Environmental Crimes Blog

W.R. Grace Trial cont.

On Tuesday, February 24, 2009, (day two of the trial), the prosecutors called the government’s first witnesses and the objections flew fast and furious.  By objecting, Barbara Harding, one of the Grace lawyers, is trying to maintain a narrow time frame regarding the alleged criminal acts.  Kevin Cassidy, a senior lawyer for the USDOJ’s Environmental Crimes Section is leading the case for the government. 

 

As reported by Tristan Scott of the Montana Standard: “Just as 42-year-old Kelly Cannon would begin to describe driving truckloads of vermiculite from the Grace mine into town – ‘When you dumped your load it would blow everywhere’ - Harding would interrupt with an objection on grounds of relevance.  Cassidy would then have to establish a time frame for the exposures, and restrict the witness's testimony to events that occurred after 1990.”  You can get daily updates on the trial at http://www.mtstandard.com/special_reports/wr_grace_trial/.  The trial continued with six other Libby residents who have been diagnosed with asbestos-related diseases.  None worked at the Grace mine. 

 

As to the objections, a previously ruling by US District Judge Don Molloy held that testimony about releases must fall under a relevant criminal provision of the Clean Air Act, which was not enacted until 1990.  This is one of the key issues at play in the trial.  Grace filed several motions seeking judgment of acquittal on the three CAA counts.  Grace’s position is that much of the government's case seeks to hold Grace accountable for actions that took place before the CAA’s knowing endangerment provision was enacted in 1990 (i.e. the federal statute did not exist when Grace operated the Libby mine).  Molloy has, appropriately denied the motions as premature.  The motions undoubtedly will be reasserted at the close of the government’s case.

 

The government next called Paul Peronard, the USEPA's on-site coordinator, an expert witness.  As an aside, I saw Paul Peronard testify in trial in Birmingham, Alabama, in the ILCO Superfund Site cost recovery trial and he was a very good witness for the government and the private party plaintiffs.  Peronard was the USEPA's on-site coordinator in Libby when the town's asbestos contamination gained national attention in November 1999.  He has over twenty-three years of experience and has coordinated emergency cleanups on more than 100 spills and hazardous releases.  Grace objected to Peronard as he did not have any real experience in asbestos remediation.  Peronard was prepared to testify as an expert regarding the hundreds of thousands of air and soil samples collected during the remediation which contained hazardous levels of asbestos fibers.  Based upon objections by Grace, Judge Molloy ruled that Peronard could not testify on asbestos hazards or testify as an expert on “knowing endangerment.”  Judge Molloy further ruled that Peronard could not testify on a range of science and medical issues.  Under Judge Molloy's ruling, Peronard can testify about the decisions he made, but not about why he made them.  It is my opinion that this was just and attempt by the government to over reach with an expert witness.  Surprise, surprise.  The government will have to rely on its other experts to address those issues.    

Peronard was the individual who made the referral to the USEPA's criminal division after noting discrepancies between Grace's statements and Grace’s own data tracking the concentration of asbestos fibers in the air.

 

By the way, the reporting by Tristan Scott is excellent and provides a very good blow-by-blow of the trial.  Check out his work (the link is above).

 

More later.

 

As always, feel free to contact me via e-mail at walter.james@jamespllc.com.

 

WDJiii

W.R. Grace Goes to Trial

On February 23, 2009, the W.R. Grace trial began in Missoula, Montana.  During opening statements, Kris McLean, the federal prosecutor, told the jurors Grace knew for years that its mining operation exposed residents of Libby, Montana, to asbestos and that the company hid the risks from workers and government regulators.  McLean went on to say that “individual executives chose profits at the expense of people's health and chose avoiding liability over disclosing health hazards to the government."  Grace and five retired executives are charged with violating the Clean Air Act and obstructing an USEPA investigation into the asbestos contamination.  The individuals face up to fifteen (15) years in prison and fines totaling millions of dollars.

 

Grace acquired the mine in 1963 from Zonolite.  Grace continued to mine vermiculite; however, the mine was contaminated with naturally occurring asbestos mineral fibers.  When inhaled, these fibers can cause mesothelioma, asbestosis and lung cancer.  The government will attempt to prove that Grace knew through its own research that even low levels of asbestos in the vermiculite became dangerous when disturbed.  According to McLean, Grace donated mine waste to Libby schools to build running tracks.  The government also contends that Grace and some of its managers conspired to hide health risks from its workers.  The allegations of public endangerment and conspiracy to defraud the government relate to the time period after 1999 (after the mine had closed) when the USEPA went to Libby to collect information about asbestos contamination.  The mine closed in 1990.

 

David M. Bernick, Grace’s counsel stated that: "There is no charge in this case that the defendants, Grace or the individuals, acted criminally to cause injury to miners and their families."  Bernick also noted that Grace took active steps that reduced asbestos exposure after Grace acquired the mine.

 

The trial is expected to last several months.

 

More later.

 

As always, feel free to contact me via e-mail at walter.james@jamespllc.com.

 

WDJiii

Is A Shut-Down Order The New Hammer?

On February 6, 2009, the USEPA, in coordination with the LDEQ, ordered Global Environmental Methods LLC to cease all operations at its waste oil and industrial process waste management and treatment facility in New Iberia, Louisiana.  The order entered as a result of violations of the discharge permit issued by the LDEQ.  On February 4, 2009, the USEPA and LDEQ conducted an inspection at the Global facility and observed numerous deficiencies and discrepancies which rose to violations of Global’s permit.

 

The noted deficiencies and discrepancies included inadequate treatment of wastewater and waste oil.  The facility also discharged significantly more wastewater than the total available treatment and storage capacity of the facility.  Additionally, the treatment process in use was not the treatment process described in the discharge permit application submitted to LDEQ.  The inspection also noted twenty-seven (27) fifty-five (55) gallon drums in poor condition; some were leaking and inconsistent drum labeling.  Soil staining was also noted in several areas throughout the facility.  The staining also apparently formed a path that led directly to a channel that discharged to Vermilion Bay.

 

Peggy Hatch, LDEQ Assistant Secretary of the Office of Environmental Compliance, was quoted as saying: “This is an example of how state and federal government working together can improve compliance, and therefore the quality of our environment, within the state of Louisiana.  We hope that other facilities that are willfully disobeying the environmental regulations take notice.  There are so many businesses that operate within the rules.  Those who don’t should expect to face the stiffest enforcement action possible.”

The USEPA order requires Global to cease all operations at the facility; cease all discharges of wastes or any process water; stop accepting any waste material for storage or treatment; notify the USEPA and LDEQ of the details and efforts conducted to cease and desist all operations at the facility; and within thirty (30) days submit a report to the USEPA and LDEQ detailing all actions to comply with the order.

 

The shut down order is very draconian; it should be a significant warning to other entities operating within Region VI.

 

More later.

 

As always, feel free to contact me via e-mail at walter.james@jamespllc.com.

 

WDJiii

An Interesting Twist . . .

Review the case and history of United States v. McKittrick, 142, F3rd 1170 (9^th Cir. 1998).   Or, better yet, read Ed Newcomer and Marie Palladini’s article in the ABA SEER EECC’s newsletter on the Endangered Species Act.  http://www.abanet.org/environ/committees/environcrimes/newsletter/jan09/EECC_Jan09.pdf

Newcomer is a senior special agent for the US Fish and Wildlife Service and Palladini is an assistant professor of criminal administration at California State University at Dominguez Hills. 

 

The article describes a “giant loophole” in the mens rea of the criminal provisions of the ESA as applied by the USDOJ.  Specifically, it describes a USDOJ “self-imposed requirement that it must prove that the defendant knowingly killed a specific species of animal, to wit, an endangered one.” 

 

This would, in effect, provide a significant defense to any prosecution.  As the authors describe: “If you kill a grizzly bear, claim you believed you were shooting a black bear.” 

 

Interesting . . ..

 

More later.

 

As always, feel free to contact me via e-mail at walter.james@jamespllc.com.

 

WDJiii 

What is the Status?

Lisa P. Jackson has been approved by the senate as the USEPA Administrator.  Eric Holder has been approved as the Attorney General.  So, why has not enforcement picked up?  All I can do is counsel patience for those who will benefit from the increased enforcement (lawyers and consultants).  To those who will be the targets, all I can counsel is patience. 

 

An environmental criminal investigation can have a life as long as two or three years (and sometime longer).  To lawyers and consultants, that is good news.  To those being investigated, that is a cruel and unsettling adventure.  The uncertainty is probably the worst aspect.  A civil enforcement matter can last upwards of several years as well.  In a civil enforcement, the activity level is probably a little more predictable than that of a criminal investigation.  There is no typical enforcement action, however. 

 

How is an enforcement action started?  Sometimes it is a disgruntled employee or ex-employee.  Sometimes it is as a result of a concerned citizen.  Sometimes it is as the result of luck.  And sometimes it is the result of good old fashioned detective work by the respective investigating agency.  However an investigation gets started, as most experienced practitioners will tell you, whether it goes criminal or civil (or both) often depends upon who shows up at your door first.

 

More later.

 

As always, feel free to contact me via e-mail at walter.james@jamespllc.com.

 

WDJiii