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Environmental & Toxic Tort Law Bulletin - September 2014



The Future Wind of Energy

In June, the U.S. Environmental Protection Agency ("EPA") announced a draft rule that would establish federal standards for carbon dioxide emissions from existing power plants. The draft rule provides flexibility to the states to develop plans to reach emissions goals, and EPA has indicated its support for state programs that require power producers to generate a certain percentage of their energy from renewable sources. As a result, renewable energy sources, such as wind energy, are gaining momentum in some areas of the country.

According to the American Wind Energy Association, the U.S. saw record growth for wind energy at the end of 2013. At the end of the year, an estimated 12,000 megawatts of new generating capacity was under construction. Key states where wind power is expected to flourish include Texas, Iowa, Kansas, North Dakota, and Michigan. Although Alabama's potential for wind energy has been characterized as relatively small due to the lack of available consistent wind, new developments, including offshore projects, could make wind farms a possibility in Alabama and other southern states.

Recently, several companies have explored the possibility for development of wind farms in Alabama. Pioneer Green Energy, a Texas company, had proposed a wind farm project in Cherokee and Etowah counties in northwest Alabama. A Virginia company, APEX Wind Energy, had also developed a proposal for wind turbine development in southern Baldwin County. Both projects were met with substantial opposition in the form of lawsuits by citizens and city ordinances banning wind farm projects. A bill passed by the Alabama Senate, SB 12, proposing regulation of wind farms, stalled in the House. The bill would require permitting of wind farms and require adoption of regulations regarding location, design, installation, and operation of wind farm projects.

Although wind energy is viewed as a source of clean energy because it produces no toxic pollution or greenhouse gas emissions, wind farms do have an impact on the environment, particularly wildlife such as birds and bats. Noise pollution and visual impact are also factors cited by opponents of wind farm projects, particularly in areas that rely on tourism as a major industry.

Despite opposition from many in southern states, as EPA and state agencies continue to tighten emissions standards and technology continues to improve, wind power may prove a viable alternative energy source.


Additional Items of Interest

Civil Enforcement

City of Dothan, Alabama to Pay Civil Penalty for SSOs

On July 15, the City of Dothan, Alabama reached a settlement with EPA and the U.S. Department of Justice to resolve Clean Water Act violations as a result of Sanitary Sewer Overflows (SSOs), violations of NPDES permits, and failure to maintain its wastewater treatment plants. According to EPA, the violations have resulted in discharges to Beaver Creek and Cypress Creek, two impaired waterways. The City will pay a civil penalty of $264,000 and has already re-routed the flow of sewage to a newly upgraded wastewater treatment plant to reduce SSOs.


Atlanta Company Resolves FIFRA Violations

On July 15, Zep Inc., an Atlanta-based company, settled alleged violations of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) resulting from distribution and sale of Formula 165, a pesticide. EPA alleged that Zep Inc. failed to obtain a supplemental distribution agreement and, therefore was not authorized to distribute the pesticide. The settlement also resulted from alleged false compliance certifications for other pesticides. The company has agreed to pay $905,000 and has certified its compliance with FIFRA.


DuPont Settles Claims Following Toxic Exposure at West Virginia Facility

In August, E.I. du Pont de Nemours and Company (DuPont) agreed to pay a $1,275,000 civil penalty as a result of alleged releases of hazardous substances including methyl chloride, oleum, and phosgene from its Bell, West Virginia facility. The company will also spend an estimated $2,276,000 to improve its safety and emergency response processes in accordance with the Clean Air Act, Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Section 103, and Emergency Planning and Community Right-to-Know Act Act (EPCRA) Section 304. The settlement followed the death of a worker resulting from exposure to phosgene, a toxic gas, at the DuPont facility where the company failed to comply with industry accident prevention procedures.


DuPont to Pay $1,853,000 to Settle FIFRA Violations

On September 15, a settlement between E.I. du Pont de Nemours and Company (DuPont) and EPA for violations of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) was announced. Under the settlement, DuPont will pay $1,853,000 as a result of improper reporting and labeling of the herbicide Imprelis. According to EPA, DuPont's failure to properly label its product resulted in damage to certain tree species when applied by customers. DuPont also failed to submit to EPA required reports on Imprelis' potential adverse impacts on plants and animals.


Kentucky Coal Companies Settle CWA Violations

On October 1, EPA announced a settlement with Appolo Fuels, Inc. and Coal Operators 1, LLC, Coal Essence Preparation Plant to resolve violations of Sections 402 and 404 of the Clean Water Act. According to EPA, the Appolo Fuels, Inc. deposited dredged and/or fill material into waters of the U.S. without the appropriate permits while constructing sediment retention ponds. The company will pay a civil penalty and has agreed to restore 790 linear feet of waters of the U.S. as part of the settlement. Coal Operators, who is alleged to have violated is KPDES permit by inter alia discharging pollution in violation of permit limits and failing to maintain a proper Best Management Practices Plan, will also pay a civil penalty.


Criminal Enforcement

North Carolina Company Sentenced for Mishandling of Hazardous Wastes

On July 16, Benjamin Franklin Pass, owner of P&W Waste Oil Services, Inc. was sentenced to 42 months in prison and ordered to pay over $21 million in clean up costs as restitution as a result of mishandling of used oil that contained polychlorinated biphenyls (PCBs). His company was retained to collect and process used oil from service stations, repair companies and marinas, but did not handle the wastes in accordance with the law resulting in environmental contamination. Pass was also ordered to pay $539,000 to the Internal Revenue Services for unpaid federal income taxes.


Pelham Man to Serve Two Years in Prison for Misapplication of Pesticides

On August 27, Steven A. Murray, of Pelham, Alabama, was sentenced in federal court the Middle District of Georgia to two years in prison, one year of supervised release, and a $7,500 fine after pleading guilty to several federal offenses including unlawful use of pesticides. His company, Bio-Tech Management, Inc. was sentenced to three years of probation and to pay a fine of $50,000. The sentences resulted from the defendants' application of the pesticide Termidor indoors at multiple nursing homes in Georgia, South Carolina, North Carolina, and Alabama, contrary to the manufacturers label instructions, and subsequently concealing such use.


North Carolina Captain Pleads Guilty to CWA and Rivers and Harbors Act Violations

On September 29, David Wayne Luther, captain of the M/V The Raven, pled guilty in federal court in North Carolina to dredging of federal waterways in violation of the Clean Water Act and Rivers and Harbors Act. The area where the violation occurred is an environmentally sensitive area designated as an essential fish habitat. Luther faces a potential sentence of two years imprisonment and $200,000 fine.


Florida Residents and Corporation Plead Guilty to Unlawful Sales of Pesticide and Obstruction of Justice

On October 6, federal officials announced guilty pleas by Florida corporations Nautical Coatings, Inc. d/b/a "Sea Hawk Paints" and Sea Hawk Refinish Line, Inc. d/b/a "Refinish Line Auto Supplies" as well as individuals Erik Norrie, David Norrie, Jason Revie, and Tommy Craft to various charges including conspiracy to obstruct the proper administration of the law, willfully conspiring to knowingly distribute and sell an unregistered pesticide, and knowingly distributing and selling an unregistered pesticide. The guilty pleas stem from manufacture of Biocop Anti-Fouling Coating, a marine paint containing tributyltin methacrylate, a pesticide regulated by the EPA. EPA registration for the product was cancelled in 2005; manufacture after 2005 was, therefore, illegal. The defendants are scheduled for sentencing on December 5.


Court Decisions

Fifth Circuit Holds USACE Wetlands Designation Not Final Agency Action

In Bell Co. v. U.S. Army Corps of Engineers, 761 F.3d 383 (5th Cir. July 30, 2014), the Fifth Circuit Court of Appeals held that the USACE's formal designation of land as wetlands under Section 404 of the Clean Water Act, in the form of a final Jurisdictional Determination, is not a final agency action subject to judicial review. According to the court, the JD was not an action "by which rights or obligations have been determined, or from which legal consequences will follow" and, therefore, was not final. Unlike an EPA compliance order, the JD does not state that the recipient is in violation of the CWA, require compliance with any terms, or require steps to be taken to alter the property. Based on this reasoning, the Fifth Circuit affirmed the lower court's dismissal of the plaintiff's suit for lack of subject matter jurisdiction.


Agency News

Nonylphenol Added to Toxics Release Inventory Chemical List

On September 30, EPA published a final rule adding nonlyphenol to the Toxics Release Inventory list of reportable chemicals. According to the agency, nonylphenol is highly toxic to aquatic organisms, based on a 2005 evaluation (Aquatic Life Ambient Water Quality Criteria - Nonylphenol, EPA-822-R-05-005), and can reasonably be anticipated to cause significant adverse effects in aquatic organisms. For more information, go to http://www2.epa.gov/toxics-release-inventory-tri-program/addition-nonylphenol-category-final-rule.