Region 5 - Office of Regional Counsel

• January 5, 2004
• January 12, 2004
• January 19, 2004
• January 26, 2004

January 5, 2004

Region 5 files Consent Agreement and Final Order with Valmont Coatings, Inc., d/b/a/ Valmont Applied Coating Technology.  On December 11, 2003, Region 5 and Valmont Coatings, Inc., d/b/a/ Valmont Applied Coating Technology (Valmont), entered into a consent agreement and final order (CAFO) (pursuant to Rules 22.13(b) and 22.18(b) of the Consolidated Rules of Practice simultaneously commencing and concluding EPA’s action) resolving EPA’s claims that Valmont had violated certain provisions of the Federal Resource Conservation and Recovery Act (RCRA) and Minnesota’s hazardous waste rules.  In the CAFO, Valmont agrees to pay a civil penalty of $35,310, which is 100% of the amount claimed by EPA in its pre-filing negotiations.  The particular Valmont facility at issue in this matter closed after the violations were discovered during an EPA inspection.  Accordingly, there are no compliance issues in this matter.
Primary contact:  Jeffrey A. Cahn, 312-886-6670;
Additional contact:  Michael Valentino, 312-866-4582.

Region 5 signs a Consent Agreement and Final Order with Welch Foods, Inc.
On June 19, 2003, Region 5 issued filed a civil administrative complaint against Welch Foods, Inc. of Lawton, Michigan for violations of § 312 of the Emergency Planning and Community Right to Know Act (EPCRA), which requires a subject facility to submit an Emergency and Hazardous Chemical Inventory Form (Tier II Form) to the State Emergency Response Commission, Local Emergency Planning Commission and local fire department. In its complaint, U.S. EPA proposed a penalty of $73,689. On January 2, 2004, Region 5 filed a Consent Agreement and Final Order (CAFO) resolving the § 312 violations. In consideration of Welch’s cooperation and willingness to implement a site security supplemental environmental project (SEP) for its outside anhydrous ammonia storage tank farm, the final settlement penalty, after a SEP credit of $53,682, is $15,659. This settlement will promote greater awareness of Tier II reporting procedures and minimize the risk of anhydrous ammonia leaks at Welch’s outdoor tank farm.
Primary contact: Joanna Glowacki, 312-353-3757;
Additional contact: James Entzminger, 312-886-4062

January 12, 2004

There were no significant case developments to report this week.

January 19, 2004

Region 5 files Consent Agreement and Final Order with Stafford-Smith Inc. d/b/a Brothers Restaurant Supply Center, Inc.  On August 7, 2003, Region 5 filed a complaint against Stafford-Smith Inc. d/b/a Brothers Restaurant Supply Center, Inc. (Stafford-Smith), Kalamazoo, Michigan, alleging that, in violation of Section 12(a)(1)(A) of FIFRA, Stafford-Smith distributed or sold on six occasions a pesticide product without the existence of a supplemental distribution agreement required for the product, and therefore distributed or sold an unregistered pesticide. The complaint sought a penalty of $4,400 for each of six counts, amounting to a total penalty of $26,400. After settlement discussions, including the parties’ participation in the Alternative Dispute Resolution (ADR) process offered by the Office of Administrative Law Judges, Region 5 agreed to settle this matter for $17,138, based upon the Stafford-Smith’s good faith compliance efforts and litigation risk. The fully executed Consent Agreement and Final Order was filed by Region 5 on January 16, 2004. The penalty represents a substantial sanction against Stafford-Smith for distributing a pesticide that lacked a supplemental distribution agreement, and will deter future violations.
Primary Contact:  Kevin Chow, (312) 353-6181;
Additional Contact:  Joe Lukascyk, (312) 886-6233.

Printing Company Vice President, Plant Manager, Sentenced Related to False Statements on Clean Air Act Title V Permit Application.  John Littlehale was the Vice President of Manufacturing at Multi-Color Corporation, a label manufacturer. In 1996 and 1997, Mr. Littlehale controlled a Multi-Color facility in Scottsburg, Indiana. On September 8, 2003, Mr. Littlehale appeared in federal court in the Southern District of Indiana before Judge David F. Hamilton and pled guilty to count two of his January 15, 2003, indictment. This count alleged that Mr. Littlehale knowingly made material false statements on a document required to be filed by the Clean Air Act, violating 42 U.S.C. § 7413(c)(2)(A). On January 13, 2004, Judge Hamilton sentenced Mr. Littlehale to 18 months imprisonment, 12 months probation, 50 hours of community service, a $4,000 criminal fine and a $100 special assessment.

In 1996 and 1997, Roger Taylor was the Plant Manager of Multi-Color’s Scottsburg facility. On June 4, 2003, Mr. Taylor appeared in federal court in the Southern District of Indiana before Judge David F. Hamilton and pled guilty to a one-count information alleging that Mr. Taylor committed misprision of a felony in that he (a) knew of the actual commission of a felony; and (b) failed to make that felony known to the authorities as soon as possible. On January 13, 2004, Judge Hamilton sentenced Mr. Taylor to 6 months home confinement, 5 years probation and 500 hours of community service.

Specifically, on or about December 5, 1997, Mr. Littlehale signed a Clean Air Act (CAA) Title V application for the Scottsburg facility. This application falsely represented that a new press (Press #3) at the Scottsburg facility (a) was not operating; and (b) would when operating direct its emissions to an oxidizer with a 95% destruction efficiency. When Mr. Littlehale signed this permit application, he knew that Press #3 (a) was operating daily; and (b) was venting its emissions directly to the atmosphere with no pollution controls.

The felony that Mr. Taylor misprised was Mr. Littlehale’s making material false statements in a document required by the CAA.  Specifically on December 5, 1997, Mr. Taylor saw John Littlehale, Multi-Color’s Vice President of Manufacturing, sign the CAA Title V application.  Mr. Taylor knew then that the application contained material false statements.  Mr. Taylor nonetheless failed to disclose the false representations to the Indiana Department of Environmental Management (IDEM) or other authority.

On January 15, 2003, a grand jury in the Southern District of Indiana indicted Mr. Littlehale.  The second count of this two-count indictment charged Mr. Littlehale with committing the above CAA felony on December 5, 1997.  The first count of this indictment charged Mr. Littlehale with participating in an unlawful conspiracy to enrich Mr. Littlehale and others, violating 18 U.S.C. § 371.  According to the indictment, this conspiracy centered on making false statements to IDEM and U.S. EPA to hide that the Scottsburg facility was operating Press #3 without a permit or any pollution control equipment installed.  According to the indictment, these false statements enabled the Scottsburg facility to secretly operate Press #3 months or years sooner than it could have had it complied with the CAA, and avoided the expense of installing and maintaining an oxidizer or other means of reducing solvent emissions.

Multi-Color has not been charged.  In January 1998, Multi-Color voluntarily disclosed to IDEM the environmental violations that the false representations had concealed. Multi-Color and IDEM entered into a civil settlement of those violations.  In that settlement, Multi-Color agreed to pay a civil fine and to perform supplemental environmental projects.
Primary contact: Kris Vezner, (312) 886-6827.

January 26, 2004

Company Executives and Company Charged with Clean Water Act Violations; United States v. John H. Whitacre, William T. Holland, Thomas R. Whitacre, and Rees Plating Corporation.  On January 23, 2004, John H. Whitacre, William T. Holland, Thomas R. Whitacre, and Rees Plating Corporation (Rees Plating) were charged in a three count information for illegally discharging industrial wastewater into the Massillon sewer system and subsequently lying to authorities about the discharge. John H. Whitacre was the President and William T. Holland and Thomas R. Whitacre were Vice-Presidents of Rees Plating, an Ohio corporation, which was a metal plating operation located in Stark County, Ohio. As a part of the metal plating process heavy metals such as zinc or chromium are used. As a result, the wastewaters generated by Rees Plating, contained zinc and chromium.

The information alleges that the defendants knowingly discharged industrial wastewater containing zinc and chromium into the Massillon’s sewer system without a permit. In addition the information alleges that William T. Holland and John H. Whitacre falsely stated that Rees Plating was not discharging industrial wastewater into the sewer system to the City of Massillon and the Ohio Environmental Protection Agency.

This case was investigated, in a joint investigation, by the Ohio Bureau of Criminal Identification and Investigation, the Ohio Environmental Protection Agency, the City of Massillon Wastewater Treatment Department, and U.S. EPA CID, all members of the Northeast Ohio Environmental Crimes Task Force.  The actual sentence in this case, upon conviction, will be determined by the Court under the mandatory Federal sentencing guidelines, which considers a number of factors unique to each case, including the defendants’ prior criminal record, if any, the defendants’ role in the offense, and the unique characteristics of the violation.  In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Contact: Brad Beeson (440) 250-1761

Region 5 files Consent Agreement and Final Order with Rod Bruner and Century 21 Country North.  On January 28, 2003, Region 5 issued a civil administrative complaint against Rod Bruner and Century 21 Country North alleging that Bruner and Century 21 violated the Residential Lead-Based Paint Hazard Reduction Act of 1992 (the “Lead-Based Paint Hazard Reduction Act”), 42 U.S.C. § 4852d et seq., and Section 16 of TSCA, 15 U.S.C. § 2615, and 40 C.F.R. § 745.113(b)(1), (b)(2), (b)(3), (b)(4), and (b)(6) in the sale of a residential property. The complaint sought a penalty of $34,100. Respondents filed an Answer to U.S. EPA’s Complaint. On January 20, 2004, Region 5 and the Respondents entered into a Consent Agreement and Final Order (CAFO) settling U.S. EPA’s claims. In the CAFO, the Respondents agree to pay a civil penalty of $8,525.
Primary contact: Jeffrey A. Cahn (312) 886-6670;
Additional contact: Scott Cooper (312) 866-1332.

Eighth Circuit Reverses Trial Judge’s Condition of Probation at Facility No Longer Owned by Defendant (U.S. v. Ashland, Inc., D. MN). The Eighth Circuit Court of Appeals held January 27, 2004 that a trial judge abused his discretion in ordering Ashland, Inc. to be responsible for environmental compliance at a facility which they no longer owned. Ashland pleaded guilty and was fined in 2003 arising from a series of explosions and fires at its St. Paul Park, MN refinery. The explosions, and resulting injuries, were attributed to a failure to seal a manhole as required by Clean Air Act regulations applicable to refinery sewer systems. After the explosions, Ashland, Inc. sold the refinery to a new company jointly-owned by itself and Marathon. At sentencing, the Chief Judge of the District ordered Ashland to hire a consultant to assess environmental compliance at the Minnesota refinery, despite the fact that Ashland no longer owned it. This appeal resulted. The Eighth Circuit ruled that due process prohibits making Ashland responsible for activities at a facility which they do not control, and struck that portion of the sentencing order. The decision, however, leaves intact other sentencing requirements, such as requiring Ashland to pay to upgrade the St. Paul Park sewer system to ensure that the explosions do not re-occur.
Primary contact: David M. Taliaferro (312) 886-0815

Region 5 Issues Final Order in the matter of Premcor Refining Incorporated. On December 17, 2003, Region 5 filed a Final Order in the matter of Premcor Refining Incorporated. On September 12, 2003, the Region filed a Complaint against Premcor for violations discovered at its Blue Island, Illinois facility. Specifically, the Complaint alleged that Premcor violated § 15(1) of TSCA and 40 C.F.R. § 761.60 (a) (the PCB Rule) for failure to properly dispose of PCBs that were at concentrations greater than 50 parts per million. In its Complaint, Region 5 proposed a penalty of $11,000. Premcor paid the penalty in full. Resolution of this matter promotes greater awareness of the requirements for PCB disposal.
Primary contact: Joanna Glowacki (312) 353-3757;
Additional contact: Kendall Moore (312) 353-1147