 and 40 C.F.R. § 266.34(e)(2). Amended Complaint, ¶¶ 63-64. In the Fourth Claim, the Government contends Eastern failed to submit a Part A RCRA permit application or to notify either the EPA or the New Jersey Department of Environmental Protection of its hazardous waste fuel oil storage activities pursuant to 40 C.F.R. §§ 266.34(c) and 270.10(e) and N.J.A.C. 7:26-12.3. Amended Complaint, ¶¶ 67-68. In the Fifth Claim, the Government contends Eastern failed to develop the written waste analysis plan which is required of marketers of hazardous waste fuel oil pursuant to 40 C.F.R. §§ 266.34(c) and 265.13(b) and N.J.A.C. 7:26-9.4(b)(2). Amended Complaint, ¶¶ 71-72.

In the Sixth Claim, the Government contends Eastern has failed to comply with 40 C.F.R. §§ 266.34(c) and 265.112 and N.J.A.C. 7:26-9.8(c), which require marketers of hazardous waste fuel oil and owners or operators of hazardous waste facilities to have a written closure plan. Amended Complaint, ¶¶ 75-76. In the Seventh Claim, the Government contends Eastern has failed to establish financial assurance for closure pursuant to 40 C.F.R. §§ 266.34(c) and 265.143 and N.J.A.C. 7:26-9.10. Amended Complaint, ¶¶ 79-80. In the Eighth Claim, the Government contends Eastern has failed to prepare manifests for the transportation of hazardous waste fuel pursuant to 40 C.F.R. §§ 266.34(d) and 262.20(a) and N.J.A.C. 7:26-7.4(a)(3). Amended Complaint, ¶¶ 83-84. In the Ninth Claim, the Government contends Eastern has failed to retain certain certifications pursuant to 40 C.F.R. § 266.34(f). Amended Complaint, ¶ 87-88.

The Tenth through Fifteenth Claims are brought under 40 C.F.R. Part 266, Subpart E, which governs the burning of used oil for energy recovery. In the Tenth Claim, the Government contends Eastern has failed to file with the EPA a timely notification of their used oil activities pursuant to 40 C.F.R. § 266.43(b)(3) and 50 Fed.Reg. 49,164. Amended Complaint, ¶¶ 91-92. In addition, the Government contends Eastern has failed to notify the EPA of its activities as marketers of off-specification used oil fuel pursuant to 40 C.F.R. § 266.43(b)(3). Amended Complaint, ¶ 94. In the Eleventh Claim, the Government contends Eastern failed to obtain from its first customers the required certifications pursuant to 40 C.F.R. § 266.34(b)(5)(i). Amended Complaint, ¶¶ 97-98. Under 40 C.F.R. § 266.34(b)(5)(i), Eastern's customers would have to certify either that they have notified the EPA of their used oil management activities or that, if the customer is a burner, then the off-specification used oil fuel sold by Eastern will be burned only in an industrial furnace or boiler identified in 40 C.F.R. § 266.41(b). See Amended Complaint, ¶ 97.

In the Twelfth Claim, the Government contends Eastern has failed to provide the required certification to the first oil marketers from whom it accepted waste fuel that Eastern has notified the EPA of its used oil management activities pursuant to 40 C.F.R. § 266.43(b)(5)(ii). Amended Complaint, ¶¶ 101-02. In the Thirteenth Claim, the Government contends Eastern has failed to utilize invoices which complied with 40 C.F.R. § 266.43(b)(4), 40 C.F.R. § 266.43(b)(...