Phillips Law Firm Blog

You own and operate Independent Plating, Inc.("IPI"), in Cincinnati, Ohio. Your company is small, and you have been very diligent at complying with the environmental laws. Through your cooperation with the local sewer district, Ohio EPA and U.S. EPA, you are in full compliance with all air and water discharge permits issued to your company. Everything is going well. Your company is making a nice profit, your sales are up, and your costs are down. Yesterday, however, you are surprised to receive a "notice of intent to sue" from the Regional Environmental Watch Dogs, Inc. ("REWDI"). REWDI has notified your company that it intends to sue your company for failing to submit form Rs for its toxic chemicals subject to the Emergency Planning and Community Right-to-Know Act ("EPCRA") during years 1993 through 1996.

You are not sure what a form R is, but you know what a lawsuit is, and you know that to defend your company, you need to talk to an environmental attorney. You find an attorney experienced in environmental law, and you meet with him to discuss the threatened lawsuit against your company. You ask the attorney to explain how your company could be violating an environmental law if it complies fully with all of the permits for air and water discharges issued to your company. Your attorney explains that EPCRA is a paper work law. Section 313 of EPCRA requires owners and operators of facilities using specified toxic chemicals to file toxic chemical release forms, which provide information about the storage and release of those chemicals, with the United States Environmental Protection Agency ("U.S. EPA") and designated state officials. 42 U.S.C. §§ 11023(a), 11023(g). The U.S. EPA created the "form R" as the toxic chemical release reporting form. 40 C.F.R. § 372.85. Form Rs for a given calendar year are due the following July 1. 42 U.S.C. § 11023(a). Violators of § 11023 are liable to the United States for civil penalties of up to $25,000 for each violation. 42 U.S.C. § 11045(c)(1). The EPA can seek civil penalties either administratively or by bringing an action in federal district court. 42 U.S.C. § 11045(c)(4).

Your attorney goes on to explain that EPCRA also authorizes citizen enforcement suits. The citizen suit provision relied upon by REWDI to threaten your company with a lawsuit provides that "any person may commence a civil action on his own behalf against . . . [a]n owner or operator of a facility for failure to . . . [c]omplete and submit a toxic chemical release form under section 11023(a) of this title." 42 U.S.C. § 11046(a)(1)(A)(iv). District courts have jurisdiction over citizen enforcement actions "to enforce the requirement concerned and to impose any civil penalty provided for violation of that requirement." 42 U.S.C. § 11046(c). Prevailing parties may recover reasonable costs and attorneys' fees. 42 U.S.C. § 11046(f).

To sue your company, the law requires that a citizen may not commence an enforcement action until sixty days after he or she provides notice of the alleged violation to U.S. EPA, state officials, and the alleged violator. 42 U.S.C. § 11046(d). The notice of intent to sue received by your company states that IPI uses some of the specified toxic chemicals that should have been reported on form Rs at its production facility in Cincinnati, Ohio. REWDI is a not-for-profit organization also based in Cincinnati, Ohio. On July 17, 1997, REWDI notified IPI of its intention to file a citizen enforcement action against IPI for violating EPCRA § 313. Specifically, the notice stated that IPI had failed to file the required form Rs for the years 1993 through 1996.

Your attorney asks you if you used the alleged chemicals, and if you filed form Rs. Sheepishly, you tell your environmental attorney that you did use the chemicals and that you have not submitted the data for any year, including 1997. You ask your attorney if you should simply contact REWDI and offer to pay money if REWDI will agree not to sue your company. Your environmental attorney smiles and says that he has a better idea. He proposes filing all of the past due form Rs within sixty days of July 17, 1997, the day you received the notice of intent to sue, and then telling REWDI that your company cannot be sued under the citizen suit provision of EPCRA for failing to submit form Rs. You are confused and ask for an explanation; after all, your company did not submit the form Rs as required by law. How can you possibly avoid being sued? Your company is guilty.

Your attorney agrees that it is undisputed that at the time IPI received the notice of intent to sue, IPI had not filed the required form Rs. However, if you file all past due form Rs before REWDI can file its complaint alleging that IPI failed to submit form Rs, REWDI's complaint against your company will be dismissed. According to your attorney, this is the law, not just wishful thinking.

Your attorney explains that EPCRA authorizes citizen suits for "failure to . . . [c]omplete and submit [form Rs] under section 11023(a) of this title." 42 U.S.C. § 11046(a)(1)(A)(iv). Although § 11023(a) requires submission of the form Rs by a certain date, the citizen suit provision emphasizes the completing and submitting of the forms. This language suggests that only the failure to complete and submit the required forms can provide the basis for a citizen suit. While among the provisions of 11023(a) is the requirement that the form be filed by July 1 for the preceding calendar year, the citizen suit provision speaks only of the completion and filing of the form. The form is completed and filed even when it is not timely filed. Therefore, your attorney explains, if your company can file all of the past due form Rs within sixty days of receiving the notice of intent to sue, REWDI will be precluded from suing you under the citizen suit provision.

Your attorney explains that in Atlantic States Legal Found. V. United Musical Instruments, 61 F.3d 473 (6th Cir., 1995), the court dismissed a lawsuit brought against a company that had neglected to file the appropriate form Rs. The court dismissed the claim since the defendant had managed to file the appropriate form Rs before the lawsuit was filed in court. In dismissing the lawsuit, the court in the Atlantic States Legal Found. V. United Musical Instruments concluded that if Congress had intended to authorize citizen suits for any violation of § 11023(a) -- such as a late submission -- it could easily have done so. Instead, Congress clearly gave U.S. EPA and citizen plaintiffs differing authority to enforce EPCRA. Congress authorized U.S. EPA to bring actions to assess and collect "any civil penalty for which a person is liable." 42 U.S.C. § 11045(c)(4). Rather than give citizen plaintiffs this same broad power, however, Congress limited citizen suits by emphasizing that it is the failure to submit the requisite forms that gives rise to a citizen action. Congress did not authorize citizen suits for other violations of § 11023. This difference between the grants of authority to U.S. EPA and citizen plaintiffs is significant because it indicates a congressional intent to limit citizen suits to ongoing violations and to give U.S. EPA sole authority to seek penalties for historical violations.

Your attorney advises you to prepare and submit the form Rs immediately as required by EPCRA. If your company can complete and submit all past due form Rs within sixty days of July 17, 1997, the date you received the notice of intent to sue, REWDI will be precluded from suing your company. You thank your attorney, and with the assistance of an environmental consultant, you file all past due form Rs within sixty days of receiving REWDI's notice of intent to sue. You send REWDI a copy of your form Rs that were submitted along with a copy of the court's decision in Atlantic States Legal Found. V. United Musical Instruments, 61 F.3d 473 (6th Cir., 1995). REWDI, whose objective was to bring your company into compliance, agrees that upon submission of the form Rs, a citizen suit is not proper under the law. You are thrilled, and relieved.

I always advise clients who are threatened with a citizen suit to seek legal advice immediately. Congress provided certain limitations on citizen suits, including time to achieve compliance and preclude a lawsuit in some cases. In this case, the company was able to avoid a citizen suit by simply filing the appropriate form Rs. In this example, U.S. EPA could still file suit against the company. However, after a company achieves full compliance, U.S. EPA often will focus its legal resources on companies that refuse to comply with the law, rather than those that were simply unaware of the law, and fully comply with the law when told what the law requires.

Your father founded a company in 1958 called Old Painters, Inc. From 1965 to 1976, Old Painters, Inc. disposed of hazardous waste from its paint plant in a lagoon located on the company property in Anytown, New York. In 1986, your father retired, and you took over the operation of the company. In 1988, the regulatory authorities investigated your company's property for the possible disposal of hazardous wastes. In 1990, Old Painters, Inc. entered into a Consent Order with the New York State Department of Environmental Conservation and the United States Environmental Protection Agency to investigate environmental impacts and to undertake remediation at your company's hazardous waste disposal lagoon.

In 1991, your company, Old Painters, Inc., contacted Litt & Gate, Inc ("Litt & Gate") the owner of the property adjacent to your plant and obtained permission to place a cluster of monitoring wells on the property. In 1992, your company, as part of the remediation effort and Consent Order published the "Site Status Report to the Public," which graphically illustrated that the plume of heaviest contamination extended under all of Litt & Gate's property. You sent a copy of the report to Litt & Gate with its property outlined in red ink. You specifically advised Litt & Gate in the transmittal letter accompanying the document that "all of your property is located within the hazardous waste plume."

Between 1991 and 1992, your company took additional remedial measures to stop the migration of the hazardous waste onto Litt & Gate's property. In an attempt to minimize further contamination of Litt & Gate's property, your company installed a groundwater cutoff or slurry wall to vertically enclose the original disposal pit on your property. This measure was completely unsuccessful.

In 1993, as part of the Consent Order, you sent Litt & Gate extensive technical data on the remediation effort, the failure of the slurry wall to stop the migration of hazardous wastes onto its property and enclosed a map on which you again identified Litt & Gate's impacted property by outlining the property in red ink. In your correspondence, you notified Litt & Gate that all of the wells installed on its property indicated that extensive contamination was present. You expected to be in litigation with Litt & Gate over the impact that your site had on the property during the time of the remediation, but you never heard a word regarding any kind of litigation, until yesterday.

Yesterday, a sheriff's deputy served a summons and complaint on your company. Litt & Gate has sued your company alleging that the hazardous wastes deposited by Old Painters, Inc. had contaminated Litt & Gate's property. Litt & Gate alleges in the complaint that your company is also continuing to contaminate its property due to the continued presence of these hazardous wastes which constitute a continuing trespass and a continuing nuisance on Litt & Gate's property. Litt & Gate seeks compensatory and punitive damages from your company due to the diminished value of its property, and compensatory and punitive damages for the continuing trespass and continuing nuisance, and an injunction ordering your company to prevent any further contamination of Litt & Gate's property. As you read the Summons and Complaint served on your company, you say to yourself, "I can't say that I didn't expect it."

You contact your environmental attorney, and you explain that you have been sued by Litt & Gate. You tell your attorney that clearly the contamination is from your company, and that you do not expect that you have any defenses to the lawsuit. Your attorney reads over the allegations in the complaint, reviews your entire file on the remediation, including the notices sent to Litt & Gate in 1991 and in 1993, and cautions you not to be so quick to concede defeat on this matter.

Your attorney explains that you have a real possibility of winning this case. Your attorney explains that the outcome of this case will depend on how the New York Courts apply and interpret New York's following law:

Notwithstanding the provisions of section 214, the three year period within which an action to recover damages for personal injury or injury to property caused by the latent effects of exposure to any substance or combination of substances, in any form, upon or within the body or upon or within property must be commenced shall be computed from the date of discovery of the injury by the plaintiff or from the date when through the exercise of reasonable diligence such injury should have been discovered by the plaintiff, whichever is earlier

(CPLR 214-c[2]).

Your attorney explains that the above type of law is called a "statute of limitations." Such a statute limits someone's time within which he or she may recover damages from someone else. To determine if this statute will prevent Litt & Gate from recovering its damages from your company, your attorney tells you that the courts must look for "clarity and certainty of expression" when construing the statute. As to the very statute at issue, the most powerful court in New York, the New York Court of Appeals, stated:

CPLR 214-c is a remedial statute and such statutes should be liberally construed to effectuate their aims * * * [and] must be given a meaning consistent with the words chosen by the Legislature -- those words define the scope of the remedy that the Legislature deemed appropriate.

Enright v Lilly & Co., 77 NY2d 377, 385 (19__), cert denied 112 S Ct 197 (19__).

Therefore, your attorney explains, by its very terms, CPLR 214-c[2] applies to actions "for damages for * * * injury to property caused by the latent effects of exposure to any substance." The all-encompassing words chosen by the New York Legislature leaves no room for judicial insertion of qualification or exceptions by interpretation, especially when the context and evolution of this particular statute of limitations is examined (Enright v Lilly & Co., supra, at 385)

You ask your lawyer if this statute affects the claims against your company for continuing trespass and continuing nuisance. Those are not environmental claims. What good is it to get some claims thrown out if you can't get all of the claims thrown out. Your attorney agrees with you. Continuing nuisance and continuing trespass are not "environmental claims" unless the claims involve environmental harm. If the claims involve environmental harm, the court held in Jensen et. al., v. General Electric Company, 82 N.Y.2d 77, (1993) that:

[W]e discern no evidence in explicit words, legislative history or manifest intent that the Legislature chose to exempt continuing nuisance and continuing trespass actions from the comprehensive scope and language of this intensely negotiated legislation. . . . The statute was enacted to "provide relief to injured New Yorkers whose claims would otherwise be dismissed for untimeliness simply because they were unaware of the latent injuries until after the limitation period had expired" (Mem of Senator R.B. Stafford, reprinted in 1986 Legis Ann at 287).

Prior to enacting this legislation, a New Yorker had to file suit within three years of the hazardous substances becoming located on the property. After the law was changed in 1986, a person had three years to file suit after the person discovered the existence of the hazardous substance on his or her property. Governor Cuomo emphasized in his Approval Memorandum when attending the signing of this long-awaited legislation:

[CPLR 214-c(2) is] a fair and simple rule which permits a person to discover his or her injury before the statutory time period for suit begins to run.

(1986 Legis. Ann. at 288).

Prior to the enactment of CPLR 214- c[2], the Statute of Limitations began to run as of the date of exposure, regardless of the date on which the injury was discovered (Snyder v Town Insulation, Inc., 81 NY2d 429 (19__). You ask your attorney to explain how this law will impact the litigation with Litt & Gate. Your attorney explains that it is undisputed that Litt & Gate was aware of the injury to its property as early as 1991, six years before filing its lawsuit against your company. Thus, Litt & Gate's causes of action for damages could have been and should have been timely brought within three years after it first learned of the injury to its property. Since Litt & Gate chose not to litigate within the three years after learning of the injury to its property, they are time-barred by CPLR 214-c[2]. In other words, your company wins because Litt & Gate chose to sit on its rights instead of pursuing the rights given to all citizens -- the right to recover damages from the person who caused the harm within the governmentally established time for pursuing those rights. Because Litt & Gate did nothing within the three years after it first learned of the harm to its property, Litt & Gate can now recover nothing on its claim against your company, regardless of whether your company is to blame for the harm.

Statutes of limitations get more clients, and more lawyers, into serious trouble than almost any other law. I always advise clients about the statutes of limitation when a client is trying to decide whether or not to sue someone. Some states, such as New York, have passed specific environmental statutes of limitation. These statutes are designed to encourage timely action with ample time allowances by injured parties with knowledge of their injuries. These laws are designed to discourage people from sitting on their rights and inhibiting early intervention by the courts for redressing the harm done to a person. In New York, the statute of limitations for environmental harm is three years. The time in which to bring a lawsuit in other states will vary depending on what the legislature has set forth in its laws.

If you believe that you may have a cause of action for environmental damage against a person or company, do not sit on your rights. Determine when the applicable statute of limitations will prevent you from litigating to recover your damages, and then decide whether or not to go forward with the litigation. Do not do as Litt & Gate did -- file a lawsuit and then realize that there is no chance of recovery. Of course, if you happen to be Old Painters, Inc., the best thing to do is lay low and hope for the best -- at least until the statute of limitations expires.

You own Neighbors' Heat Treating, Inc. ("Neighbors") just outside of New York City. Your property consists of about 0.8 acres, is zoned industrial, and includes a 9,500 square-foot single-story building. Neighbors is in the business of heat-treating metal objects and ball bearings to harden them for military and industrial uses. In its treatment process, Neighbors uses several large concrete furnaces that leave a sludge residue containing high levels of barium chloride. From time to time, those furnaces needed to be cleaned and/or replaced. As part of that process, Neighbors' took the old furnaces outside the building and washed them down with water, in close proximity to the property next door, which is owned by Fences' Trucking. In addition, from 1979 until 1990, Neighbors' used jackhammers to break up the old furnaces outside the building so that they could be more easily transported off site for disposal. A drain, which empties into a swale, is located on the concrete pad where the furnaces were cleaned and demolished.

In 1986, the New York State Department of Environmental Conservation ("NYDEC") designated barium as a hazardous waste. Several years later, the NYDEC began investigating Neighbors' facility. By 1994, Neighbors' property was declared a hazardous waste site and Neighbors' was ordered to remove the barium contamination from the soil and groundwater in the area. After many months and several million dollars of expenditures, your company successfully removed the contamination to the satisfaction of the NYDEC. You assumed that your environmental problems were over, until today.

Today, you were sued by the owner of the property next door for trespassing. You and the property owner next door have never really gotten along. The property owner next door is a retail fencing company called Fences by Fred, Inc. ("Fences"). After a property line dispute, zoning variances, surveyors, and lawyers, Fences erected a display of dozens of different kinds of fences along the property line between your property and Fences' property. Needless to say, with dozens of different kinds of fences on display on the property line, it looks pretty ridiculous. This time, however, you believe the Fences have really "stepped over the line." The Fences sued Neighbors in the United States District Court for the Western District of New York, claiming that Fences' property had been contaminated by Neighbors' waste disposal practices. In particular, the Fences asserted a claim against Neighbors for trespass under New York common law. Since you have already removed the contamination, you fail to see how you could possibly be liable for "trespassing." You decide to contact your company's attorney and fight this form of legalized extortion.

You make an appointment with your attorney, explain the facts, including the part where you had to pay millions of dollars to clean up the contamination on the Fences' property, and then you ask your attorney if you will have to pay the Fences' for trespassing. Your attorney sighs and simply states, "Yes."

Under New York law, trespass is the intentional invasion of another's property. See Ivancic v. Olmstead, 66 N.Y.2d 349, 352 (1985), cert. denied, 476 U.S. 1117 (1986); Phillips v. Sun Oil Co., 307 N.Y. 328, 331 (1954); see also New York State Nat'l Org. for Women v. Terry, 886 F.2d 1339, 1361 (2d Cir. 1989), cert. denied, 495 U.S. 947 (1990). To be liable, the trespasser "need not intend or expect the damaging consequences of his intrusion[;]" rather, he need only "intend the act which amounts to or produces the unlawful invasion." Phillips, 307 N.Y. at 331; see New York State Nat'l Org. for Women, 886 F.2d at 1361. The intrusion itself "must at least be the immediate or inevitable consequence of what [the trespasser] willfully does, or which he does so negligently as to amount to willfulness." Phillips, 307 N.Y. at 331; see also Ivancic, 66 N.Y.2d at 352.

Your attorney explains that there is a body of law on trespass claims arising from the movement of noxious liquids from one property to another. The New York Court of Appeals has held that:

even when the polluting material has been deliberately put onto, or into, defendant's land, he is not liable for his Neighbors' damage therefrom, unless he (defendant) had good reason to know or expect that subterranean and other conditions were such that there would be passage from defendant's to plaintiff's land.

Phillips, 307 N.Y. at 331.

You ask your attorney if it matters that your company never intended for the water used in the cleaning process to enter Fences' land. In fact, there is no proof that anyone ever observed water running off of your property onto Fences' property. You explain to your attorney that even if water that had been contaminated by Neighbors' seeped into the soil on your property and thereafter migrated through the soil onto Fences' property, there is no proof that Neighbors' intended that to occur or that Neighbors' acts were so reckless that they should be charged with trespass. Your attorney explains that, unfortunately for you, in determining whether Neighbors' had the requisite intent for trespass under New York law, the issue is not whether Neighbors intended the contaminated water used in its cleaning process to enter plaintiffs' land. Rather, under Phillips, the appropriate standard is whether Neighbors': (i) "intend[ed] the act which amounts to or produces the unlawful invasion," and (ii) "had good reason to know or expect that subterranean and other conditions were such that there would be passage [of the contaminated water] from defendant's to plaintiff's land." Phillips, 307 N.Y. at 331 (emphasis added).

When this standard is applied, your attorney explains that Neighbors' is liable to the Fences in trespass. Your attorney explains that this is the likely conclusion that the court would reach since, in 1986, the NYDEC listed barium as a hazardous waste. Nonetheless, from 1986 until 1990, Neighbors' continued to take its barium-tainted furnaces outside its building and demolish them on site using jackhammers. Moreover, it was Neighbors' practice to wash the furnaces down with water on site in close proximity to the Fences' property. Your attorney explains that Neighbors' would have to concede in court that in the process of removing and breaking up the worn out furnaces, small amounts of barium salts escaped onto the pavement. These barium particles were carried by moving water into a swale on Neighbors' land, but near the boundary with plaintiffs. Your attorney explains that one conclusion is inescapable: the barium in the Fences' soil and groundwater came from the Neighbors' site.

Under Phillips, your attorney explains that the court is likely to conclude that Neighbors' intended the acts which caused the invasion of the Fences' property, and, on these facts, the court is likely to conclude that Neighbors' "had good reason to know or expect," see Phillips, 307 N.Y. at 331, that barium particles would pass from the pavement where the furnaces were washed and demolished, into the swale, and onto to the Fences' property.

You are thoroughly frustrated. Even after spending millions of dollars to eliminate the contamination on Fences' property, you are still being sued for "trespass." You tell your attorney to negotiate a "reasonable" settlement and to get your company out of this mess. Your attorney agrees.

You ask your attorney if he remembers how Robert Frost counseled that "good fences make good neighbors" in "Mending Wall," from The Poetry of Robert Frost 33-34 (Edward Latham ed., 1969). You look at your attorney and advise him that if Robert Frost had been familiar with your lawsuit, Robert Frost might have stated, "some Fences make poor Neighbors."

You are the plant manager of Coaters and Platers, Inc. Your company recently acquired six acres of a fifty acre industrial site next to your current location for the construction of a new warehouse and parking lot. During the initial excavation of the acquired property, you receive a report that your workmen have excavated several buried drums. You go to the excavation site and find that a bulldozer has unearthed five drums, puncturing them in the process. Your familiarity with chemicals helps you identify the contents of the buried drums as an industrial solvent never used by your company, but commonly known to be a hazardous substance.

You immediately notify the property owner who sold you the six acres. Although he denies liability, he agrees to take responsibility for the soil contaminated by the incident. He allows your company to place the contaminated soils on an asphalt parking lot located on the remaining 44 acres of industrial property that you did not purchase. After this unpleasant discovery, you have an environmental consultant survey the remaining six acres with a magnetometer to locate additional buried drums. Fortunately, none are found.

You mostly forgot the incident until a representative of U. S. EPA showed up at your plant to ask you what you knew about the contaminated soil located on your neighbor's property. Apparently, rains washed the contamination out of the soil and into a local stream causing a major fish kill. U. S. EPA and the Department of Justice are doing an investigation to determine the responsible parties. You feel that your neighbor is really in big trouble.

A few days later, you are notified that you are being investigated for environmental crimes related to the buried drums that caused the fish kill. Your attendance at a meeting with the prosecutor is requested, and you are advised to bring your lawyer. U. S. EPA is seeking an enforcement action against you for failing to report the release of a hazardous substance. You call an attorney and explain to him what happened.

Your attorney explains that under section 103(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. 9601 et seq., as amended by the Superfund Amendments and Reauthorization Act of 1986 (SARA), the person in charge of a facility must, as soon as such person has knowledge of a release of a hazardous substance in a quantity that equals or exceeds its reportable quantity (RQ) in a twenty-four hour period, immediately report the release to the National Response Center. Section 102(b) of CERCLA establishes an RQ of one pound for releases of hazardous substances, except for hazardous substances whose RQs were established pursuant to section 311 of the Clean Water Act (CWA), and hazardous substances whose RQs were adjusted by the Administrator of U.S. EPA pursuant to the authority granted by section 102(a) of CERCLA. Section 109 of CERCLA authorizes U.S. EPA to assess civil penalties for failure to report releases of hazardous substances that equal or exceed their RQs. Section 103(b) of CERCLA authorizes EPA to seek criminal penalties for failure to notify pursuant to CERCLA section 103(a).

Your attorney explains that to be convicted criminally on a CERCLA section 103(a) count the United States must establish that a) you are a person; b) you were in charge of a facility from which there was a release of a hazardous substance; (c) the quantity of the substance released was equal to or exceeded the reportable quantity for that substance; and d) you did not notify the National Response Center as soon as you had knowledge of the release. Your attorney explains that many of the elements of the crime are defined by statute, while other terms have been left to judicial interpretation. A "Person" is defined at 42 U.S.C. §9601(21) to include individuals, firms, corporations, associations and other entities, such as federal, state and local government units. Your attorney explains that U.S. EPA will have no trouble proving that you are a person. A "Facility" is defined at 42 U.S.C. §9601(9) to include any building, structure, installation, impoundment, landfill or site where a hazardous substance is located. The six acres where the hazardous substance was buried would be a facility under the statute. As defined by 42 U.S.C. §9601(22), a "Release" covers virtually any contact with the environment, including any spilling, leaking, pumping, pouring, emitting, discharging, injecting, escaping, leaching, dumping or disposing into the environment. By puncturing the drums with the bulldozer, there was a release at your company's facility. The "Environment" includes by definition the navigable waters, ocean waters, surface waters, the drinking water supply, groundwater, land surface or subsurface strata, or ambient air per 42 U.S.C. §9601(8).

You cannot believe that simply failing to call U.S. EPA to report the release of a CERCLA hazardous substance could be a crime. You ask your attorney if anyone else has ever been convicted of such a crime. Your attorney explains that three people in Pennsylvania were sentenced in July 1996 for facts very similar to yours. In that case, two township supervisors and a fire chief were sentenced. The township administrators received eight months of confinement; the fire chief received four months of confinement and two years of probation. Their criminal convictions arose out of an incident, when the defendants unearthed five drums of waste buried on a tract of land owned by the township. Each drum was punctured in the process, releasing chemicals into the environment. A town laborer was ordered to crush the drums and rebury the waste. No required report was made of the incident to the proper authorities. Subsequent testing of the drums by the Pennsylvania Department of Environmental Protection determined that at least three of the drums contained hazardous substances. In a plea bargain agreement, all three defendants pleaded guilty to failing to report the release of hazardous substances into the environment. Your attorney explains that his goal is to minimize your criminal penalty; the chances of you being found not guilty are almost impossible.

My advice to clients is to be aware of the reporting requirements -- not just under CERCLA, but all the environmental laws. In addition to the reporting requirement under CERCLA, section 304 of the Emergency Planning and Community Right-to-Know Act of 1986 (EPCRA), 42 U.S.C. 11001 et seq., also known as SARA title III, requires owners or operators of certain facilities to report certain releases of extremely hazardous substances and CERCLA hazardous substances to State and local authorities. EPCRA section 304 notification must be given immediately after releases of hazardous substances in quantities equal to or greater than their RQs to the community emergency coordinator for each Local Emergency Planning Committee for any area likely to be affected by the release, and to the State Emergency Response Commission of any State likely to be affected by the release. These notification requirements apply to releases that extend off-site and that are from facilities at which a "hazardous chemical" (defined by regulations under the Occupational Safety and Health Act of 1970 (29 CFR 1910.1200(c)) and section 311(e) of EPCRA) is produced, used, or stored. In addition, section 311(b)(5) of the CWA requires the person in charge of a vessel or facility, as soon as that person has knowledge of any discharge of a CWA hazardous substance, to notify immediately the appropriate Federal agency. There may be other agencies with reporting requirements applicable to releases at your facility, and your state may have other reporting requirements along with the federal requirements. I suggest that you learn what the reporting requirements are for your facility, make a list of phone numbers for emergency use and keep it available at all times. Furthermore, never assume that a release of a hazardous substance at your facility is not reportable without verifying your assumption with your environmental consultant and attorney. The expense your company incurs for determining if a release is reportable is very inexpensive compared to the cost of defending against a criminal prosecution, or sitting in prison.

Employers have been known to ask employees to violate environmental laws. Sometimes, the request occurs because of an honest misunderstanding of the law and should be considered an innocent mistake. Less scrupulous employers have been known to ask employees to perform an activity that is in violation of an environmental law because it is a cheaper way of doing business. In either case, the employee faces both a moral and a legal dilemma. Questions like, "Could I go to jail for this?" or "If I refuse will I be fired, or passed over for a raise or promotion?" and "Who is responsible if someone gets hurt?" often haunt the employee. As he wrestles with his conscience, the employee may not know where to turn, or what to do. The employee may not even be certain that what the employer is requesting is illegal. The employee may only suspect that the activity is illegal because of something he heard, or something he read. In such situations, the employee must know for what he has legal responsibility, and for what his employer has legal responsibility. The employee must also know what to do if he finds that his employer is retaliating against him for not violating the law.

The law holds that a person responsible for compliance with a law must also answer for violations of the law. An employee who has no responsibility for compliance with a law, when directed to violate the law, is usually not held responsible for the violation unless the employee knew or should have known that his conduct was illegal. For example, an employee who uses an illegal type of paint when ordered to do so would probably not be held responsible for a violation of the Clean Air Act if the employee was not responsible for maintaining company compliance with the Clean Air Act. However, an employee performing midnight dumping of drums of used solvent into a vacant field when ordered to do so could be held liable since such activity is without question known to be illegal.

If a supervisor asks an employee to perform an act, such as using a paint that the employee believes to be illegal, the employee should state the concern to the employer. He should specifically tell the person requesting the activity that the environmental laws could prohibit the requested activity. The employee should determine if the person making the request is responsible for environmental compliance. If the person making the request is not responsible for environmental compliance, the employee and the person making the request should consult the person with responsibility for environmental compliance before proceeding. The employee should state that he is only requesting the consultation to protect the company. If the person making the request refuses to consult with the company's environmental compliance officer, or if the person making the request happens to be the company's environmental compliance officer, the employee should remind the person that if EPA later determines that the activity was illegal, the company and the person ordering the illegal activity will be liable, but usually not the employee who simply follows the order.

If the person ordering the activity states that he knows the activity is illegal, but orders the employee to perform the activity anyway, the employee has a difficult decision to make. If he continues, he is committing a knowing violation of the law, possibly exposing himself to criminal sanctions. If he does not continue, he is subjecting himself to retaliation by his employer for not following directions, albeit illegal directions. Congress contemplated such a problem and passed "whistle-blower" laws to protect the employee. The Clean Water Act (33 U.S.C. § 1367(a)), the Clean Air Act (42 U.S. C. § 7622), the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9610), the Safe Drinking Water Act (42 U.S.C. § 300(j)-9(i)), the Resource Conservation and Recovery Act (42 U.S.C. § 6971), and the Toxic Substances Control Act (15 U.S.C § 2622) all contain whistle-blower provisions. Other state and federal laws also contain whistle-blower provisions that could be applicable depending on the specific situation.

Under the whistle blower laws, no employer may discharge or otherwise discriminate against any employee concerning his compensation, terms, conditions, or privileges of employment because the employee reported, or is threatening to report suspected illegal activity of the employer. Such whistle-blower provisions promote a working environment in which employees are relatively free from the debilitating threat of employment reprisals for publicly alleging violations of laws protecting the environment. The whistle-blower laws encourage employees to aid in the enforcement of the underlying laws by allowing employees to raise legitimate concerns through protected procedural channels. It is usually not necessary for the employee to know that the activity is illegal, provided the employee substantiated the allegation and was not merely harassing the employer. The courts scrutinize an employer's motivation for his actions regarding an employee who reports, or threatens to report a violation. Hence, after an employee "blows the whistle," the employer must show that a legitimate reason exists for taking action against an employee. Even if an employer had compiled enough information to terminate an employee, but failed to do so until the employee reported a violation of an environmental law, the whistle-blower statutes would protect the employee from being terminated as a result of reporting the violation of the environmental law.

In the case of Passaic Valley Sewerage Commissioners v. U. S. Department of Labor, 992 F. 2d 474 (1993), the third circuit court of appeals extended the whistle-blower protection to reports made internal to an organization. Thus, an employee can make his initial report to upper management where he feels that such reporting could result in correction of the illegal activity. There is no legal requirement that the employee start within the organization to report the alleged illegal activity. However, some employment contracts require that an employee report all grievances internally before being reported outside the company. It is important that the employee be aware of such requirements since disciplinary action for not following company procedures are at least arguably not covered by the whistle-blower statutes.

Whistle-blower statutes do not apply to an employee who, acting without direction from his employer, deliberately violates the law. Thus, an employee who initiates the violation and then threatens to report the "company's" illegal activity to save his job when the employer finds out, cannot rely on the whistle-blower statute for protection. It is also important to remember that the law affords no protection to a person who sits on his rights. An employee only has a limited amount of time to file a claim under the whistle blower statutes. For example, an employee must file within thirty days under the Clean Air Act's whistle-blower statute.

I recommend the following course of action to any employee who is asked to perform an illegal activity:

1) If the employee does not know, but merely suspects the activity to be illegal, question the person making the request as to the legality of the activity. The employee should ask to speak to the environmental compliance officer "to protect the company." If possible, the employee should try to have a witness present during the conversation. If the employer tells the employee that the activity is legal, then the employee should perform the task. The employee is not the person responsible for making the determination of compliance with the law.

2) If the employee knows that the activity is illegal, but the employer orders the employee to perform the illegal activity anyway, the employee should only perform the task if retaliation is likely, and performing the task is not likely to put others in danger. If possible, the employee should try to have a witness present during the conversation. On the employee's own time, the employee should write down the sequence of events leading up to the violation, and all details related to what violation occurred. The employee should pay particular attention to who ordered the violation, witnesses, times, dates and details about the violation in his writing. When practical, the employee should report the situation to management and/or EPA for resolution. Reporting is important since it negates any inference that the employee was the person initiating or responsible for the illegal activity.

3) If the illegal activity is one that could result in someone being hurt, the employee should simply refuse. An employee should never knowingly endanger anyone by creating an environmental hazard. The employee should report the situation to management immediately before someone with less integrity performs the activity. If management does not take immediate steps to prevent the illegal activity, immediately report the situation to EPA. If the employee believes that the activity endangers employees of the company, the employee should also report the situation to OSHA. OSHA gives any matter in which there is an imminent danger of employee harm first priority. Furthermore, under OSHA's interagency sharing of information agreement, OSHA will cooperate with EPA by providing EPA with information regarding violations of environmental law. If the company retaliates against the employee for reporting or threatening to report the illegal activity, the employee should immediately seek legal assistance. Congress designed the whistle-blower statutes to protect and to compensate employees in such situations, but the employee may only have thirty days in which to act after retaliation occurs.

In addition, I offer the following advice to employers. When any employee comes forward with an allegation that a supervisor asked the employee to violate the law, treat the matter seriously. Investigate the facts and the law. If the supervisor did request that the employee violate the law, try to determine if the supervisor understood that the action was illegal. If he did, consider the supervisor's value to the company compared to the potential environmental liability your company could have faced. Furthermore, if your company or the supervisor does anything which might even appear to be retaliatory against the employee who reported the incident, the company is again exposed to liability under the whistle-blower statutes. The best businesses are those that find cost effective ways to comply with the law, not those that look for employees who are willing to violate the law.

You are the owner of Chromers and Platers, Inc., a business that you started thirty years ago and have grown to employ sixty people on a full time basis. You have diligently tried to comply with the environmental laws over the years, but with the myriad of paperwork associated with the environmental laws, you really are not sure if you have been successful.

Recently, you decided to sell the business, but before listing the business for sale, you decided to have a compliance audit of your facility completed by a local environmental consulting company. After the audit, the environmental consultant revealed that your company was in violation of several different environmental laws. The violations are mostly caused by failure to maintain appropriate records. None of the violations would result in a criminal prosecution, but some of the violations could result in a significant civil penalty if discovered by U.S. EPA. You immediately make plans to ensure that future violations will not occur. However, selling the business with the potential for U.S. EPA to come in and levy large civil penalties against your company will certainly affect the selling price.

Unsure of what to do, you contact an environmental attorney for assistance. The attorney explains that since you are aware of the past violations and the possibility that an enforcement action could be brought against the company because of the violations, you must disclose the violations to any potential buyer. If you choose not to disclose the past violations, the buyer could sue you for fraud if U.S. EPA brings an enforcement action against the company after you sell. The attorney explains that his recommendation is for you to report the violations to U.S. EPA yourself. Your attorney explains that under a new U.S. EPA policy, if you self-report the violations, you may be entitled to a complete waiver of any penalty that would otherwise be assessed against the company.

Your attorney explains that on May 23, 1996, U.S. EPA implemented one of the twenty-five regulatory reform initiatives announced by President Clinton on March 16, 1995. The regulatory reform initiative recently implemented was EPA's Policy on Compliance Incentives for Small Businesses and implements, in part, the Executive Memorandum on Regulatory Reform, issued on April 21, 1995, by President Clinton.

The new policy sets guidelines to reduce or waive penalties for small businesses that make good faith efforts to correct violations under most EPA statutes. The policy does not apply when public health or the environment is seriously threatened, or when the violation involves criminal conduct. Since the violations at your business are unintentional paperwork violations that did not involve criminal conduct, your attorney explains that your case is a good candidate for a penalty waiver under the new policy.

For a facility to be eligible for a penalty waiver, the company must be a "small business." The policy defines a small business as a company that employs one hundred or fewer persons on a company-wide basis. Furthermore, a facility must demonstrate a good faith attempt at complying with the environmental laws. Facilities can demonstrate good faith in two ways: either by conducting a self or third-party compliance audit and promptly disclosing and correcting the violations or by getting on-site compliance assistance from a state, federal or other government-sponsored compliance assistance program. Assuming the company discovered the violation as part of a self-compliance audit, the company must report the violation promptly to U.S. EPA in writing.

The violation itself must be a first time, non-criminal violation that does not pose a significant threat to public health, safety or the environment for the policy to apply. For purposes of a first time violation, within the past three years the facility must not have received or been subject to an information request, warning letter, notice of violation, field citation, citizen suit or other enforcement action or received penalty mitigation pursuant to the new policy for the current violation and, in the past five years, has not been subject to two or more enforcement actions for violations of environmental requirements.

In addition, the company must correct the violation remedy any harm caused to the environment within 180 days of being discovered, or 360 days if the company must install pollution prevention equipment. If a business meets all the criteria but takes additional time to correct the violation or, in the rare event that a business obtains a significant economic benefit from the violation, U.S. EPA will waive up to 100 percent of the gravity or punitive portion of the penalty, but may seek the amount that company saved through its non-compliance. According to U.S. EPA, this will eliminate any economic advantage that violators have over those companies that do comply with the law.

You explain to your environmental attorney that you believe your company meets all the requirements. You employ less than one hundred people, attempt in good faith to comply with the environmental laws, discovered the violations during a self-audit, and have never been party to a prior enforcement action. In addition, your company received no economic advantage from the violation, did nothing criminal, and never harmed the environment, nor did your company pose a significant threat of harm to the environment. Under the circumstances, your company should be eligible to have the entire penalty that would otherwise be applicable to your situation waived by U.S. EPA after you report and correct the violations. You feel relieved; finally, a policy from U.S. EPA that could actually improve your company's profitability.

My advice to clients who are performing self-audits is to be aware of the latest environmental policies coming out of U.S. EPA. U.S. EPA's latest policies are designed to save you money. However, U.S. EPA has no track record under the new policy, and many of the criteria necessary for a company to be eligible for a penalty waiver are subjective. I would never recommend that any company cover-up its violations of the environmental laws. However, proceed with caution when reporting violations to U.S. EPA and remember that you are making admissions that you will be held accountable for if U.S. EPA later decides that your company is not eligible for a penalty reduction. What is more important, if U.S. EPA decides that the conduct is a criminal violation, you may have made the admission necessary to prosecute the case against you.

In addition, policies come and policies go for various reasons such as court challenges, election year campaign promises, and federal budget balancing considerations. U.S. EPA's new policy on Small Business Compliance Incentives is a good idea, in my opinion. However, it has not yet withstood the test of time. As for now, if your company has discovered violations that must be reported, such as in this case due to a pending sale of the business, be aware that President Clinton has promised relief to those small businesses who meet the above criteria. As for large businesses, you may want to write to the President and ask him why his new policy does not apply equally to you.

You own and operate Ace Plating and Painting, Inc. Your company specializes in coating materials for the secondary automotive parts market. You rechrome bumpers and grills, and strip and paint body parts for antique cars. You have been operating the business for over twenty years and have become one of the Midwest's largest secondary automotive refinishing suppliers. Business is good, and your reputation for being a quality supplier keeps it that way.

Your facility has an air permit for the emission of particulates and volatile organic chemicals. Your company has tried to comply with its permit. Occasionally, your company has problems with its air pollution control equipment and there will be times when the facility is not in compliance. However, because you are not required to monitor your results continuously, you take the position that there is no evidence to show that you have violated your air permit. When you are required to monitor, you make certain that all of your pollution control equipment is working before you collect the necessary test date required by your air permit. While the ethical issues raised by this approach could be troubling if you really stopped to ponder, legally, you feel like you are on solid ground. You have operated this way uninterrupted for several years without a problem, until yesterday.

Yesterday, your company, Ace Plating and Painting, Inc. received a Notice of Intent to Sue pursuant to the Citizen Suit provision of the Clean Air Act. You are outraged. "They've got no proof that I ever violated the Clean Air Act," you say to yourself. "There's no definitive evidence that I violated my air permit. A good strong letter from my lawyer should shut these people up," you say, and off you go furiously to your lawyer's office.

Your attorney reviews the notice of intent to sue letter, and asks you to explain the allegations in the letter that your facility emits "obnoxious and hazardous odors," and "particulates that settle on automobiles, sticking thereto and ruining the automotive finish." Your attorney further asks you to explain the photographs that your neighbors were kind enough to enclose with their Notice of Intent to Sue showing your air emission stack belching black smoke. Your response is quick and definitive. "They can't prove a thing. All of my monitoring results show that I am in complete compliance with my air permit," you say. "There is no definitive evidence proving that I have violated any of EPA's laws," you remind your lawyer.

Your lawyer tells you that if he is too defend you, you must be honest with him. You proceed to tell him confidentially that your pollution control equipment does not work all of the time, but that it always works on days when you perform tests to demonstrate compliance with the terms and conditions of your air permit. You admit that occasionally your factory does belch black smoke, but this is just the type of business you own. To install equipment that would capture every such release would be cost prohibitive. Similarly, you explain that the cost of installing new VOC capturing equipment that would work continuously as needed would also be cost prohibitive. Your philosophy has been that if the other side cannot prove the violation, which your data shows they cannot, then you intend to keep operating as you have for the last ten years. When you finish, your attorney sighs and says that you used to be correct. Until February of 1997, the citizens probably could not have pursued a citizen suit without test data showing that Ace Plating and Painting, Inc. violated the terms of its permit. However, in February 1997, EPA changed the law and made it a lot easier for citizens to sue and win in court based on information regarding violations obtained from sources other than your monitoring data.

Your attorney explains that EPA promulgated another regulation in 1997 that will aid citizen suits. On February 24, 1997, EPA promulgated a final version of the "any credible evidence" rule, 62 Fed. Reg. 8314. The any credible evidence rule specifically amends four different parts of the Code of Federal Regulations, 40 C.F.R. Parts 51, 52, 60, and 61, and allows the use of any credible evidence in enforcement actions brought under the Clean Air Act by EPA, state enforcement agencies, or citizens. The key language added by the rule states that nothing in those regulations "preclude[s] the use, including the exclusive use, of any credible evidence or information, relevant to whether a source would have been in compliance with applicable requirements if the appropriate performance or compliance test procedures or methods had been performed." Previously courts applying this rule would only find reference test data admissible as evidence in enforcement suits. The any credible evidence rule establishes that nonreference test data may also be admitted as evidence in an enforcement action, including a citizen suit action.

Your attorney explains that even beyond the basic impact of the rule in changing what constitutes compliance under many standards, certain portions of EPA's preamble to the new rule raises additional concerns about how the new rule may be used in enforcement actions. In particular, Agency officials had previously stated that credible evidence could properly be used to prove a violation only if the plaintiff could demonstrate "a strong correlation between reference test results and the credible evidence in question." In otherwords, the credible evidence had to correlate with test results. However, nowhere in the preamble to the any credible evidence rule is there a statement that the role of credible evidence is limited in this manner. Instead, the preamble refers to the specified reference test method as merely constituting a "benchmark" against which other data or methods may be compared when they are used to establish that a violation has occurred. The preamble emphasizes that "by law the Agency is limited only by general evidentiary rules in what it can use to prove a violation alleged in an enforcement action." 62 Fed. Reg. 8320. Also troubling is the portion of the preamble that states if credible evidence indicates the existence of possible "deviations" from a limit, a source may "be out of compliance with an applicable requirement even though the unit's permit-identified data indicates compliance." 62 Fed. Reg. 8320. In other words, your attorney explains that even if your data indicates that you are in compliance, the evidence to be produced by the citizens indicating that you are not in compliance can be used to prove violations if it is credible. As your attorney looks at the photographs sent by the plaintiffs, he sighs and mumbles to himself, "This could be tough to discredit." Furious, you tell your attorney that you are willing to upgrade your equipment if that will make the lawsuit go away. Unfortunately for you, your attorney explains that the Supreme Court decided this issue in the case of Gwaltney v. Chesapeake Bay Foundation, 484 U.S. 49 (1987). The issue in Gwaltney was whether the citizen suit provisions of the Clean Water Act, permitting private citizens to bring suit against any person alleged to be in violation of the Act, required that a defendant be violating the Act at the time of suit. The Court concluded that the CWA did not permit citizen suits for wholly past violations. However, the Court stated that the provisions required that a citizen plaintiff allege a state of either continuous or intermittent violation. In other words, there must be a reasonable likelihood that a past polluter will continue to pollute in the future. In your case, the attorney explains, simply upgrading the equipment will not be enough unless you can upgrade within sixty days from the Notice of Intent to Sue, and the upgrades guarantee that there is no possible way that the plant could operate in violation of the limits set by your air permit.

You look at your attorney and state, "No system can guarantee that." Your attorney in response simply states, "And that is why you are likely to lose. There is credible evidence of past violations, and no way to insure that future violations will not occur."

Be advised that EPA has lowered the standard to bring citizen suits and win. Under the new "Any Credible Evidence" rule, enforcement actions, including citizen suits, are a lot easier to win. Further, unless it can be demonstrated that the violation will never reoccur, they are even more difficult to stop. The new rule is referred to as the "Any Credible Evidence" rule or ACE rule. The "ACE" rule will undoubtedly become the ace in the hole for citizens pursuing enforcement actions against companies like the one in this article, Ace Plating and Painting, Inc.

Your company, Deep Dutch Metal Finishing Company ("Deep Dutch") operates an electroplating operation in Deep Dutch, Illinois. Deep Dutch's electroplating operation generates wastewater that is treated before discharging into the Publicly Owned Treatment Works, the "sewer system." Your company has operated at its current location since 1969. In 1995, your company learned that the factory across the street was closing. You learn that the closing factory's facility is for lease, and with its less expensive rent, you calculate that you can easily save about forty thousand dollars per year. The cost of moving will be made up in the reduction of the lease payments for the first year.

The move went smoothly, with only a minimal impact on production. You moved your electroplating lines one at a time so that your production was never shut down completely. After the move, you notify everyone that your address has changed from 1953 Industrial Boulevard to 1948 Industrial Boulevard. Your company disassembled and reassembled its pretreatment equipment for its wastewater and moved it across the street as well. Instead of watching the sunrise, you now watch the sunset, and instead of discharging pretreated wastewater on the east side of the street, you now discharge your pretreated wastewater on the west side of the street. Other than that, your operation is exactly as it was before the move. Everything was going according to plan, until yesterday. Yesterday, you received a notice in the mail that your local Water District expected you to upgrade your wastewater pretreatment equipment as a "new source" of pollution. You are stumped, and anticipate that a clerical error has occurred.

The day following receipt of the notice, you notify the Water District to determine why the Water District is demanding that you upgrade your pretreatment equipment. After a rather long and somewhat heated exchange with a technical staff employee of the Water District, you eventually learn that after Deep Dutch's move, the Water District is taking the position that Deep Dutch's operation is subject to more rigorous treatment standards now as a "new source" with respect to its discharges into the sewer system. According to the Water District, as a result of its move to a new location, Deep Dutch's operation became a "new source" under U.S. EPA's regulations rather than an "existing source," which it had been classified as prior to its move. The "new source" classification subjects your manufacturing operation to stricter waste treatment standards than the "existing source" classification. Just before telling the Water District employee exactly what you thought of his opinion, you explained that you believed Deep Dutch remained an "existing source" because it had merely moved its existing equipment from one building to another and this in your opinion should not be considered a "new source."

The Water District immediately initiated a series of administrative actions before the Water District's Board of Commissioners to determine whether Deep Dutch was subject to the Metal Finishing Point Source Category (a pretreatment standard for "new sources"), 40 C.F.R. § 433.17, or instead, as you maintain, to the less stringent Electroplating Point Source Category (a pretreatment standard for "existing sources"), 40 C.F.R. § 413.14. Because the Water District is required by law to enforce U.S. EPA's regulations, U.S. EPA's regional office, Region V, took an interest in the Water District's administrative actions relative to Deep Dutch's Operations and issued a letter in which Region V gave an informal interpretation of the applicable regulations (an "interpretative ruling"). The interpretative ruling indicated how Region V, as opposed to the Water District, would characterize your operation in the course of independent review, such as during an audit of the Water District's enforcement program. In its interpretative ruling, Region V concluded that Deep Dutch became a "new source" as defined by the Clean Water Act and 40 C.F.R § 403.3(k) once it moved across the street.

The Water District, not about to do anything contrary to an interpretive ruling from Region V, immediately concludes that Deep Dutch's new location is a new source and orders that Deep Dutch must meet the new source wastewater standards. This ruling could cost Deep Dutch over five hundred thousand dollars in equipment and operating costs over the next several years. In response, you immediately contact U.S. EPA's Region V headquarters seeking a hearing to reconsider the interpretive ruling from Region V. Region V responded by confirming its initial determination that Deep Dutch's operation at 1948 Industrial Boulevard constitutes a "new source" under the law. When Region V confirmed its interpretive ruling that your move from 1953 Industrial Boulevard to 1948 Industrial Boulevard constituted a "new source" under the law, you decide to hire an attorney and fight Region V's interpretation.

You arrive at your attorney's office and explain the problem. You want your attorney to file suit against U.S. EPA and get Region V's interpretative ruling reversed so that the Water District will allow your plant to be classified as an existing source. You emphatically explain to your lawyer that Deep Dutch is not a "new source" and should not be subject to the more stringent effluent limitations set forth in 40 C.F.R. § 433.17. Your attorney cringes when you tell him the facts and what you want.

Your attorney explains that Congress passed the Federal Water Pollution Control Act, 33 U.S.C. §§ 1251-1387, also known as the Clean Water Act, in order "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251. To this end, Congress established a comprehensive regulatory scheme to control the direct and indirect discharge of waste and pollutants into navigable waters. To curtail indirect discharges into sewer systems and POTWs, U.S. EPA promulgated pretreatment standards for various industrial categories. 33 U.S.C. § 1317. These "categorical" pretreatment standards typically specify the maximum amounts of certain pollutants that a source in a particular industrial category may discharge into a sewer via its wastewater. Generally, "new sources" must adhere to more stringent pretreatment standards than "existing sources," e.g., compare 40 C.F.R § 433.17 (pretreatment standards for new sources) with 40 C.F.R § 433.15 (pretreatment standards for existing sources). According to U.S. EPA's logic, new sources are subject to more rigorous controls because, as a practical matter, it is much easier to design and build new equipment to meet the tougher standards than it is to upgrade existing equipment to meet those same standards.

Your attorney explains that the statute granting a court jurisdiction to review EPA's decisions, Section 509(b)(1) of the Clean Water Act, 33 U.S.C. § 1369(b)(1), does not afford the court jurisdiction to review the agency's informal interpretative rulings such as the one issued in your case. You are astounded, the Water District will not change its position regarding your status as a "new source" unless you can get Region V to change its position, and your attorney is telling you that you can't even sue U.S. EPA to determine the correctness of Region V's position. Your attorney explains that in determining if a court has jurisdiction, the question the court must address is whether Region V's interpretative ruling constitutes a reviewable issue under the law. If it does not, the courts have no jurisdiction. In American Paper Institute v. EPA, 882 F.2d 287 (7th Cir. 1989), Region V issued a policy statement concerning dioxin discharges from pulp and paper mills. The American Paper Institute sought review of Region V's policy statement, believing it to be too onerous. U.S. EPA argued that the court system had no jurisdiction over the matter since the policy statement was not reviewable under Section 509(b)(1)(E) of the Clean Water Act, which at the time provided: "Review of the Administrator's action . . . in approving or promulgating any effluent limitation or other limitation under section 1311, 1312, or 1316 of this title . . . may be had by any interested person in the Circuit Court of Appeals of the United States."

The court agreed that it had no jurisdiction to determine the matter and determined that Section 509(b)(1)(E) did not cover Reg