Enforcement Action Summary FY 2006 - June

June 5, 2006

Settlement with Ohio Art Company for Strydel EPCRA Reporting

On June 1, 2006, EPA issued a Consent Agreement and Final Order (CAFO) under EPCRA Section 325 resolving claims for civil penalties for violations of EPCRA Section 313 reporting requirements self-disclosed by the Ohio Art Company's Strydel Inc. facility located at 201 Ellis Street in Stryker, Ohio. The CAFO simultaneously commences and concludes EPA's action for EPCRA Section 313 violations regarding the Form R reporting of Tetrabromobishenol A for calendar year 2001 and 2002. EPA calculated a gravity based proposed penalty of $37,400; but determined that a 75% reduction was appropriate pursuant to the Self-Disclosure Policy, and that there was no economic benefit associated with the alleged violations. EPA determined that Respondent had satisfied eight of the nine Self-Disclosure Policy criteria. Only the systematic discovery criterion was not determined to be satisfied. The CAFO assesses a penalty of $ 9,350. The violations were self-disclosed on June 22, 2004, and follow-up information was provided on March 29, 2005, October 19, 2005 and December 30, 2005. Respondent is in compliance and the forms were submitted in June of 2004. The CAFO resolves only Respondent's liability for federal civil penalties for the violations alleged, and conditions the effect of that settlement upon the accuracy of the information submitted.

Contact: Maria Gonzalez, primary contact, 312-886-6630.

Seventh Circuit Affirms Judgment In Wetlands Case

On June 6, 2006, the Seventh Circuit affirmed the district court's judgment in U.S. v. Heinrich. In 2003, the district court had granted the United States summary judgment, holding the Defendant liable for the construction of a seaplane access road in a white cedar swamp without a permit under the Clean Water Act. After a bench trial in 2003, the district court assessed a $75,000 penalty and ordered full restoration of the wetland. In deciding the subsequent appeal, the Seventh Circuit ruled that, contrary to Heinrich’s argument, Wisconsin had not waived state water quality certification for nationwide permit 26. In addition, the Seventh Circuit rejected Heinrich's argument that the case should have been dismissed because the administrative order had not been personally served stating that "[w]hile the Clean Water Act specifies that such orders ‘shall be by personal service,' 33 U.S.C. § 1319(a)(5), the record shows that Heinrich received the order, responded to it without objecting to the mode of service, and was not prejudiced by the absence of personal service. The district court did not err in finding that Heinrich thus waived strict compliance with the personal service requirement.”
Contact: Ignacio Arrázola, 312-886-7152

Environmental Appeals Board (EAB) Issues Order Upholding Underground Injection Control (UIC) Permit Issued to Sunoco Partners Marketing & Terminals, LP., Taylor, Michigan.

On June 1, 2006, the Environmental Appeals Board issued an Order Denying Review in Part and Remanding in Part of a Underground Injection Control (UIC) permit issued to Sunoco Partners Marketing & Terminals. U.S. EPA Region 5 issued a Class III UIC permit to SPMT on June 6, 2005. On July 6, 2005, Environmental Disposal Systems, Inc., a nearby property owner with its own underground injection wells, filed a petition for review with the EAB. Region 5 filed a response to the petition on September 15, 2005. The EAB did not request oral argument on the matter. In its June 1, 2006 Order, the EAB denied the petition for review on all grounds, finding that (1) EDS failed to demonstrate any clear error or abuse of discretion in Region 5’s decision not to hold a public hearing on the draft permit, (2) EDS did not establish clear error in the Final Permit’s well monitoring requirements, (3) EDS did not identify any cavern monitoring regulatory requirement which the Region failed to include in the Final Permit, and (4) EDS failed to preserve for review its arguments on the need for construction and materials requirements in the permit. The EAB did remand the Final Permit so that the Region may clarify that cavern monitoring is always required during fluid injections.

Contact: Mony Chabria, 312-886-6842.

June 12, 2006

State court in Indiana enters judgment against Indiana Department of Environmental Management for breach of contract regarding the Shelly Ditch removal site in Crawfordsville, Indiana .

On July 26, 2002, Raybestos Products Company filed an action against IDEM alleging breach of contract. The case arose out of a February 28, 1997 Agreed Order between IDEM and Raybestos concerning the investigation and cleanup of PCBs in Shelly Ditch in Crawfordsville, Indiana. Under the Agreed Order, IDEM initially approved a risk assessment prepared by Raybestos. Raybestos then prepared a technical memorandum, based on the risk assessment, which set a PCB cleanup level in the Ditch of 238 ppm. IDEM then withdrew its approval of the risk assessment as unprotective of human health and the environment. In further negotiations, IDEM was unable to reach an agreement with Raybestos on a cleanup for the Ditch. IDEM then referred the matter to EPA. On December 6, 2000, EPA issued a UAO to Raybestos to remove PCBs over 10 ppm from the Ditch. Raybestos complied with the UAO and this work was completed in August 2003. While complying with the UAO, Raybestos filed an administrative action challenging IDEM’s withdrawal of its approval of the risk assessment. On June 1, 2001, the Marion County Superior Court found that IDEM’s withdrawal of its approval of the risk assessment and its disapproval of the technical memorandum was arbitrary and capricious and further found that IDEM had breached the Agreed Order, that Raybestos was prejudiced by the breach and that approval of the risk assessment and technical memorandum should be reinstated. IDEM did not appeal this decision. Afterwards, Raybestos sued IDEM for the cost difference between the cleanup under the Agreed Order and the one it performed pursuant to the UAO. In the case, Raybestos claimed that IDEM breached it agreement with Raybestos regarding the 238 ppm cleanup level, improperly referred the matter to EPA and failed to request that EPA turn the lead of the site back to the state after the June 2001 ruling. The case proceeded to a bench trial in 2005/2006.

On June 12, 2006, the Marion County Superior Court for Indiana entered judgment against IDEM. The court held that IDEM’s breach of the Agreed Order was at least a substantial, if not direct, cause of EPA’s involvement in the cleanup of Shelly Ditch and therefore Raybestos was entitled to the cost difference between the cleanup Raybestos performed under the UAO and the cleanup that would have been required under the Agreed Order pursuant to the risk assessment and technical memorandum. The Court awarded Raybestos $11,645,321.58 excluding attorney fees and post judgment interest. A hearing on the attorney fees incurred by Raybestos in responding to EPA’s involvement at the site and in overseeing the compliance with the UAO was set for hearing in July 2006. IDEM is contemplating an appeal of the decision.

Contact: Peter Felitti, Office of Regional Counsel, (312) 886-5114.

Detroit Metropolitan Airport Pleads Guilty to Negligently Failing to Report Unusual Discharge.

The Wayne County Airport Authority operates the Detroit Metropolitan Airport, the largest airport in the State of Michigan. On June 8, 2006, the Airport Authority appeared in Detroit in the Eastern District of Michigan and pled guilty to a one-count misdemeanor information alleging that the Airport Authority negligently violated its NPDES permit, violating the Clean Water Act, 33 U.S.C. Sections 1311(a) and 1319(c)(1). The Court sentenced the Airport Authority on the same date.

The plea agreement stated that air carriers at the Airport use significant quantities of deicing materials in colder months. The Airport’s sewers direct airplane deicing run-off to a detention pond designated 3Wand having a capacity of 74 million gallons. The Airport Authority discharges the deicing-contaminated stormwaters in pond 3W to the City of Wyandotte’s wastewater treatment plant. In April 2001, the pipe discharging pond 3W to the Wyandotte treatment plant became clogged. Pond 3W’s waters became dark and odorous as the deicing chemicals broke down.

On May 16-17, 2001, the Airport Authority discharged the turbid, odorous wastewaters of pond 3W through massive stormwater ponds to a waterway called the Frank and Poet Drain. The Frank and Poet Drain flows to the Detroit River. On May 17, 2001, Airport Authority employees noticed that the massive stormwater ponds through which pond 3W’s waters were flowing had also turned turbid and odorous. The employees then stopped the discharge, having discharged approximately 25 million gallons to the Frank and Poet Drain.

The Airport Authority’s NPDES permit required the Airport Authority to report any unusual discharges like the turbid, odorous discharge of May 16-17, 2001, to the Michigan Department of Environmental Quality (MDEQ). The Airport Authority negligently failed to report this unusual discharge to MDEQ. The Airport Authority’s NPDES permit also forbade the Airport Authority from discharging deicing materials in May. On May 18, 2001, a fish kill was observed in the Frank and Poet Drain.

In accordance with the plea agreement, the Court sentenced the Airport Authority to pay a $75,000 criminal fine and an additional $25,000 to Friends of the Detroit River as community service. As a special condition of the Airport Authority’s four-year term of probation, the Airport Authority must construct and then use a forced main connecting pond 3W to the City of Detroit’s wastewater treatment plant. This project will cost an estimated $8.5 million. U.S. EPA's Criminal Investigation Division, the Federal Bureau of Investigation and the Michigan Department of Environmental Quality’s Office of Criminal Investigation jointly investigated this matter.

Contact: Kris Vezner, Criminal Counsel, (312) 886-6827

Business Owner Charged With Spilling Oil Onto A Tributary Of The Great Miami River; United States v. George L. Flory.

On June 9, 2006, George L. Flory was charged in a one-count Information for spilling oil onto a tributary of the Great Miami River. Mr. Flory was the owner and operator of Personal Touch Environmental (“PTE”), a company which specialized in the recycling of waste oil collected from Dayton area residences and facilities. Mr. Flory stored the waste oil in drums and storage tanks at the PTE facility which is bordered by an unnamed tributary of the Great Miami River. On February 16, 2004, there were approximately 700 drums and storage tanks at the PTE facility, many of which were leaking oil directly into the tributary bordering the facility. The information charges that numerous days beginning on or about April 16, 2002 and continuing to on or about February 12, 2004, Mr. Flory knowing caused waste oil stored at the PTE facility to be discharged into and upon an unnamed tributary of the Great Miami River.

This case was investigated, in a joint investigation, by the Ohio Bureau of Criminal Identification and Investigation, the Ohio Environmental Protection Agency, the U.S. Coast Guard, and the U.S. EPA CID, all members of the Southwest Ohio Environmental Crimes Task Force. If convicted, the defendant's sentence will be determined by the Court after review of factors unique to this case, including the defendant's prior criminal record, if any, the defendant's role in the offense and the 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, Criminal Counsel, (440) 250-1761

United States District Court in Cincinnati enters Consent Decree with AK Steel Corporation resolving issues at its Middletown, Ohio, works.

On May 15, 2006, the U.S. District Court for the Southern District of Ohio entered a Consent Decree resolving a Complaint filed in June, 2000. Subsequent to the filing of the Complaint, the State of Ohio, the Sierra Club and the Natural Resources Defense Council joined the case as Interveners. The Complaint sought penalties for past CAA and CWA violations and site-wide corrective action under RCRA. Region 5 worked closely with State environmental and citizen representatives to resolve the compliance issues. In the settlement, AK Steel has agreed to pay a penalty of $460,000 (to be shared evenly with the State) and has agreed to implement a SEP to reduce use of or remove from service ozone depleting refrigerants at its Middletown works. The injunctive relief ordered in the Consent Decree will specifically include interim measures to continue with the characterization and clean up of PCB contaminated sediments in Dicks Creek. Additionally, AK Steel has agreed to begin a facility-wide RCRA Facility Investigation and Corrective Measure Study to in anticipation of implementing corrective action. The 40 day public comment period passed without comment.

Contact: Robert Guenther, primary contact 312-886-0566; James Morris, additional contact 312-886-6632.

The United States of America enters into Consent Decree with Sahli Enterprises, Inc., and Michael Sahli to resolve CERCLA liability

On May 22, 2006, the Northern District of Illinois, Eastern Division, entered a Consent Decree resolving claims under Section 107 of CERCLA against Sahli Enterprises, Inc., and Michael Sahli at the Crescent Plating Superfund Site in Chicago, Illinois. EPA conducted a time-critical removal action at the former plating facility between December 2003 and June 2004. Sahli Enterprises, Inc., as the beneficiary of the Illinois Land Trust that holds the property, is the current owner of the property. Michael Sahli is the alter ego of Sahli Enterprises, Inc. Due to an inability to pay and equitable considerations, the Settling Defendants will pay $222,500 of EPA’s approximately $1.1 million dollars in response costs. EPA also retains access to the property up to 60 days after entry of the Consent Decree for, among other things, collecting additional information related to the ownership or operation of Crescent Plating Works, Inc. In return for the payment of $222,500 for response costs incurred and to be incurred, the Settling Defendants will receive contribution protection from EPA, and the United States covenants not to sue or take administrative action pursuant to Sections 106 and 107(a) of CERCLA with regard to the Site. Also, EPA will remove the federal lien that was recorded with the Recorder’s Office, Cook County, Illinois.

Contact: Mark Koller, Office of Regional Counsel, (312) 353-2591

On June 7, 2006 Region 5 issued an Administrative Order to WCJ, Inc. of Rock Island, Illinois.

On June 7, 2006, Region 5 issued an Administrative Order to WCJ, Inc. (d/b/a as E.& J. Metal Company) of Rock Island, Illinois requiring WCJ to comply with the Secondary Aluminum Production NESHAP, 40 C.F.R. § 1500, et seq., if it starts up its sweat furnace and to also notify U.S. EPA if it sells its sweat furnace. WCJ allegedly operated its sweat furnace from March 24, 2003 to at least November 2003 without complying with several of the provisions of the Secondary Aluminum Production NESHAP.

Contact Michael Berman: (312) 886-6837

U.S. EPA reaches administrative settlement for violation of the Clean Water Act regarding the land application of domestic septage.

Tom Kepler Sanitation & Excavating (Respondent) of Jamestown, Ohio, operates a small business that collects and disposes of domestic septage by land application. The Respondent typically collects between 7,000 to 10,000 gallons a month. Though the Respondent had obtained the required permit from the Greene County Health Department, Respondent failed to comply with the record keeping and land application requirements of Section 405(d) of the Clean Water Act, and the regulations promulgated thereunder in 40 C.F.R. Part 503.

On September 1, 2005, U.S. EPA notified the Respondent of its intent to file an administrative complaint against him for violations of the Clean Water Act. Specifically, Respondent was notified that he failed to comply with record keeping requirements for land application of domestic septage; applied domestic septage to land that did not meet vector attraction or pathogen reduction requirements; and exceeded the agronomic application rate. After reviewing information provided by the Respondent in response the notice, including information on the Respondent’s financial status, the parties were able to reach a settlement. The Respondent agreed to sign a Consent Agreement and Final Order (CAFO) which requires the Respondent to admit to the prior violations, assure that he is now in compliance with the applicable requirements and pay a civil penalty of $2,750. After the required public notice, the CAFO was signed on June 7, 2006.

Contact: Peter Felitti, Office of Regional Counsel, (312) 886-5114.

Modified Consent Decree Entered in U.S. v. Krilich et al, Clean Water Act Wetlands Case.

On May 23, 2006, the United States District Court for the Northern District of Illinois entered a consent decree modification in U.S. v. Krilich, et al., Civil Action No. 92 C 5354. The consent decree modification agreed to by the parties requires the Defendant Robert Krilich to purchase one half acre of wetland at an approved mitigation bank in lieu of meeting final performance criteria at a portion of its wetland mitigation site. No comments were received in response to the Federal Register notification of the consent decree modification. Also on May 23, 2006, Defendants filed a Motion to Stay Entry of Plaintiff's Motion to Enter Modification to Consent Decree, or in the alternative Motion to Stay Enforcement of Settlement Agreement Pending Resolution of Ambiguity in Consent Decree Terms, with the district court. The court denied Defendants’ motion.

Entry of the modified consent decree concludes the United States’ enforcement of a 1992 consent decree for the Defendants’ Clean Water Act violations. In 1996, the U.S. District Court for the Northern District of Illinois held that the Defendants had violated the consent decree and issued a judgment against Defendants for $1,257,500 in stipulated penalties. Defendants unsuccessfully appealed that decision to the 7th Circuit Court of Appeals. Defendants subsequently filed a motion to bar enforcement of the penalty in 1999 and a motion to vacate the consent decree in 2001. Both motions were respectively denied by the district court. Defendants appealed each of those decisions to the 7th Circuit, which affirmed the district court decisions each time in 2000 and 2002 decisions. Defendants petitioned for certiorari to the Supreme Court for review of the 7 th Circuit decisions. The Supreme Court denied certiorari each time. EPA conducted a financial investigation of Defendants’ assets and put a lien on several properties owned by Defendant Robert Krilich. Ultimately Krilich agreed to place the amount of the judgment in escrow with the district court in return for release of a lien on one property. In October 2003, the district court released the judgment, plus accrued interest for a total of $1,713,515, to the United States.

Contacts: Deborah Carlson, Office of Regional Counsel, (312) 353-6121, David Schulenberg, Water Division, (312) 886-6680

Judge Withdraws Decision Holding FIFRA Labels Unconstitutional.  On June 8, 2006, a federal district judge withdrew a previously-issued opinion finding that three FIFRA labeling provisions were unconstitutionally vague. The issue arose out of a case involving the alleged drift of pesticides during an application of pesticides on a farm field in southern Illinois. The United States filed misdemeanor charges under FIFRA in April, 2005, against Wabash Valley Service Co., Inc. and two employees. In a pre-trial ruling, the court held that the three labeling provisions relevant to the case were unconstitutional. The United States filed a Notice of Appeal to the Seventh Circuit. However, the parties subsequently agreed to recommend to the court that the court’s decision be withdrawn, if the United States would forgo its appeal and agree to seek a dismissal. On June 12, 2006, on motion of the United States, the court dismissed the case. Contact: David M. Taliaferro (312) 886-0815.

June 19, 2006

Bankruptcy Hearing Held and Decision Rendered in EaglePicher Chapter 11 Case Involving Contaminated Ohio Properties

On June 1-6, 2006, the final EaglePicher Reorganization Plan confirmation hearing was held in Cincinnati, Ohio (United States Bankruptcy Court, Southern District of Ohio). At issue was the proper funding amount for response activities at two contaminated properties in Ohio. EaglePicher filed for protection under Chapter 11 (reorganization) of the Bankruptcy Code in April 2005. Initially, EaglePicher informed the Court that it would not attempt to abandon various contaminated parcels owned by EaglePicher. However, in late January 2006, EaglePicher filed its initial Reorganization Plan, which called for abandoning sixteen contaminated parcels (including four in Michigan, two in Ohio and one in Illinois). The United States filed a formal objection in late February 2006. Shortly after the Objection was filed, EaglePicher amended its Reorganization Plan, moving away from abandonment and towards a custodial trust approach. Specifically, EaglePicher stated in its amended Reorganization Plan that upon reorganization, it would transfer title to the contaminated properties to a custodial trust and fund the trust in order to remediate the properties. Region 5 had no information on file regarding the properties, and immediately utilized site visits and state file reviews in order to determine the response activities required at the properties and their associated costs. Additionally, between March 5 and May 12, EaglePicher provided over 15,000 pages of documents related to contamination at the Region 5 properties. On May 4, 2006, the date of the final confirmation hearing (5/12-16) was moved to 6/1-5. The parties settled their disagreement regarding proper funding for the Illinois property on May 15 (actual settlement agreement to be negotiated and filed later). Witnesses for EaglePicher were deposed during the week of May 15, and witnesses for the government parties were deposed during the week of May 22. The parties settled their disagreement regarding proper funding for the Michigan properties on May 31 (again, actual settlement agreement to be negotiated and filed later). The final confirmation hearing was held June 1-6 regarding the proper funding amount for response activities at the Ohio properties. The United States used as witnesses employees from both U.S. EPA Region 5 and the State of Ohio to establish the proper response activities and associated funding amounts for the properties. On June 13, 2006, Judge Aug agreed with the United States and ruled that the proper standard for required response activities to be funded by the trust were those “required by law”. However, Judge Aug also ruled that the response activities described by the Debtor were the response activities required by law (with the exception of “contingency funding” which was deemed unnecessary by the Debtor, but which was awarded - 20% for one of the properties - by the Judge), and therefore he directed that the Custodial Trust be funded with $45,000 for one property and $1,080,000 for the other property. Region 5 personnel was heavily involved with all aspects of the case.

Contacts: Catherine Garypie, Associate Regional Counsel 312/886-5825; Tom Martin, Associate Regional Counsel 312/886-4273; Jon Gulch, On-Scene Coordinator 734/692-7686; John Fagiolo, Remedial Project Manager 312/886-0800.

On June 20, 2006, U.S. EPA staff met with the Mayor, Deputy Mayor, and City Attorney of Fairmont City, IL, and a staff aide of U.S. Congressman J. Costello (D-IL) in order to explain the current status of the Old American Zinc (OAZ) Superfund Site remove (Completed) and current RI/FS.

At the request of U.S. Rep. Costello, EPA (Site Removal OSC, Site RPM, Site OPA/Community Involvement Coordinator, and Site attorney) met with Mayor Bregen and his staff, as well as Mr. Frank Miles of Congressman Costello’s office. Mayor Bregen is still displeased with the previous removal action of 2002-2004, including use of the prime source area of the OAZ Site as a repository for the contaminated soil removed from residential areas. Mayor Bregen wanted the soil taken to a nearby landfill. EPA again explained that the main risk pathways of ingestion and dermal contact were eliminated, and that the vegetation covered, fixated on-site soil repository presented no more imminent and substantial risk to local residents. Mayor Bregen also stated that the removal should have included other nearby residences. EPA again explained that excavations during the removal depended upon whether soil sampling results exceeded Removal Action levels for residential areas. Finally, Mayor Bregen demanded a written guarantee from EPA that no more contaminated soil from nearby areas (as a result of a future Site remedy) would be placed on-site, in return for cooperation on access to Fairmont City alleys for RI/FS sampling. EPA told the Mayor that it could not guarantee this because the RI/FS has not been completed and no remedy has been selected or documented in an EPA ROD. Further, this would set a problematic precedent. EPA offered a letter committing to consider the Mayor’s request as one of the options for remedial action at the time of the completion of the RI/FS and Proposed Plan for a ROD. The Mayor indicated that a letter was not sufficient to give him political cover. (The Mayor also acknowledged on at least 2 occasions during the meeting that the city had voluntarily taken and used slag from the active OAZ facility to spread in its alleys as a stabilizing agent. The Mayor inquired as to whether that made Fairmont City a PRP. I replied that I was not certain based on the information presented, but that the City attorney might want to check defenses to municipal CERCLA liability at Section 101(35) et al.) I also mentioned that impeding investigation of a Superfund removal/remedial action is also a possible violation of CERCLA. OAZ is an active Superfund Site undergoing a PRP-lead RI/FS. The PRPs are: Blue Tee, Inc.,the General Services Admin. (both by AOC), and XTRA Intermodal, Inc. (by UAO). A residential area removal was performed by Blue Tee between 2002 and 2004.

Contacts: Tom Turner, Office of Regional Counsel, (312/886-6613); Ron Murawski, Superfund Division (312/886-2940); Joe Munoz, Office of Public Affairs (312/886-7935).

June 26 , 2006

Image Technology, Inc. CAFO Signed.   On June 27, 2006 Region 5’s Director of the Waste, Pesticides and Toxics Division signed a Consent Agreement and Final Order (CAFO), simultaneously commencing and concluding an administrative action under RCRA against Image Technology Inc. Pursuant to the terms of the settlement, Image Technology will pay $50,000 over a five-year period.  Image Technology, an Illinois corporation, manufactures printed circuit boards. Region 5 determined that the company had stored hazardous waste without a permit or interim status when it failed to comply with certain conditions for RCRA’s 90-day storage exemption, including secondary containment, labeling and training requirements. Region 5 reduced the penalty originally proposed in the opportunity-to-confer letter after the company submitted information demonstrating an inability to pay the full amount of the proposed penalty.

CONTACT: Eileen Furey (312 ) 886-7950