CASE DEVELOPMENT
TRAINING MANUAL
Sponsored by:
Toxics and Pesticides Enforcement Division
Office of Regulatory Enforcement
U.S. Environmental Protection Agency
401 M Street, SW
Washington, DC 20460
October, 1997
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DISCLAIMER
This manual does not create any rights, duties, obligations, or defenses, implied or
otherwise. It is a training document for Case Development Officers. Although this manual
quotes many court decisions and Agency documents signed under separate signature, the
statements in this manual do not represent a statement of policy or view of the Agency.
This manual is to be used as part of a training course and is not final Agency action.
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FOREWORD
Role of the Case Development Officer
1. Determine that evidence has been lawfully obtained.
2. Evaluate evidence to ascertain that the Agenc s burden of proof has been met.
3. Select, prepare, and initiate enforcement action in accordance with applicable
laws, rules, and A policy.
4. Provide compliance and technical support to the members of the litigation team
during all steps of the enforcement action process.
5. Monitor environmental compliance with the terms of any subsequent
enforcement agreements.
Role of the Inspector
1. Follow all jurisdictional requirements of the statute to insure lawful entry, search,
and seizure.
2. Lawfully gather all evidence necessary to support Agency’s burden of proof.
3. Arrange all evidence collected so it may be evaluated and appropriate
enforcement decisions made.
4. Provide expert and evidentiary testimony to support Agency’s position.
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Role of the Attorney
1. Evaluate case and make sure evidence supports the complaint and the Agency
action.
2. Interview witnesses and prepare for trial.
3. Serve as chief negotiator at settlement conferences.
4. Litigate cases, write briefs, and arguments to Administrative Law Judge (ALl) and
Environmental Appeals Board (EAB).
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Table of Contents
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Table of Contents
Course Outjjne .
Related References lx
Glossary of Terms
INTRODUCTION i—i
I A AUTHORITY . . . . . ... . I—i
1 ConstitutionavStatutory Authority . . . . . I—i
a) Case Law . . . .. . I—I
2 Delegation of Auth onty to Exercise Power . - . . 1—2
a) Case Law . 1—2
b) Special Considerations . .. . . 1—2
3 Exercise of Power . .. . 1—3
a) Rule Making . ... . . . . l—4
b) Special Considerations . . . . . I—4
I B. HisToRic BACKGROUND . . . . l—4
I Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) 7 U S C §136 et seq . l—4
2 Toxic Substances Control Act (TSCA) 15 U S C §2601 et seq [ TITLE I] . . 1—5
3 Asbestos Hazard Emergency Response Act (AHERA) 15 U S C §2641 et seq
[ TSCA Title II] .
4 Residential Lead-Based Paint Hazard Reduction Act of 1992, 42 U.S C 4851, amends
TSCA to add Title IV, Lead Exposure Reduction, 15 U.S.C §2681 . I—6
5 Emergency Planning and Community Right-to-Know Act (EPCRA) 42 U S.C §11001 et seg 1—7
6 Other Statutes . .. . . . 1—7
II. EVIDENCE GATHERING li—I
lI.A CONSENSUAL/WARRANTED INSPECTION - . . . . . li—i
1 Entry . . . . Il—i
a) Constitution/Statutory Requirements . . . . . Il—i
b) Case Law ... . . . ... . 11—2
c) Special Considerations . . . . 11—10
d) Process . . . . . 11—10
2 Admittance Procedures/Demeanor. Entry . . .. Il—li
a) Statutory Requirements . . Il—li
b) Case Law . 11—13
c) Special Considerations - . . . . 11—14
d) Documentation/Process . 11—15
3 Scope Of Inspection . . . 11—16
a) Statutory Requirements . . .. 11—16
b) Case Law . . . . . . . . . 11—17
c) Special Considerations . . 11—18
d) Documentation/Process . . 11—19
4 Exit Requirements . . . . . 11—19
a) Statutory Requirements . . . . . . 11—19
b) Case Law .. . . . . 11—19
c) Special Considerations . . 11—20
d) Documentation/Process .. . 11—20
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Table of Contents
Ill A BURDEN OF PROOF AND PERSUASION/PRIMA FAdE CASE
1. Statutory/Regulatory Requirements . .
2 Case Law .... . . . .
3 Special Considerations . .. .
4 Process . ... .
lIl.B STANDARDS AND LEVELS OF EViDENCE
I Statutory/Regulatory Requirements
11—20
11—20
11—21
11—21
11—21
11—21
11—21
11—23
11—23
11—24
11—24
11—26
11—27
11—27
11—29
11—29
11—29
11—31
11—31
11—31
ll—43
11-44
11-44
11-44
11-44
lI—45
5 Post-Inspection Requirements .
a) Statutory Requirements
b) Case Law .
C) Special Considerations
d) Documentation
II B SUBPOENA AUTHORITY
1. Statutory Requirements
2. Case Law . .
a) Statutory Authonty
b) Subpoena Power
c) Purpose of the Inquiry
d) Scope of Court Review .
3 Special Considerations .
4 Documentation/Process .
a) Issuance . .
b) Service .
c) Sworn Oral Testimony
lI.C VOLUNTARY DISCLOSURE/SELF CONFESSION
1 Statutory Requirements .
2. Case Law . . . .
3. Policy
4 Documentation/Process . .
II D. OTHER DATA SOURCES ...
1. Federal/State/Local Government Activities
a) Case Law . . .
b) Special Considerations
2 Financial Data .
a) Secunties and Exchange Commission (SEC) “10-Kr and 10-Q’ Statements
b) Dun and Bradstreet (D&B) ... . . .
C) Financial Directories . .
3 Toxics Release Inventory System (TRIS)
4 FIFRA and TSCA Tracking System (FTTS)
5. Shadowlaw . .. . . .. ..
6 Certified Statements . . . . .
a) Rules of Practice . . . . . .. . . . .
b) Case Law ..
c) Special Considerations . .
d) Process. . . . .. ..
11—32
11—32
11—35
11—35
11—35
11—36
11—37
11—39
11—40
11-41
11—42
11—42
Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATION Ill—I
Ill—I
Ill—I
111-4
111—7
111—7
111-8
111-8
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II
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Table of Contents
2 Case Law . 111—10
3 Special Considerations . 111—12
4 Process 111—13
a) Civil Administrative Proceedings . 111—13
b) Civil Judicial Proceedings (Injunction) . 111—13
c) Cnminal Prosecution . . 111—13
Ill C VIOLATIONS AND ELEMENTS OF PROOF 111—13
1 Constitutional/Statutory/Regulatory Requirements 111—13
2 Case Law 111—16
3 Special Considerations .. 111—19
4 Process . . . 111—19
Ill D PENALTiES AND ADJUSTMENT FACTORS 111—21
1 Statutory/Regulatory Requirements . 111—21
2 Case Law . 111—24
3 Special Considerations . . . 111—32
4 Process . . 111—32
Ill E ADEQUACY, QUALITY, AtiD AUTHENTiCiTY OF EVIDENCE . 111—33
1 ConstltutionaVStatutory/Regulatory Requirements 111—33
2 Case Law . . 111—34
3 Special Considerations . 111—36
4 Process . . 111—37
IV. CIVIL ADMINISTRATIVE PROCESS IV—1
IV A ISSUANCE OF THE COMPLAiNT . . . . IV—1
1 Statutory/Regulatory Requirements . IV—1
2 Case Law . . . . . . lV—4
IV.B CONTENT OF THE COMPLAiNT . IV—5
1 Statutory/Regulatory Requirements IV—5
2. Case Law . . . . . . lV—6
3 Special Considerations . . IV—7
4 Process . . . . . . IV—7
IV C SERVICE OF THE COMPLAINT AND TIMELY AND APPROPRIATE FILING OF OTHER PLEADiNGS ... IV—8
1 Statutory/Regulatory Requirements . . . . IV—8
2 Case Law . . . . IV—1 1
3 Special Considerations . . . . .. IV—1 3
4 Process . . . lV—13
IV.D ANSWER To THE COMPLAINT . . IV—1 3
1 Statutory/Regulatory Requirements ... . . . . . IV—1 3
2 Case Law .. . . . . . . IV—14
3. Special Considerations . . lV—1 5
4 Process . . lV—15
IV E. MOTIONS . . . . IV—16
1 Statutory/Regulatory Requirements . . . . IV—16
2. Case Law . . tv—i 9
3 Special Considerations .. . . . . . lv—22
lv.F INFORMAL SETTLEMENT . . . tv—23
1. Statutory/Regulatory Requirements . . IV—23
2. Case Law . . . . . IV—24
3 Special Considerations .. IV—26
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Table of Contents
4 Process . . . . lV—26
a) Settlement Negotiation . . .. lV—26
b) Supplemental Environmental Projects . . IV—26
c) Consent Agreement Oversight . IV—27
IV.G HEARING PROCESS . .. . IV—28
1 Statutory/Regulatory Requirements . . IV—28
2 Case Law . . lV—33
3 Special Considerations . lV—37
4 Process . . . . lV—37
IV. H APPEALS . . lV—37
I Statutory/Regulatory Requirements . IV—37
2 Case Law . lV—39
V. OTHER ACTIONS v—i
V A SEIZURES . . V—i
1 Statutory/Regulatory Requirements . V—i
2 Case Law . . V—2
3. Special Considerations . - . . V—2
4. Process .. . . . . . . V—2
V B Si-op SALE, USE, OR REMOVAL ORDERS . . V—3
1 Statutory/Regulatory Requirements . . . V—3
2 Case Law .. . . V—3
3 Special Considerations . . . . V—4
4 Process . V—4
V.C RECALL . V—5
1. Statutory/Regulatory Requirements . . . . . V—5
2 Case Law . . . . . . .... . V—6
3 Special Considerations . . . . V—6
4 Process . . . . . . -. . .. V—6
V D CIVIL JUDICIAL PROCEEDINGS . - . V—7
1 Statutory/Regulatory Requirements ... . . V—7
2 Case Law .. . . . .. . V—9
3 Special Considerations . .. ... . V—il
4 Process ... . . . V—li
V E CRIMINAL PROCEEDINGS .. . .. . . . V—il
I Statutory/Regulatory Requirements . ... V—il
2 Case Law . . . . .. . . . V—12
3 Special Considerations . . .. . . V—i 3
4 Process . . . . .. . . . V—13
V F NOTICE OF WARNING/NOTICE OF NONCOMPLIANCE/NOTICE OF CONTEMPLATED PROCEEDINGS V—i 3
1 Statutory/Regulatory Requirements . . . . ... . V—i 3
2 Case Law . . . . . .. .. V—14
3 Special Considerations .. . . . ... . V—14
4 Process .. .. . . .. .. V—15
V G. OThER ACTIONS MATRIX - . . . . . . . . V—i 5
October 1997 Iv
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Table of Contents
EXAMPLE 11—14
EXAMPLE 11—15
EXAMPLE 11—16
EXAMPLE 11—17
EXAMPLE 11—18
EXAMPLE 11—19
EXAMPLE 11—20
EXAMPLE 11—21
EXAMPLE 11—22
EXAMPLE Ill—i
EXAMPLE 111—2
EXAMPLE 111—3
EXAMPLE III—4
EXAMPLE 111—5
EXAMPLE III—6
EXAMPLE 111—7
EXAMPLE 111—8
EXAMPLE 111—9
EXAMPLE IV—1
EXAMPLE IV—2.
EXAMPLE IV—3
EXAMPLE VI—i.
EXAMPLE VI—2
EXAMPLE VI—3
EXAMPLE VI—4
EXAMPLE VI—5
Vl—1
VI—1
IE—1
IE—17
IE—23
lIE—i
I IE—3
I IE—7
IIE—9
lIE—li
I IE—1 3
IIE—21
IIE—23
I IE—26
IIE—27
I IE—35
IIE—47
I IE—53
• •. UE—61
I IE—71
I IE—73
IIE—83
• IIE—85
• IIE—97
IIE—89
• IIE—91
I IE—93
IIIE—i
• IIIE—3
IIIE—5
IIIE—7
IIIE—9
• I IIE—li
I IIE— 13
I IIE—15
IIIE—25
lyE—i
• IVE—9
• IVE—27
VIE—i
VIE—7
VIE—9
VIE—li
• VIE—13
VI. ENFORCEMENT DISCRETION Vi—i
VI A AGENCY POLICY
VI.B PROCESSING A “No ACTION ASSURANCE” REQUEST
LiST OF EXAMPLES
EXAMPLE I—i DELEGATIONS OF AUTHORITY UNDER FIFRA — MANUAL
EXAMPLE —2 REDELEGATION OF ENFORCEMENT AUTHORITY UNDER FIFRA — MEMORANDUM
EXAMPLE 1—3 REDELEGATION OF SSURO AUThORITY UNDER FIFRA
EXAMPLE Il—i TARGETING STRATEGY FOR MERCURY SUBPOENA
EXAMPLE 11—2 TSCA MANAGEMENT PLAN FOR MERCURY SUBPOENA
EXAMPLE 11—3 PRELIMINARY ASSESSMENT FORM FOR MERCURY SUBPOENA
EXAMPLE II—4 FOLLOW-UP QUESTIONS FOR MERCURY SUBPOENA
EXAMPLE 11—5 MERCURY SUBPOENA COVER LETTER
EXAMPLE II—6 MERCURY SUBPOENA
EXAMPLE 11—7 EXTENSION FOR RESPONSE LETrER — MERCURY SUBPOENA
EXAMPLE II—8 MERCURY SUBPOENA MODIFICATION LETTER #1
EXAMPLE 11—9 MERCURY SUBPOENA MODIFICATiON LETTER #2
EXAMPLE 11—10 ALYESKA SUBPOENA— PRECEDENT
EXAMPLE Il—il TEXAS EASTERN SUBPOENA
EXAMPLE 11—12 3M AND SET ENVIRONMENTAL, INC — ORDER GRANTING MOTION FOR SUBPOENA
EXAMPLE 11—13 INCENTIVES FOR SELF-POLICING DISCOVERY, DISCLOSURE, CORRECTION AND PREVENTION
OF VIOLATIONS (EPA FINAL POLICY STATEMENT)
EPA POLICY ON COMPLIANCE INCENTIVES FOR SMALL BUSINESSES
VOLUNTARY DISCLOSURE DOCUMENTATION REQUEST
SEC 1 0-Q STATEMENT
DUN & BRADSTREET
STANDARD AND POOR’S REGISTER LISTiNG
D&B MILLION DOLLAR DIRECTORY LISTING
MOODY’S INDUSTRIAL MANUAL LISTING
FTTS REPORTNIOLATION HISTORY
CERTIFIED STATEMENTS
BLANK VIOLATION WORKSHEET •
COMPLETED VIOLATION WORKSHEET
ELEMENTS OF A VIOLATION
BLANK FIFRA CIVIL PENALTY CALCULATION WORKSHEET
COMPLETED FIFRA CIVIL PENALTY CALCULATION WORKSHEET
TSCA CIVIL PE iTY ASSESSMENT WORKSHEET
EXTENT CALCULATION RATIONALE
PENALTY CALCULATION RATIONALE
MEMORANDUM PE u..r ’ RATIONALE FOR ROHR INDUSTRIES INC
COMPLAINT WITh CONFIDENTiAL INFORMATION DELETED
MAY 1995 INTERIM REVISED SUPPLEMENTAL ENVIRONMENTAL PROJECTS POLICY
CONSENT AGREEMENT - SCHEDULE OF ACTIViTIES •
PROCESSING REQUESTS FOR USE OF ENFORCEMENT DISCRETiON - MEMORANDUM
ANDATTACHMENT
REQUEST FOR EXPEDITED SAFETY REVIEW •
“NO ACTION ASSURANCE” PENDING RECEIPT OF VIOLATION DOCUMENT
“No ACTiON ASSURANCE” AFTER RECEIPT OF VIOLATION DOCUMENT
LETTER DENYING “No ACTION ASSURANCES”
V
October 1997
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CASE DEVELOPMENT
TRAINING COURSE OUTLINE
INTRODUCrION
EVIDENCE GATHERING
A CONSENSUAUWARRANTED INSPECrnON
1. Entry
2. Admission Procedures/Demeanor - Entry
3. Scope Of Inspection
4 Exit Requirements
5 Post-Inspection Requirements
B. SUBPOENA AUTHORITY
C VOLUNTARY DIscLosuRE/SEJY CONFEssIoN
D. OThER DATA SOURCES
1. Federal/State/Local Government Activities
2 Financial Data
a) Sec 10-K And 10-Q Statements
b) Dun And Bradstreet
c) Financial Directones
3. TRIS
4 FITS
5 Shadowlaw
6. Certified Statements
III PROOF/EVIDENCE EVALUATION AND ORGANIZATION
A. BURDEN OF PROOF AND PERsuAsIoN/Pi t . FAdE CASE
B. STANDARDS AND LEVELs OF EVIDENCE
C VIOLATIONS AND ELEMENTS OF PROOF
D PENALTIES AND ADJusTMEr rr FACTORS
E ADEQUACY, QUALITY, AND AUTHENTICITY OF EVIDENCE
VU October 1997
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COURSE OUmINE
I V CIVIL ADMINISTRATIVE PROCESS
A ISSUANCE OF THE COMPLAJNT
B. CONTENT OF THE COMPLAINT
C. SERVICE OF THE COMPLAINT AND TIMELY AND APPROPRIATE F lUNG OF OTHER PLEADINGS
D. ANswER To THE COMPLAINT
E. MOTIONS
F INFORMAL SErrLEMENT
G. HEARING PROCESS
H. APPEALS
V OTHER ACrIONS
A. Suzui s
B STOP SALE, USE, AND REMOVAL ORDERS
C. RECAll.
D. CIVIL JUDICL L PROCEEDINGS
E. CRIMINAL PROCEEDINGS
F NOTICE OF WARNING/NOTICED OF NONCOMPUANCE/NOTICE OF CONTE1 1PLATED
PROCEEDINGS
G. OTHER ACrIONS MATRIX
VT ENFORCEMENT DISCRETION
A. AGENCY POUCY
B PROCESSING A “No ACrION ASSURANCE” REQUEST
October 1997 viii
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CASE DEVELOPMENT TRAINING
RELATED REFERENCES
1 Federal Insecticide, Fungicide, and Rodenticide Act, as Amended (FIF’RA), P.L 92-516 et
seq.
2 Toidc Substances Control Act (TSCA); P.L. 94-469, as amended by P L. 97-129.
3 Emergency Response and Community Right-to-Know Act (EPCRA); Title III of the
Superfund Amendments and Reauthorization Act
4. F’IFRA Compliance/Enforcement Guidance Manual — Policy Compendium.
5 TSCA Compliance/Enforcement Guidance Manual.
6 Pesticides Inspection Manual.
7 TSCA Inspection Manual.
8 EPCRA Section 313 Inspection Manual.
9 40 C.F.R. Part 22 “Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits.”
10 39 C.F.R Part 148 “Guidelines for the Assessment of Civil Penalties Under Section 14(a)
of the Federal Insecticide, Fungicide, and Rodenticide Act, as Amended.”
11. 45 Fed Reg 59770 “Guidelines for the Assessment of Civil Penalties Under Section 16 of
the Toxic Substances Control Act.”
12 Administrative Procedures Act (5 U.S C. Chapter 5)
For a more comprehensive list of references, see the FIFRA and TSCA
Compliance/Enforcement manuals.
ix October 1997
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GLOSSARY OF TERMS
Many of the legal terms which are used in this text are found in the Consolidated Rules of
Practice, 40 CFR § 22 j sea Other terms are listed below
Affidavit A voluntary, written declaration of facts, the truthfulness of
which is confirmed by oath or affirmation of the party making it
before an officer having the authority to administer such oaths.
Brief A written statement summarizing the facts and laws pertaining
to a case, and the arguments on how these laws apply to the
facts in support of a legal position.
Burden of Persuasion The obligation on a party to produce a sufficient amount of
evidence to persuade the tner of fact that an action did or did
not take place. Once the moving party meets its burden of
persuasion, the burden shifts to the respondent to rebut the
evidence.
Burden of Proof The legal duty of proving a fact or facts in dispute. The duty to
produce evidence as the case progresses and the duty to
establish the truth of the claim.
Chain of Custody An all inclusive record of the successive conveyance, transfer
and custody of evidence from the time it is gathered to the time
of trial. This record demonstrates to the Court the reliability,
authenticity, and quality of the evidence.
Consent Voluntary acquiescence or agreement to the proposition of
another.
Express Consent—Consent directly given by voice or in wnting.
Implied Consent—Consent manifested by actions, silence,
facts, or inaction which raise a presumption that consent has
been given.
Default The omission of, or failure to perform, a legal duty
X i October 1997
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GLOSSARY OF TERMS
Default Judgment—A judgment rendered against a party which
has failed to plead (answer) or defend against a properly filed
and pled complaint
Depositions A form of preheanng discovery whereby testimony is recorded,
out of Court, under oath, to be used later in the heanng This
practice is not encouraged in civil admirustrative matters
Due Process The use of fair procedures in the administration of the law.
Equity Concept of fairness and right dealing. Grounded in conscience
rather than in law.
Evidence Concrete facts, supphed by testimony, records, or other
documents, which may be legally presented at trial in order to
prove something to the trier of fact.
After, or Newly, Discovered Evidence—Material evidence
which was not available pnor to the rendermg of a decision in a
case. Depending on the significance of the evidence, after
discovered evidence may be the basis for a new hearing.
Circumstantial Evidence—Indirect evidence and inferences
drawn from such evidence.
Direct Evidence—Evidence in the form of testimony from a
witness who actually saw, heard, or touched the subject of the
testimony
Hearsay Evidence—A statement made out of court by someone
other than the person introducing it at hearing. It is offered to
show the truth of the matters asserted to and is often restricted
by the Court
Rele ant Evidence-Evidence which has any tendency to make
the existence of any fact that is of consequence to the
determination of the action more, or less, probable than it
would be without the evidence.
Exclusionary Rule Rule of evidence in Federal Courts which prohibits the
introduction of certain evidence. Often used to keep out the
“fruit” of an illegal search.
October 1997 xii
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GLOSSARY OF TERMS
Ex Parte A Latin phrase meaning by one party only Under the
Consolidated Rules, ex parte communications with the Judicial
Officer are prohibited. A TSCA subpoena may be ex parte . or
at the request of the Agency with no notice to the Respondent.
Expert Witness A witness having specialized knowledge, scientific or techmcal
expertise. A witness who by knowledge, skill, experience,
trcnning, or education will assist the trier of fact in
understanding the evidence.
Freedom of Information Under this Act, 5 U S.C. § 552, all governmental agencies are
Act required to make information available to the public. Some
information is not obtainable under the Act. Most important in
civil administrative practice is the privilege which protects
documents prepared in anticipation of litigation from discovery
(“work product rule”). See privilege.
Injunction A legal wnt issued by the Court forbidding or requiring certain
action. Injunctions are issued through the Distnct Court.
Judicial Notice Recognition by the Court of certain facts as true without the
necessity of proof. The facts are generally known and capable
of verification from other recognized sources. Ex: the
acknowledgment of laws, geography, certain scientific facts,
and histoncal events.
Judgment Order or decree in a legal matter.
Knowing Conscious violation of a statute.
Motion A written application to the Court asking for a ruling. May be
filed by either party. Some of the most used Motions are.
Motion to Amend—Asks the Court for leave to add additional
information to a pleading already filed.
Motion for an Accelerated Decision—Asks the Court to render
a decision on the pleadings with no further evidence or
argument.
Motion for Default—Asks the Court to render a decision in favor
of the Agency when the respondent has failed to file pleadings.
X i i i October 1997
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GLOSSARY OF TERMS
Motion to Dismiss—Asks the Court to dismiss the Agency’s
case for failure to state a claim or dismiss a Respondent’s
Answer for failure to state a defense
Motion to Set Case for Hearing—Asks the Hearing Officer to
place the case on the docket.
Motion to Strike—Asks the Court to remove issues from
litigation.
Motion to Strike Defenses—Asks the Court to rule that certain
defenses need no litigation because they are not supportable
under the law or have been decided in pnor cases. Ex Statute
of Limitations.
Neutral Admimstrative A general administrative plan for enforcing a statute using
Inspection Scheme specific neutral cnteria
Parallel Proceedings Sirnullaneous cnminal arid civil litigation proceedings pursued
by the Agency
Preponderance of the Evidence which is more convincing to the trier of fact than the
Evidence evidence offered in opposition to it. That degree of proof
which, when the evidence presented is taken as a whole, is
more creditable or convincing. This is the burden of proof in
civil administrative cases.
Prima Facie Case Latin phrase meaning at first sight. A case which presents
sufficient proof to support a violation unless and until rebutted
by other evidence to the contrary.
Proof The establishment of a fact by evidence.
Pro Se Latin phrase meaning in person. Generally used to identify a
respondent who represents himself before the Court rather
than retaining an attorney
October 1997 xiv
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GLOSSARY OF TERMS
Privilege A nght created by law. Privilege against self incrimination is a
right created by the 5th Amendment to the Constitution which
the defendant may invoke to protect himself from proving the
government’s case through his testimony. Privileged
commumcations are statements made between certain
persons, such as husband and wife, attorney and client, patient
and doctor The law protects the nght of the individual to make
such statements with candor by barnng them from discovery in
a legal case. In a civil administrative action, the Agency
encourages all attempts to settle cases and therefore protects
settlement negotiations from being introduced as evidence
Service Delivery of legal papers. May be direct or implied
Standard of Proof The degree to which the evidence must convince the trier of
fact. In criminal actions, the standard is to convince the judge
or jury beyond a reasonable doubt. In civil admirustrative
actions, the standard of proof is by a preponderance of the
evidence.
Statute A law enacted by the legislature, national or state.
Statute of Limitations Required time limit for filing a case. Cases brought after the
time limit has passed are “barred” and will be dismissed by the
court.
Stipulations Prehearing agreement between the parties that certain facts
are not at issue and need not be proved in litigation Examples
are stipulation of professional credentials, chemical structures
of certain substances, and facts specific to the case.
Strict Liability Statute A statute which imposes sanctions without requiring the
showing of any intent to violate the statute TSCA and F’IFRA
are strict liability statutes.
Sua Sponte Latin phrase meaning of one’s own will. If a Judicial Officer
renders a ruling sua sponte . he does so voluntarily and not at
the request of either party.
XV October 1997
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GLOSSARY OF TERMS
Subpoena A legal wnt which orders the recipient to perform certain tasks.
A TSCA subpoena may be issued by the Agency but, because
the Agency lacks the power to directly enforce a subpoena, it
must be transf erred to an appropnate Distnct Court for
enforcement if the Respondent fails or refuses to comply
Subpoena ad A subpoena which orders someone to be present and give
Testificandum testimony at a specific time and place
Subpoena Deuces Tecum A subpoena which orders someone to produce records,
documents, books, or other tangible things.
Warrant A legal writ issued by a Court or a Magistrate which authorizes
an officer of the Court to make an arrest, enter a dwelling or
place of business to carry out a search or inspection, and to
seize certain evidence.
Wifflul Intentional violation of a statute.
October 1997 xvi
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I. Introduction
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I. INTRODUCTION
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I. INTRODUCTION
l.A. AumoRfl-y I—I
I Constitutiona!/Stafuto,y Authority I—I
a) Case Law
2. Delegation of Authority to Exercise Power 1—2
a) Case Law 1 —2
b) Special Considerations I—2
3. Exercise of Power 1—3
a) Rule Making
b) Special Considerations
l.B. HISTOR,c,j .. BACKGROUND 1—4
1. Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) 7 U.S. C. p136 et seq 1—4
2. Toxic Substances Control Act (TSCA) 15 U.S. C. §2601 et seq. ITITL.E I) 1—5
3. Asbestos Hazard Emergency Response Act (AHERA) 15 U.S.C. §2641 et seq.
ITSCA l7tJe II) I— .6
4. Residential Lead-Based Paint Hazard Reduction Act of 1992, 42 U.S.C. 4851, amends
TSCA to add Title IV, Lead Exposure Reduction, 15 U S.C §2681 1—6
5. Emergency Planning and Community Right-to-Know Act (EPCRA) 42 U.S.C. §11001 et seg. . 1—7
6. Other Statutes 1—7
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I. INTRODUCTION
LA. Authority
1. ConstitutionauStatutory Authority
Article I, Section 8.
The Congress shall have Power to lay and collect T ces, Duties, Imposts, and Excises, to
pay the Debts arid provide for the common Defense and general Welfare of the United
States;
To regulate Commerce with foreign Nations, and nong the several States, and with the
Indian Tribes;
S S •
To make all Laws which shall be necessary and proper for carrying into Execution the
foregoing Powers, and all other Powers vested by this Constitution in the Government of the
United States, or in any Department or Officer thereof.
Article II, Section 2.
[ The President) shall have Power, by arid with the Advice and Consent of the Senate, to
make Treaties, provided two thirds of the Senators present concur; and he shall nominate,
and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other
public Mmisters and Consuls, Judges of the Supreme Court, and all other Officers of the
United States, whose Appointments are not herein otherwise provided for, and which shall
be established by Law; but the Congress may by Law vest the Appointment of such inferior
Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads
of Departments.
Article II, Section 3.
[ The President] shall take care that the Laws be faithfully executed...
a) Case Law
McCulloch v. Mazyland .
4Wheo-t316(1819)
This case interpreted the “necessary and proper” clause of the Constitution to give
Congress the latitude or implied power to create the means of fully exercising the other
powers delegated to it.
October 1997
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I. A. Authority I. INTRODUCTiON
2. Delegation of Authority to Exercise Power
Statutes (Acts) transfer the authority to exercise power to Department Heads (EPA
Administrator).
Dele ations of Authority in the Agency Delegations Manual transfer authority to exercise
power to the Assistant and Regional Administrators.
Redelegations of Authority transfer authority to exercise power within an office.
The inspector’s credential is a representation of the delegation of authority: 1) from the
administrator/Regional Administrator to exercise the power to inspect under all laws
administered by EPA. and 2) from the Assistant Administrator/Office Director/Division
Director to exercise the power to inspect under certain laws administered by EPA.
a) Case Law
In re: Spang and Company. Inc. ,
Docket Nos EPCRA-IIJ-037 arid 048, Order Denying Motion to Dismiss
Background:
Respondent’s motion alleged that the complaints were null and void because under
Section 325 only the Administrator has authority to issue complaints.
Ruling:
Express authority to delegate within an Agency is not necessary in all cases but may be
implied when deemed necessary to carry out Agency functions. [ Shreveport Engraving
Company v. United States, 143 7.2d (5th Cir. 1944)] The general rule of implied authority to
sell delegate should be applied since it is impracticable to expect the EPA Administrator to
personally bring complaints. 40 CER Section 22.04 authorizes the Administrator to
subdelegate EPCRA enforcement authority to Regional Administrators and Regional
Administrators may redelegate the authority to issue complaints. This authority was
appropriately redelegated to personnel within the region. Consequently, the motion was
denied.
b) Special Considerations
Because all authority is delegated authority, the Case Development Officer is responsible
for assunng that the powers to inspect and issue civil complaints, among others, are
appropriately delegated to the persons exercising the authority on behalf of the Agency.
October 1997 1—2
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I. INTRODUC11ON I. A. Authority
3. Exercise of Power
Constitution - The legal right to make and administer all laws comes from the Constitution.
How Congress will exercise its authority to provide for the common good and to regulate
commerce is defined within the laws it passes.
Statutes - All statutes passed by Congress must conform to the rights and authorities
established by the Constitution (Interpretive Documents - Federalist Papers). When a bill
becomes a law, it is codified in the U.S. Code.
Federal Insecticide, Fungicide, and Rodenticide Act (F1FRA) -7 U.S.C. Agriculture
Toxic Substances Control Act (TSCA) - 15 U.S.C. Commerce and Trade
Emergency Planning and Community Right-to-Know Act (EPCRA) -42 U.S.C. Public Health
and Welfare Administrative Procedure Act -5 U.S.C. Government Organizations arid
EmployeesEqual Access to Justice Act (EAJA) -5 U.S.C.
Freedom of Information Act (FOIA) -5 U.S.C.
Paperwork Reduction Act (PRA) -44 U.S.C.
(Interpretive Documents - Legislative History)
Rules/Reoulations - As opposed to orders and rulings which are the product of
adjudication, rules or regulations are “any agency statement.. .designed to implement,
interpret, or prescribe law or policy...” Section 2 APA definition. There are three types of
rules:
• Interpretive : Rules which grow out of the tasks assigned to the Agency. Courts may
disregard interpretive rules. The court will look at such factors as 1) whether it agrees
with the Agency, 2) is the subject matter within the Agency’s expertise, 3) how
contemporary or of long standing is the rule, and 4) whether the underlying statute has
been reenacted since the promulgation of the rule. Example: FIFRA Penalty
Guidelines
• Legislative : Rules promulgated pursuant to a statute which the Agency administers.
Reviewing courts defer to the Agency in legislative rules because the legislature has
placed this power in the Agency. The standard of review is: 1) Is the rule within the
statutorily granted power? 2) Is the rule issued according to the proper procedure?
and 3) Is the rule reasonable? Example: Chevron U.S.A. v. NBDC , 467 U.S. 837, 842-
43 (1984).
• Procedural : A subset of legislative rules. The Agency interpretation of its own
procedures is binding on the Court as well as on the Agency. Example: Consolidated
Rules of Practice Governing the Administrative Assessment of Civil Penalties -40 CFR
Part 22.
October 1997
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I.B. Historical Background I. lNTRo uciiopi
a) Rule Making
The procedures for Agency rule making are contained in the Administrative Procedures
Act. Public participation is not required for interpretive or procedural rules. It is for
legislative rules. EPA proposed rules are published in the Federal Register . The full
proposed test must appear as well as a sohcitation of public comment and participation in
the rule making process.
b) Special Considerations
The Case Development Officer is responsible for assuring that:
• the requirements alleged to have been violated are actual requirements imposed by
statute or substantive rule; and
• the power to be exercised by the Agency to enforce these requirements is authorized by
law.
I.B. Historica’ Background
1. Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)
7 U.S.C. S136 etseq.
1902 Pesticides for agricultural use are first manufactured.
1910 Insecticide Act is passed regulating misbranded and adulterated insecticides and
fungicides.
1945 Chlorinated Hydrocarbon pesticides including DDT are commercially
manufactured.
1947 FIFRA enacted requiring registration of pesticides in interstate commerce
(consumer protection statute).
1962 Silent Spring by Rachael Carson published. The book discusses the damage to
nontarget organisms caused by pesticide applications.
1969 Report of the House Committee on Government Operations, Deficiencies in the
Administration of FIF1 A issued.
Department of Health, Education, and Welfare, Report of the Secretary’s
Commission on Pesticides and Their Relationship to Environmental Health (MRAK
Commission Report) recommends changes in the regulation of pesticides.
October 1997 1—4
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I. INTRODUCTION LB. Historical Background
1970 EPA is formed and the regulation of pesticides is transferred from the USDA to
EPk
1972 F [ FRA is amended to:
• include a registration standard to prohibit the acceptance of pesticides that
caused “unreasonable adverse effects” on human health or the environment;
• regulate “intrastate” as well as “interstate” pesticides;
• prohibit pesticide misuse; and
• require registration of pesticide producers.
1988 Most recent amendments of flFRA. Established an extensive system of re-
registration of pesticides and expanded the scope of scientific data required for
registration.
1996 FIFRA amended by the Food Quality Protection Act
• adds nitrogen stabilizers to the pesticide definition;
• creates new types of pesticide applications;
• reforms the antimicrobial and minor use pesticide registration process; and
• requires data collection to ensure the health of infants and children.
2. Toxic Substances Control Act (TSCA)
15 U.S.C. 26O1 etseq.fTITLEIJ
1960s Concern raised by widespread contamination of food, water, and soil by organic
mercury.
Hazards posed by asbestos publicized.
1970s Contamination of animal feed by Polybrominated biphenyls (PBBs) found in
Michigan.
Concern raised by widespread contamination of Great Lakes and Hudson River
with Polychlorinated biphenyls (PCBs) and its link to cancer.
1970 Council on Environmental Quality (CEO) report notes increase in numbers,
production volume, and uses of synthetic chemicals, but knowledge of long-term
effects unknown.
1—5 October 1997
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l.B. Historical Background I. lwmorucriopi
1971 President Nixon submits the bill ‘The To dc Substances Control Act.” The Act
would provide for:
1) information gathering regarding chemical to ccity and exposure;
2) regulation of e dsting chemical hazards; and
3) identification and prevention of future risks.
1975 Vinyl Chloride is linked to rare form of liver cancer.
1976 Passage of the To dc Substances Control Act establishes “cradle to grave”
regulation of chemical substances.
3. Asbestos Hazard Emergency Response Act (AHERA)
15 U.S.C. 2641 etseq. (TSCA Title IIJ
1982 Rule adopted pursuant to Section 6 of TSCA requiring schools to inspect for
friable asbestos and notify the school parents and employees of the results.
1984 Aggressive enforcement of prograni initiated because of high rate of
noncompliance.
1986 Congress passes AHERA after concerns were expressed that much of the
abatement work conducted as a result of the notification requirements was being
done improperly. The law requires the Agency to establish standards requiring:
• the inspection of asbestos containing materials;
• the proper conduct of response actions such as asbestos removal or
encapsulation;
• the periodic reinspection of school buildings; arid
• the conduct of a study by A to determine the dangers posed by asbestos in
public and commercial buildings.
4. Residential Lead-Based Paint Hazard Reduction Act of 1992, 42
U.S.C. 4851, amends TSCA to add Title IV, Lead Exposure
Reduction, 15 U.S.C. 2681
1970s Federal laws enacted to eliminate, as practical, lead-based paint hazards in
federally owned, assisted, and insured housing.
October 1997
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I. lwrRooucnoN l.B. Historical Background
1 990s Low level lead poisoning is found widespread among American children, afflicting
as many as 3,000,000 children under age 6, with minority and low income
communities disproportionately affected.
1992 Congress passes Lead-Based Paint Hazard Reduction Act, which amends TSCA
by adding Title W Lead-Exposure Reduction. The law directs EPA to enforce new
lead regulations:
• Real Estate Disclosure Rule;
• Worker’s Certification and Training Rule;
• Lead Debris Rule; and
• Fee Rule.
5. Emergency Planning and Community Right-to-Know Act (EPCRA)
42 U.S.C. SIlOOl etseg.
1984 Several thousand people killed by a release of methyl isocyanate from a Union
Carbide facility in Bhopal, Jndia.
1985 AJdicarbo, e is released at Union Carbide’s Institute, West Virginia facility.
1986 Passage of Superfund Amendments includes at Title ifi a free-standing statute:
Emergency Planning and Community Right-to-Know Act.
6. Other Statutes
Administrative Procedure Act (APA)
• Sets forth the basic requirements for administrative adjudications.
• 40 CFR Part 22 establishes EPA rules for the assessment of civil penalties in
accordance with APA requirements.
Equal Access to Justice Act (EAJA)
• Sets forth criteria for reimbursing persons who prevail in civil administrative
adjudications.
• 40 CFR Part 17 establishes EPA rules for reimbursement of prevailing parties in
accordance with the Equal Access to Justice Act.
I —i October 1997
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1.8. Historical Background I. lNTRODuci1o
Freedom of Information Act (FOIA)
• Sets forth the criteria for the disclosure of information in governmental records.
• 40 CFR Part 2 establishes EPA rules for the release of information to the public and the
safeguarding of confidential information.
Paperwork Reduction Act (PRA)
• Requires Federal agencies to obtain Office of Management and Budget approval of
any requirement for the collection, maintenance, retention, or reporting of information
imposed on ten or more persons. The requirement does not apply to information
collected during the conduct of a civil adrriinistrative investigation against specific
individuals.
• No penalty for failure to comply with an information collection can be imposed if the
forms and/or regulations pertaining to the information collection do not bear the
currently valid 0MB control number.
Examples are presented in the following example section.
Example I—i Delegations of Authority under FIFRA — Manual E— 1
Example 1—2 Redelegation of Enforcement Authority under FIFRA —
Memorandum IE— 17
Example 1—3 Redelegation of SSTJBO Authority Under FIFRA IE—23
October 1997
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I. INTRODUCTION
EXAMPLES
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EXAMPLE I—i. DELEGATIONS OF AUTHORITY UNDER FIFRA — MANUAL .. . IE—1
EXAMPLE 1—2 REDELEGATION OF ENFORCEMENT AUTHORITY UNDER FIFRA —
MEMORANDUM ... . .. .. . .. . .. . IE—17
EXAMPLE 1—3 REDELEGATION OF SSURO AUTHORITY UNDER FIFRA IE—23
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Example I—I. Delegations of Authority Under FIFRA — Manual
DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-9. InsDectlons and Information Gather na
1. AUTHORITY
a. To perform the Environmental Protection Agency functions
and responsibilities relative to the inspection of books and
records, as set forth in the Federal Insecticide, Fungicide and
Rod.entjcjde Act (FIFRA).
b. To perform the Environmental Protection Agency functions
and responsibjlit es relative to the inspection of establishments
and obtaining and executing warrants as set forth in FIF_RA.
c. To cariv out or require the carrying out of any other
inspection and information gathering activities authorized by
FIFRA.
d. To designate representatives of the Adrnin stratcr to
perform the functions specified in paragraphs l.a - 1.c.
2. TO WHOM DELEGATED . Assistant Administrator for Prevention,
Pesticides, and Toxic Substance, Assistant Administrator for
Enforcement and Comcliance Assurance, and Regional Adminiscrazors.
3. LIMITATIONS .
a. The Assistant Administrator for Prevention, ?est c:des,
and Tox c Substances must consult with the Assistant Adm n strator
for Enforcement and Compliance Assurance or his designee pr cr to
obtaining warrants.
b. The Assistant Administrator for Enforcement and ComDJ.:ance
Assurance and the Assistant Adm njstrator for Prevent cn,
Pesticides, and Toxic Substances must notify the approDrlate
Regional Administrator prior to exerc sing any of the author:t.es
specified in paragraphs l.a - 1.c.
4. REDELEGATION AUTHORITY . This authority may be redelecated.
5. ADDITIONAL REFERENCES . Sect ons 8 and 9 of FIFRA.
IE—1 October 1997
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DELEGATIONS MANUAL - 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND R0DEN’rICIDE ACT (FIFRA )
5-12. Issuance f Stop Sale, Use or Removal Orders
1. ADTHORITY . To issue stop sale, use, or removal orders as
provided in the Federal Insecticide, Fungicide and Rodenticide Act
(FIFRA.), wherever there is reason to believe on the basis of
inspection or tests that a pesticide or device is in violation of
any provision of the Act, or that such pesticide or device has been
or is intended to be distributed or sold in violation of any such
provisions, or when the registration of the pesticide has been
cancelled by a final order or has been suspended.
2. TO WHOM DELEGATED . Regional Administrators and -Assistant
Administrator for Enforcement and Compliance Assurance.
3. LIMITATIONS .
a. The Assistant Administrator for Enforcement and Compliance
Assurance may exercise :hese authorities in cases including multi-
Regional cases or cases of national significance. In addition, the
Assistant Administrator for Enforcement and Compliance Assurance
must notify any affected Regional Administrators or their designees
before exercising any cf the above authorities.
b. The Assistant Administrator for Enforcement and Compliance
Assurance may waive the notification rec irement by memorandum.
4. REDELEGATION AtTrHOKITY . This authority may be redelegated.
5. ADDITIONAL REFERENCES .
a. Section 13(a) and 13(b) of FIFRA.
b. See the Chapter 5 delegations entitled “Civil Judicial
Enforcement Actions” and “Emergency ‘TRO’s” for seizure authority
under Section 13 (b)
c. See the 5/29/80 FIFRA and TSCA Concurrence Procedure
Memorandum, Conroy to Regional Office Divisions, for general
Regional Office waiver.
October 1997 - IE—2
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DELEGATIONS MANUAL 1200 TN 350
- 5/11/94
FEDERAL INSECTICIDE, FUNGICIDE. AND RODENTICIDE ACT (FIFRA )
5-13. Disposition of Pesticides
1. AUTHORITY . To cooperate with a Federal District Court in the
disposition of a condemned pesticide or device, as provided in the
Federal Insecticide, Fungicide and Rodenticide Act (FIFRA).
2. TO WHOM DELEGATED . Assistant Administrator for Prevention,
Pesticides, and Toxic Substances, Assistant Administrator for
Enforcement and Compliance Assurance and Regional Administrators.
3. REDELEGATION AUTHORITY . This authority may be redele ated.
4. ADDITIONAL REFERENCES .
a. The disposal of pesticides may involve Solid Waste
Disposal Act questions. See Chapter 8 of this Delegations Manual.
b. Section 13(c) of FIFRA.
IE—3 October 1997
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE. FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-14. Administrative Enforcement :
and Sianinc of Consent Aqreements
1. AUTHORITY . Pursuant to the Federal Insecticide, Fungicide and
Rodenticide Act (FIFRA), to issue written notices of warning; to
issue complaints; to evaluate the appr3priateness of civil
penalties; and to negotiate and sign consent agreements
memorializing settlements between the Agency and respondents.
2. TO WHOM DELEGATED . Regional Administrators and the Assistant
Administrator for Enforcement and Compliance Assurance. —
3. LIMITATIONS .
a. Regional Administrators must consult with the Assistant
Administrator for Enforcement and Compliance Assurance or designee
in cases of national significance before exercising any of the
above authorities except for the issuance of warning letters. In
addition, once the alleged violator files an answer or fails to
file an answer in the specified time period, the Regional Counsels
or their designees and technical program staff will conduct all
negotiations.
b. The Assistant Administrator for Enforcement and Compliance
Assurance may exercise these authorities including multi-Regicnal
cases or cases of national significance. In addition, once the
alleged violator files an answer or fails to file an answer in the
specified time period, the Assistant Administrator for Enforcement
and Compliance Assurance or designee will conduct all negotiations.
c. The authority to promulgate rules of practice governing
public hearings conducted in the assessment of a civil penalty
against any violator of the Act is reserved to the Administrator.
4. REDELEGATION AUTHORITY . This authority may be redelegated.
5. ADDITIONAL REFERENCES .
a. Sections 9(c) and 14 of FIFRA.
b. The Agency official who signed the complaint should sign
the settlement agreement.
c. The Office of Enforcement and CcmDliance Assurance is
c r.tLnu ng to waive consultation by memorandum as Regional Of f ces
exer: nca . art cu1ar rocrans
October 1997 IE—4
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DELEGATIONS 1200 TN 350
5 /11/94
FEDERA1 INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-15-A. Administrative Enforcement: Agency Representation
in Hearings and Signing of Consent Acreernents
1. AUTHORITY . To represent the Agency in administrative
enforcement actions conducted under the Federal Insecticide,
Fungicide and Rodenticide Act (FIFRA), and 5 U.S.C. Section 554; to
negotiate consent agreements between the Agency and respondents
resulting from such enforcement actions; and to initiate an appeal
from an administrative determination, and to represent the Agency
in such appeals. -
2. TO WHOM DELEGATED . Assistant Administrator for Enforcement and
Compliance Assurance and Regional Administrators.
3. LIMITATIONS .
a. This authority may only be exercised after the alleged
violator either files an answer of fails to file an answer in the
specified time period.
b. Only the Assistant Administrator for Enforcement and
Compliance Assurance may exercise the authority to initiate
appeals.
c. The Assistant Administrator for Enforcement and Cornoljance
Assurance must consult with the Regional Administrator or his
designee and the Assistant Administrator for Prevention,
Pesticides, and Toxic Substances or his/her designee prior to
initiat.na an appeal.
4. REDELEGATION AUTHORITY . This author ity may be redelegated.
5. ADDITIONAL REFERENCES .
a. Sections 9(c) and 14 of FIFRA.
b. The Agency official who signed the complaint should sign
the settlement agreement.
IE—5 October1997
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE. FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-15-B. Administrative Enforcement: Issuance of Consent
Orders and Final Orders
1. AUTHORITY .
a. To issue consent orders memorializing settlements between
the Agency and respondents resulting from administrative
enforcement actions under the Federal Insecticide, Fungicide and
Rodenticide Act (FIFRA)
b. To issue final orders assessing penalties under FIFRA.
2. TO WHOM DELEGATED . Regional Administrators —and the
Environmental Appeals Board.
3. LIMITATIONS . Regional Judicial Officers may not be employed by
the Office of Enforcement and Compliance Assurance or by any
program office directly associated with the type of violation at
issue in the involved proceeding.
4. REDELEGATION AUTHORITY . The Regional Administrators may
redelegate this authority to their respective Regional Judicial
Officers. The Environmental Appeals Board may not redelegate this
authority.
S. ADDITIONAL REFERENCES . 40 CFR 22.
October 1997 IE—6
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DELEGATIONS 1200 TN 350
5 /11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-17-A. Civil Judicial Enforcement Actions
1. AtYrHORITY . To request the Attorney General to appear and
represent the Agency in any civil enforcement actions to intervene
in any civil enforcement actions instituted under the Federal
Insecticide, Fungicide and Rodenticide Act (FIFRA); to request the
Attorney General to decline to prosecute a previously referred
civil enforcement action; to determine that the Attorney General
has failed or refused to appear and represent the Agency in any
FIFRA civil enforcement action; to appear and represent the Agency
in any FIFRA action where the Attorney General has re .ised or
failed to appear and represent the Agency; to request ths Attorney
General to initiate an appeal and represent the Agency in such an
appeal; and to initiate an appeal and represent the Agency when the
Attorney General fails to do so.
2. TO WHOM DELEGATED . Assistant Administrator for Enforcement and
Compliance Assurance, Regional Administrators, and the General
Counsel.
3. LIMITATIONS .
a. The Regional Administrators and the Assistant
Administrator for Enforcement and Compliance Assurance may exercise
this authority only in regard to causing civil actions to be
commenced and 1nterven ng in civil actions commenced under FIFRA,
requesting the Attorney General to appear and represent the Agency
in civil actions under FIFRA exclusive of appeals.
b. The Regional Administrators and the Ass stanc
Administrator for Enforcement and Compliance Assurance may exercise
this authority only in cases specified in and in accordance with
written agreements between authorized representatives of the Agency
and the Department of Justice.
c. The Assistant Administrator for Enforcement must notify
the Assistant Administrator for Prevention, Pesticides, and Toxic
Substances and the appropriate Regional Administrator prlor to the
time he or she refers a case or collection request to the
Department of Justice and prior to the time he or sne formally
initiates an appeal.
d. The General Counsel and the Assistant Admin szratcr for
Enforcement and Compliance Assurance may only exercise tri s
author tv :n regard o appeals or a case or col1ect cn :ecuesz
IE—7 October 1997
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-17-A. Civil Judicial Enforcement Actions (cont’d )
e. Any exercise of the appeal authority will be done jointly
by the General Counsel and the Assistant Administrator for
Enforcement and Compliance Assurance. Either office may waive
joint exercise of authority to appeal by memorandum.
f. The Regional Administrators must notify the Assistant
Administrator for Prevention, Pesticides, and Toxic Substances, and
the Assistant Administrator for Enforcement and Compliance
Assurance prior to the time they refer cases to the Depar. ment of
Justice.
4. REDELEGATION AUTHORITY . The Assistant Administrator for
Enforcement and Compliance Assurance and the General Counsel may
redelegate this authority to the Division Director level. Regional
Administrators may redelegate this authority to the Regional
Counsel.
5. ADDITIONAL REFERENCES .
a. Memorandum of Understanding between the Agency and the
Department of Justice, June 1977.
b. Section 16(c) of FIFRA.
c. See the Chapter 5 delegation entitled “Emergency TRO’s”
for Regional Administrators’ authority to make direct referrals of
recuest for emergency FIFRA Temporary Restraining Orders:
October 1997 IE—8
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DELEGATIONS 1200 TN 350
5/11/94
EDERA.L INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-17-B. Criminal Enforcement Actions
1. AtTrHORITy . To refer criminal matters under the Federal
Insecticide, Fungicide and Rodenticide Act (FIFRA) to the
Department of Justice for assistance in field investigation, for
initiation of a grand jury investigation or for prosecution under
FIFRA.
2. TO WHOM DELEGATED . Assistant Administrator for Enforcement and
Compliance Assurance.
3. REDELEGATION AUTHORITY . This authority may be redele ated to
the Director, Office of Criminal Enforcement; may be further
redelegated to the Division Director level; and may not be
redelegated further.
4. ADDITIONAL REFERENCES . Sections 9(c), 12, 13(b) and 14(b) of
FIFRA.
IE—9 October 1997
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-17-C. Settlement or Concurrence in Settlement of Civil
Judicial Actions
1. AUTHORITY . To settle or exercise the Agency’s concurrence in
the settlement of civil judicial actions under the Federal
Insecticide, Fungicide and Rodenticide Act (FIFRA); to amend a
consent decree issued under FIFRA, and to request the Attorney
General to Amend a consent decree issued under FIFRA.
2. TO WHOM DELEGATED . Assistant Administrator for Enforcement and
Compliance Assurance.
3. LIMITATIONS . The Assistant Administrator for Enforc.ement and
Compliance Assurance must consult with the Agency official who
initiated the case (that is, either the Assistant Administrator for
Prevention, Pesticides, and Toxic Substances or his/her designee or
the appropriate Regional Administrator or his/her designee) before
exercising this authority.
4. REDELEGATION AUTHORITY . This authority may be redelegated.
October 1997 IE—1 0
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DELEGATIONS MANUAL 12OO
5/13 0
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (F
5-17-D. Emeraencv TRO’s
1. AUTHORITY . To refer requests for emergency
Restraining Orders under the Federal Insecticide, Fur
Rodenticide Act (FIFRA), to the Department of Justi
appropriate United States Attorney.
2. TO WHOM DELEGATED . Regional Administrators and th
Administrator for Enforcement and Compliance Assurance
3. LIMITATIONS .
a. The Regional Administrators must notify th
Administrator for Enforcement and Compliance Assuranc€
designee and the Assistant Administrator for
Pesticides, and Toxic Substances or his/her de
exercising this authority.
b. The Assistant Administrator for Enforcement an
Assurance must notify the appropriate Regional Admir
his/her designee and the Assistant Administrator for
Pesticides, and Toxic Substances or his/her de
exercising this authority.
4. REDELEGATION AUTHORITY . This authority may only bE
to an on-scene coordinator.
5. ADDITIONAL REFERENCES .
a. Memorandum of Understanding between the Agency and the
Department of Justice, June 1977; Section 16(c) of FIFRA.
b. For referral of other civil actions under FIFRA, see the
Chapters delegation entitled “C .vil Judicial Enforcement Act ions.?l
IE—Il October 1997
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-18. Publication of JudqTnents
1. AUTHORITY . To publish notices of all judgments entered in
actions instituted under the authority of the Federal Insecticide,
Fungicide and Rodenticide Act (FIFRA).
2. TO WHOM DELEGATED . Assistant Administrator for Enforcement and
Compliance Assurance.
3. REDELEGATION AUTHORITY . This authority may be redelegated.
4. ADDITIONAL REFERENCES . Section 16(d) of FIFRA.
October 1997 IE—12
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DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-19. Im ortatjon Activities
1. AUTHORITY . To inspect books and records maintained pursuant to
the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA),
Section 17(a); to request the Secretary of the Treasury to deliver
samples of pesticides or devices being imported or offered for
importation into the United States; to give notice to and receive
testimony from the owner or consignee of such samples that are in
conformity with the provisions of the Act; and to request that the
Secretary of the Treasury refuse admission of violative pesticides
and devices into the United States, as provided in FIFRA,Section
17(c). —
2. TO WHOM DELEGATED . Assistant Administrator for Prevention,
Pesticides, and Toxic Substances, Assistant Administrator for
Enforcement and Compliance Assurance and Regional Administrators.
3. REDELEGATIO AUTHORITY . This authority may be redelegated. -
IE—1 3 October 1997
-------
DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA )
5-21. Consultation with Secretary of Treasury
1. AUTHORITY . To consult with the Secretary of the Treasury on
the prescription of enforcement regulations, as set forth in the
- Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA),
Section 17(e).
2. TO WHOM DELEGATED . Assistant Administrator for Prevention,
Pesticides, and Toxic Substances and Assistant Administrator for
Enforcement and Compliance Assurance.
3. REDELEGATION AUTHORITY . This authority may be redelegated.
October 1997 IE—14
-------
DELEGATIONS MANUAL 1200 TN 350
5/11/94
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIPRA )
5-25. Administering Oaths
1. AIJTHORITY . To designate officers or employees of the Agency to
administer oaths and affirmations or to take affidavits pursuant to
authority vested in the Administrator by 43 Statutes-at-Large 803
(7.U.S.C. 2217), Reorganization Plan No. 3 of 1970 (5 U.S.C. at
Reorganization Plan of 1970 No. 3), and the Federal Insecticide,
Fungicide, and Rodenticide Act (FIFRA), Section 22(a) as read
together.
2. TO WHOM DELEGATED . Assistant Administrator for Pre zentjon,
Pesticides, and Toxic Substances, and Assistant Administrator for
Enforcement and Compliance Assurance and Regional Administrators.
3. REDELEGATION AUTHORITY . This authority may be redelegated.
IE—15 October 1997
-------
Example 1—2. Redelegation of Enforcement Authority Under FIFRA
— Memorandum
w UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
JUN06 1994
OFFICE OF ENFORCEMENT
MEMORANDUM
SUBJECT: Redelegations of forc inent Authority
FROM: Steven A. Herm
Ass istant Admi tr tor for
Enforcement and Compliance Assurance
TO: Regional Administrators
Assistant Administrators
OECA Office Directors
The attached matrix reflects how the enforcement authorities
delegated to me by the Administrator are being redelegated in the
new Office of Enforcement and Compliance Assurance. In reviewing
the matrix, there are several things to bear in mind. First, the
primary thrust of this redelegation effort is to get the new
organization up and running. Thus, the redelegations generally
preserve the status quo in terms of levels of decision making,
simply reflecting a change in locale for decisions from former
organizations to comparable levels in the new organization. This
redelegation package does not attempt to deal with new delegations
of authority that may be needed. As you know, we are examining the
potential for additional delegations to the field as part of the
follow—up to the Regional Impacts Task Force; moreover, the need
for additional delegations within OECA will undoubtedly surface as
a result of continuing efforts to streamline our processes and
empower employees. Thus, we expect to be making changes to this
package in the near term.
Second, we have structured these delegations to allow for
flexibility in implementation. When I have redelegated an
authority, for example, to the branch chief level, anyone in the
chain of command down to the branch chief can also exercise that
authority. In addition, upon notice to me in writing, managers in
a chain of command can pull back a redelegation from a lower level
if experience suggests that any of these redelegations are
operating at too low a level in the organization.
Finally, the redelegations referenced in the matrix are
implicitly constrained by the limitations on the Administrator’s
delegations to me. The last column in the matrix, entitled,
“Further Redelegations,” contains my instructions as to how far the
authority can be further redelegated and any restrictions on that
. urther redelegation. To allow for succinct presentation, the
restrictions n the matrix generally do - not include the
IE—17 October 1997
-------
restrictions contained in the Administrator’s delegations to me.
Thus, in some instances, this matrix must be read in conjunction
with the Administrator’s delegations.
I would like to express my appreciation to everyone who
participated on the Enforcement Delegations Workgroup. This
effort, which involved over two hundred delegations of authority,
required a great deal of thought and dedication on the part of each
participant. The final product, which for the first time in almost
nine years summarizes the current status of all enforcement
delegations, reflects their significant contribution.
cc: Regional Counsels
Enforcement Delegations Workgroup Members
October 1997 IE—18
-------
OECA DELEGATIOHS OF AUTHORITY
Del. P Del. Title
New Chemical
_________ Registration
5.1-8 Change to Existing
_________ Req i at rat ion
Director. FFEO and ORE Branch
chief level - all authorities in
this delegation
FFEO and ORE Staff level
negotiate on behalf of the
J gency in assIgned cases .
•‘ “ c I’y)4
Steven A. Herman Date
Assistant: Administrator for
Enforcement and Compliance Assurance
Delegated To j To Whom Rodelegated
7 /OPPTS.
1 .A/OECJ
AA/OPpTS
AA/OECA ‘
Divinion t)ireclor Il?v(l
Division Director level
Further Redoleqatjoii
5-4
Use of Pesticides
Under Experimental
Use Permits
A A/opPTS,
AA/OECA, and
RAe
Division Director level
Branch Chief level
5-7
Cancellation and
Suspension
AA/OP PTS,
AA/OECA
Division Director
5-8
flegistration of
Establishments
AA/OPPTS,
P’J%/OECJt, and
PAn
Branch Chief
5-9
I
Inspections and
Information Gathering
M/OPPTS,
AA/0EcA, RAg
OECA Branch Chief level - all
authorities in this delegation;
QECA etaff with insp c gr
credentials - to conduct
5-11
InformatIon
Collection Under
FIFR.A Section 6 (g)
M/OPPTS,
AJ /OECA
inspections.
Director FFEO and ORE Branch
Chief level
5-13
DispositIon of
Pesticides
AA/OPPTS,
M/OECA, and
RAe
Branch Chief level
5-14
m
0
0
0
0
w
I D
- 1
Administrative
Enforcement:
Issuance of
Complaints and
Signing of Consent
Agreements
RAg, AA/OECA
-------
OECA DEIJEGATIOI9S OF AUTHORITY
0R Diyiuipn Director level -
claims of $50,000 or lees
ORE Office Director -
claims of more than $50,000
ORE Office Director level -
authority to cause the
commencement of enforcement
actione, intervene in auite,
request the Attorney ceneral to
appear and represent the Agency
in suits;
Staff Attorney level
represent the Agency in
enforcement actions and appeals
in assigned cases.
Steven A. Herman
Assistant Administrator for
Enforcement and Compli Assurance
3 1Y94
Date
Initiation of appeals muni he
done Jointly witI OGC
0
‘p
0
5-16
Del.
J Del. Title
Pelegated To
To Whom Redelegated
Further Iledelegolioui
5-15-A
Administrative
Enforcement: Agency
Representation in
hearings and Signing
of Consent Agreements
.
AA/OECA
RAn
and
,
Director. FEEO and ORE I3rpn 1]
Chief level all authorities in
this delegation;
FFEO and ORE Staff Attorney
level
negotiating on behalf of the
Agency, representing the Agency
in administration enforcement
actions, and representing the
Agency in appeals in assigned
cases.
-
Indemnity Payments
5-17-A
AA/OPPTS,
AA/OECA
Civil Judicial
Enforcement Actions
AA/OECA, RAn,
GC
No further redelegat ion
5-17-B
Criminal Enforcement
Action
AA/OECA
oc Division Director level
Does not apply.
-------
OECA DELEGATIONS OF AUTHORITY
ORE Division Director level -
for settlements under $100,000
that recapture the benefit of
noncompliance and do not involve
issues of national significance;
ORE Office Director level - all
other settlements under
$500. 000,
Steven A. Herman Dale
Assistant Administrator [ or
Enforcement and Compliance Assurance
5-17-C
Settlement or
Concurrence in -
Settlement of Civil
Judicial Actions
AA/OECA
Del. N
) Del. Title
J_Delegated To
To Whom Redalegated
Further Redelegation
5- 7-D
Emergency TRO’e
RAs. AA/OECA
On-scene Coordinator
5-18
,
Publication
Judymente
of
AA/OECA
ORE Branch Chief level
No
No
further
further
redelegation
redelegation
5-19
Importation
Activities
AA/OPPTS,
AA/OECA and
RAe
ORE Branch Chief level -request
samples, request representatives
of the
No
futher
--.
redelegation
•
Department Treasury to
.
.
admission of violative
pesticides;
ORE Dtpft with inspectp
credentials - request samples
(but must consult with Branch
Chief before exercising),
teceive testimony, request
representatives of the
Department of Treasury to refuse
admission of violative
pesticides (but must consult
with Branch Chief before
exercising authority)
0
0
0
5-21
Consultation with
Secretary of Treasury
AA/OPPTS and
AA/OECA
ORE Division Director level may No further redelegation
consult with representatives of
the Department of Treasury
-------
OECA DELEGATIONS OF AUTHORITY
Del. Title Delegated To
Soliciting Views AA/OPPTS and
______________________ AA/OECA
Administering Oaths AA/OPPTS 1
AA/OECA and
RAe
Administrative
Enforcement Actions:
Issuance of
Complaints and
ordera, and Signing
of Consent
Agreements, etc.
May be redelegated to Hie II,ai’ I,
Chief level.
I%i auic-h
Steven A. Herman
Assistant Administrator for
Enforcement and Compl 4 ‘e Assurance
Dale
Del. l
5-24
5-25
0
m
To Whom Redelegated
ORE Division Director level
5-27
ORE inspectors and staff
attorneys
5-26
Cooperation with
Other Agencies
AA/OPPTS,
AA/OECA and
PAD
ORE Division Director level
May be
Chief
redelegated lo
level.
Further Redelegation -
the I I , al’ I i
No further redelegalion
State Cooperative
Agreementu (Personnel
and Facilities)
AA/OPPTS,
AA/OECA and
RAe
ORE Division Director level
7-6-A
5-29
contracting for
Applicator Training
with Federal Agencies
AA/OPPTS,
AA/OECA and ..
RAn
Director, FFEO and ORE Division
Director level
May be redelegateci to (lie
Chief level
CLEA.fl AIR
ACTs
RAe, AA/OECA
Director. FFEO and ORE Divisiofl
Director level . . all authorities
in this delegation
FFEO and OR Staff - negotiate
on behalf of the Agency in
aenigned cases
-------
Example 1—3. Redelegation of SSURO Authority Under FIFRA
I UNITED STAlES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
ALJ — 2 1994
OFFcE
co w E
(ORAN1 V 1
SUBJECT: Rede1e ation of Stop Sale, Use or Removal Order
Authority — Federal Insecticide, Fungicide,. and
Rodenticjcje Act (Delecation. -t ) I
FROM: Stave A. Berman
Assistant ‘sdministratczr for
Enforcement and Compliance Assurance
TO: Jesse Baskervjfl .a
Director, Toxics and PestLcides Enforcement Di ision
Office of Enforcement and Compliance Assurance
I h reby redelegate to you the authority delegated to mu in
Dele ati n 5—12 to issue Stop Sale, Use or Removal Orders as
provided in the Federal Insecticide, Fungicide, and Rodenticida
Act (FIFRh). Please add this redel agation of authority to the
redelegations matrix I signed on June 8, 1994.
cc: Regional Administrators
Assi :tant Administrator for Prevention, Pesticides, and
Toxics Substances
OECA Office Directors
Req ions ). Counsels
Jorathan Libber
IE—23 October 1997
-------
II. Evidence Gathering
-------
Example 11—2. TSCA Management Plan for Mercury Subpoena
TScA OR EMZNT 8UBPO
1 CRMmNT PLP N
Authority: Section 11(c), Toxic Substances Control Act
Purpose: Mercury has been detected, at extremely high levels in
individuals exposed to this substance through
inhalation. The purpose of this document is to develop
a management plan for the review, dissemination, and use
of information received as a result of the issuance of
subpoenas to a select group of mercury users. The
subpoenaed information will be reviewed to determine if:
1. the chemical substance, mercury, or a mixture
containing such substance presents an imminent hazard
pursuant to Section 7 TSCA requiring civil action in
District Court to grant relief; and
2. violations have occured pursuant to:
PIFRA Section 12(a) (1) (E) — fail to include adequate
directions
FIFRA Section 12(a)(2)(B) — fail to report 6(a)(2)
information
FIPRA Section 12(a) (2) (G) — misuse a pesticide
TSCA Section 15(3) (A) - fail to record adverse reactions
EP RA Section 325(c) (1) — fail to file a Section 313
toxic release inventory
report.
Universe: Paints, Coatings, or Other Mixtures Manufacturers 10
Building Material Manufacturers 5
Unique Users
Total 20
Required Response:
Submissj n of written answers to twenty-one
questions by March 2, 1990
Provision of oral testimony and copies of end product
sales records on March 16, 1990
IIE—3 October 1997
-------
—2—
Process: 1. Issuance - February 15, 1990
2. Master file and logging system creation by DCO -
February 15 to February 28, 1990
A master file will be.created for each respondent.
The file will include:
o Subpoena action status suml”ary, copy attached,
with list of the various milestones and their
completion dates.
o Copy of the subpoena
o Certificate of Service
o Certified receipt showing delivery
o All notes of telephone inquiries
o Master copy of the written subpoena response
o A copy of the transcript of oral testimony
o A list of all referrals to other.. Agency offices
o Copies of all follow—up correspondence
o Copies of all enforcement actions
3. Inquiry Response — February 20, 1990 to
March 16, 1990
Contacts: Mike Calhoun 382—7865
Compliance Division
Office of Compliance Monitoring
(technical guidance)
Alice Crowe 475—8690
Toxics Litigation Division
Office of Enforcement and Compliance
Monitoring
(legal matters)
4. Receipt — March 2, 1990 deadline
Written responses to the subpoena will be
received in the Office of Compliance Monitoring
October 1997 IIE—4
-------
5. Failure to obey the subpoena determination —
March 5, and March 20, 1990
If any company fails to provide written
information or oral testimony by thedesignated
deadline, 001 will refer the master file to OECM
along with a cover memorandum and certified
statement by the Director, Compliance Division, 0CM.
The memorandum and certified statement will, indicate
that no response has been received or oral, testimony
provided. OEQ1 will, prepare a case for referral to
the Department of Justice to obtain a District Court
order to compel compliance.
6. Preliminary Assessment -
February 20, 1990 to March 9, 1990
The written response will receive a preliminary
assessment by the Office of Compliance Monitoring.
The assessment will categorize each response under
one or more of the following headings:
a. Potential, hazard
b. Potential FIFR violation pesticide
manufacturer
c. Potential FIFRA violation pesticide user
d. Potential TSCA violation mercury user
e. Potential EPCRA violation mercury user
f. Nonresponsive
1. no information submitted
2. submitted information nonresponsive
7 • Three copies of the written response along with
the preliminary assessment will. be made and provided
to OPP, OTS, and the Region in accordance with any
applicable TSCA-cBI procedures.
8. Dissemination -
February 20, to March 9, 1990
The OPP, OTS, and regional copies of the
written response and preliminary assessment will be
disseminated within 3 working days of the response.
IIE—5 October 1997
-------
9. Preliminary Evaluation
Each office will be given 3 working days to
evaluate the response to determine if a potential
violation may exist with respect to TSCA, FIPRA, or
EPCRA and to provide recommendations concerning
questions that should be posed during any oral
testimony, and the appropriateness of conducting an
immediate physical inspection.
10. Question Development
Based on the evaluation, a list of questions
will be prepared for review and concurrence by the
respective offices.
11. Premeeting
Prior to the presentation of oral testimony,
a meeting will be scheduled by OECZ4 with the
representatives of the EPA offices who will be
attending the presentation of oral testimony. The
attendees will organize the framework for obtaining
the oral testimony regarding the various areas
of inquiry.
12. Oral Testimony
OE X will have lead responsibility for
developing and arranging the schedule for
presentation of oral testimony, directing the
presentations, and providing the transcripts of the
testimony to the respective offices.
13. Final Compliance Evaluation
Fifteen working days after receipt of the
transcript, 0Q1 will conduct a final evaluation
of both the written response and oral testimony.
The evaluation will determine if one or more of the
following actions is warranted:
a. physical inspection of the company
b. enforcemnt action pursuant to TSCA, FIFRA,
or EPCRA. or
c. enforcemnt action to prevent an iinent
hazard.
October 1997 IIE—6
-------
Example 11—3. Preliminary Assessment Form for Mercury Subpoena
TBCA SECTION 11(c) SUBPOENA
PRELTVT .RY ASSESSMENT
Company Nan.:
Respondent:
PuPA Violations
Section 1.2 (a) (1) (B) and (I) — Evidence that the registrant failed
to provide accepted and adequate directions for use? (Q12, 13,
14)
Section 12(a) (2) (3) — Evidence that registrant failed to report
6(a) (2) information? [ Q 21]
Section 12(a) (2) (G) - Evidence that manufacturer misused a
pesticide? (Q 4 — 16)
TBCA VIOLATIONS
Section 15(3) (A) - Evidence that the manufacturer failed to
record adverse reactions? (Q 17, 18, 19]
EPCRA VIOLATIONS
Section 32 5(c) (2.) — Evidence that manufacturer failed to file a
Section 313 toxic release inventory report? (Q 1 — 3]
IIE—7 October 1997
-------
Example lI—4. Follow-Up Questions for Mercury Subpoena
) RCV1Y BUBPOEN RE8PON8 8
FOLLOW-UP QUESTIONS
Company Name:
Address:
Question Nu r: Additional Information Requested:
IIE—9 October 1997
-------
Example lI—5. Mercury Subpoena Cover Letter
CERTIFIED MAIL
RETURN RECEIPT - —
Re: Subpoena Pursuant to Section 11. of
the Toxic Substances Control Act
The Environmental Protection Agency (EPA) is investigating
the processing, distribution in coerce, and use of mercury.
Preliminary information indicates that mercury is released during
the application of paints, coatings, and other mixtures
containing this substance.
Under the provisions of Section 11 of the Toxic Substances
Control Act (TSCA), 15 U.S.C. Section 2610, the Administrator of
the Environmental Protection Agency has the authority to require
the production of reports, papers, documents, answers to
questions, and other information deemed necessary by the
Administrator in carrying out the provisions of TSCA. Pursuant
to this statutory authority, you are hereby commanded to provide
the information and documents set forth in the enclosed SUBPOENA
DUCES TECUM AND SUBPOENA AD TESTIFICANDUM on the basis of all
information and documents in your possession, your custody or
control, or the possession, custody or control of your employees,
agents, servants or attorneys.
EPA regulations governing confidentiality of business
information are set forth in Part 2, Subpart B of Title 40 of the
Code of Federal Regulations. For any portion of the information
you submit that you believe is entitled to confidential treatment
by EPA, please assert a business confidentiality claim in
accordance with 40 C.P.R. Section 2.203(b). If EPA determines
that the information claimed confidential meets the criteria in
40 C.F.R. Section 2.200, then such information will be disclosed
by EPA only to the extent and by the procedures specified in 40
C.F.R. Part 2, Subpart S. EPA will construe your failure to
furnish a confidentiality claim with your response as a waiver of
a confidentiality claim, and the information may be made
available to the public by EPA or the Department of Justice
without further notice to you.
lIE—Il October 1997
-------
If you have any questions concerning this subpoena, please
contact Michael Calhow at (202) 382-3809 concerning technical
matters and Alice Crows at (202) 475—8690 concerning legal
matters.
Sincerely yours,
Michael P. Wood, Director
Compliance Division
Office of Compliance Monitoring
October 1997 IIE—12
-------
Example 11—6. Mercury Subpoena
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
BEFORE THE ADMINISTRATOR
IN THE Mi OF:
Investigation of the Processing, ) SUBPOENA DUCES TECUN AND
Distribution in Commerce, and Use ) SUBPOENA AD TESTIFICANDUN
of the Chemical Substance, Mercury )
TO:
YOU ARE EBY COMMANDED, pursuant to Title 15, United States Code,
section 2610(c) (Toxic Substances Control Act section 11(c)) TO
PRODUCE FOR INSPECTION AND/OR COPYING those reports, papers,
documents, answers to, and other information requested in the
ATTACHED SPECIFICATIONS, at the following date, time and place:
DATE AND TIME: March 2, 1990 at 3:00PM
PLACE: U.S. Environmental Protection Agency
Off ice of Compliance Monitoring
Compliance Division (EN—342)
401 M Street, S.W.
Washington, D.C. 20460
YOU ARE COMMANDED FURTHER TO BE AND APPEAR IN PERSON at the
following date, time and place:
DATE AND TIME: March 16, 1990 at 10:00AM
PLACE: U.S. Environmental Protection agency
401 M Street, S.W.,
Washington, D.C.
Room 113 Northeast Mall
TO TESTIFY then and there upon oath and MAKE Thwnwui RESPONSE to
all lawful inquiries and questions then and there put to you on
behalf of the United States Environmental Protection Agency, and
TO REMAIN IN ATTENDANCE until expressly excused by the EPA attorney
conducting the proceeding.
FAILURE TO COMPLY WITH THIS SUBPOENA MAY RESULT IN A COURT ACTION
AGAINST YOU.
Issued at Washington, D.C. this 15th day of February 1990.
Attorney Contact: Alice Crove, (202) 475—8690
Mtchael P. Wood, Director
Compliance Division
Office of Compliance Monitoring
IIE—13 October 1997
-------
SPECIFICATIONS
I. Definitions
As used in this subpoena:
1. “Document” means the original or a true, correct and
complete copy and all nonidentical copies of any report, paper,
note, letter, correspondence, memorandum, study, data compilation,
circular, work sheet, minutes, test result, laboratory note or
memorandum, analysis or other transcription of information, whether
written, typed, printed, recorded on tape, microfilm, or other
device, regardless of whether circulated within the company or to
outsiders, regardless of whether generated within or without the
company and regardless of whether in the possession of your company
or any agent acting in its behalf.
2. “You” or “your” refers to both the individual addressee and
the corporate addressee.
3. “Mixture” means a combination of chemical substances in
liquid or semi-liquid form and having no defined shape e.g. a
caulk.
4. “Mercury containing end product” means the item containing
mercury that is presented for sale upon manufacture by your
company.
5. “Mercury source material” means any material that is
purchased by your company that contains mercury.
II. Directions :
1. For your convenience in reponding to the subpoena, a form is
attached to be used to answer the questions that have been posed.
If more space is required to respond to a question than is provided
on the form, attach a continuation sheet to the form and indicate
the number of the question to which you are providing additional
information. A form should be completed for each mercury
containing end product that you manufacture.
2 • Each question posed should be answered. If the appropriate
response is “none” or “not applicabl.” that information should be
so stated.
3. If you do not manufacture for sale any end product containing
mercury, complete the form using the terms “none” or “not
applicable” as appropriate. Attach a continuation sheet to the
form and provide:
October 1997 IIE—14
-------
a. an explanation of the use and/or intended use of all.
purchases of mercury source materials for the past 5
years e.g., research and development;
b. the net weight of mercury source material currently in
inventory; and
c. the disposal locations of any waste containing mercury.
III. INFORMATION TO BE PROVIDED :
l.a. What is your principal line of business; and
b. What is the 4 digit standard industrial code that best
describes your business activities?
2. How many full-time employees do you have?
3. Have you submitted a Toxic Chemical Release Inventory Reporting
Form concerning the processing or use of mercury or mercury
compounds pursuant to Section 313 of the Emergency Planning
and Community Right-to-Know Act (EPCRA)?
4. Identify each mercury containing end product that you
manufactured for sale in the past 5 years including the:
a. brand name and if only a particular subset contains mercury
the names of the subset items e.g., interior latex paint-
only colors red and blue;
b. principal use of the product e.g., paint, coating, or other
use, include the EPA Reg No. if claims are made for use
of the product as a pesticide;
c. purpose of the mercury in the product e.g., mildewcide
d. range of lot or code numbers of product batches
containing mercury if the current end product is no
longer formulated to contain the chemical substance
mercury;
e. latest calendar year of manufacture as a mercury
formulation e.g., 1990; and
f. net weight in pounds and volume in gallons of each size
unit of the product that you sell as a paint, coating,
or other mixture or a description and net weight of any
end product that is a building material, an item of
furniture or other equipment.
5. For each end product identified above, describe your source of
mercury by the:
a. brand name of source product, including EPA Reg. No., if
it is a pesticide;
b. name of manufacturer and city/state address;
c. chemical form of the mercury e.g., pheny]. mercuric acetate;
d. percentage by weight of the chemical form of mercury in
the source material;
IIE—15 October 1997
-------
5. e. percentage by weight of total mercury in the source
material; and
f. net weight in pounds of standard size unit of purchase
and the type of immediate contather the mercury is
packaged in e.g., 25 lb. boxes containing 50—8oz. water
soluble packets.
6. For each end product identified above, how many pounds of the
mercury source material do you use each year in the
manufacture of that product?
7. For each end product identified above, ind.cate the
percentage by weight of the mercury source material in your
product.
8. For each end product identified above, ind cate the
percentage by weight of total mercury in your product.
9. For each end product identified above:
a. how many of each unit size of the end product did you sell
in the last one year period from the date of the subpoena
and what total net weight does this represent (copies of
your last five years of sales records including the names
and addresses of your puchasers are to be submitted at
the time of deposition); and -
b. how many of each size unit of the end product currently
remains in your inventory and what total net weight of
the product does this represent?
10. Is mercury incorporated into your end product at the point of:
manufacture, sale, or use?
11. For each end product identified above, what method do you use
to incorporate the mercury into your end product e.g., mixing,
spraying, etc.?
12. For each end product identified above, describe the source of
the directions that you follow to incorporate the mercury
source material into your own product e.g., manufacturer’ s
brochure, trade association bulletin, own calculations, etc..
13. Have you ever received directions for use from the supplier of
the mercury source material? If so, when did you receive
these directions (give specific dates if Imown, if not
indicate relative timeframes e.g., yearly, with each shipment
etc.)?
October 1997 IIE—16
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14. If you have received directions from your supplier of mercury
source material, what rate of application of the source
material does the supplier recommend to manufacture each
end product identified above e.g., percent in pounds of the
source material and total mercury?
15. For each paint, coating, or mixture end product identified
above, indicate:
a. the types of surfaces you recommend that it be applied to,
e.g., wood, wall, board, plaster, concrete, etc.:
b. the locations of the surfaces e. g. indoor construction,
outdoor equipment, etc.;
c. the place of application of the product e.g., industrial,
educational, domestic, etc.;
d. the average coverage of the product in square feet;
e. the number’ of coats recommended for each type of
application; and
f. the method(s) of application e.g., brush, spray, etc..
16. For each product identified above that is neither a paint,
coating, nor a mixture indicate:
a. the location of the mercury in the product e.g., part of
a surface material, incorporated into a specific
component of the product etc •; and
b. the place of use of the product e.g., industrial, domestic,
etc.
17. Have you received consumer reports regarding significant
adverse health reactions from the use of the end product
identified above? Please indicate for each product identified
above:
a. the types of reactions reported;
b. the number of complaints received regarding each type of
reaction;
c. the location of the file where copies of the reports are
maintained; and
d. the name and position of the person in charge of these
files.
18. Rave your employees filed reports regarding significant adverse
health reactions or have incidents occured resulting in
adverse health reactions associated with the manufacture of
the end product(s) identified above? Please indicate for each
product identified above:
a • the types of reactions reported;
b. the number of reports regarding each type of reaction;
c. the location of the file where copies of these reports
are maintained; and
lIE —Il October 1997
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18. d. the name and position of the person in charge of
maintaining these files.
19. Have your employees filed reports regarding significant adverse
health reactions from the use of the mercury source material?
Please indicate for each mercury source material identified
above:
a. the types of reactions reported;
b • the number of reports regarding each type of reaction;
c. the location of the file where copies of these reports
are maintained; and
d. the name and position of the person maintaining these
files.
20. Have you received reports from consumers or employees regarding
significant adverse reactions to the environment from the use
of the end product or the mercury source material? Please
indicate for each mercury source material and end product
identified above:
a. the type of reaction reported;
b. the number of reactions reported regarding each type of
reaction;
c. the location of the file where copies of these reports
are maintained; and
d. the name and position of the person maintaining these
files.
21. Have you notified your mercury source material supplier of any
reports of significant adverse health or environmental
reactions from the use of the mercury source material? Please
indicate for each mercury source material:
a. the name and address of the supplier who was notified;
b. the type of reaction reported;
c • the number of reports for each type of reaction; and
d. the name and position of the person maintaining these
files.
October 1997 11E18
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CERTIFICATE 0? SERVICE
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
I hereby certify that on this 20th day of April, 1990, a
copy of the foregoing Subpoena Duces Tecum and Subpoena Ad
Testificandum amendment was served by certified mail, return
receipt requested, and by placement in the EPA mail room at 401 M
Street, S.W., Washington, D.C. to the following individual:
Mr. William E. ?ogg, President
Wall and Floor Products
Post Office Box 26905
Philadelphia, Pennsylvania 19134
John Mason (EN—342)
Document Control Officer
U.S. Environmental Protection Agency
401 N Street, S.W.
Washington, D.C. 20460
IIE—19 October 1997
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Example 11—7. Extension for Response Letter — Mercury Subpoena
CERTIFIED MAIL
RETURN—RECEIPT REQUESTED
(name)
(title)
(address)
( “ )
( I )
Re: Subpoena Pursuant to Section 11 of the Toxic Substance
Control Act
Dear (name)
Under the provisions of Section Li of the Toxic Substance
Control Act (TSCA), 15 U.S.C. §2610, the Administrator of the
Environmental Protection Agency has the authority to require the
production of reports, papers, documents, answers to questions,
and other information deemed necessary by the Administrator in
carrying out the provisions of TSCA. Pursuant to this statutory
authority, the Administrator issued to you on February 15, 1990,
a SUBPOENA DUCES TECUN AND SUBPOENA AD TESTIFICANDtJN demanding
the submission of specified information and the testimony of
company personnel regarding the above—referenced matter.
Your written response to the above—referenced Subpoena, in
which you requested an extension, was received by the Agency on
(date, for most March 2, 1990). Following a review of your
response, I have determined that the extension you have requested
will be granted. Therefore, I am by this letter modifying the
SUBPOENA DUCES TECUM AND SUBPOENA AD TESTIFICANDTJX issued to you
on February 15, 1990 as follows:
The requirement on you, “TO PRODUCE FOR INSPECTION AND/OR
COPYING” on March 2, 1990 at 3:00PM is changed to March 16,
1990 at 3:00PM.
and,
The requirement on you, “TO BE AND APPEAR IN PERSON” on
March 16, 1990 at 10:00AM is changed to March 30, 1990 at
10: OOAN.
Sincerely yours,
Michael F. Wood, Director
Compliance Division
Office of Compliance Monitoring
IIE—21 October 1997
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Example 11—8. Mercury Subpoena Modification Letter #1
CERTIFIED MAIL
RETuICN—REcEIPr REOUESTED
Re: SUBPOENA DUCES TECUM AND SUBPOENA AD ESTIFICAND i(
pursuant to Section 11 of the Toxic Substances Control Act
Dear
Under the provisions of Section 11. of the Toxic Substances
Control Act (TSCA), 1.5 U.S.C. Section 2610, the Administrator of
the Environmental. Protection Agency has the authority to require
the production of reports, papers, documents, answers to questions,
and other information deemed necessary by the Administrator in
carrying out the provisions of TSCA. Pursuant to this statutory
authority, the Administrator issued to you on February 15, 1990 a
SUBPOENA DUCES TECUM AND SUBPOENA AD TESTIFICANDUN demanding the
submission of specified information and the testimony of company
personnel regarding the above—referenced matter.
Your written response to the above—referenced Subpoena was
received by the Agency on March 14, 1990. As a result of a review
of your written response, i have determined that your appearance
for oral. testimony as demanded by the Subpoena will be postponed
pending receipt of your response to the questions listed below.
Therefore, I am by this letter further modifying the SUBPOENA DUCES
TECUM AND SUBPOENA AD TESTIFICANDUM issued to you on February 15,
1990 as follows:
o The requirement on you to “TO PRODUCE FOR INSPECTION
AND/OR COPYING” on March 16, 1990 at 3:00PM is amended
to April 20, 1990 at 3:00PM.
o The requirement on you or your designated agent “TO BE
AND APPEAR IN PERSON” on March 16, 1990, is amended to
May 4, 1990.
IIE—23 October 1997
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o The Specification, iii. INFORMATION TO BE PROVIDEID : 1. through
21. is amended to:
1. Your response to Specjfjacatjori 12 indicates that one
source of the directions was the manufacturer. Your
response to Specification 13 indicates that you have not
received directions from your supplier. Provide an
e xplanation for this apparent contradiction.
Sincerely yours,
Michael F. Wood, Director
Compliance Division
October 1997 IIE—.24
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Example 11—9. Mercury Subpoena Modification Letter #2
CERTIFIED MAIL
RETURN—RECEIpT REOUESTED
Re: SUBPOENA DUCES TECUM AD TESTIFICANDtJX
pursuant to Section 11 of the
Toxic Substances Control Act
Dear Mr.
Under the provisions of Section 11. of the Toxic Substances
Control Act (TSCA), 15 U.S.C. Section 2610, the Administrator of
the Environmental Protection Agency has the authority to require
the production of reports, papers, documents, answers to questions,
and other information deemed necessary by the Administrator in
carrying out the provisions of TSCA. Pursuant to this statutory
authority, the Administrator issued to you on February 15, 1990 a
SUBPOENA DUCES TECUM AD TESTIFICANDUX demanding the submission of
specified information and the testimony of company personnel
regarding the above—referenced matter.
Your follow—up response to the above—referenced Subpoena was
received by the Agency on April 20, 1990. Following a review of
your response, I have determined that your appearance for testimony
as demanded by the Subpoena is not required. Therefore, I am by
this letter further modifying the SUBPOENA DUCES TECUM AND SUBPOENA
AD TESTIFICANDUM issued to you on February 15, 1990 as follows:
The requirement on you or your designated agent,
NTO BE AND APPEAR IN PERSONS on May 4, 1990,
is deleted.
Sincerely yours,
Michael F. Wood, Director
Compliance Division
IIE—25 October 1997
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Example 11—10. Alyeska Subpoena — Precedent
BEFORE THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
EPA REGION 10, SUITE 1802, 1200 SIXTH AVENUE
SEATTLE, WASHINGTON, (206) 442-1098
No. 1086-07-21-2610
IN THE MATTER OF
SUBPOENA DUCES TECUM AND
Alyeska Pipeline Service Co,
Inc SUBPOENA AD TESTIFICANDUM
TO BAY TANKERS, INC., a corporation, 1 Chase Manhattan Plaza, Suite 3800, New York City,
NewYork, 10005; and
Its Vice-president, CHARLES NIELES,
RESPONDENT(s)
YOU ARE HEREBY COMMANDED, pursuant to Title 15, United States Code, section 2610(c)
[ Toxic Substances Control Act section 11(c)] to APPEAR PHYSICALLY IN PERSON at the
following time and place:
TIME AND DATE: 10:00 A.M THURSDAY 14 AUGUST 1986
PLACE: Office of Regional Counsel, EPA Region a
26 Federal Plaza, New York City, New York 10276
YOU ARE COMMANDED FURTHER TO TESTIFY then and there upon oath and MAKE
TRUTHFUL RESPONSE to all lawful inquines and questions then and there put to you on behalf
of the United States Environmental Protection Agency, and TO REMAIN IN ATTENDANCE until
expressly excused by the attorney conducting the proceeding for EPA
YOU ARE COMMANDED FURTHER TO BRING WITH YOU at the above stated time and
place and time, and to then and there produce for inspection and/or copying by EPA, those items
identified and described on the ATTACHMENT which are possessed by you or are under your
control.
ANY FAILURE BY YOU TO COMPLY WITH THE COMMANDS OF
THIS SUBPOENA MAY RESULT IN A COURT ACTION AGAINST YOU.
llE—27 October 1997
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Issued at Seattle, Washington, this day of July, 1966
RALPH R. BAUER
Acting Regional Administrator
Contact ATTORNEYS for EPA
Michael J. Walker, Esq.
Keith Onsdorff, Esq.
(202) 475-8690
(202) 382-3072
October 1997 IIE—28
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ATTACHMENT OF SUBPOENA — Cause No. 1086-07-21-2610
I. DEFINITIONS For the purpose of this Subpoena and the Aftachment, the following terms
have the following meanings.
1. “ANS CRUDE” or “ALASKA CRUDE” means oil which was pumped out of an Alaska well
through a pipeline to the Valdez terminal
2. “BALLAST’ means liquid or solid material placed in a ship below the main deck for
purposes of increasing stability against rolling of the ship about a longitudinal (fore and aft)
axis.
3. “BALLAST WATER” includes, without limitation, any liquid or semi-liquid material which is
or was taken aboard a tanker, and was or is
(A) material as descnbed in I 5.(A) below; and
(B) used ballast under the assumption that it was predominantly water as described in
1.5 (A) below, and
(C) was carned as “cargo” and wasj predominantly ANS Crude containing 0% to
1 0& water.
4. “BWTF” or “BALLAST WATER TREATMENT FACILITY” means that portion of an onshore
facility whose predominant function is to separate out oil from ballast water received from
ships
5. “CHEMICAL MIXTURE” includes, without limitation, any liquid or semi-liquid material
containing chemicals, OTHER THAN A MIXTURE OF SOLELY THOSE MATERIALS
DESCRIBED IN (A) THROUGH (D) below, the phrase EXCLUDES any material whose only
components or ingredients are SOLELY one or a combination of the followingS
(A) water taken aboard the carrying tanker directly from (and out of) the oceans or any
other body of water or any portion thereof including bays, estuaries, or nvers
(B) unused bunker oil suitable and destined for, and stored aboard for, use as fuel in
the boilers of the carrying tanker.
(C) unused petroleum based lubricants suitable and destined for, and stored aboard
for, lubricating the equipment aboard the carrying tanker.
(D) Alaska crude carried as cargo, or carried as the unflushed residue of cargo in a
shipboard container which in the immediate past held Alaska crude as cargo.
6. “COMPANY” means the corporation “Bay Tankers, Inc.” under that name or any assumed
name.
7. “LOAD” and “LOADED” mean pumped aboard a ship from a source or location outside the
ship.
8. “OFF-LOAD” and “OFF-LOADED” mean gravity-flowed or pumped from a tanker putatively
to or into some onshore facility.
IIE—29 October 1997
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9. “RECORD” means the original, a true copy, or a substantial copy, of a physical item
containing or memonalizing data, or information, or symbols, or an instruction, or an event,
or a transaction, or an utterance, which item is presently in documentary, film, electronic
impulse, magnetic disk, magnetic tape, or some computer storage form. THIS TERM
EXCLUDES ANY RECORD CREATED BEFORE January 1, 1978, AND ANY RECORD
CREATED AFTER July 1, 1986.
10. “RELEASE” or “RELEASED” means one or any combination of occurrences resulting in a
liquid or a semi-liquid material moving to and becoming present in a body of water whose
surface is exposed to the atmosphere. It includes each occurrence described in 42 U.S.C.
§9601 (22) It includes each onboard act or omission by any officer or other crewmember of
any tanker.
11. ‘TANKER” or ‘TANKERS includes the ships Stuyvesant, Bay Ridge, Brooklyn, and
Williamsburg, except where the context requires otherwise.
12. ‘TERMINAL” means a crude oil handling, storage, or transfer onshore facility including
(without limitation) those parts of that facility constituting a BWTF, and those parts of that
facility used to remove liquids from Alaska crude oil.
(A) “PANAMA TERMINAL” means the terminal at which the tankers typically (from
January 1, 1978 to July 1, 1986) off-loaded their cargos of Alaska crude oil which had
been loaded at the Valdez terminal.
(B) “VALDEZ TERMINAL” means the terminal operated by Alyeska Pipeline Service, Co.,
Inc., at or near Valdez, Alaska from January 1, 1978 to the present.
H ITEMS TO BE BROUGHT WITH YOU :
1. Each record reflecting activities aboard, or communication to or from, the tanker Stuyvesant
at any time between March 1 and May 31, 1982.
2. Each record which contains or reflects communication to or from the tanker Stuyvesant in
the year 1982 concerning that tanker loading, towing, carrying, off-loading, or releasing
approximately 14,000 barrels of chemical mixtures or any part or portion thereof.
3. Each record which contains or reflects communications to or from on or more of the tankers
which concerned that tanker loading, carrying, off-loading, or releasing any chemical
mixture.
4. Each record reflecting a testing, sampling, or laboratory analysis done on any chemical
mixture which was loaded onto, off-loaded from, or released from one or more of the
tankers.
5. Each record indicating any chemical testing, sampling, or scientific analysis performed on
liquids or semi-liquids constituting the flushings resulting from flushing out a tanker’s cargo
spaces, cargo takes, ballast tanks, wing tanks, or slop tanks.
6. Each record reflecting a spillage of oil or a chemical mixture from one or more of the
tankers occurring after January 1, 1981, which was not reported by Bay Tankers, Inc. to the
National Response Center in Washington, DC operated by the Coast Guard.
October 1997 liE—3D
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7. Each record constituting what is sometimes called by company employees a “ship’s
abstract”, for each voyage of each tanker from the Panama terminal to the Valdez terminal,
which voyage began between January 1, 1978 and July 1, 1986
8. Each cargo manifest for each tanker for each voyage from the Panama terminal to the
Valdez terminal , which voyage began in one of the years 1978 through 1986.
9. A list of all company shareholders and directors as of the time of each annual shareholders
meeting held after 1977 but before 1986.
10 Each memo, report, letter, note, document, record, or minutes of meetings of the corporate
directors or a committee thereof which discusses in any way an aspect of governmental
investigations into occurrences or operations at the Valdez terminal dunng one or more of
the years 1978 through 1986
11. Each log entry in a tanker’s log for any portion of the years 1978 through 1986 which
records the release or off-loading or a chemical mixture from such tanker, or which records
the release of any “ballast” at sea during that tanker’s voyage beginning at the Panama
terminal and ending at the Valdez terminal.
12. The logbooks for each tanker for each year 1978 through 1986 which are described below,
or records which contain for such years substantially the same entnes as the logbooks
described below.
(A) the “yellow” covered logbook required since 1982 by the US Coast Guard (manne
pollution authorities) to be carried by and used aboard a tanker.
(B) any logbooks preceding the one described in (A) which were prescribed by the US
Coast Guard to be camed aboard and used aboard a tanker
13 Each record which reflects or indicates one or more of the following occumng in relation to
one or more of the tankers.
(A) the loading into such tanker at or near the Panama terminal (or anyplace after
departure from the Panama terminal but while the tanker was en route to the Valdez
terminal) of a chemical mixture which was used and dealt with by the tanker involved
either (1) in a manner different from that in which liquid cargo was handled by such
tanker, or (2) in the same manner as ballast water used aboard the tanker involved.
(B) the release from a tanker of a chemical mixture after such tanker off-loaded ANS
crude at the Panama terminal but before that tanker next berthed or anchored
(whichever first occurred) at the Valdez terminal.
(C) the release from a tanker of a chemical mixture after the tanker had berthed or
anchored (whichever first occurred) at the Valdez terminal but before that tanker
started to load ANS crude at the Valdez terminal.
(D) the release from a tanker of a chemical mixture after that tanker had started loading
ANS crude at the Valdez terminal and before it next berthed or anchored (whichever
first occurred) at the Panama terminal.
(E) the loading onto a tanker of a chemical mixture to be used to flush out any tanks on
such tanker.
ilE—31 October 1997
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(F) the off-loading of a chemical mixture or tank flushings from a tanker at any terminal
14. Each record which contains or reflects a company prescribed policy or work-practice or
procedure in effect in one or more of the years 1978 through 1986 covering one or more of
the following:
(A) by which one or more of the tankers were to load ANS crude at the Valdez terminal.
(B) by which one or more of the tankers were to load or off-load chemical mixtures at any
location.
(C) by which one or more of the tankers were to off-load or to otherwise dispose of the
flushings resulting from a tanker flushing out one or more of its tanks.
(D) by which one or more of the tankers were to load ballast on departing the Panama
terminal or en route to Valdez, Alaska.
(E) by which one or more of the tankers were to off-load ballast or ballast water at the
Valdez terminals.
(F) by which one or more of the tankers were to release ballast, chemical mixtures, or
ballast water from the tanker when moored, anchored, berthed, or underway
(G) by which one or more of the tankers were to report (either to company headquarters or
to governmental authorities) a release of oil or other liquids from such tanker
15. Each record which contains or reflects the current name or current address of one or more
of the following individuals
(A) those whose main duties for the company in any one or more of the years 1978
through 1986, included communicating on behalf of the company headquarters with
the tankers.
(B) those from whom such tankers received one or more communications concerning
such chemical mixtures.
(C) those to whom such communications were addressed.
(D) those who are known or believed to have knowledge of the existence of, the sending
of, the receiving of, or the present whereabouts of a copy of any such
communications.
(E) those familiar with the personnel records of the company for any of the years 1978
through 1986.
(F) those familiar with archived records of the company.
(G) those familiar with the Captains of each tanker during a voyage by that tanker from the
Panama terminal to the Valdez terminal which began in any of the years 1978 through
1986.
October 1997 iIE—32
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(H) those familiar with the First Mates of each tanker during a voyage by that tanker from
the Panama terminal to the Valdez terminal which began in any of the years 1978
through 1986
(I) those familiar with the organizational structure of the company, including the names
and titles of each of its officers and directors from January 1, 1978 to the present.
(J) those who know who the employees of the company were who were stationed at the
corporate headquarters dunng any of the years 1978 through 1986.
(K) those who know where there is now located the original or a true copy or a substantial
copy of any record which is both (1) described in this subpoena, and (2) which is not
specifically pointed out as being produced in response to this subpoena, and (3)
whose existence is not specifically testified to in an answer given under oath in
response to this subpoena
I 1E—33 October 1997
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Example Il—Il. Texas Eastern Subpoena
BEFORE THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
401 M Street, SW
Washington, DC 20460
IN THE MATTER 0F SUBPOENA DUCES TECUM AND
SUBPOENA AD TESTIFICANDUM
TEXAS EASTERN TRANSMISSION
CORPORATION
TO H D CHURCH
SENIOR VICE PRESIDENT ENGINEERING
AND OPERATIONS
TEXAS EASTERN GAS PIPELINE COMPANY
1221 McKinney, P0 Box 2521
HOUSTON, TEXAS 77252-2521, RESPONDENT
YOU ARE HEREBY COMMANDED, pursuant to the provisions contained in Title 15, United
States Code, Section 2610(c) [ Toxic Substances Control Act Section 11(c)] and the Title 42,
United States Code, Section 9622(e)(3)(B) [ Comprehensive Environmental Response
Compensation and Liability Action Section 1 22(e)(3)(B) TO PRODUCE THE DOCUMENTS and
other items described herein at your offices on 1221 McKinney, Houston, Texas, at 10 00 A.M.
on April 14, 1987, for inspection and/or copying AND, at the same time and place, PROVIDE
PERSON(S) WITH KNOWLEDGE regarding the matters addressed herein to respond to
questions relative to these documents
YOU ARE COMMANDED FURTHER TO TESTIFY then and there upon oath and MAKE
TRUTHFUL RESPONSE to all lawful inquines and questions then and there put to you on behalf
of the United States Environmental Protection Agency, and TO REMAIN IN ATTENDANCE until
expressly excused by the official conducting the proceeding on behalf of EPA.
You may claim any information that you submit in response to this subpoena to be confidential
business information; please mark each page containing such information with the work
“confidential.” If you wish to make a claim of confidentiality for this information, you must do so
by the date set forth above. Any documents or other information not marked confidential will be
available to the public. That portion of your response to the subpoena marked as confidential will
be handled in accordance with EPA’s public information regulations (40 C F R Part 2). If you
claim information submitted in response to this subpoena as confidential, you must also provide
a redacted version of the information with all TSCNCERCLA confidential business information
deleted.
ilE—35 October 1997
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FAILURE TO COMPLY WITH THIS SUBPOENA MAY RESULT IN COURT PROCEEDINGS
AGAINST YOU IN A UNITED STATES DISTRICT COURT
Issued: Washington, DC, this day _________ of ______________ 1987.
Attorney Contact: National Enforcement Investigations Center
Contact:
David C. Batson
Toxic Litigation Division Barrett E Benson
US Environmental Protection Agency (LE-1 34P) NEIC
401 M Street, SW Building 53
Washington, DC 20460 Box 25277
(202) 475-9501 Denver, Colorado 80225
(303) 236-5120
THOMAS L. ADAMS, JR
Assistant Administrator for
Enforcement and Compliance
Monitonng
October 1997 liE—36
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ATTACHMENT TO SUBPOENA
In The Matter Of Texas Eastern Gas Pipeline Company
I INSTRUCTIONS AND DEFINITIONS
1. The words “and” and “or” shall be construed conjunctively or disjunctively as necessary to
make the request inclusive rather than exclusive.
2. When a question asks for identification or other response regarding the “character” of a
substance the identification or response shall include a description of the substance’s
composition in terms of chemical elements, compounds or mixtures Include a statement
as to the probability of the substance containing PCBs, or other hazardous substances,
their concentrations if known and method of analysis and the basis for this statement.
3. “Chemical Substance” or “substance” includes any organic or inorganic substance as
defined in 15 U.S.C. §2602(2). A chemical substance includes, without limitation, any
solid, semi-solid, liquid, fluid or oil material containing chemicals, as well as any mixture
thereof.
4 “Closed unit” means any unit where the operating status of the unit has been terminated
by means of closure activities.
5. “Closure activities” means activities related to and resulting in the termination of the
operating status of a pit or other unit These activities may include cessation of receipt of
hazardous substances; backfilling; applying or installing final covers or caps; disposing of
decontaminating equipment, structures, soils and residual hazardous substances, and
care and maintenance of the closed pit or unit.
6 “Disposal” or “Dispose” means the discharge, deposit, injection, dumping, spilling,
leaking, or placing of any waste into any or on any land or water so that such waste or
any constituent thereof may enter the environment or be emitted into the air or discharged
into any waters, including ground waters.
7. The word “document” or “documents” means all written, typewritten, handwritten, or
printed matters, including drafts, originals, and nonconforming copies that contain
deletions, insertions, handwritten notes or comments, or graphic matter of any kind or
nature, however produced or reproduced, any form of collected data for use with
electronic, visual or sound recordings including, without limitation, all tapes and discs,
now or formerly in you possession, custody or control. It includes, but is not limited to,
any logs of materials or containers shipped, as well as other logs, invoices, purchase
orders, checks, banking records, receipts, bills of lading, weight receipts, toll receipts,
loading tickets, receiving tickets, shipping orders, manifests, inventories, letters and other
correspondence, offers, contracts, agreements, bids, proposals, licenses, permits,
communications with government agencies, operating procedures, ledgers, accounts
receivable, accounts payable, account statements, financial statements, monthly reports,
other reports, minutes of meetings, sales estimates, sales reports, source and use
analyses, memoranda, handwritten or other notes, calendar or diary entries, agendas,
bulletins, graphs, charts, maps, photographs, drawings, surveys, data, sampling results,
analytical results, descriptions of matenals, load schedules, price lists, summanes,
telegrams, teletypes, computer pnntouts, magnetic tapes discs, microfilm, and microfiche.
IIE—37 October 1997
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For purposes of the foregoing, “drafts” means any earlier, preliminary, preparatory, or
tentative version of all or part of a document, whether or not such draft was superseded
by a later draft and whether or not the terms of the draft are the same as or different from
the terms of the final document, and the term “copies” means each and every copy of any
document which is not identical in every respect to the document being produced.
8. “Drum” includes eighty-five (85) gallon overpack drums, fifty-five (55) gallon drums, pails,
fibre packs or any other container or object less than fifty-five (55) gallons capable of
containment
9. “Hazardous substance” includes all solid, liquid, sludge-like, gaseous, or other materials
(including, without limitation, PCBs, condensates, and all residues in drums and all
contact and non-contact water or process water employed in any chemical or industrial
operation) that are, that contain, or may contain chemicals or chemical, industnat,
domestic or other by-products, unused products, matenals that may be recycled,
including mixtures or sewage which could be discharged or placed into the air, any water,
lagoon, landfill, container, storage tank, barrel, drums, ditch, trench or surface or
subsurface impoundment, and any other solid or hazardous wastes, hazardous
substance, or pollutant or contaminant as defined in 42 u.s c. §6903(5) and (27) or 42
U.S C. §9601 (14).
10. “Identify” or “indicate” means.
(i) as to a document: the type of document (letter, memorandum, etc.), the identity of the
author or onginator, the date authorized or originated, the identity of each person to
whom the onginal or copy was address or delivered, the identity of each person known or
reasonably believed to have present possession, custody, or control thereof, and a brief
description of the subject matter thereof.
(ii) as to a person: the name, present or last known business and residence address(es),
occupation, job title, and dates so employed and, if not an individual, state the full name,
the type of entity, the address of its principle place of business, and the name, title and
address of its chief officer.
11. The word “include” or “including” shall be construed without limitation.
12. “In-service” unit means an active unit which is receiving, treating, storing, disposing, or
otherwise handling hazardous substances and which is not a closed unit or undergoing
closure activities
13. The terms “liquid” or “liquids,” and “fluid” or “fluids,” and “oil” or “oils,” shall be construed
broadly to include sludges, sludge-like materials and semi-solids so as to make the
request inclusive rather than exclusive.
14 The word “person” or “persons” as used herein includes natural persons, firms,
partnerships, associations, joint ventures, corporations, business trusts, banking
institutions, unincorporated organizations, and any other legal entity. The word “person”
or “persons” also means personnel or employees.
15. The term “pipeline” includes any pipeline components associated with the transmission of
product.
October 1997 iiE—38
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16. “Pit” includes surface impoundments, lagoons, ponds, diked areas, natural depressions,
excavated holes, ditches, or any other discrete natural or man-made structure or area
which is currently in use, has been used, or is intended for use for the receipts,
accumulation, storage, treatment, or disposal of chemical or hazardous substances and
which is not a tank nor drum as defined herein
17. “Polychlonnated Biphenyls” (PCB or PCBs) means any chemical substance that it is
limited to the biphenyl molecule that has been chlonnated to varying degrees or any
combination of substances which contain such substances as defined in 40 C.F R
§761.3
18 A document or communication “relating to,” that “relates to,” or that is “in connection with”
a given subject means any document or communication that constitutes, contains,
embodies, comprises, reflects, identifies, states, refers to, deals with, comments on,
responds to, descnbes, analyzes, or is in any way pertinent to that subject, including,
without limitation, a document concerning the presentation of other documents.
19. “Service Facility Site” means any property previously or currently maintained or used by
Texas Eastern or on behalf of Texas Eastern including compressor stations, gas
dehydration facilities, filter-separation facilities, sweetening facilities, pumping stations,
pipeline maintenance yards, any building, structure, installation, equipment, pipe or
pipeline (including any pipe into a sewer or publicly owned treatment works), well, pit,
pond, lagoon, impoundment, ditch, landfill, storage container, motor vehicle, rolling stock,
or aircraft; any present, or past pits or other unit and any other location, titles and job
descnption used to generate, treat, store, dispose, place, accumulate, collect, receive,
transport, ship, or otherwise manage waste, waste oils, lubncants, pipeline liquids and
compressor, dehydrator, hydraulic, and dielectnc fluids, PCBs, PCB containing matenals
or other substances used at any time in the maintenance and operation of the Company’s
natural gas pipeline, or where any waste has otherwise comes to be located.
20 “Storage” or “Store” means the containment of wastes, either on a temporary basis or for
a period of years, in such a manner as not to constitute disposal of such wastes.
21. “Tank” includes any object capable of containment that is not subject to inclusion under
the definition(s) of “drum” or “pit”, regardless of size, capacity or construction.
22. “Texas Eastern Transmission Corporation” or “Texas Eastern” includes Texas Eastern
Gas Pipeline Company (Texas Eastern Gas), Roy F. Weston, Inc. (Weston) and any
officers, directors, agents or employees of Texas Eastern, Texas Eastern Gas, or
Weston.
23 “Treatment” or “Treat” means any method, technique, or process, including neutralization,
designed to change the physical, chemical, or biological characteristic or composition of
any waste so as to neutralized such waste or so as to render such waste nonhazardous,
safer for transport, amenable for recovery, amenable for storage, or reduced in volume
24. When a question asks for identification or other response regarding “type” of a substance
the identification or response shall include a descnption of the substance by method of
generation, such as pipeline condensate or pipeline liquid.
25. “Unit” means any discernible unit, building, equipment, or structure, whether man-made
or natural, which is now or was ever used for the treatment, storage, disposal, or other
handling of wastes and substances. This definition includes pits, drums, tanks, waste
piles, land treatment units, ditches, incinerators, injection wells, container storage areas,
and transfer stations
iIE39 October 1997
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26. Each document submitted shall be clearly and precisely identified as to its title, author,
date of preparation subject matter, the numbered question to which it responds, and any
and all persons having any knowledge relating to the documents sought by this
subpoena.
27 Two sets of documents shall be submitted in response to each question. The first set of
documents will be arranged by Service Facility Site with the exception that documents
provided in response to questions regarding corporate-wide programs will be organized in
a separate group. The second set of documents will be arranged by question number
28. If the information sought by this subpoena is not contained in a document, separately
identify the person(s) who provided the information in your response, and the basis for
each person’s knowledge.
29. The plural shall include the singular and the singular shall include the plural Any
reference to a male pronoun shall also constitute reference to a female pronoun
30. If any document was, but is no longer, in the possession, custody, or control of
Respondent, provide the following information:
(a) state the disposition of the document;
(b) state the date such disposition was made;
(c) identify the present custodian of the document and state his address or, if the
document no longer exists, so state;
(d) identify the person who made the decision to regarding the disposition of the
document.
(e) state the reason for the disposition; and,
(f) describe the document and the contents of the document, including the title, the
author, the position or title of the author, addressee, the position or title of the
addressee, indicated or blind copies, date, subject matter, number of pages,
attachments or appendices, and all persons to whom the document was
distributed, shown, or explained.
31. In preparing responses to this subpoena, all information or documents requested by the
government are to include and cover the penod beginning January 1, 1978 and
continuing to the present. In the event that information or documents which are
responsive to this subpoena pre-date 1978, but relate to information or documents
requested herein, they must also be provided.
II. Information and Documents Requested
SERVICE FACILITY SITE DESCRIPTION
Provide a description of each service facility site including:
a. topographic map
October 1997 iiE—40
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b schematic layout - designating all compressors, pits, storage tanks, (above and
below ground), blow down tanks, liquid separators, transformers, large high and
large low voltage capacitors, or other units
c architectural and engineenng drawings of all systems as installed
d any available geologic data including distance to ground water, analysis of ground
water, ground water flow direction
e the location of all domestic and industnal wells within a 5 mile radius and analysis
of water at these wells
f. narrative description of the operations which take place or have ever taken place
at the site
g. copies of all operating procedures developed by or for each individual service
facility site
- compressor operation/servicing
- removal of fluid
- storage of fluid
- disposal of fluid
- clean-up of fluid
- filter separator operation/servicing
2. For each pit, tank or other unit at each service facility site, describe the purpose of each
unit (e.g., evaporation, sedimentation, neutralization, burning or incineration).
3. For multiple pits, tanks or other units for each service facility site, provide flow charts
descnbing the relationship between units
4. Provide a list by service facility site of all compressors operated by Texas Eastern,
indicate the type of compressor and size.
COMPRESSORS
5. For each compressor at each service facility site, provide a monthly summary and
supporting documents of the volume, type, vendor, scientific name, commercial name,
and character of the chemical substance purchased for maintenance, repair or
replacement of each compressor, and names, title, and job description of employees who
executed the purchases
6. For each compressor at each service facility site, provide a monthly summary and
supporting documents of the volume, type, source, scientific name, commercial name,
and character of the chemical substances added to each compressor; and names, title,
and job descnption of employees who performed this function.
7 Provide maintenance and servicing records for each compressor by service facility site,
including names, title and job description of employees who performed this function.
8. For each compressor at each service facility site, provide a monthly summary and
supporting documents of the volume, type, and character of the hazardous substances
intentionally or unintentionally removed from each compressor the reason and method of
removal, the volume, character and location of any of this hazardous substance place in
storage, the method of transport to the storage unit, the volume, character, method of
disposal and ultimate disposal site of the removed hazardous substances and the names,
title and job descnption of employees who performed these functions
iIE—41 October 1997
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9. For each compressor at each service facility site, provide a monthly summary and
supporting documents of compressor “blowouts” or seal failures and the volume of
chemical of hazardous substance lost in each failure.
10. Provide all documents pertaining to the sources and cause of pipeline liquids, the
character of the liquids, and programs implemented for their removal
10(a). Provide all documents, or in the absence of documents prepare a narrative, describing
what occurs due to compressor “blowouts” or seal failures and the resultant entry of
compressor fluids into the pipeline system.
FILTER SEPARATORS
11. Provide a list by service facility site of all filter separators that are now or have ever been
operated by Texas Eastern. Indicate the type of filter separator, size, installation date,
and any and all removal efficiency data developed by the manufacturer and Texas
Eastern.
11(a). For each filter separator at each service facility site, provide a monthly summary and
supporting documents of the volume, type, and character of chemical or hazardous
substances intentionally or unintentionally removed from each filter separator; the
volume, character and location of any chemical or hazardous substances placed in
storage, the volume, character and ultimate disposal site of the removed chemical or
hazardous substances, and the names, titles, and job description of employee who
performed these functions.
DEHYDRATORS
12. Provide a list by service facility site of all dehydrators that are operated by Texas Eastern.
Indicate the type of dehydrators, size, installation date, and any and all removal efficiency
data developed by the manufacturer and Texas Eastern.
13. For each dehydrator at each service facility site, provide a monthly summary and
supporting documents of the volume, type, and character of chemical or hazardous
substances intentionally or unintentionally removed from each dehydrator; the volume,
character and location of any chemical or hazardous substances placed in storage, the
volume, character and ultimate disposal site of the removed chemical or hazardous
substances, and the names, title, and job description of employees who performed these
functions.
OTHER UNITS
14. Provide a list by service facility site of any and all units other than those described or
listed in response to questions above or below, that are now or have ever been operated
by Texas Eastern. Indicate the type of device or system, its size, installation date, and
any or all removal efficiency data developed by the manufacturer and Texas Eastern.
15. For each unit not described or listed in response to questions above or below, at each
service facility site, provide a monthly summary and supporting documents of the volume,
type, and character of chemical and hazardous substances intentionally or unintentionally
removed from each compressor the volume, character, and location of any chemical and
hazardous substances placed in storage, the volume, character, and ultimate disposal
site of the removed chemical and hazardous substances, and the names, title and job
description of employees who performed these functions.
October 1997 IiE—42
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ADDITIONS, COLLECTION, AND REMOVAL POINTS
16. Provide a listing by service facility site of all pipeline liquid addition, removal and
collection points.
17. Provide for each addition point at each service facility site, a monthly summary and
supporting documents of the volume, type, vendor, brand name, scientific name,
purpose, and character of all substances added, and the names, title and job description
of the employees who performed this function
18. For each collection and removal point at each service facility site, provide a monthly
summary and supporting documents of chemical or hazardous substances, the volume
and character of substances removed, the reason removed, method of removal, the
volume, character, and location of any chemical or hazardous substances placed in
storage, the method of transportation to the storage unit, and the volume, character,
method of disposal, and name and location of the ultimate disposal site of the removed
substances, and the names, titles, and job descnption of the employees who performed
this function. For each collection point where pipeline chemical or hazardous substances
are no longer removed, provide the reasons they are no longer removed.
DRUM/BARREL STORAGE AREAS
19. Provide a list by service facility site of all drum/barrel storage areas and a descnption of
the structural components of the areas, and types of chemical or hazardous substances
and materials stored.
20. For each drum/barrel storage area at each service facility site, provide a monthly
summary and supporting documents of the volume, source, type, and character of the
chemical or hazardous substances added to the area, the method of transport to the
area, and the names, title, and job descnption of the employees who performed this
function.
21 For each drum/barrel storage area at each service facility site, provide a monthly
summary and supporting documents of the volume, source, type, number of drums or
barrels, the character of chemical substance or hazardous substance removed from the
area, the method of transportation to the disposal site, and location and ownership of the
ultimate disposal site of any chemical substances or hazardous substances removed
from the area, and the names, titles, and job description of the employees who performed
this function.
TANKS
22. Provide a list by service facility site of all tanks, indicating their purpose, current status as
in service or closed, the dates placed in service and closed, the location above or below
ground, their containment volume, if the tanks ever contained PCBs, the basis for this
determination, including the concentration of any PCBs, if known, and method of analysis,
and the name of any previous owners.
23. For each tank at each service facility site, provide a monthly summary and supporting
documents of the volume, source, type and character of the chemical or hazardous
substance added to the tank, the method of transport to the tank, the purpose of the
addition, and the names, titles, and job descnption of employees who performed this
function.
HE—43 October 1997
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24. For each tank at each service facility site, provide a monthly summary and supporting
documents of the volume, source, type, and character of the chemical or hazardous
substances removed, the purpose of removal, the name and location of the ultimate
disposal site, the method of transport to the site, the method of disposal, and the names,
titles, and job description of the employees who performed this function
25 Provide all documents pertaining to the institution of a tank installation program in lieu of
using pits, including dates of all tank installations at each service facility site.
PITS
26. Provide a list by service facility site of all pits operated by Texas Eastern indicating the
current status as either in service or closed, the dates placed in service and closed, and
the approximate dimensions (width, length, depth) of each pit, and the date each pit was
constructed, and actively used.
27 For each pit, provide a chronological listing with supporting documents by month of all
chemical or hazardous substances placed in each pit, by service facility site, indicating
the purpose, volume, source, type, and character of the chemical or hazardous
substances, method of transport to the site, purpose of placement, the names, title, and
job description of employees who performed this function.
28. For each pit, provide a chronological listing with supporting documents by month of all
chemical or hazardous substances removed from the pit indicating the volume, type,
method of removal, method of transport, the name and location of the ultimate disposal
site, method of disposal, and the names, titles, and job descnption of employees who
performed this function
29 For each pit provide an estimate of the substances remaining in each pit. Supply
supporting documentation.
30. Provide a list by service facility site of all pits where materials were burned, a listing of
materials which were burned, dates of burning, frequency of burning and quantity burned.
31. Provide all documents pertaining to the program for the discontinuation of use of pits by
service facility site.
32. Describe the method used to close each pit including procedures used to clean,
decontaminate or remove chemical or hazardous substances from the pit, a description of
any and all chemical or hazardous substances and procedures used to stabilize chemical
or hazardous substances or residuals remaining in the pit, and any and all methods used
to determine the levels of contamination of chemical or hazardous substances remaining
at the time of closure, and the adequacy of stabilization and other elements of the closure
process
33. Provide a monthly summary of all purchases of PCB fluids for compressors, electrical
equipment, transformers, capacitors, heat transfer and hydraulic systems, and any other
equipment used in connection with the operation and maintenance of the pipeline system
indicating the vendor, commercial name, scientific name, quantity purchased, and the
type of equipment where the PCB fluid was, is, or will be used.
October 1997 liE—44
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34. Provide a monthly summary by service facility site of any hazardous substances
treatment operations conducted at Texas Eastern service facility sites Indicate the
volume, type, and character of the hazardous substances before treatment, the method
of treatment, the volume, type and character of the treated hazardous substances, the
location and ownership of the ultimate disposal site of the treated hazardous substances,
method of transportation of the treated hazardous substances, and the names, titles, and
job description of the employees who performed this function
35. For each service facility site, provide a monthly summary and supporting documents of all
disposal of pipeline liquids, dielectric and hydraulic fluids, compressor fluids and
lubncants, waste oils and hazardous substances at sites other than those owned by
Texas Eastern. Indicate the dates of shipment and receipt of the hazardous substances,
volume, type and character of the hazardous substances; location and ownership of the
disposal site, method of disposal of the hazardous substances, and the names, title, and
job descnption of the employees who performed this function
36 Provide all documents relating to spills, releases, or other emissions of PCBs, PCB
containing materials, or hazardous substances, including:
a. all data on or records of known releases
b likely or actual dates/details of occurrences
c all actions taken to mitigate/remedy any releases not reported by Texas Eastern in
response to any previous information requests
d all data regarding fires, explosions or other unanticipated events
37. Provide copies of all documents in use or that have even been used which contain
instructions on the method of disposal of substances intentionally or unintentionally
generated dunng the operation and closure of service facility sites. In the event that the
documents are no longer available, provide a list of such documents, and an explanation
for their unavailability Such documents include instruction documents on:
a. Compressor station operations
b. Filter separator operations
c. Removal of pipeline liquids, PCB oils and other liquids
d. Storage of pipeline liquids, PCB oils and other liquids
e. Disposal of pipeline liquids, PCB compressors and pipeline fluids.
f Clean up of PCB spills, PCB compressors and pipeline fluids.
38 Provide a copy of all instructions, protocols, methods, directions and other documents
regarding Texas Eastern’s procedures for, and records of, retention and destruction of
documents. Such documentation includes:
a. Any and all logs or other documents identifying documents which have been
destroyed, and the date of such destruction;
b Instructions for the length of time documents are to be retained, including any
exceptions to those procedures, and the title of any employee authorized to make
such exceptions.
39. Provide all documents and make whatever inquiries are necessary to obtain information
that describes and identifies the character, type, quantity, extent, sources, and causes of
soil, air, ground water, surface water, and sediment contamination beyond unit or service
facility site boundanes, at all Texas Eastern service facility sites where such
contamination has been detected.
iiE—.-45 October 1997
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40. For each service facility site, provide all documents containing analytical results from the
monitoring of air, surface water, ground water, sludge, or soil at or in the vicinity of each
of these service facility sites.
41. Provide all documents pertaining to the need for and implementation of a monitoring
program at service facility sites owned and operated by Texas Eastern.
42. Provide a list by each service facility site of all PCB items, PCB storage areas and PCB
transport vehicles which have been marked in accordance with 40 CFR and the date of
marking.
43. Provide all records and reports prepared by Texas Eastern to fulfill the requirements
imposed by4O CFR 761.
44. Provide all documents showing the manufacture, import, export, or processing of PCBs
by Texas Eastern.
45. Provide all documents relating to the preparation of PCB monitoring reports submitted to
EPA as part of the gas pipeline remedial monitoring program.
46. Provide any and all documents and raw data collected by Texas Eastern in
investigating/surveying all Texas Eastern service facility sites including data collected for
the purpose of prepanng the reports titled: “Results of Compressor Station Disposal Pit
Investigations” (dated April 1, 1986); “Preliminary Report of Sampling Program at Texas
Eastern Compressor Stations” (dated December 1986); and “Generic Clean-Up Plan for
PCBs at Compressor Station Sites” (dated December 1986). For purposes of this
request, “raw data” includes sampling and analytical results in both raw and numerical
form, quality assurance/quality control data and information, data sheets, field notes and
logs, maps, drawings, plans, photographs, surveys, memoranda, work plans, sampling
plans, interim progress reports, and other information collected or maintained for any and
all service facility sites or pits. The request includes all service facility sites investigated
and is not limited to the eight stations discussed in the above-referenced reports.
Describe the method used to collect samples and identify any laboratory(ies) that
conducted analyses of the samples. Include the names, addresses, phone numbers and
job descriptions and qualifications for each person involved in the Roy F. Weston
investigations of service facility sites. Texas Eastern shall provide a listing and brief
summary of the contents of each set or grouping of raw data being provided.
47. Provide all permits, certifications, and/or authorizations received by Texas Eastern from
any or all Federal, State, or local regulatory agencies for construction, operation, disposal,
closure, or other activities occurring at any and all of the service facility sites that are or
were operated by Texas Eastern. Also, provide copies of any and all notifications of such
activities submitted by Texas Eastern to any or all Federal, State or local regulatory
agencies.
48. If any service facility site or component thereof discharges chemical or hazardous
substances to surface waters or to publicly owned treatment works, provide analyses for
all discharges and provide copies of permits.
49. Provide all documents, manifests, correspondence, shipping bills of lading for PCB liquid,
solid, or sludge-like matenals transported to any storage or disposal facilities.
50. Provide all documents pertaining to any and all programs for the phase out or
discontinuation of specific chemical or hazardous substances at service facility sites.
This shall include Monsanto product OS-81 and Turbinol 153.
October 1997 IIE—46
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Example 11—12. 3M and SET Environmental, Inc. — Order Granting
Motion for Subpoena
UNITED STATES
ENViRONMENTAL PROTECTION AGENCY
BEFORE THE ADMINISTRATOR
In the Matter of
)
Minnesota Mining and ) Docket No. TSCA-V-C-20-91
Manufacturing Co. and SET )
Environmental, Inc., )
)
Respondent )
ORDER GRANTING MOTION FOR SUBPOENA
The Motion by Respondent SET Environmental, Inc for issuance of a Subpoena Duces
Tecum is granted, and the Subpoena is attached hereto.
Thomas W. Hoya
Administrative Law Judge
Date& ___________
I IE.—47 October 1997
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UNITED STATES OF AMERICA
BEFORE THE ENVIRONMENTAL PROTECTION AGENCY
Docket No. TSCA-V-C-20-91
IN RE: Minnesota Mining & Manufacturing
Co. and Set Environmental, Inc.,
SUBPOENA DUCES TECUM
TO: Robert Parsons, Safety-Kleen Environmental Systems
633 East 138th Street, Dalton, IL 60419
By virtue of the authority vested in the undersigned by the Toxic Substances Control Act,
Section 11(c), 15 U.S.C. 2610 (C), YOU ARE HEREBY COMMANDED TO APPEAR before a
Notary Public, at 122 5. Michigan Avenue, Suite 1220, Chicago, Illinois 60603, at a date and time
to be set by Respondent, to testify and to bnng with you for inspection and copying the following
documents.
Documents To Be Produced
I Any and all documents dated February 15, 1989 through Apnl 15, 1989, which reflect
upon, relate to or refer to SET Environmental, Inc.’s vehicles
2. Any and all documents reflecting upon, relating to or referring to SET Environmental,
Inc.’s trailer #T-21.
3. Any and all documents reflecting upon, relating to or referring to any tests performed on
samples removed by Safety-Kleen personnel from SET Environmental, Inc.’s vehicles in
March, 1989.
4. Any and all documents received by Safety-Kleen from SET Environmental, Inc. in March,
1989.
5. Any and all documents sent by Safety-Kleen to SET Environmental, Inc. in March, 1989.
6. Any and all documents (including but not limited to rules, regulations, internal guidelines
or memoranda) of Safety-Kleen pertaining to the sampling of waste materials received by
Safety-Kleen.
7. Any and all documents reflecting upon, relating to or referring to discussions between
Safety-Kleen and the United States Environmental Protecti6n Agency concerning the
presence of PCBs in a load received from Minnesota Mining & Manufacturing Company
on or about March 23, 1989.
October 1997
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8. Any and all documents reflecting upon, relating to or referring to discussions between
Safety-Kleen and Minnesota Mining & Manufactunng Company concerning the presence
of PCBs in a load received from Minnesota Mining & Manufactunng Company on or about
March 23, 1989.
9 Any and all other documents refemng to, relating to or reflecting upon the receipt and
subsequent handling of a load from Minnesota Mining & Manufacturing Company on or
about March 23, 1989
10 A list of Safety-Kleen employees who were involved in the receipt of a load from
Minnesota Mining & Manufactunng Company on or about March 23, 1989.
11. A list of Safety-Kleen employees who were involved in the sampling and/or testing of a
load from Minnesota Mining & Manufactunng Company on or about March 23, 1989
12. Any and all documents reflecting upon, relating to or referring to the cleaning of SET
Environmental, Inc. vehicles in March, 1989.
13. Any and all documents (including but not limited to rules, regulations, internal guidelines,
memoranda or policy statements) which relate to the cleaning of trailers or vehicles by
Safety-Kleen.
Definitions
“Document” means any written, printed, typed or other graphic matter of any kind or
nature in the possession, custody or control of Robert Parsons or Safety-Kleen Environmental
Systems. The terms include, without limitation, all writings, letters, reports, correspondence,
memoranda, notes of meetings or of conversations either in writing or upon any mechanical or
electronic recording device, stenographic or handwritten notes, records, canceled checks, books,
work papers, telegrams, telexes, dianes, calendars, studies, surveys, manuals, contracts,
agreements, publications, minutes, press releases, computer printouts, punch cards, electrical or
magnetic recordings, pamphlets, statistical compilations, microfilm and microfiche records,
financial and accounting records or statements, telephone bills, travel vouchers, expense
account records.
“Safety-Kleen” means Safety-Kleen Environmental Systems and Safety-Kleen
Corporation, including all of their officers, directors, agents, employees and attorneys acting for
and on behalf of Safety-Kleen.
iiE—49 October 1997
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Done at Washington, DC
Thomas W. Hoya
Administrative Law Judge
Dated: April 18, 1991
Witness fees and expenses are to be paid by the party upon whose request the subpoena is
issued, in this instance, Respondent SET Environmental, Inc.
Attorney for Respondent SET Environmental, Inc.:
James A Davids, Esquire
Hoogendoom, Talbot, Davds, Godfrey &
Milligan
122 South Michigan Avenue
Suite 1220
Chicago, Illinois 60603
(312) 786-2250
October 1997 IIE—50
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RETURN ON SERVICE
Summoned the above-named witness by delivering a copy to __________________
and tendenng __________________ the fees for one day’s attendance and mileage allowed by
law, on the _____ day of _______________________, 1 9_, at _____________
Dated: ____________________________
Subscribed and sworn to before me, a ____________________________________
this ________ day of ________________, 19
A subpoena shall be served in accordance with 40 C.F R. Section 22.05 (b) (1), and a
copy of each subpoena with proof of service shall be filed with the Regional Hearing Clerk.
NOTE: Affidavit required only if service is made by person other than US Marshal or his deputy.
lIE—SI October 1997
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IN THE MATTER OF MINNESOTA MINING & MANUFACTURING
COMPANY. & SET ENVIRONMENTAL INC. . Respondent
Docket No. TSCA-V-C-20-1 9
Certificate of Service
I certify that the foregoing Order Granting Motion For Subpoena, dated April 18, 1991,
was sent this day in the following manner to the addressees listed below.
Onginal by Regular Mail to:
Beverly Shorty
Regional Hearing Clerk
US Environmental Protection Agency
230 South Dearborn Street
Chicago, IL 60604
Copy by Regular Mail to:
Attorney for Complainant:
Andre Daugavietis, Esquire
Office of Regional Counsel
US Environmental Protection Agency
230 South Dearborn Street
Chicago, IL 60604
Attorney for Respondent:
James A. Davids, Esquire
Hoogendoorn, Talbot, Davids, Godfrey & Milligan
122 South Michigan Avenue
Suite 1220
Chicago, IL 60604
Maria Whiting
Secretary
October 1997 IIE—52
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Example 11—13. Incentives for Self-Policing: Discovery, Disclosure,
Correction and Prevention of Violations (EPA Final
Policy Statement )
ENVIRONMENTAL PROTEC ’flON-
AGENCY
RL - 4 1J
Incentives for Self-Policing: Discovery.
Disclosure, CorTeetlon and Prevention
of Violations
AGENCY: Environmental Protection
Agency (EPA).
ACTION: Final Policy Statement .
SJ4ARY: The Environmental Protection
Agency (EPA) today issues Its final
policy to protection of human
health end the environment by
encouraging regulated entities to
voluntarily discover, and disclose and
1 . ct violations of environmental
requirements. Incentives Include
. lbntn.t1 05 or substantially reducing
the gravity component of dvii penalties
and not ren ,n ..ndIng ceses for
orlmakprosecouon where specified
c ” Itlons are met, to thos. who
voluntaif 1’ salf .dlsdose and promptly
correct violations. The policy J
restates EPA’s long-standing practice of
not requesting voluntary audit reports to
trigger enforcement Investigations. This
policy was developed In close
nsuhatIcn with the U.S. Department
of JustIc . states, public Interest groups
and the regulated nunity . and will
be applied uniformly by the Agency’s
enforcement prcgrems.
DATES: Th_ls policy is effective January
22,1998.
FOR FURThER INFORMATION CONTACT’.
Additional do iTnhI 1thL1on relating to
the development of this policy Is
contained In the environmental auditing
public docket Documents from the
docket may be obtained by calling (202)
260—7548. requesting an index to docket
C—94—01. and faxing document
requests to (202) 260-4400. Hours of
operation are 8 a.m. to 530 p.m..,
Monday through Friday. except legal
holidays. Additional contacts are Robert
Fentress or Brian Riedel, at (202) 564—
4187.
suPPt.EMENTART INFORMATION:
L Explanation of Policy
A. introduction
The Environmental Protection Agency
today Issues Its final policy to enhance
protection of human health and the
environment by encouraging regulated
to discover voluntarily disclose
correct and prevent violations of federal
environmental law. £ff Ive 30 days
from today, where violations axe found
through volu tazy environmental audits
or efforts that reflect a regulated entity’s
due dthgence, and are prouiptly
disclosed end expeditiously corrected,
EPA will not seek gravlty-bued (I.e..
non-economic benefit) p.nsilties and
will generally not recomend er ,niri1
prosecution against the regulated entity.
EPA will reduce gravity-based penalties
by 75% lQr violations that are
voluntarily discovered, and are
promptly disclosed and corrected, even
If not found through a formal audit or
due diligence. Finally, the policy
restates EPA’s long-held policy and
practice to refrain from routine requests
for environmental audit reports.
The policy Includes important
.safeguards to deter irresponsible
behavior end protect the public and
environment For example, In addition
to prompt disclosure and expeditious
correction, the policy requires
companies to act to prevent recurrence
of the vlohflon and to remedy any
envlronm ta1 harm which may have
oonmed. Repeated violations or those
which result In actual harm or may
present IflhlT fnent and siih tsntlaI
endangerment are not eligible for relief
under this policy, and companies will
not be allowed tog an economic
advantage aver their competitors b ’
delaying their 1nves ent In
comp” ” ’ Corporations r ,rin in
oriminally liable for violations that
result from conscious disregard of their
obligations under the law, and
Individuals are liable for ciinthu.I
misconduct.
The Issuance of this policy concludes
EPA’s eigbteen.month public evaluation
of the optimum way to encourage
voluntary sell-policing while preserting
fair and effective enforcement. The
incentives, conditions and exceptions
announced today reflect thoughtful
suggestions from the Department of
Justice, state attorneys general and local
prosecutors, state environmental
agendas. the regulated community, and
public Interest organizations. EPA
believes that It has found a balanced
and responsible approach, and will
conduct a study within three years to
determine the effectiveness of this
policy.
3. Public Process
One of the Environmental Protection
Agency’s most Important
responsibilities Is ensuring compliance
with federal laws that protect public
health and safeguard the environment.
Tffec$Ive deterrence requires Inspecting.
bringing penalty actions and securing
compliance and remediation of harm,
But EPA realizes that achieving
compliance also requires the
cooperation of thousands of businesses
end other regulated entitles subject to
these requirements. Accordingly. In
May of 1994, the Administrator asked
the Office of Enforcement and
Compliance Assurance (OECA) to
determine whether additional
incentives were needed to enmurage
voluntary disclosure and correction of
violations uncovered during
environmental audits.
EPA began Its evaluation with a two-
day public meeting in July of 1994. in
Washington, D.C.. followed by a two-
day meeting in San Frana wo on
January 19, 1995 with staheholders from
industry, trade groups. state
environmental commissioners and
attorneys general, district attorneys.
public interest organizations and
professional environmental auditors.
The Agency also established snd
maintained a public docket of testimony
presented at these meetings and .11
cl fT.Tn.nt and correspondence
submitted to EPA by outside parties on
this Imue.
In addition to considering opinion
and Information from ss.t 1 ’lden. the
Agency vainIned other federal and
state policies related to self-policing.
saif.dlsdosure and corr un. The
Agency also considered relevant surveys
on auditing practices In the private
sector. EPA completed the first stage of
this effort with the a000 , ,nr.Inenl of an
Interim policy on April 3 of this year.
which defined conditions under which
EPA would reduce civil penalties and
not recommend oriminal prosecution for
companies that audited, disclosed, and
corrected violations.
Interested parties were asked to
submit comment on the Intense policy
by3une 30 of this year (60 P7 16875).
and EPA received over 300 responses
from a wide variety of private and
public org .tnrntions. (Comments on the
interim audit policy; e contained in the
AuditIng Policy Docket, hereinafter,
“Docket”.) Further, the .4 . mencan Bar
Association SONREEL Subenn in ,ttee
hosted five days oT dialogue with
representatives from the regulated
Industry, states and public interest
organizations In June and September of
this year, which identified options for
strengthening the Interim policy. The
changes to the interim policy
announced today reflect Insight gained
through comments submitted to EPA.
the ABA dialogue, and the Agency’s
practical experience Implementing the
interim policy.
C. Purpose
This policy is designed to encourage
greater compliance with laws and
regulations that protect human health
and the environment. It promotes a
higher standard of self.pollcing by
waiving gravity-based penalties for
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66707
violations that are promptly disclosed
and corrected. and which were
discovered through volunzaz j audits or
compliance management systems that
demonstrate due diligence. To further
promote ccmplien . the policy reduces
gravity-based penalties by 75% for any
violation voluntarily discovered and
promptly disclosed and corrected, even
if not found through an audit or
compliance management system.
EPA’s enforcement program provides
a strong inr..n ive for respønsible
behavior by Imposing stiff sanctions for
noncompliance. Enforcement has
contributed to the dxamatlc expansion
of environmental auditing measured In
numerous recent surveys. For example.
more than 90% of the corporate
respondents to a 1995 Price-Waterhouse
survey who conduct audits said that one
of the reasons they did so was to find
and correct violations before they were
found by government inspectors. (A
copy of the Price-Waterhouse survey is
contained In the Docket as document
VW .—A—76.)
At the same time, because government
resources ire limited. mainmum
compliance cannot be achieved without
active efforts by the regulated
community to police themselves. More
than hail of the respondents to the same
1995 Price-Waterhouse survey said that
they would expand environmental
auditing in exchange for reduced
penalties for violations discovered and
corrected. While many companies
already audit or have compliance
management programs. EPA believes
that the incentives offered in this policy
will Improve the frequency and quality
of these sell-monitoring efforts.
D. Incentives for Self-Policing
Section Cot EPA’s policy identifies
the major incentives that EPA will
provide to encourage self policIng , self-
disclosure, and prompt selI-corre jo ,
These Include not seeking gravity-based
civil penalties or reducing them by
75%. d’ ”i’”’ .g to r m..’.ad tiv ta iI
prosecution for regulated entities that
self-police, and refraining flora routine
requests for audits. (As noted In Section
C of the policy. EPA baa refrained from
uifr4tig routine requests for audit
reports since issuance of Its 1986 policy
on envIronmental auditing.)
1. Hmin ting Gravity-Based Penalties
Under Section G Il) of the policy, EPA
will not seek gravity-based penalties for
violations found through auditing that
are promptly disclosed and corrected.
Gravity-based penalties will also be
waived for violations found through any
documented procedure for self-policing.
where the company con show that it has
2. 75% Reduction of Gravity
The policy appropriately limits the
complete waiver of gravity-based civil
penalties to companies that meet the
higher standard of environmental
auditing or systematic compliance
management. However, to provide
additional encouragement for the kind
of self-policing that benefits the public.
gravity-based penalties will be reduced
by 75% for a violation that Is
voluntarily discovered, promptly
disclosed and expeditiously corrected.
even If It was not found through an
environmental audit and the company
r nnnt document due diligence. EPA
expects that this will encourage
companies to come forward and work
with the Agency to resolve
environmental pro leras and begin to
develop an effective compliance
management program.
a coplisnce management program that Gravity-based penalties will be
meets the criteria for due diligence in reduced 75% only where the company
Section B of the policy, meets all conditions in Sections D(2)
Gravity-based penalties (defined in through D(9). EPA has eliminated
Section B of the policy) generally reflect language from the interim policy
the seriousness of the violator’s indicating that penalties may be
behavior. EPA has elected to waive such reduced “up to” 75% where “most”
penalties for violations discovered conditions are met, because the Agenc
through due diligence or environmental believes that all of the conditions in
audits. recognimug that these voluntary D(2) through D(9) are reasonable and
efforts play a entical role in protecting essential to achieving compiluun.— This
human health and the environment by change also responds to requests for
identifying, correcting and uttims .ly greater clarity and predictability.
preventing violations. AU of the 3. No Recommendations for Criminal
conditions set forth In Section D. which Pro ution
include prompt disclosure and EPA has never recommended criminal
expeditious correction, must be satisfied
for gravity-based penalties to be waived, pro cution of a regulated anti based
on voluntary disclosure of violations
s in the interim policy. EPA reserves discovered through audits and disc’osed
the right to collect any economic benefit to the government before an
that may have beeniealized as a result in ugation was already under WV:.
of nelicompliance. even where Thus, EPA will not recommend criminal
companies meet all other conditions of prosecution for a regulated entity ax
the policy. Economic benefit may be covers lolations through
waived, however, where the Agency environmentaj audits or due dilirence,
determines that It Is insignificant. uu .c promptly discloses and expeditiously
After considering public comment, Ilu”.’-corrects those violation,, and meei.s all
EPA has decided to retain the discretion other conditions of Section D of the
to recover economic benefit for two policy.
masons. First, it provides an Incentive ‘i ’ policy is limited to good actors,
to comply on time, Taxpayers expect to h f Impor.ant llrflitEions.
pay interest or a penalty fee if their t It will not apply. lox example, whe’e
payments are late; the same principle corporate oU1ci a1s are consciously
should apply to corporations that have involved in or willfully blind to
delayed their Investment In compliance. violations or conceal or condone
Second. it Is fair because It protects noncompliance. Since the regulated
responsible companies from being entity must satisfy all of the conditions
undercut by their noncomplying of Section D of the policy, violations
competitors, thereby preserving a level that caused serious harn or which may
playing field. The concept of recovering pose Imminent and substantial
economic benefit was supported In endangerment to human health or the
public comments by many stakeholders, environment are not covered by th..s
including industry representatives (see, policy. Finally. EPA reserves the ht to
e.g.. Docket. fl—F-39. U—F—28, and fl—F— recommend prosecution for the crrsinal
18 ) . conduct of any culoable individual.
Even where all ol the conditions of
this policy are not met, however, it is
Important to remember that EPA .zv
decline to recommend prosecution of a
company or Individual for many other
reasons under other Agency
enforcement policies. For example, the
Agency may decline to recommend
prosecution where there is no
significant harm or culpability and the
individual or corporate defendant cas
coouexated fully.
woere a company has met the
conditions for avoiding a
recommiundation for criminal
prosecution under this policy, it will
not face any civil liability for gravtrv-
based penalties. That Is because the
same conditions-for discovery.
disclosure, and correction apply in both
cases. This represents a clarification of
the interim policy, note substantive
change.
October 1997
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4. No Routine Requests for Audits
EPA is reaffirming its policy. In effect
since 1986. to refrain from routine
requesti for audits. Eighteen months of
public testimony end debit. have
produced no evidence that the Agency
has, deviated, or should deviate, from
this policy.
If the Agency has Independent
evidence of a violation, It may seek
information needed to establish the
entent and nature of the problem and
the degree of culpability, In general.
however, an audit which results In
prompt correction dearly ‘will reduce
liability, not expand it. Furthermore, a
review of the cr . nii iui docket did not
reveal a single cr min 1 prosecution for
violations discovered as a result of an
audit self-disclosed to the government.’
E. Conditions
Section D describes the nine
conditions that a regulated entity must
meet in order for the Agency not to seek
(or to reduce) gravity-based penalties
under the policy. As explained in the
Su .* y above, regulated entities that
meet all nine conditions will not face
gravity-based dvii penalties. and will
generally not have to fear criminal
prosecution. Where the regulated entity
meets all of the conditions except the
first (D(1)). EPA will reduce gravity-
based penalties by 75%.
1. DIscovery of the Violation Through
an Environmental Audit or Due
Diligence
Under Section DCI), the violation
must have been discovered through
either (a) an environmental audit that Is
systematic, objective, and periodic as
defined in the 1986 audit policy, or (b)
a documented. systematic procedure or
practice which reflects the regulated
entity’s due diligence In preventing.
detecting, end correming violations. The
interim policy provided full credit far
any violation found through “voluntary
seuf’eveluatlon , even If the evaluation
did not constitute en audiL In order to
receive full credit under th. final policy.
any self-evaluatlon’that Is not an audit
must be part of a “due diligence”
program. Both “environmental audit”
and “due diligence” are defined In
Section B of the policy.
Where the violation Is discovered
through a “systematic procedure or
practice” which Is not an audit, the
regulated entity will be asked to
document how its program reflects the
criteria for due diligence as defined in
Section B of the policy, These criteria,
which are adapted from esisting codes
of practice such as the 1991 Cri .,i., ,1
Sentencing Guidelines, were fully
discussed during the ABA dialogue. The
onteria are fleidble enough to
‘rITmTIodate different types and sizes
of businesses. The Agency recognizes
that a variety of compliance
“ gemenx programs may develop
under the due diligence criteria. and
will use itz review under this policy to
determine whether basic ciiteria have
been met.
Compliance management programs
which train and motivate production
staff to prevent, detect and correct
violations on a daily basis are a valuable
complement top o auditing. The
policy Is responsive to
recomm ndatLons received during
public comment and from the ABA
dialogue to give compliance
management efforts which meet the
criteria for due diligence the same
penalty reduction offered far
environmental audits, (See. e g . Il—F—
39. l1—E—18, and fl—G—18 in the Docket..)
EPA may require as a condition of
penalty mitigation that a description of
the regulated entity’s due diligence
efforts be made publicly available. The
Agency added this provision in
response to suggestions from
environmental groups, and believes that
the availability of such Information will
allow the public to judge the adequacy
of compliance management systems.
lead to hiincpd compliance, and foster
greater public trust In the Integrity of
compliance management systems.
2. Voluntary Discovery and Prompt
Disclosure
Under Section D(2) of the final policy,
the violation must have been Identified
voluntarily, and not through a
monitoring, sampling. or auditing
procedure that Is required by statute,
regulation, permit. judici ii or
*,tvnwiictratjve order, or consent
agreement. Section D(4) requires that
disclosure of the violation be prompt
and In writing. To avoid confusion and
respond to stile requests for greater
clarity, disclosures under this policy
should be made to EPA. The Agency
will work closely with states In
Implementing the policy.
The requirement that discovery of the
violation be voluntary Is consistent with
proposed federal and state bills which
would reward those discoveries that the
regulated entity can legitimately
attribute to its own voluntary efforts.
The policy gives three specific
examples of discovery that would not be
voluntary, and therefore would not be
eligible for penalty mitigationi
emissions violations detected through a
required continuous .?rn qo s monitor,
violations of NPDES discharge limits
found through prescribed monitoring.
and violations discovered through a
compliance audit required to be
performed by the term_s of a consent
order or settlement agreement.
The fins.! policy generally applies to
any violation that is voluntarily
discovered, regardless of whether the
violation is required to be reported. This
definition responds to comments
painting out that reporting requirements..
are extensive. and that excluding them
from the policy’s scope would severely
limit the incentive for self-policing (see.
e.R.. Ii-C--46 In the Docket).
‘l ’he Agency wishes to emphesi” that
the integrity of federal environmental
law depends upon timely and aomrate
reporting. The public relies on timely
end armuate reports from the regulated
community, not only to measiue
compliance but to evaluate health or
environmental risk and gauge progress
in reducing pollutant loadings. EPA
expects the policy to encourage the kind
of vigorous sell-policing that will serve
these objectives, and not to provide an
excuse for delayed reporting. Where
violations of reporting requirements are
voluntarily discovered, they must be
promptly reported (as discussed below).
Where a failure to report results in
imminent and substantial endangerment
or serious harm, that violation Is not
covered under this policy (see
Condition D(8)). The policy also
requires the regulated entity to prevent
recurrence of the violation, to ensure
that noncompliance with reporting
requirements Is not repeated. EPA will
closely scrutinize the effect of the policy
in furthering the public Interest In
timely and accurate reports from the
regulated community.
Under Section D(4), disclosure of the
violation should be mad. within 0
days of Its discovery. and In writIng to
EPA, Where a statute or regulation
requires reporting be made in less than
10 days, disclosure should be made
within the time limit established by law.
Where reporting within ten days Is nor
practical g use the violation Is
compIe n4 .bompllanc. cannot be
determui wlthIn that period. the
Agency may accept later disclosures if
the circumstances do not present a
serious threat and the regulated entity 7
meets its burden of showing that the
additional time was needed to
determine compliance status,
This condition recognizes that it is
critical for EPA to get timely reporting
of violations In order that ft might have
clear notice of the violations and the
opportunity to respond If necessary, as
well as an accurate picture of a given
facility’s compliance record. Prompt
disclosure is also evidence of the
regulated entity’s good faith in wanting
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66709
to achieve or return to compliance as
soon as possible.
In the final policy, the Agency has
added the words. “or may have
occurred,” to the sentence, “The
regulated entity fully discloses that a
specific violation has occurred. or may
have occurred • .“ This change,
which was made In response to
comments received, clarifies that where
an entity has some doubt about the
e,ustence of a violation, the
recommended course is for it to disclose
and allow the regulatory authorities to
make a definitive determination,
In general, the Freedom of
Information Act will govern the
Agency’s release of disclosures made
pursuant to this policy. EPA will,
independently of FOIA, make publicly
available any compliance agreements
reached under the policy (see Section H
of the policy), as well as descriptions of
due diligence programs submitted under
Section D.1 of the Policy. Any material
claimed to be Confidential Business
inforniatlon will be treated In
accordance with EPA regulations at 40
C.F .R. Part 2.
3. Discovery and Disclosure
Independent of Government or Third
Party Plaintiff
Under Section D(3), in order to be
‘voluntary”, the violation must be
identified and disclosed by the
regulated entity prior to: the
commencement of a federal state or
local agency inspection, investigation.
or Information request: notice of a
citizen suit; legal complaint by a third
party the reporting of the violation to
EPA by a “whisdeblower” employee
and ““ ‘ ‘ent discovery of the violation
by e reguls.toty agency.
This condition means that regulated
entities must have taken the initiative to
find violations and promptly report
them, rather than reacting to knowledge
of a pending enforcement action or
third.party complaint. This concept was
reflected In the Interim policy and In
federal and state penalty Immunity laws
and did not prove connuveraiaj In the
public comment procosa.
4. Correction end Remedlation
Section D(5) ensures that, In order to
receive the penalty mitigation benefits
available under the policy, the regulated
entity not only voluntarily discovers
and promptly discloses a violation, but
expeditiously corrects it. remedies any
harm caused by that violation
(Including responding to any spill and
currying out any removal or remedial
action required by law), and
expeditiously certifies In writing to
appropriate state, local and EPA
6. No Repeat Violations
In response to requests from
commenters (see. e.g., Il-F-39 and fl-C-
18 In the Docket). EPA has established
“bright lines” to determine when
previous violations will bar a regulated
entity from obtaining relief under this
policy. These will help protect the
public and responsible companies by
ensuring that penalties are not waived
8. Cooperation
Under Section D(9). the regulated
entity must cooperate as required by
EPA and provide information necassart’
to determine the applicability of the
policy. This condition is largely
unchanged from the interim policy. In
the final policy, however, the Agency
has added that “cooperation” includes
authorities that violations have been for repeat offenders. Under condition
corrected. It also enables EPA to ensure D(7), the same or closely.related
that the regulated entity will be publicly violation must not have occurred
accountable for Its commitments previously within the past three years at
through binding written agreements, the same facility, or be part of a pattern
orders or consent decrees where of violations on the regulated entity’s
necessary. part over the past five veers. This
The final policy requires the violation provides companies with a continuing
to be corrected within 80 days. or that incentive to prevent violations, without
the regulated entity provide written being unfair to regulated entities
notice where violations may take longer responsible for manning hundreds of
to correct. EPA recogninas that some facilities. It would be unseasonable to
violations can and should be corrected provide unlimited .nn.qy for repeated
immediately, while others (e.g.. where violations of the same requirement.
capital expenditures are involved), may The term “violation” includes any
take longer than 80 days to correct. In violation subject to a federal or state
all cases, the regulated entity will be vil judicial or administrative order,
expected to do its u ost to achieve or consent agreement, conviction or plea
return to compli.. .r ” as expeditiously as agreement. Recoenining that minor
possible. violations are sometimes settled without
where correction .of the violation a formal action in court, the term •j
depends upon Issuance of a permit covers any act or oussion for which the
which has been applied for but not regulated entity has received a penakv
issued by federal or state authorities, the reduction in the past. Together. these
.igeucy will, where appropriate, make conditions idenuf situations in which
reasonable efforts to secure timely the regulated commenity has had clear
review of the permit notice of its noncompliance and an
5. P event Recurrence Opportunity to correct.
Under Section D(6), the regulated . Other Violations L’ccluded
entity muSt agree to take steps to Section D(8) makes clear that penalty
prevent a recurrence of the violation, reductions are not available under this
including but not limited to policy for violations that resulted in
Improvements to its environmental serious actual harm or which may have
auaiting or due diligence efforts. The presented an ‘ “ent and substantial
final policy mi t clear that the endangerment to public health or the
preventive steps may Include environment. Such events Indicate a
improvements to a regulated entity’s serious failure (or absence) of a self.
environmental auditing or due diligence policing program, which should be
efforts to prevent reciurence of the designed to prevent such risks, and It
violation, would seriously undermine deterrence
in the interim policy, the Agency to waive penalties for such violations.
required that the entity Implement Th se exceptions are responsive to
appropriate measures to prevent a suggestions from public interest
recisrence of the violation, a organizations, as well as cthe
requirement that operates prospectively. commenters, (See, e.g., fl—F—39 and II—
However, a separate condition in the C-la In the Docket.)
Interim policy also required that the The final policy also excludes penalty
violation not indicate “a failure to take reductions for violations of the specific
appropriate steps to avoid repeat or terms of any order, consent agreement.
reaming vIolatlons’ —. requirement or plea agreement. (See, D-E-60 in the
that operates retrospectively. In the Docket.) Once a consent agreement has
Interest of both clarity and fairness, the been negotiated, there Is little Incentive
Agency has decided for purposes of this to comply if there are no “ons for
condition to keep the focus prospective violating its specific requirements. The
and thus to require only that steps be exclusion In this section applies to
taken to prevent recurrence of the violations of the terms of any response.
violation after It has been disclosed, removal or remedial action covered by
a written agreement.
October 1997
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Federal Register / Vol. 60. No. 246 I Friday. December 22. 1995 I Notices
assistance in determining the facts of
any related violations suggested by the
cisciosiire. as well as of the disclosed
violation itself. This was added to allow
the a!enCy to obtain information about
any violations Indicated by the
disclosure, even where the violation is
not initially identified by the regulated
eiy.
F O?pcsitlOn to Privilege
The Agency remains firmly opposed
to the establishment of a statutory
evidentiary privilege for environmental
aucis for the following reasons:
?:ivilege. by definition, invites
. ,e ey. instead of the openness needed
to id public trust in industry’s ability
:o saj.police. American Law reflects the
:z vaJi e that the public places on fair
ac:ess to the facts. The Supreme Court.
o: example. has said of privileges that.
w natever their origins, these
to the demand For every
nan s evidence are not lightly created
o: expansively construed. for they are
in cerogation of the search for tuth.”
L. ::ed States v. Nivon. 418 U.S. 683
( c4). Federal courts have
unanmously refused to recognize a
,rviege For environmental audits in the
c::’ t of government investigations.
See. e q.. United Slates v. Dexter. 132
F..D 8.9—10 (D Conn 1990)
(a pzcation of a privilege “would
effe . ively impede IEPA’sl ability to
e .o e the Clean Vater Act, and would
oe contrary to stated public policy.”)
Eighteen months have failed to
octice any evidence that a privilege is
eed d. Public testimony on the interim
?n y confirmed that EPA rarely uses
e .: reports as evicence. Furthermore.
s .. evs demonstrate that environmental
c.. ng has expanded rapidly over the
gas: cecade without the stimulus of a
p iege . Most recently. the 1995 Price
V. ae house surveY found that those few
a::! or mid ”sized companies that do
not audit generally do not perceive any
need to: concern about confidentiality
re.nited as one of the least Important
iao in their decisions.
3. A privilege would Invite
defendants to claim as “audit” material
almost any evidence the government
needed to establish a violation or
determine who was responsible. For
e. a.npie. most audit privilege bills
under consideration in federal and stale
lee slatures would arguably protect
factual information—such as health
studies or contaminated sediment
daze—and not lust the conclustons of
the auditors. While the government
might have access to required
monitoring data under the law, as some
industry commenters have suggested, a
privilege of that nature would cloak
underlying facts needed to determine
whether such data were accurate.
4. An audit privilege would breed
litigation, as both parties struggled to
determine what material fell within its
scope. The problem is compounded by
the lack of any clear national standard
for audits, The “in camera” (Le.. non-
ptiblic) proceedings used to resolve
these disputes under some statutory
schemes would result In a series of
tme .cOn5U ifl8. expensive mIni ’trials.
5. The Agency’s policy eliminates the
need for any privilege as against the
got eminent- by reducing civil penalties
and criminal liability for those
companies that audit, disclose and
correct violations. The 1995 PrIce
Va:erliouse survey indicated that
companies would expand their auditing
programs in exchange for the kind of
ir.cenuves that EPA provides in its
policy.
6. FInally, audit privileges are
strongly opposed by the law
enforcement community, including the
National District Attorneys Association.
as well as by public interest groups.
(See. e.g.. Docket. Il—C—21. U—C—28. II—
C—32. IV—G—l0. fl—C—25. ll—C—33. Il—C—
32. li.-C—i8. and II-G—13 through Il—C—
24.)
C. ffed on Slates
The final policy reflects EPA’s desire
to develop fair and effective incentives
for self.policing that will have practical
value to states that share responsibility
for enforcing federal environmental
laws. To that end, the Agency has
consulted closely with state officials in
avclGpinti ;bis policy, through a series
of snecial meetings and conference calls
in addition to the e, .Iensive opportunity
for public comment. As a result. EPA
believes its final policy Is grounded in
corunon’sense principles that should
ove useful In the development of state
programs and policies.
As always, states ire encouraged to
experiment with different approaches
that do not 1 eopardlze the Fundamental
national interest in assuring that
violations of federal law do not threaten
the public health or the environment, or
make it profitable not to comply. The
Agency remains o 2 4 to state
legislation that does not include these
basic protections, and reserves its right
to bring independent action against
regulated entitles for violations of
federal law that threaten human health
or the environment, reflect criminal
conduct or repeated noncompliance, or
aUow one company to make a
substantial profit at the expense of Its
law ’ablding competitors. Where a state
has obtained appropriate sanctions
needed to deter such misconduct, there
is no need for EPA action.
H. Scope of Policy
EPA has developed this document as
a policy to guide settlement acuolis.
EPA employees will be expected to
follow this policy. and the Agency will
take steps to assure national ne1etency
in application. For example. the Agency
will make public any compliance
agreements reached under this policy.
in order to provide the regulated
community with fair notice of decisions
and greater accountability to affected
communities. Many in the regulated
community recommended that the
Agency convert the nolicy into a
regulation because l ney felt it might
ensure greater consistency and
redictability. While EPA is taking steps
to ensure consistency and predictabiLty
and believes that it will be successful.
the Agency will consider this Issue anc
will provide notice if it determines tea:
a rulemaking is appropriate.
II. Statement o(Policvi Incentives for
Self.Policing
Discovely. Disclosure. Correction and
Preve ntion
A. Purnose
This policy is designed to enhance
protection of human health and the
environment by encouraging regulated
entities to voluntarily discover, disclcse.
correct and prevent violations of federi.
environmental requirements.
B. Definitions
For purposes of this policy, the
following definitions apply
“Environmental Audit” has the
definition given to tt in EPA’s 1986
audit policy on environmental auditi !.
i.e.. “a systematic, documented,
periodic arid objecti e review by
regulated entities of facility operations
and practices related to meeting
environmental requixements.
“Due Diligence” encompasses the
regulated entity’s systematic efforts.
appropriate to the size and nature of its
business, to prevent, detect and correct
violations through all of the foUowirig:
(a) Compliance policies. standards
and procedures that identify how
employees and agents are to meet the
requirements of laws, regulations.
permits and other sources of authority
for environmental requirements:
(b) Assignment of overall
responsibility for overseeing compliance
with policies, standards. and
procedures. and assignment of specific
responsibility for assuring compliance
at each facility or operation;
p.
I E—57
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66711
(c) Mechaniams for systematlcully
assuring that compliance policies.
standards and procedures are being
carried out. including monitoring and
auditing systems reasonably designed to
detect and correct violatinni, periodic
evaluation of the overall performance of
the compliance management system.
and a means for employees or agents to
report violations of environmental
requirements without fear of retaliation:
(dl Efforts to communicate effectively
the regulated entity’s standards and
procedures to all employees and other
agents:
(e) Appropriate Incentives to
managers and employees to perform In
accordance with the compliance
policies, standards and procedures.
including consistent enforcement
through appropriate disciplinary
mthen!ems and
(I) Procedures for the prompt and
appropriate correction of any violations.
and any necessary modifications to the
regulated entity’s progrern to prevent
future violations,
‘Environznental audit report” means
the analysis, conclusions, and
recommendations resulting from an
environmental audit, but does not
include data obtained in. or testimonial
evidence concerning, the environmental
audit.
“Gravity-based penalties” are that
portion of a penalty over and above the
economic benefit.. i.e.. the punitive
poruon of the penalty, rather than that
portion representing a defendant’s
economic gain from non-compliance.
(For further discussion of this concept.
see “A Framework for Statute-Specific
Approaches to Penalty Assessments”,
GM-22. 1980. U.S. EPA General
Enforcement Policy Compendium).
“Regulated entity” means any entity,
including a federal, state or municipal
agency or facility, regulated under
federal environmental laws.
C. Incentives for Self-Policing
1. No Gravity-Based Penalties
Where the regulated entity establishes
that it satisfies all of the conditions of
Section D of the policy. EPA will not
seek gravity.based penalties for
violations of federal environmental
requirements.
2. Reduction of Gravity-Based Penalties
by 75%
EPA will reduce gravity.based
penalties for violations of federal
environmental requirements by 75% so
long as the regulated entity satisfies all
of the conditions of Section D(2)
through D(9) below.
4. No Routine Request for Audits
EPA will not request or use an
environmental audit report to initiate a
Qvil or cr niea1 Investigation of the
entity. For example. EPA will not
request an environmental audit report in
routine inspections. If the Agency has
independent reason to believe that a
violation has occurred, however. EPA
may seek any Information relevant to
Identifying violations or determining
liability or eatent of harm,
D. Conditions
1. SystematIc Discovery
The violation was discovered through:
(a) an environmental audit; or
(b) an objective, documented.
systematic procedure or practice
reflecung the regulated entity’s due
diligence In preventing, detecting, and
correcting violations. The regulated
entity must provide accurate and
complete documentation to the Agency
as to how ft exercises due diligence to
prevent. detect and correct violations
according to the criteria for due
diligence outlined in Section B. EPA
may require as a condition of penalty
mitigation that a description of the
regulated entity’s due diligence efforts
be made publicly available.
2. Voluntary Discovery
.fle violation was identified
voluntarily, and not through a legally
mandated monitoring or sampling
requirement prescribed by statute.
regulation. permit, judicial or
administratIve order, or consent
agra.snent. For example, the policy does
not apply to:
(a) e .n aons violations detected
through a continuous “““'“‘ozis monitor
(or alternative monitor established in a
permit) where any such monitoring is
reaWred.
( i) violations of National Pollutant
Di€rhiirge 1 ” ” Lion System (NPDES)
dischsr e limits detected through
3. Prompt Disclosure
The regulated entity fully discloses a
specific violation within 10 days (or
such shorter period provided by law)
after it has discovered that the violation
has occurred, or may have occurred, in
writing to EPA;
4. DIscovery and Disclosure
independent of Government or Third
Party Plaintiff
The violation must also be identified
and disclosed by the regulated entity
prior to:
(a) the commn .,n.nt of a federal.
state or local agency inspection or
lnvestlgeUon. or the issuance by snob
agency of an Information request to the
regulated entity ’
(b) notice of a citizen suit.
(c) the filing of a complaint by a third
fthe reporting of the violation to
EPA (or other government agency) by a
“whietleblower” employee, rather than
by one authorized to speak on behalf of
the regulated entity: or
(e) m?ninent discovery of the
violation by a regulatory agency;
5. Correction and Remedlation
The regulated entity co cts the
violation within 60 days, certifies in
writing that violations have been
corrected, and takes appropriate
measures as determined by EPA to
remedy any envirott,vii .ntaL or human
harm due to the violation. If more than
60 days will be needed to cunect the
violation(s), the regulated entity must so
notify EPA In writing before the 60-day
period has passed. Where appropriate.
EPA may require that to satisfy
conditions 5 and 6, a regulated entity
enter into a publicly available written
agreement, administrative consent order
or judicial consent decree, particularly
where compliance or remedial measures
are complex or a lengthy schedule for
attaining and mainta !th g compliance
or remediating harm is required.
6. Prevent Recurrence
The regulated entity agrees in writing
to take steps to prevent * recurrence of
the violation, which may include
Improvements to Its environmental
auditing or due diligence efforts:
3. No Criminal Recommendations
(a) EPA will not recommend to the
Depar ent of Justice or other
prosecuting authority that ci 4 n .ini.
charges be ght against a regulated
entity where EPA determines that all of
so long as the violation does not ___ ____
the conditions in Section Daze
demonstrate or involve
(I) a prevalent management
philosophy or practice that c”ealed
condoned environmental violations; or
(ii) high-level corporate 0 ffimaIt ’ or
managers’ conscious involvement in, or
wLUfu.l blln ’4n ” ’ to, the violations.
(b) Whether or not EPA refers the
regulated entity for cr 4 minal prosecution
under this section. the Agency reserves
the right to recommend prosecution for
thecriminal acts of Individual managers
or employees under erosling policies
guiding the exercise of enforcement
discretion.
October 1997
IIE—58
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Federal Register I Vol. 60. No. 246 / Friday, December 22. 1995 / Notices
7. No Repeat Violations
The specific violation (or closely
related violation) has not occurred
previously within the past three years at
the same facility. or is not part of a
pattern of federal. state or local
violations by the facility’s parent
organization (if any). which have
occurred within the past five years. For
the purposes of this section. a violation
is:
(a) any violation of federal, state or
local environmental law Identified In a
judicial or administrative order, consent
agreement or order, complaint, or notice
of violation, conviction or plea
agreement or
(b) any act or omission for which the
regulated entity has previously received
penalty mitigation from EPA or a state
or local agency.
8. Other Vjo1 tio ijs Excluded
The violation is not one which (i)
resulted In serious actual harm, or may
have presented an im nent and
substantial endangerment to, human
health or the environment, or (ii)
violates the specific terms of any
judicial or administrative order, or
consent agreement.
9. Cooperation
The regulated entity cooperates as
requested by EPA and provides such
Information as is necessary and
requested by EPA to determine
applicability of this policy. Cooperation
includes, at a minrnium, providing all
requested documents and access to
employees and assistance in
investigating the violation, any
noncompliance problems related to the
disclosure, and any environmental
consequences related to the violations.
E. Economic Benefit
EPA will retain its full dlscietion to
recover any economic benefit gained as
a result of noncompliance to preserve a
“level playing field” In which violators
do not gain a competitive advantage
over regulated nH1 that do comply.
EPA may forgive the entire penalty for
violations which meet condjtlon. s 1
through 9 in section D and, In the
Agency’s opinion, do not merit any
penalty due to the Insignificant amount
of any economic benefit.
F. Effect on State Law, Regulation or
Policy
EPA will work closely with states to
encourage their adoption of policies that
reflect the Incentives and conditions
outlined in this policy. EPA remains
firmly opposed to statutory
environmental audit privileges that
shield evidence of environmental
violations and undermine the public’s
right to know, as well as to blanket
Immunities Lot violations that reflect
oriminsi conduct, present serious
threats or actual harm to health and the
environment, allow noncomplying
companies to gain an economic
advantage over their competitors, or
reflect a repeated failure to comply with
federal law. EPA will work with states
to address any provisions of state audit
privilege or immunity laws that are
inconsistent with this policy, and which
may prevent a timely end appropriate
response to significant environmental
violations. The Agency reserves Its right
to take necessary actions to protect
public health or the environment by
enforcing against any violations of
federal law.
C. Applicability
(1) This policy applies to the
assessment of penalties for any
violations under all of the federal
environmental statutes that EPA
administers, and supersedes any
inconsistent provisions In media-
specific penalty or enforcement policies
and EPA’s 1986 Environmental
Auditing Policy Statement.
(2) To the extent that eaisting EPA
enforcement policies are not
inconsistent, they will continue to apply
in conjunction with this policy.
However, a regulated entity that has
received penalty mitigation for
saUsf .ing specific conditions under this
policy may not receive additional
penalty mitigation for satisfying the
same or similar conditions under other
policies for the same violation(s), nor
will this policy apply to violations
which have received penalty mitigation
under other policies.
(3) This policy sets forth factors for
consideration that will guide the
Agency in the exercise of Its
prosecutorial diseuon, It states the
Agency’s views as to the proper
allocation of its enforcement resources.
The policy is not final agency action.
and Is intended as guidance. It does not
create any rights, duties, obligations, or
defenses, implied or otherwise, in any
third parties.
(4) ThIs policy should be used b .i#.A .J(
whenever applicable in settlement ,tfr
negotiations for both administrative and
civil judicial enforcement actions. It is ‘
not intended for use in plesding, at
hearing or at tt’laL The policy may be
applied at EPA’s discretion to the
settlement of administrative and judicial
enforcement actions instituted prior to.
but not yet resolved. as of the effective
date of this policy.
H. Public Accountability -
(1) Within 3 years of the effective date
of this policy. EPA will complete a
study of the effectiveness of the policy
in encouraging:
(a) changes in com liance behavior
within the regulated community.
including improved compliance rates:
(b) prompt disclosure and correction
of violations, including timely and
accurate compliance with reporting
requirements:
Cc) corporate compliance progre’ns
that are successful in preventing
violations, improving environmental
performance, and promoting pubic
disclosure:
Cd) consistency among state programs
that provide incentives for voluntary
compliance.
EPA will make the study available to
the public.
(2) EPA vill make publicly available
the terms and conditions of any
compliance agreement reached ‘rnder
this policy, Including the nature of the
violation, the remedy, end the schedule
lot returning to compliance.
L Effective Date
This policy is effective January 22.
1996.
Dated December 18, 1995.
Steven A. Henesa,
Assistant Adm:nzstra:orforEnforc.ement and
Compliance Ass Wance.
(FR Dec. 05—31346 FlIed 12—21—95: 8.45 sin!
ee,wio coca
IIE—59
October 1997
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Example 11—14. EPA Policy on Compliance Incentives for Small
____ Businesses
EPA Policy on Compliance Incentives For
Small Busmesses
issued May 20, 1996 ; effectIve June 10, 1996
A. INTRODUCTION
This document sets forth the U.S. Environmental Protection Agency’s Policy on
Compliance Incentives for Small Businesses. This Policy is one of the 25 regulatory reform
inir 4 itjvgs announced by President Clinton on March 16, 199 , and implements, in part, the
Executive Mcxnor2ndum on Regulatory Reform, 60 FR 20621 (April 26, 1995).
The Executive tvfemor2vvfum provides in pertiflent parc
To the extent permitted by law, each agency sball’use its discretion to modify
the penalties for small bnc ’ses in the following sitwirions. Agencies shall
exercise thew enforc znent discretion to waive the imposition of all or a portion
of a penalty when the violation a corrected within a time period appropriate to
the violation in question. For those violations that may take longer to correct
than the period set by agency, the agency shall us c its cnforc mint
discretion to waive up to 100 percent of the v ial pen2lties if the amounts
waived are used to bring the entity into compliance. The provisions [ of this
paragraph) shall apply only where there has been a good faith effort to comply
with applicable regulations and the violation does not involve criminal
wrongdoing or signi&anr threat to health, safety, or the environment.
This Policy also implements section 323 of the Small Business Regulatory Enforcei nt
Fairness Act of 1996, signed into law by the President on March 29, 1996.
As set forth in this Policy, EPA will refrain from initiaung an enforc ’n nt action
seeking civil penalties, or will mitigate civil pe’ ”ies , whenever a small business tnak a
good faith effort to comply with environmental requirements by receiving compliance
assistance or promptly disclosing the findings of a voluntarily conducted environmental iidi •
subject to certain conditions. These conditions require that the violation: is the small business’s
first violation of the particular requirement; does not involve criminal conduct; has not and s
not causing a significant health, safety or environmental threat or harm; and is remedied
within the corrections period. Moreover, EPA will defer to State actions that are consistent
with the criteria set forth in this Policy.
B. BACKGROUND
The Clean Air Act (CAA) Amendments of 1990 require that States estahlish Sins]!
Business Assistance Programs (SBAPs) to provide technical and environmental compliance
IIE—61 October 1997
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Compliance Lncenuve tot Small Busine s page 2
assistance to stationary sources. On August 12, 1994, EPA issued an enforcement response
policy for stationary sources wbich provided that an authorized or delegated state program
may, consistent with federal requirements, either:
(1) assess no penalties against small businesses that voluntarily seek compli2nee
assistance and correct violations revealed as a result of compliance assistance within a
limited period of time; or
(2) keep confidential informat ion that identifies the nsr s and locations of specific
. cmall businesses with violations revealed through compliance assistance, where the
SBAP is independent of the stare ecforcem nt program.
In a further effort to assist small businesses to comply with environmental regnle Ions,
and to achieve health, safety, and environmental benefits, the Agency is adopting a broader
policy for all media programs, including water, air, toxics, and hazardous waste.
C. PURPOSE
This Policy is intended to promote environmental compliance among niaIl businesses
by providing incentives for them to participate in on-site compliance assistance programs and
to conduct environmental audits . Further, the Policy encourages t,,iaii businesses to
expeditiously remedy all violations discovered through compliia assistance and
environmental audits . The Policy accomplishes this in two wiys: by setting forth a serrl n nt
penalty Policy that rewards such behavior, and by providing guid2nee for States and local
governments to offer these incentives.
D. APPLICABILiTY
This Policy applies to facilities owned by small buS1E SSe5 U defined here. ‘ ‘
business is a person. corporation, partnership, or other entity who employs 100 or fewer
individuals (across all facilities and operations owned by the entity). t This definition is a
simplified version of the CAA §507 definition of 5m211 business. On b2l2nee , EPA
determined that a single definition wouldm implementation of this Policy sinightforwjard
and would allow for consistent application of the Policy in a intil iedia CO t.
This Policy is effective June 10, 1996, and on that dale supersedes the Interim version
of this Policy issued on June 13, 1995 and the Septeniber 19, 1995 Qs and As gui iiee on the
Interim version. This Policy applies to all civil judicial and arlmini mative enforcement actions
l The number of employees should be considered as fuil-ume equivalimu on an aDnn2 basis. xluding
comrlct employees. FuI l.ume equivalents r .znc 2,000 hours per year of employment.. For example, see 40
CFR §372.3.
October 1997 IIE—62
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Compliance Incentives tot Small Businesses page 3
taken under the authority of the environmental statutes and regulations that EPA administers,
except for the Public Water System Supervision Program under the Safe Drinking Waxer Act.
This Policy applies to all such actions filed after the effective daze of this Policy, and to all
pending cases in which the government has not reached agreement in principle with the alleged
violator on the amount of the civil penalty.
This Policy sets forth how the Agency expects to exerise u.s enforcement discredon in
deciding on an appropriate, enforcement response and determining an appropriate civil
settlement penalty for violations by small businesses. It states the Agency’s views as to the
proper allocation of enforcement resources. This Policy is ant final agency action and is
intended as guidance. It does not create any rights, zhiri s , obligations, or defenses, implied or
otherwise, in any third parties. This Policy is to be used for settlement purposes and is not
intonded for use in pleading, or at bearing or thai. To the extent that this Policy may differ
from the terms of applicable enforcrm ’nt response policies (including penalty policies) under
media-specific programs, this document supersedes those policies. This Policy sUpplements,
but does not supplant the August 12, 1994 Enforcement Resprnse Poilq for Treasratra of
Information Obtained Through Clean Air Act Section 507 Small Business As ance P7vgranu.
E. CRiTERIA FOR CIVII PENALTY M iT GATION
EPA will eIiminar or mitigate its settlement penalty demand! ; against small busirrssei based
on the following criteria:
1. The n aI1 business has made a good faith effort to comply with applicable
environmental requirements as demonstrated by sathfving it her a. or b. below .
a. Receiving on-site compliance assistance from a or government
supported program that offers services to small businesses (such as a SBAP or state
university), and the violations are detected during the complisnec assistance. If a email
business wishes to obtain a corrections period after receiving compliance assistance from a
confidential program, ,the business must promptly disclose the violations to the appropriate
regulatory agency..
b. conducting an environmental audit (either by itself or by using an independent
contractor) and promptly disclosing in writing to EPA or the appropriate state regulatory
agency all violations discovered as part of the environmental audit pursuant to section H of
this Policy.
This Policy does not apply to the Public Water System Supervision (PWSS) Propam bc use the
PWSS Program already baa an active compliance assistance program and EPA baa a policy to address the special
needs of smaLl communities. Sec November 1995 Polzcy oa Flazble Sane Eiijbrcsrwv Respoiu. to Small
Comniwwy Vioianonz.
IIE—63. October 1997
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Compliance lncenuv for Small 8 ine ses page 4
For both a. and b. above, the disclosure of the vio1acio must occur before the violation was
otherwise discovered by, or reported to the regulatory agency. See section 1.1 of the Policy
below. Good faith also requires that a small business cooperate with EPA and provide such
information as is necessary and requested to determine applicability of this Policy.
2. This is the small business’s first violation of this requirement This Policy does not
apply to businesses that have previously been subject to an intbrmanon request, a warning
letter, notice of violation, field citation, cmzen suit, or other enforcement action by a
government agency for a violation of that requirement within the past three years. This Policy
does not apply if the small busm ss received penalty mitigation pursuam to this Policy for *
violation of the same or a 3 imilar requfrem within the past three years. If a bush es hes
been subject to two or more enforcement acuons for violatione of environmental requirements
in the past five years, this Policy does not apply even if this is the first violation of this
particular requirement.
3. T e heicin s nrr. - s th.vinl iinn witP in th. nrr rin period set forth belg .
Small businesses are expected to remedy the violations within the shortest practicable
period of time, not to exceed 180 days following detection of Ihe violation. However, a smell
business may rake an additional period of 180 days, i , up to a period of one year from the
daze the violation is detected, only if necessary to allow a small business to correct the
violation by imp1eme ting pollution prevention measures. For any violation that cam o ( be
corrected within 90 days of detection, the small business should submit a written sched” , or
the agency should issue a compliance order with a s hMule , as appropriate. Correcting
violation includes remediating any iionme I harm associated with the violation , as well
as implementing steps to prevent a recurrence of the violation.
The Policy applies it
a. The lation i as not caused aemal serious harm to public health , safety, or the
environment; and
b. The violation is not one that may present an ‘ ‘ “ent and substnnthl eng tm iu
to public health or the environment; and
c. The violation does not present a significant health, safrty or envfronmentsl threat
(e.g., violations involving hazardous or toxic substances may present such threats); and
d. The violation does not involve criminal conduct.
If signaficani efforts wüI be reqwred to remediaze the bar . the Polny will nor apply since cnmrwn 3 is
likely not to bave been sausticd.
October 1997 tlE—64
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COmplianCe Incentives (or Small Businesses psge 5
F. PENALTY MiTIGATION GUIDELTh(ES
EPA will exercise its enforcement discretion to eliminate or mitigate civil sertietnent
penalties as follows.
1. EPA will eliminate the civil sen pC ky tfl any enforcement action if a
small business satisfies gil of the criteria in section E.
2. If a small business meets all of the criteria, exept is needs a longer corrections
period than provided by criterion 3 (i.e., more than 180 days. for non-pollution prevention
remedies, or 360 days for pollution prevention remedies) , EPA will waive up to 100% of the
gravity component of the penalty, but may seek the full amount of any economic benefit
associated with the violations.’
3. If a em 1I business meets all of the criteria, etcepc it has obtained a significant
economic benefit from the violation(s) such that it may have obtained an economic advantage
over its competitors. EPA will waive up to 100% of the gra ity component of the penalty, but
may seek the full amount of the signif eant economic benefit associated with the violations.
EPA retains this discretion to ensure that tmall bu ij e that comply with public health
protections are not put at a serious marketplace dt advamage by those who have not complied.
EPA anticipates that this siruasion will occur very thfrequentiy.
If a small business does not fir within guidelines 12, or 3 rn .rnethately above, this Policy does
provide any special penalty mitigation. However, if a small iness has otherwise fl12e 5
good faith effort to comply. EPA has discretion, pursuant to its applicable enforcement
response or penalty policies, to refrain from f 5 IIng an enforcement action seeking civil
penalties or to mitigate its dom2nd for pennines.’ Further, these policies allow for mitigation
of the penalty where there is a documented inability topsy all or a portion of the penalty,
thereby placing emphasis on enabling the small business to fii v coinplianee. See Guidance
on Derermuwrg a V iola tor’: Ability to Pay a Civil Penalty of December 1986. PenaltIes also
may be mitigated pursuant to the L’zterim RM,ed Siçplanergal Envirownenwi Projects Policy
of May 1995 (60 P.R. 24356, 5/10/95) aed lncennver jbr Se ’-Policing: DLrcoveiy,
Ditcioture, Correction and Plevennon of Violations Policy c f December 1995 (60 P.R. 66706,
12/22195).
‘ The gravuy component’ of ike penalty ineh ever thing except the economic benefit In
determining the appropriate amo of the V3VILY Cn flp Of the penalty to minpt , EPA aboold o” 1 ’ the
nature of the viobnona. the duranon of the violaii the envircemaj or public health impacts of the
vioLations. good faith efforts by the small buri. . promp y remedy the vtglauon. and the facility’s overall
record of compliance with enviionmgnr ,j requaromeors.
For exaniple. In some media specific penalty policies. if good faith efforts are undertaken, the penalty
calcujanon auzom n auy (actors in such efforts through a poz&.nnally sma.Uer economic benefit or viry anio .
IIE—65 October 1997
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Compliance lncennv for SmaLl Businms page 6
G. COMPLIANCE ASSISTANCE
L Defimtions and Limitations
Compliance assistance’ is informa tion or assistance provided by EPA, a State or
another government agency or government supported entity to help the regulated community
comply with legally manh42r d environmental requirements. CDmpliance assistance does oct
include enforccm nt inspections or enforcement actio&.
In its broadest sense, the content of compliance assistance can vary greatly, ranging
from basic information on the legal requirements to speci2Ii2ecl advice on what echoology
may be best suited to achieve compliance at a particular ciliry. Compliance assistance also
may be delivered in a variety of ways, ranging from general oatreach through the Federal
Register or other publications, to conferences and cou izer bulletin boards, to on-site
assistance provided in response to a specific request for help.
The special penalty mitigation considerations provided by this Policy only apply to
civil violations which were id ntffIed as part of an on.eft cmpllavwe assistance visit to
the faeillty . If a email business wishes to obtain a corrections period after receiving
compIi nee assistance from a coifld nti I program, the busim ss must promptly disclose the
violations to the appropriate regulatory agency and comply with the other provisions of this
Policy. This Policy is resthcted to on-site compliance assistance because the other forms of
assistance (such as botlines) do not expose a cmall business to an increased riskof en(o -ement
and do not provide the regulatory agency with a simple way to determine when the violations
were detected and thus when the violations must be corrected. In short, ntal1 businesses do
not need protection from p naltiPL as an incentive to use the other types of compliance
assistance.
Delivery of On-Site Compliance Assistance By Goverrtment Agency or Govirnnient
Supported Program
Before on-sire compliance assistance is provided under this Policy or a iar State
policy, businesses should be informed of how the program works and their obligations to
promptly remedy any violations discovered. Td a!1y, before on-site t ompliance assistance is
provided pur uam to this Policy or 5 imilar Stare policy, the agency should provide the ftcllity
with a document (such as this Policy) e pl2ming how the program works and the
responsibilities of each party. The document should ctnphast e the responsibility of the
facility to remedy all violations discovered within the corrections period and the types of
‘Compliance assistance is sometimes caLled compLiance as im zs or technical asslitaecr .
Of course. dunng an inspection or enforcement ac cn. a facility may receive sug esuom and information
front the regtZasory au&boruy about bow to correct and prevent vlol2tiOns.
October 1997 IIE—66
-------
Compliance Incentives for Small Bmm .Ses pI e 7
violations thai are exciutied from penalty mitigation (e.g., viclations that caused serious harm).
The facility should sign a simple form acknowledging that it underst2ndl the Policy.
Documentation expl2ining e nanire of the compliance a.ssisc nce visit and the penalty
mitigation guidelines is essential to ensure that the facility understands the Policy.
At the end of the compliance assistance visit, the government agent should provide the
facility with a list of all violations observed and report within 10 days any additional violations
identified resulting from the visit, but not directly observed, e.g.. results from review and
analysis of data or information gathered during the visit. Any violations that do not fit within
the penalty mitigation guidelines in the Policy - e.g., those that caused serious h2zm ... should
be identified, If the violations all be corrected within 90 days, the facility should be
requested to submit a sehed”Ic for remedying the violations or a compliance order setting forth
a schedule should be issued by the agency.
Requests for On-Site Compliance Assistance
EPA, Scares and other government agencies do not have the resources to provide on-
site compliance assistance to all small busirrss c that request such assistance. This Policy
does not create any right or entitlement to compliance assistarce. A 1 business that
requests on-site compliance assistance will not necessarily receive such assistance. If a ll
business requests on-site compliance assistance (or any other type of assistance) and the
assistance is not available, the government agency should provide a prompt response in&ating
that such assistance is not available. The’”’ flbesiness should be referred to other public and
private sources of assistance that may be available, such as clearinghouses, bodlines, and
extension services provide by some universities. fl• j should be
informed that it may obtain the benefits offered by this Policy by conducting an envfromnental
audit pursuant to the provisions of this Policy.
H. ENVIRONMENTAL AUD11
For purposes of this Policy, an environmental 21141t is defined as a systematic,
documented, periodic and objective review by regulated enouss of facility operations and
practices related to meeting environnv’ntal requirements. See EPA’s new 2Ilthtiltg policy,
entitled Incerawes for S4 -Polici rig, 60 P.R. .66706, 66711, December 22, 1995.
The violation must have been discovered as a result of a VOlflflt2iy cnviionmen&al anñit ,
and not through a legally yiinrtd ted monitoring or sampling requirement prescribed by stanur ;
regulation, permit. judicial or administrative order, or consent agreement. For example. the
Policy does not appLy to:
1) emissions violations detected through a mssious monitor (or alternative
monitor established in a permit) where any such monitoring is required;
IIE—67 October 1997
-------
c!mpllance Incenth for Small BmznesS pae $
2) violations of National Pollutant Discharge System (NPDES) discharge
limits detected through required sampling or momtorin ; or
3) violations discovered through an audit reqwred to be performed by the terma of a
consent order or senle 1 l%t agreement.
The small business must fully disclose a violation within 10 days (or such shorter
period provided by law) after ii has discovered that the violation has occurred, or may have
occurred, in writing to EPA or the appropriate state or local goverent agency.
I. ENFORCEMENT
To ensure that this Policy enlw” es sod does not couiprotnise public health aod dte
environment, the following cojidif ions apply:
1. Violations detected through inspections, field citations, reported to an agency by a
member of the public or a whistleblower employee, identified in notices of citizen suits, or
previously reported to an agency as required by applicabLe regulations or permits, r m n fWly
enforceable.
2. A business is subject to all applicable enforcement response policies (which may
include discretion whether or not to tab formal enforcement action) fcr all violations that had
been detected through compliance assistance aM were not reme&d w-ihin the corrections
period. The penalty in such action may include the time period before sod during the
correction period.
3. A State’s or EPA’s actions in providing compliance assistance is not a legal defense in
any enforcement action. This Policy does not limit EPA or a state’s discretion to use
information on violations revealed through compliance assistance as evidence in subsequent
enforcement actions. -
4. If a field citation is issued to a cm ll business (e.g. wider the Undergrouod Storage
Tank program!), the ‘ mall business may provide information to the Agency to show tha1
specific violations cited in the field citation are being remcdi d uoder a. corn. nons. schedule
established pursuant to this Policy or simiI r Stare policy. In such a si non , EPA would
exercise its enforcement discretion not to seek civil penalties for those violations.
The Underground Storage Tiek (UST) field cüanon propa prOV de3 (07 iub .nt fly redured pm e1dee in
e ehange for the rapid correction of certain UST ViOL3flOm for &SL titoC ViOlators. ee csJbr hdv i
F eId C tas on Eiforcgswu. OSWER Directive 9610.16. October 1993.
October 1997 IIE—68
-------
CompUa ce Incentfvm for Small Bmin page 9
J. APPLICABILiTY TO STATES’
EPA recogni” s thax states are partoers in enforcement and compliance assura .
Therefore. EPA will defer to state actions in delegated or approved programs that are
generally consistent with the crueria set forth in this Policy. Whenever a State agency
provides a correction period to a I1 business pursuant to this Policy or a 5 1T11i12r policy, the
agency should notify the appropriate EPA Region. This notification will assure that federal
and state e rccmem responses are properly coordina’ d.
L Public Accomvtahillty
Within three years of the effective date of this Policy, EPA will cond” t a study of the.
effectiveness of this Policy in promoting compliance among amsil busin ises. EPA will make
the study available to the public. EPA will maP publicly available the terms of any EPA
agreements reached under this Policy, including the nsnare of the violation(s), the remedy, and
the schedule for returning to compliance.
‘ Scates i. cIudes thbes.
IIE—69 October 1997
-------
Example 11—15. Voluntary Disclosure Documentation Request
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Washington, DC
RE. Report of Chemical Manufacture
Dear Mr Sussman:
This letter follows our earlier meeting of this afternoon in which
________________________ officials disclosed certain information to US EPA regarding chemical
substances claimed to be TSCA Confidential Business Information To be eligible for EPA to
treat the disclosure of chemical manufacture of ______________________ as voluntary, the
following information must be provided to US EPA within twenty (20) days of receipt of this letter
1. Confirm in wnting the schedule for filing premanufacture notices for the substances
2. Provide a listing of the specific dates and quantities that the substance(s) were
manufactured. Please submit batch records of production and certify that they are
authentic copies of onginal documents.
3. Identify the primary purchasers of these chemical substances. What were the primary
end-uses for these products?
4 Did ___________________ license or permit any contractors or subcontractors to
manufacture these chemical substances?
5. Who (facility and personnel) developed the chemical formulations for the substances
6 At what facility or facilities within the United states were the substances manufactured?
7. Did _______________________ import or export any quantities of the substances?
8. What is the status of any remaining stocks of these products? Where are the stocks
being kept2 Was a recall initiated? If a recall was initiated, please submit copies of all
directives, memoranda or correspondence regarding the recall.
9. Identify who discovered that the chemical substances were not on the TSCA chemical
inventory on or about November 6, 1989 Descnbe with particularity what process led to
this discovery and provide copies of internal correspondence that documented the
discovery
liE—li October 1997
-------
Please respond in wnting within twenty (20) days of receipt of this letter. Any materials
claimed as Confidential or TSCA Confidential should be so designated and sent in double
envelopes. The response should be sent directly to:
Michael F. Wood, Director
Compliance Division
Office of Compliance Monitoring
US EPA
401 M Street, SW
Washington, DC 20460
After we have the opportunity to evaluate your submittal, we will contact you to arrange a
follow-up meeting as necessary. If you have any questions, please call me at 475-8690.
Sincerely,
Michael J Walker
Assistant Enforcement Counsel
Toxic Litigation Division
cc: Michael Hackett [ EN-342]
John Foley (EN-342]
Carol Haffield [ TS-794]
Vincent Giordano
October 1997 IIE—72
-------
Example 11—16. SEC 1O-Q Statement
SECURITIES AND EXCHANGE CO (ISSION
WASHINGTON, D.C. 20549
FORM l0—Q
Quarterly Report nd.er. Section 13
of the Securities £xcba.rtge Act of 1934
r the Quarter C .ss1.or
•d June 30, 1990 fl.Le Number 1—4422
ROLLINS, INC
ncorporated .R.S. Employer
• Ident .fi.cat .on Number
Delaware 51—0068479
2170 P .ed ont Road, N.E., Atlanta, GeorgLa 30324
Telephone Nu ber —— (404) 888—2000
Ind .cate by check mark whether the reg .strant (1) has filed all
rts requ .red to be filed by Section 13 or 15 (d) of the Secur.t.es
chance Act of 194 dur ng the preced g 12 months (or cr suc. s or: r
od that the req .s:rant was requLred to file such :eoorts , and (2; r as
sub ec: to such fi1 ng requirements for the past 90 days.
Yes X No
At June 30, 1990, there were 23,642,713 shares of Common Stock $1
Value, outstand.Lng.
IIE—73 October 1997
-------
ROLLINS, INC. AND SUBSDIARIES
INDEX
Page Mo .
?t I Financial intoz ation
Condensed Statements of Financial Position —
June 30, 1990 and December 31, 1989 1
Condensed Statements of Earr ings and Earnings
Reta.j .ned — s x months ended June 30, 1E 90
and 1989 2
Condensed Statements of Cash Flows
si.x months ended June 30, 1990 and 1989 3
Motes to Condensed Financi.aj. Statements 4
Management’s Discusslon and Analysis of
Fi.nanc .aj Cond .t and Results of
Operat .ons 5
-t II Other informat Ion
Item 4. SUbmISSIOn of Matters to a Vote of 7
Security Holders
rtem 5. Other Information 7
Item 6. Exhibits and Reports on ‘Forms 8—K. 7
October 1997 UE—74
-------
tz s, . M D
s i op F & L rri
(S In Th . ar s)
- s rt-te ‘w ts
‘ a r vab1 , net
MateriaLs ar
0 r t ets
l t a ets
it e 30,
1990
(Ur t )
$ 29,277
40,360
13,705
15,978
99,320
D& er 31,
1989
(AL t )
$ 25,983
35,955
U, 489
10.957
84,384
i ir AN at
r iiat depec at .on
r ra
ASSFIS
70,301
41,557
28,644
40,315
6.778
$ 160,L22 .
L 3fl T 3:
? ts ayab1e
ran e
t=’ :
$
Ear d
$ 12,731
12,539
S
20,215
2,362
7.450
55,297
20,925
24. 190
100,412
27,622
108,619
1.36,241
54,706
81,535
$ 181,947
S 8,180
11,600
14,657
569
5.434
40,440
24,507
22.945
87,392
27,622
99,424
1.27,046
54,81.7
72.229
74,391
az a rt 3at 44,378
30,013
41,058
11.556
$ 1.81.947
Zz-v tax ayab1e
C eax rev e
Total z rent Uabtht3
L G 4 t. zr
tal Uab .Lz tjes
- ( m1i. st c in ea y, at t
st Itho1dar5’ ity
‘ e a riyir rct are an int a.1. rt of e fiz rcia.1 s 1 ’ ts.
S 160,121
IIE—75
October 1997
-------
IZ E, JC. AND IAR
OF EAPN AND IPN ID
(S In Th sai , vr . .pt per share data)
( ai it )
‘Thr it Si.x ! r t
30, Jz. e 30 ,
1990 1989 1990 1989
$ 123,843 $ 12.5,523 S 221,421 S 204,323
st of sezv . provid 63,350 59,080 114,376 1 .05,138
L1 , qener I ar n .strat3.ve
39,1.27 37,409 77,961 73,783
çr 1at . ar rt .zati • 1,851 1,854 3,655 3,582
tar in e , net ( 641) ( 558) ( 1.187) ( 1,018)
103,687 97,735 195,305 L8]..435
u E VLSI 1 FOR
20,156 1.7,738 26,116
£I J FOR
8,399 7,593 1,1,278 :0,246
ferr ( 437) ( 409) ( 962) ( 996)
7,962 - 7.184 10.316 ___________
12,194 10,554 15.300 L3,536
-
.lazice at 9 thruz of Peri 99,722 88,499 99,424 38,522
£h Oi .v .det s (3,310) (3,189) (6,619) (6,260)
1oy efit P1ar 13 ( 13) 14 1
I AT ID OF S 108,619 S 95,851 $ 108,619 S 95,851
S 0.52 S 0.45 S 0.67 S 0.58
AV
-— 23,640,230 23,623,977 23,638,238 23.620.537
a a arxyiz r t a e an Intaral zt of thwcial s t ta.
October 1997 IIE—76
-------
IL E, D . ND IDIAR
S OF
(S In
( i )
Si.x t nths ed
J e 30,
- 1990 1989
atirq ActivitL :
t
n azg ( its) to ean iz :
pr at ar a cr izatj
ferred
0 er-nee
nease) de se in:
‘ e vabj
? ter1a . 1s ax .WLi
Other assets
e e (de ease) in:
? 11ts payable ar aued
rev
rn—ta se1f—jz r
her n- assets
sh provided by c eratirq activiti
stiz ?ct vitj :
s of equ.L t aM pr r y, r et of sa.1
t sh used for a u .i .sj .tj Cx of aru. ________
cash used in irwt . • i v1t .es
.,ci ACtLv3.tj :
“ideMs paid
a zy st c L ed to b f it plar
cash used in f ar ir tivit
ir ease in aM t-ts iwes ts
• aM short-te inv rts at b iz ir of peri __________
aM short-ts iuv t at eM of peri
LQ a anyirq rct are art intagral rt of th e th r aJ. stat ,t .
16, 916
S 21.812
3,655
3.582
(4,969)
772
(1,747)
183
(4,11.5)
(3,304)
(1,987)
(3,552)
86
(2,989)
12, 1 .18
3,640
2,016
619
1,185
(429)
(5 1 1
(1.015)
(4,034)
( 6,080)
J 10.114 )
(6,619)
1.25
(6.494)
4,450)
( 1 .667)
(5. :17)
(6,260)
115
(6.145)
3,294 4,396
25,983
S 29.277
IIE—77
October 1997
-------
ROLLINS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unau .ited)
NOTE 1. BASIS OF PRESENTATION
The condensed financial. statements -included herei.n have been
prepared by the Registrant, without audit, pursuant to the
rules and regulations of the Securities and Exchange
Ccmmiss .on. Footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting princip s have been condensed or omitted
pursuant to such rules and regulations. These condensed
financial statements should be read in con3unction with the
financial statements and related notes contained in the
Registrant’s annual report on Form 10—K for the year ended
Dece be: 31, 1989.
In the opinion of management, the condensed financial
statements included herein contain all ad usents necessary to
present fairly the financial position of the Registrant as of
June 30, 1990 and D ceaber 31,1989, and the results of
operations and cash flows for the six months ended June 30,
1990 and 1989.
NOTE 2. PROVISION FOR INCOME TAXES
The book provision for income taxes includes the liability for
state income taxes, net of the federal income tax benefit. The
deferred provision for income taxes arises as the result of the
use of accelerated depreciation methods, and other timing
differences between financial and income tax reporting.
NOTE 3. EARNINGS PER SEARE
Earnings per share is computed by dividing net income by the
‘.reighted average number of shares outstanding during the
respective periods.
October 1997 IIE—78
-------
ROLLINS, INC. AND SU9SIDIARI S
S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
FOR T SECOND OUARTER ENDED 3 W4Z 30. 1990
SECOND OUARTER 1990 CO!’ ARED TO SEC ND QUARTER 1989
Results of Ooerations
Revenues for the quarter ended June 30, 1990, were
$123,843,000 compared to $115,523,000 for the sam. quarter a
year ago, an increase o 7 percent. Net income increased 16
percent to $12,194,000 from $10,554,000. Zarn .ngs per share
.ncrsased 16 percent to 52 cents from 45 cents.
Revenues for Ork.in, including pest control, termite, lawn care
and plantscap. services, .ncreas.d 8 percent to $110,150,000
from $102,503,000 a year ago. Th. pest control segment
continued its strong growth. Rollins ProtectIve Services
revenues increased 4 percent to $12,480,000 from S12,059,ooo.
Late n the quarter, the new System VI, an advanced state-of-
the- ar rae ident .al security system, .was introduced.
The cost of services provided for the quarter increased 7
percent to $63,350,000. This results from serving a larger
customer has . than a year ago. As a percent of revenue.s,
costs were 51. percent, the same as a year ago. Sales and
administrative expenses increased 5 percent to 539, 127,000.
As a percent of revenues, these expenses decreased to 31.6
percent compared to 32.4 percent last year. Sales expenses
for the Orkin termit, and lawn care services were more
productive this year. Lawn Care services operated at a profit
for the quarter compared to a loss a year ago. Depreciation,
amortization and interest income had no sign.ificant change.
The provision for incom, taxes, as a percent of income before
taxes, decreased 1 percent to 39 • 5 percent from 40 • 5 percent
last year.
IIE—79 October 1997
-------
ROLLINS. INC. AND SVBSIDIARIZS
M NAGZXEN’r’ S DISCDSSION AND ANALYSIS OF FINANcIAL coNorrIp
AND R SUL S OF OP RA 0NS
FOR TH SIX MoN’rRS ENDED JDN! 30. 1990
SIX M0NT! S 1990 COMPARED TO SIX M0N’r s 1989
Results of ODerations
Revenues for the six montb.s ended Jun. 30, 1990 increased 3
percent to $221,421,000 copared to $204,373,000 for the sae
p.rLod last year. Net 4.flC0 5 and earnings per sbare increased
16 percent to $15,800,000 and 67 cents, respectivej.y.
Revenues for Oricin increased 9 percent to $194,612,000
compared to $178,351,000 a year ago. Revenues for the pest
control ., termite and lawn care services increased. Roll.Lns
Protective Services increased 4 percent to $24, 343, 000
coapared to $23,683,000 last year.
Cost of services provided increased 9 percent. As a percent
of revenues, cost of service was SL.S percent; an increase of
.4 percent compared to 51.4 percent year ago. Sales and
administ:at ve expenses increased z • 5 percent. As a percent
of revenues, these expenses decreased about 1. percent to 3.5.2
percent. Depreciation, anortizatjon expense and interest
i .ncome ad no significant cbanqe. Incom, taxes, as a percent
of income before taxes, declined to 39.5 percent compared to
40.5 percent a year ago.
Financial Condition
At June 30, 1990, assets were $181,947,000 compared to
$160,121,000 at year—end, Dcamb.r 31, 1989. Working capital.
was $44,023,000, an increase of $3,943,000 compared, to year—
end. There was no long—term indebtedness. Stockholders’
equity ihcr.as.4 to $81,535,000 compared to $72,228,000 at
year-end.
October 1997 IIE—80
-------
SI GNAT RZS
Pursuant to the r’equireents of the Securities Exchange Act of
1934, the rgistrant has duly caused this repo to be sined
on .ts behalf by the undersigned thereunto duly authorized.
DATE: 7ui.y 30. 1990
—.
(Registrant)
0. Wpy Rollins
0. Wayne Rolli.ns
a .r an of the Board and
Executive Officer
(Pr .nc .pa2. Executive 0f icar)
a es R. ffic)cs. 7r .
:aes R. cks, Iz.
Vice PresLdent, Treasurer
and Secretary
(PrLnc.pal Financial Officer)
HE—al October 1997
-------
ROLLINS, INC. AND SUBSIDIARIES
Part II. OTHER INFORMATION.
ROLLINS, INC. AND SUBSIDIARIES
ITEM 1.. LEGAL PRO INGS - -
NONE.
ITEM 2. SUBMISSION OF M - TO A VOTE OF SECURITY MOLDERS
NONE.
ITEM 5. OTHER INFORMATION
NONE.
ITEM 6. EXHIBITS AND REPORTS OF FORM 8-IC
(a) Reports of Form 8-K
No reports of Form 8—K were filed or requ .red to be
filed dur .ng the quarter ended June 30, 1990.
October 1997
!IE— .82
-------
Example 11—17. Dun & Bradstreet
11.3. DUN AND BBADStB.EET
FACILITY ‘lAnE
.3ECOMCARY MANE
FACIL rr ADDRESS
u’IAILINC ADDRESS
PAR EN T,’SU 9 5
ROLLINS INC
2170 PIEDMONT RD NE
ATL,$TA CA
PC BOX o4
30324 SMSA
TELEPHONE
MSSP
AQDO4P3
U.S. ENVIRONMENTAL PROTECTION AGENCY
FACILITY AND COMPANY TRACKING SYSTEM
DUN & BRADSTREET DISPLAY
DUNS NUNBE
09/21 ‘
iS 5* 49
‘O 4rt
OOa9i : - =
40 — ; -.25’
43
P NBR SUBS 336 HO/BR H NBR 9RAN - 5
PAREMT R HEADGUARrE? COMPANY
ULTt ,A Z COriFAN’i’ 006?19082 ROLLINS INC
LINE OF BUSINESS TEPr ITE PEST CTRL NAUFA’ P ‘G 4
.3:: CODES 42 0732 7332 6141
‘EAR STARTED i 48
CONTtt UE TO 4XT FA 5 (Y) - LIST SUBS/BRANCHES (Y
•:113 = HELP
FACTS
A DG4P3
PFL’iS = PREy
U.S. ENVIRONMENTAL PROTECTION AGENCY
FACILITY AND COMPANY TRACKING SYSTEM
DUN & BRADSYREET DISPLAY
— LIST ARE47 —
PF4/ 1 0 =
09/21 ‘°O
15 54 mO
3
ACILITI NAME ROLLINS INC
DUNS
‘tL ICEPAL OFFECER/TITL!
0 YNE
ROLLINS CHB
NIJMBER 0’)6919038
ACTUAL
ACTUAL
AL!S 371 000000
MET I 0RTH 0
EMPLOYEES THIS LOCATION
ACTUAL
see
TOTAL EMPLOYEES FOR
ACTUAL
BASE YEAR SALES. 0
BASE YEAR
7400
SUBSIDIARIES/BRANCHES
(Y —
LIST
0
P RENT/HQ ( )
PFI/ 13 = HELP
PF3/15
-
—
IIE—83
October 1997
-------
NS5P U.S. ENVIRONMENTAL PROTECTION AGENCY
FACTS FACILITY AND COMPANY TRACKING SYSTEM 15 56
FA DO4P3 DUN & BRADSTREET DISPLAY FA D04m I
FACILITY NAmE ORICEN EXTERMINATING COMPANY DUNS NUMBER 802509420
SECONDARY NAME ORKEN LAWN CARE
FAC:LIrY ADDRESS :170 PIEDMONT RD NE C DuNrr
ATLANTA GA 30324 3MSA 4
MAILING ADDRESS PC Box 647 tELEPHONE
PARENT;SUBS P/S NBR 3UBS 3 HQ/BR I-I rISR BRANC E3
PARENT DR HEADOUARTER COMPANY
0069t 9088 RCLLNS INC
ULTI MATE COMPANY @â91 9088 ROLLINS INC
LINE OF BUSINE3S PEST CTRL SVCS LAWN
SEC CODES 734 0752 2879 7311
YEAR STARTED 19 4
CONT:NUE TO NXT PAGE (Y) — 3T SUBS/BRANCHES (Y) - LIST ARE T/Hi ‘ )
F /13 = HEL.F PF3/15 = PREV 4/1o =
NSSP U.S. ENVIRONMENTAL PROTECTION AGENCy
FACTS FACILITY AND COMPANY TRACKING SYSTEM
F . DG4P3 DUN & BRADSIREET DISPLAY
FACILITY NAME ORKIN EXTERNINArIsG CMPANY DUNS NUMBER oo:so’ ::
PRINCIPAL OFEC!R/TITLE JAMES E HICKS JR VP
ACTUAL ACTUAL
SALES 9400 00e MET WORTH 0
ACTUAL &STIMArE.
EMPLOYEES THIS LOCATION 150 TOTAL EMPLOYEES FOR COMP 5900
3ASZ YEAR SALES 0 BASE YEAR EMPLOYMENT 0
LEST SUBSIDEARIES/BRANCJ4ES CY) — LIST PARENT,HQ Y.
PFI/13 = HELP PF/15 = PREy PF4/lo = MAIN
October 1997 IIE—84
-------
Example 11—18. Standard and Poor’s Register Listing
- , - .& r... .s
. - — .‘ .- — -
II 0U l
- .- — 0 r
RI o*- . CL 511. ..
Dm31: Th64.S
¶49 149 1W -
as 49.116 2*166 272.172
c a s_. — m i7 zos. oi.zs
D.. I — . — 55271 74 30216
6666— 1 731 t49
— 2.34 2306 4711
06wI 166. *30 ¶11 .13?
612* 4 .a, *49.
11 ILIIS 81.387 66
— 55561 *49 21.320
114 49 1.14
066 6614_ .... ... oil! 31
013.49 273. 275741
- - -
- l66I 01649 271J 4449
-4977 11L5 1 49.11
- - -
ii i.O1 6651
_____ 11.114 487 416.111
. *s.i -
947 dL7 6636 -
66Lfr66!I. 49t4. O
ffi.... . a gs 660 . . 4
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IIE—88
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IIE—89
October 1997
-------
6238 MOODY’S JNDUSTRL4L MANUAL
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aósC is o . 23. 1963. A z Joly.J1. 1961 c,64
1 0 1 0 Thbb6, # —4 61 Corpso 63.323 .U1
__ 21.311 2WO
L.- .10061 bs 23.066 23.219
s 5L s96t 61 swso ,swsso’Ut. r ... . uJ2 .áfl
I Doc. 1964 s9601 Corp. E96 sw . 41.991 13141$
so iso. 2. 1Q65 5901061 1..?. M6310 Ms10 . 7sw • 115.431 139.234
a Corp.. A96c . (S o. July 1910.) ________ so
Do 24oy 1. 1913 .101061 Al l. 101.. 2 d • 3UJ2 4.
__ TswLi . J99 I LP
— _ - _ . 3c,. T1015 561 99 236.391 364.377
Do Jar.. 1 1961 s 61 D . (so. .61 . 74m 10 . *944 64.741
*6165661. 33 IUI
3 E A — sz .s36 1L0 A sw4 ab.lso 1992
Ic 1970 61 561, W14 6 Pasw C o. 99J10. 1911 91JO0. s .so 1912 5.140.191
(1614 in 4cr. 1973)- C.ral. T ls Co. sod I61 . 1911 3.910.7*3
_____ Dmc sw. (cc. (sold ic iso. 19611. 1cr so —
at 33.6116161.561. 4 _99Jp6 14 5 ___
£0 3617. 1972. OU TANDD4G— D.c. 3%. t912. 33.391.706 •
& — -- ( — - - ---- 1Q71 3.140.191 161110 161 91 .
I c D.c.. 1972. 61001061 Pm so Ii7Jl1 .61so 91 13 1.
Rosso. L (or soft .61 sw
hinT JO. i s& ao a 061 $61161 S.for.4 so iso. 23. l . 3. ( .
(1561. . . .i _ . . a cr I iso. 23. 1969 J .40r4 Mso. 24. 1972. 2.1cr-I 24cc.
10. 1Q 11. s61 3.4 .3 D.c. 10.1993.
101 504 6196 61i,6100). 10 oiv ws p — ws
510
(0 P96. 1Q 17. 111061 7). . . _ . ( QI’ 61 10 1962 6114 1%36 .40
Ic Msy 1967. .900061 A l9. Zoo. II64.. . . .....0.W 071163 ........01Th ______
so 0510 P5 161. 310%10 é 1 .
______ 1615 I96O _ _ ft ” 1%7......._ .. . .ft
S. _ lI ___ Co. c a
so 6196 104 . . .......10101 so. g . at $ .1c, .4 w61
Tb. 1061 1 so - 1969 .0.07%
1101001 lOd p10 oL 2. 9 6-I
561 949 CUft 1970.............O.19 1971. .........52I
91.. _ i1y Co. •ifl.. . . . i a 50’e . 117’ “ I I
o d c6110 53 10Z S. 6196 61 ul 4361r .3.461—2 sw
0.61 6 ? Co.. SZW 161661 10 AU 561. Go. Co. 61 197’ ‘ lii 1973..........0.LSI I974 0.213
so.,or ls04 as 1013010 1973 1976 _U4% I977.........5.61’ I
Ssoi Cal. Ft. L 61104sM. flo. 1971 3J71l7 1979 __049 1969 0.M
MinOlin. Eacs. Z61is i I d. 1961 “
P - . -. Vs. 0. 161. 96. M10 2. 9 6-I
c96.i1 1 s. 365. 2 I 6 1. 7 1 5. 1961 42 191$..............063 1943.........34911
Tu61. i24la. V . Cil. 10W 110 1953 ..............Q .66 -
Nsoo s s. 1 .a lw ......._.aø% 196$ 3.33% 1940.............336 j-- ----- —
o91so. 1911 -h1 1962 _ Q4O — _ . . . — Cc,
P.R. Ralliso. Coso. 6 C.E.O - - 616111 96so s61 ‘ uso so 1 so.
G.W P &os, rrs. & C.0.O 10991 ‘“ 96
G.L. 3cs96. 0.. S . c. & Tisos. 07AIcO 6096 4..4614L 1961. .. 1963. 360%. p., _ Co. 16161 42 . 310 sq. ft. 61
______ lAlso 0.6 .6. 61 ftcI ‘ —.- — — , -. ... . .
(cc. 6 0.6 .6. at RPC E01090 5610510. 100. 16060 Go61so. Cold. 096 Ic 7.36.0 .
! L Duka 01 Losoy 96 — Co. . 96 d. .t. . Co. also f
i Roliso C W 1o496
.3. 412E24T & RZGmTRA& —. 19661.
r 0606. .4115061. Ga.
I6110 42960r Aa410110 6 C c. — NYSE (SysoXI. ROt). .61 1561
6161 l$ .ul96 . Ic 9 .pnl. so Ps61c. Ua d us so ? l • Rcsinansl
N.33 Gso. 1.. S . C.F 0. ___ 010061
S.c. .k z 1.1. (404) PRI 9ANGE — 1 )992 1Q61 111 .969 (91$ .
— -. 244’. 4 21% 21 I9’. pso. 6 C.E.O.
00.61 S6 ...,...I4— — D .C. 31. 1992.4.076. 174% 1*4% 1S’6 ia i 144’. D W R ) . C ..4 .O.
00.61 $ ..,..,, . D.c. ii. 1992. 3.613. lAdj. for 3 . 4or-2 spld. c.z. ps .
606110 2170 P% . .c 04. N.E.. A4Iso. GA p.
36324.796. su.zc . ROTONICS MANUFACTURING. INC. r.p. rsowo . s so,y
0 605610. I61 I Lc..... .orana @ in so D.c. 31.
096.31 (1000) 1996 a. so a 61cV 61 Il7 PO s.i.. y.r-
10 2451 0. 1943 1. SosM 061.
.992 l99 1 111 p 1010 C.3. 333I . c 01..... 261w
RI 101 .U (9W 10 76160 I 5u10 . 1 ‘1 3. 197q. Co it P.L Tsoso61
—- P co Coop. 10 D.c. 961 61 Is Is T. o 6110 PTso Ws10Xuoos.
in __ Corp. on 4cr. .1. 1969 ?60611 osso s96961 -_ Ic
IJ1$ 247.994 230.11$ 1*. 1992.
4616 Ic 1961.61154506161071110 Icc. (sold 10 00.61 R.. ... . . — Jso. JO. 1911.90
___ 17.23 1 169.11 133.90$ D.c. join lcd.. 100 L.143. 101196. No.041 —6’---——_S . 1.3.191% .910.
D. w & l . .3 06 Color-Woso. Icc .. Co6091 . taT 41.61 101161 51016 osooo 17102 S. F% oaus St. —
0 1992). aM BsIlooad Co. Co’ . CA 90241. 7.6. (21J)3.3$ 4412. 7101213 151 ‘
464.332 423.49% 491.012 isc6. lot 230.61 josl96 P96 5 ‘ 197 216.100 _____
I c c sin 02.114 32.064 43.363 ra.. 061010 00 S 0 . 995
C ig 6 0 1 ... 21.217 11.42% 23.471 61510 1963.
- - a11 a61 61.33% Wollort. Iso .. 9630.61 s61so 11990
T616161s 6 160 24.012 36.363 17.919 ic 19643. sod Ca60 Pou6110. (cc.. tot
.1.61 31.491 27410 - — c, . 9.117 —
160616110 131.11 11.1.67* 96424 61 Cso 61 161 6.777 6469
C 9 6 6 1 14. 13.731 11.240 Co.ior31lL61. S &s ..239 L 5 6O
L i npI b 0 1 5 6 1 443 156 10 161. a 40 Causal D .s61e 6 0.96 Coop. TaM 6 sa 9
$43 961 9654 ___ 61 £ oo. 0. (sold iso.. 1974) X 0061 1 1
61 . 3.174 -
141.991 131.11 113.671 Ic Aot. 1970. u61 *5606? W 5y _ (10510 61S . 312 236
(cc. for 100 soft $61 (aM o oa. I .sososolsol
£ 5156110 1973).
61 Is .6061 1971. f Nu44 (Sold 6 101
Yw .61 . .. 33.392 61.533 33.471 US loSS). ___ .. - 61
460016 . 33.369 193.311 35.413 n. vpry. .6 of .f 41541 411.1
60 9 6 1 6 11.12/ I 1/92 , at 24/S £o61ainso. (cc. 61 24 5 T0611061 41440 4197
C.2 0 1c5 39616161 Dos. 31 5r Icc.. . 605 . . 6..o61dY 61U 100
S 104560)61 . Ic c. (Sold July I. 19631. 614$
On D.c. 29 i,fl 5900061511 —.—.—— li u_oso Ga61soaM.bin 392 IC
1Q92 1991 at DysolsO. bc. Car 1300.400(1015 . 0 D.c. 1961). bc ft 966010061 4153
Cais 6 so-so 0.615 10.011 ° - Do Pso. I. acq 1i15d 90% 61 100 Lcsnu z N 510605 9644 d79
! ,oducin Drsooo 61 Sun £lrcpsc Coop “ 1L2 17 d 14 .4.
Trso. __ 10 P96. 1161. acawnd 7611000 (cc. 6061I4 6160 413.111 413.3
4asossin 0100061 11.113 11.073 o p 1 1113 a10waM P(Z £cdumsin. Ic c. £61561 SI.
0051114 uso 9.310 7.61$ . .
Ospor C 1lT101 $1560 In D.c. 1933. Co. 111061 — — - ‘ .6 01 CooS 010 .03 .
7ot o l 011115156160 132.069 121.912 1 56 6160 at Ort.c& boo.. osuca 4061 ou s 0.61010101 10
P,ao 6 1 nfl. 010 21.13$ 30060 o61T 10s 0616 Compulul. 10 ‘.0061. Cabil. Tb. Nit 5061616 4 1 0
---64
1956. 61461 0.iL I 0761 P
1. 1911. aM sI 61
6 61 £ Ia 41’61 96
October 1997
IIE—90
-------
Example 11—21. FTTS ReportlViolation History
II. D. PT’rS R ORT/VIOLLfloN
0/ H TLOLLflOI 113101! 21101? 7 8 0 1
710!: 10/10/01 TO: 8/10/90
)UULI PAZ ? !: 0I 1 g jj
01 ACTTOJ e?t01 CUI 111111/ P10POUO Ta lk ISCA I £1?11?. 110109/
1 £5111 M I ! SZ 1111 X I? Ul 1101. 811015 PULL?! PUlL?! £1118 T IP! S ILT!
o1/ jss j / j Ul01No— o1o10 0 zoi 1000 100 7 l 01
10111. PUIL11U * 10008 U I
9/ 10/ Il 1101.8110 ! 115701? 11102? P L C! I
— 7101: 10/10/01 70: 09/10/90
101S11LZ PUTT: OUil WI11 ?]0 Q1I!, 110.
01101 £01101 £01101 0131111W I 71010310 71111. 7508 / 11711?. 110701/
Tin £5111 UT! 0fl D AT ! DOCU? 111122 1101.811011 PULL?! PULL?! 777 18 TIP! 310!!
CC 01/U/Il 93/10/lI 301.1 208 liii 5000 7 03
CC 03/12/1? 12/30/11 305— 7 ZC& 10000 1200 ‘ 901 03
10111.71151.1111 8 150008 1200
/90 V70 flU 1 15101? 11702 ? P 10! I
710!: 10/10/01 10: 01/10/90
E1LZ PA Z ?!: 02211 m flj 110
11 101101 101101 0131 111W I 71070310 71111. 7504 / IJPUT. 110101 I
12111 D 31 31j PULL?? PULL?! 71714 TIP! SILT!
04/21/U 0S/Il/j 0430077200000 Z0& 500 0 7 901 0?
S 5008 0
IIE—91 October1997
-------
‘ to/I l flOI&TtOI LITTOIT 11100? PL I
? I: lO/tO/Ol 10: 01/10104
‘ E1LX 11011: OlID wLI1flJ0
‘ 101 £C?I01 £CTI0J CIII lOUD I 110 1 USD F!IIL TICI I 1101011
15350 DLfl cwsz 0 1? ! XCII? OUHI PUlL?! PUlL?! PUlL 111?!
02/21/SI 04/U/IS 0131U11-01OI 501 I II 500 1 01
TOTiL PUILTID t 500 * 500
‘ 1 0 YtOLLytol lISTOIT 1 l? P L O! I
0201: 10/10/01 TO: 01/10/10
1Lt II I ? ?: 0 TwiMfX1O
I 1db! 5db! CII! lOUD / £1010 301 FuLL ?!CL I 11101?. 110101/
u ?z cwsz orn xcur mm viar.rnoiz paag.ty PULL?? nn& r o stiro
02/21/IS 04/13/IS U0$IIIS.Qt01 500 500 F OU 01
TOTAL PULL?tIl $ 500 $ 500
October 1997 IIE—92
-------
Example lJ—22 . Certified Statements
CEkxi .yICATION STA1’ IT
Partial Updating of the Inventory Data Base Rule
Search and Status
I, Mary Ellen Weber, am Director .of the Economics, Exposure
and Technology Division. The Economics, Exposure and Technology
Division of the Office of Pollution Prevention and Toxics is
responsible for reviewing the data that is submitted pursuant to
the Partial Updating of the TSCA Inventory Data Base Rule (40 CFR
710 Subpart B) (“Inventory Update Rule or “lUR”), published under
Section 8(a) of the Toxic Substances Control Act, 15 U.S.C.
2607(a).
I certify that the information set out below is complete and
accurate.
Submitter name: Bloomfield Refining Company
Bloomfjeld, Minnesota
Dun & Bradstreet No.: 13—010—6651
Did submit Inventory Update Rule reports Nos. 61071783
61071791
Chemical Name: See attachments
Chemical Abstracts Service
Registry Number: See attachments
Date Report Received: December 11, 1993
Further, these substances are not excluded from the
Inventory Update Rule reporting requirements by 40 CFR 710 .26
except for Report No. 61071791, line 2: Naptha (Petroleum),
Polyan. CAS No. 64741—72—6.
JV LJ.
Mary len Weber, Director,
Economics, Exposure and
Technology Division
Date
IIE—93 October 1997
-------
CERTIFIED STATEMENT OF
WALTER C. FRANCIS
I, Walter C. Francis, certify that I am the Acting Chief of
the Antimicrobial Program Branch, Registration Division, Office
of Pesticide Programs. As Acting Chief, I am delegated the
authority to make determinations concerning the status of
products as pesticides and to register pesticides pursuant to
Section 3(c) of the Federal Insecticide, Fungicide, and
Rodenticide Act (FIFRA), as amended, 7 U.S • C. 136 seq . I
certify that the seven (7) Wipeout disinfectant products listed
below make pesticidal claims and that all seven (7) products are
not registered as pesticides pursuant to Section 3(c) of the
Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), as
amended, 7 U.S.C. 136 seq . This determination was based on
the review of copies of five (5) product labels and one (1)
example of product labeling forwarded to the Registration
Division by the Toxics and Pesticides Enforcement Division.
Those same five (5) labels and one (1) example of product
labeling are attached to this statement.
The seven (7) Wipeout disinfectant products are:
(1) Wipeout Disinfectant Towelettes (5x7 folded wipes).
(2) Wipeout Disinfectant Towelette (Flat Packs).
(3) Quickit Biological Fluid Emergency Spill Kit.
(4) Wipeout Household or Office Disinfectant Spray - 12 oz.
(5) Wipeout Medi Disinfectant Wand.
(6) Wipeout Disinfectant Spray - 2 oz.
(7) Wipeout Infection Control Travel Kit.
Attachments
))
Walter C. Francis, Acting Chief
Antimicrobial Program Branch
Registration Division
g 4 t icvi 3 7/ 9S
Date
October 1997 IIE—94
-------
tM la1’ANT 3sIo,e n, crui :a,nrn ‘.aa . icc —v. q i rico s 94T ce? ‘8
EPA US Enwormnta P,ot.coo, AgSflCy
Partial Updating Of YSCA lnvsntory Data Ba 1 990 REPORT NUM8ER
and Sit. R•p.rt
FORM (S.c 8 ) .) ?oz Suc nc.. Ccro IS USC 2607) - 10 •7 I C •3
U _ - :•••- •
— — — — — — I W d 1 _
CM abon $ 1,,uJItu y __ _______________ Ma m .1 , ,_
SaGD .c1JRE IAi a I DATE NAMEITTT1.E (TVp. or P’ mp
11/29/93 CHRIS HAWLEY - ENVIRONMENTAL MANAGER
TEOOQC.AL coNDCr MAME PLANT T! MAME
ICHRIS HAWLEY I LBLOOMFIELD REFINING COMPANY 1
cO NY AMr 8l DUN a ADST r ER
IBLOOMFIELD REFINING COMPANY I 13 l— — [ 559i
OD Idy ICOPESS I PtiMrnTe ST frt ADOPESS I
L#50 COUNTY ROAD 4990 I 11o COUNTY ROAD 4990
CO Ny ADDRESS a PLANT SiT! STREET ADORESS Ii
J P.O. BOX 159 I IP.O. BOX 159
rv
[ BLOOMFIELD 1 IBLOOMFTELD 1
CODE Tfl. 4ON5 WIAI .s Co ) CODE
[ 81413 i—1 I [ (505) 532—8013 I (87413 I—I
J CHEMICAL SUBSTANCE IDENT V/AC VITY/CONFJDENTTAIJTY
& a C. a E. 0 F G.
7 [ Z4 98—6 II 0 I 0 I [ 14.200.000 0 I 0 0
1 I&S e Oi.
PROPANE
RL-- ----- ——
E.u i, cn F
u c
a
J 0I 0 33.8OO.OOO I
fPFT nt IuMT
64741—41-9
H. Sps O,
NAPH1HA (P
a
64741—45-3
H Sø. I c3 aI
IR TDUES P
a.
I 64741-46-4
14 S .af I C
1NAPHTHA P F
C8 1
p .-
G. ca
L
L1 06—97-8 -
i H
I RIJTANF
L 8PQ8-2 0-6
10 0
o co ____
a . ca. EI.I .II _______________
c i F G
JI I 0 I 01 16s.00 0.000l It
•I
& a
I 64 41-44—2
5 H. Sp. c
I I DI rILLATE
—
I — CSi. a . —‘ E. ‘ CO F
a
ii J I 0II334.0OO.0O0
INu EUM).
HEAVY
0 CDDS
C. ca a . ‘
. -.
IPETROLEUM). STRAIGHT—RUN MIDDLE
F
I 0I 0II383.OO0,O0O1DI1
cs
G.
A.
17
ETROLEUM) AThTOWER
o t
. i a. 7 E. F
ii I o I 0JF 41.ooo,ooo
a
r64741 -54—4
o ccca
________ C. m I a. . cm E. I..0 CO F
-iI I 0 I
EUM). LIGWT STRAIGHT-RUN
—
cm ,Gca
EIE
____________________ C CCDC
1 C. 0. N on CO C. CO F cm
I 0 I 0h264.000.000 I 0
H S aIIC 1an, i IN
____ _LNAPHTHA (PETROLEUM). HEAVY CATALYTIC_CRACKED
______ C CODA
___ _____________ Ma
______ a . . 1 c. a. N cm E. . — cm F cm C ci
164741-60-2 ii I 0 i 01186.000.000 I 0 I
I 9 H.n . -a . ________________________________
— IDISTILLATES (P! ROLEUM). INTERMEDIATE CATALYTIC CPACIFfl
a.
64741-62-4
I ’
FlED OTl IPFTPflI FIIM
-- __________________________
iC. s.. i a • cm C. cm F
a
ii I 0 I 01133.100.000 1
YTIC CRACKFI)
i;’- 1 c1’ ”7” .d O
IIE—95
October 1997
-------
dMPOTAW?t 9 r, :: .,nrq - e,.i JrsfUIIy . ,s4 t acco.’va ’y..’g nwjc ors. DE x Q N .,,— ccr .ic2MB 2C - . ,i -9•
REPORT NUMBER
c EPA US Envivo m.ntaI Prozecbon Agency
Partial UpdaWi of TSCA Inventory Data Base
Pvodu ti4n and Slt• R.po,t_ -
___ __ __ 199o ( I 7V7 )
FORM I (S.c en os Ac IS USC 2607)
( pJ CS ) 4I I S e iti i s a aa . en Dn ac sa
j , UN isa msa UIa — a U I Pa. mo a . ..-t .. ... ,
NaMErTrru (? ps or Pnrtl
S 1GI4AI1JRE I 11/29/93 CHRIS HAWLEY - ENVIRONMENTAL MANAGER
yEcIOSCAL CONaCT NIME PLANt StT! M*
I CHRIS HAWLEY I I BLOOMFIFLO REFINING COMPANY I
co * s
&OOMFIELD REFINING COMPANY I I13 i —I6gs1 I
COI IlY A0OR SS I PL1NrW A !SS I
#50 COUNTY ROAD 4990 I I #50 COUNTY ROAD 4990 I
O MY ADORESSU PLAMT $17! StecaT AOORESS U
I P.O. BOX 159 I I P .O. BOX 159
C T!
EBLOOMFIELD I IBLOOMFIELD I
— OO€ 7 WCME (aIAjss Co cOOE
87413 I—I I (505) 632—8013 I I 87413 I—I I
CHEMICAL SUBSTANCE IDENTITY/AC11VITY/CONFIDENTIALJTY
0
A. tCj$i. aiia.,i 0. u E.L F
N C.
1 64Th1-68 -0 I, J E I 0 1 1237.000.000 I 0 J 0 0
1_L NAPHTHA (PETROLEUM). HEAVY CATALYTIC REFORMED
ItS is..
0 CCO(
A. a sa. .._ *s.b. I C. 0. E. L . oI CM I F
CM
64741-72-6 I I 0 I 0 I 156.900.000 I J
I 2 IH.So.aI Icci,sisasN .m.
1_I NA H tHA (PETROLEUM). POLYMN.
o c oc i s a
A. a ,sm r ‘C. is. s. , I 0. N — i CM E. s.i CM F
G.cei
— CM
I If 64742-40-1 ii I 0 I 0 113.000.000 I 0 I 0 0
n .
.1... JIN UTkALIZING AGENTS (PETROLEUM). SPENT SODIUM HYDROXIDE
o c isa
A. a Pampw C. is. Pa 0. N I CM S. CM I Pa l S
F a CM G.CM
II i oI oi’ to loo
• isa
A. 0. I ie ‘si or d s.l i 0. NaP CM I CM F
.Uaa. CM G.c
1So . Iec i sm s .. s .. 1 I 0I 0II 010_ J
o co
A. B.It ... 5PamIo lC.(s. .,a ..., 0. a CM E.
I F — C a l C
— I
‘I I oI oit
I
o — sPa PalS
A. 0. i a iaam I
C ‘E.uasso cm F
cm
G.ca ca
.
0 I Oil I 0 I
L
o s P a
c -.
A. B. i. isaa. IC . is. a , I 0. a a I CM E. - Cm F —
- Cal C. ca
]8 SOs0 nrCh U N s .N a . . 1 t oi oi’ ‘olo
C c O ca isa -—
A. B. IiPa .. ., . *a,,o.r ic. 5.. a s.p 0. N a. Ca l I S. . cm I F cm C. c i i cii
II 0.1 01 I I 010
o COOL i s a PalS
A. 0. ‘saris, ‘C. i i .. isa a aiai I 0 N a CM I S. i . .o m , F a CM pG. C8 1 31
J 2 II I 0 I Oil I 0 I 0
I
I
—. . S #I4tfl s* . so.. - IS -t I 4
October 1997
IIE—96
-------
B omfield Refining No C :
A G r k ,
November 30, 1993 .,
r-
r
—J
Scott Sherlock __
Document Processing Center (TS-790)
Office of Pollution Prevention and Toxics
Environmental Protection Agency —
Room E- 105
401 M Street S.W.
Washington. DC 20460
Attn: Inventory Update Rule
Dear Mr. Sherlock:
On November 17. 1993. James W Greene of our legal department mailed to you.
office (with a copy to the Director of the Comp iance Division). a letter stating tr
Bloomfield Refining Company had discovered that TSCA inventory update reports had no
been filed for its refinery in Bloomfield, New Mexico under 40 CFR Part 710. Subpart B.
By the same letter we requested Form U s pursuant to 40 CFR § 710.39(b). and thosr
were promptly forwarded by you ta Mr. Greene. Mr. Greene. in turn requested that
complete the Form U s and return them to your office. —
Accordingly, enclosed are the four Form U s for the refinery. We would apprecia
the opportunity to discuss certain mitigating circumstances with respect to the late f ii,
of these reports, with you, with Mr. Wood. or with anyone else within the Compliar
Division with whom it would be appropriate to have a meeting. Perhaps someone cc
advise me as to when such a meeting could be arranged.
Very truly yours.
BLOOMFIELD REFINING COMPANY
Chris Hawley
Environmental Manager
cc: Michael F. Wood. Director
Compliance Division -
Office of Prevention. Pesticides and Toxic Substances
U.S. Environmental Protection Agency
401 M Street S.W.
Washington. DC 20460
Box 159 • 8ioomfiei NO Mextcc 87413 • 505/632-8013
IIE—97 October 1997
-------
P 4aiuao
N 51s4 .I
EPA UT. !S M
2
£
DISINFECTANT TowEIE1-rE
w” OI1TT .Eni_ b.
-Øh. & . , -
W’ ffT UJyW .s D i d Vis RU u
ft h .L3 H E3 I LCC 1. PCL)OVIKJS LSC4. H AVI SA .11. 8. MAR.
d5Cal3. ELCOMONA8 &‘L& NaL. 8. BT1W8. TmcH wvT
ADLETES aT. 1W -i (AZ DTL IGLL 8M ON TEST METHODS.
N WflEflL
-- - ag ii i—-E- u
——- s $l --
F
• S . 15*-
• ____
• S d Pr .
r — S R.3*SS
4 6 .DS2 3’q .. 2 , 1
1.1w .s — -,j -
October 1997
IIE—98
-------
0 3 S/27/9
c1loo . U WIsi i ø
10 — V S P’vouaI,. ______
R$o. .mgs I. o
D 1 0 150001550.
15110a IsvIOm.st r Ioq o so si _____
QU1,4*tM s IV
US 50dSssom*so*15.
UI50 000 I$ n . U I 000 0051511511011. U .
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100 Sln ie Use Towelettes
Piece ens:
, vaid contact wftii the eyes. Prolonged
COlflactwlth the skin may cause
sensi tion. in the event of contact.
flush the affected area with water and
seek medical attention if Initatfon persista.
D lrectjons
Use Wlp.O t towelettas to unitize
PubUc areas or
obiecte suspected of being contaminated
with harmful viruses. lung. or bacteria.
Dl card the ioweIett after use.
Not Intended for use on food preparation
qu lpment.
1 A Reglsfratf n No.;8a 4-1
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Caution: Keep out of the reach of
children.
Contenta Glutaraidehyde 0.15%,
Inert Ingredienta 99.85%.
Made In canade.•
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IIE—lOl October 1997
-------
I ’ ’z
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5ei’te,8a e l aii
• WipeOut
Hard Surface, High Level
Disinfectant Towelettes
ANTI-VIRAL
ANTI-BACTERIAL
ANTI-F
WIPE OUT towelettes safely reduce the risk
Jj of infection from all known viruses, bacteria
LL ’ fun;i. not Intended for per5onal hygiene
100 Single Use Towelettes
Health Care Products Inc.
Canada: M uaug Ontas o L4Z 1.T&
U.S.A.: S1’ erman 0a 1c3, CA 91403
NOTE: Attachments (1) and (2) included.
October 1997 lIE—I 02
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II. EVIDENCE GATHERING
-------
II. EVIDENCE GAThERING . Il—I
!l.A. CONSENSUA1JWARRANTED INSPECTiON
I Entry....
a) ConstitutioniStatutory Requirements
b) Case Law
c) Special Considerations
d) Process
2. Admittance Procedures,Demeanor - Entry.
a) Statutory Requirements
b) Case Law
C) Special Considerations
d) Documentation/Process
3 Scope Of Inspection
a) Statutory Requirements ...
b) Case Law
C) Special Considerations..
d) Documentation/Process
4. Exit Requirements....
a) Statutory Requirements
b) Case Law
c) Special Considerations
d) Documentation/Process
5. Post-Inspection Requirements
a) Statutory Requirements
b) Case Law
C) Special Considerations
d) Documentation
II B SUBPOENA AumoRirv
1. Statutory Requirements
2 CaseLaw
a) Statutory Authority
b) Subpoena Power
c) Purpose of the Inquiry
d) Scope of Court Review
3 Special Considerations
4 Documentation/Process
a) Issuance ...
b) Service
C) Sworn Oral Testimony
II. C. VOLUNTARY DIscLosURE/SELF CONFESSiON
1. Statutory Requirements
2. Case Law
3 Policy
4 Documentation/Process
I!.D. OTHER DATA SOURCES
1. Federal/Stateitocal Government Activities..
a) Case Law
b) Special Considerations
11—I
11-1
11-I
11—2
11—10
11—10
1 1 -11
1 1 -11
11—13
11—14
1 1—15
11—16
11—16
11—17
11—18
11—19
11—19
11-19
11—19
11—20
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11—29
11—31
11—31
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11—32
1 1—32
11—35
1 1—35
11—35
11—36
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2 Financial Data . ... . . . . . . ll—37
a) Securities and Exchange Commission (SEC) 10-K ’ and u10 Q Statements . . ll.......39
b) Dun and Bradstreet (D&B) . . . ... 11—40
C) Financial Directories . ll—4 I
3 Toxics Release lnventoiy System (TRIS) . . . . .. 11—42
4 FIFRA and TSCA Tracking System (FiTS) . . . 11—42
5 Shadowlaw . . . . .. . . . . . . .. 11—43
6 Certified Statements .. . . . . 11—44
a) Rules of Practice.. ll—44
b) CaseLaw . . . . .. .. . . . . . 11—44
C) Special Considerations . ... . . . . . . ll—44
d) Process. . . .. . . . . 11—45
-------
II. EVIDENCE GATHERING
ILA. Consensual/Warranted Inspection
Inspection Authority arid Background Requirements
1. Entry
Site Selection - Consensual/Warranted Entry
a) Constitution/Statutory Requirements
4th Amendment:
The right of the people to be secure in their persons, houses, papers, and effects, against
unreasonable searches and seizures, shall not be violated; and no warrants shall issue but
upon probable cause, supported by oath or affirmation, and particularly describing the
place to be searched, and the persons or things to be seized.
FIFRA Section 8(b):
Inspection—For purposes of enforcing the provisions of this Act, any producer, distributor,
carrier, dealer, or any other person who sells or offers for sale, delivers or offers for delivery
any pesticide or device subject to this Act, shall request of any officer or employee of the
Environmental Protection Agency or of any State or political subdivision, duly designated by
the Administrator, furnish or permit such person at all reasonable times to have access to,
and to copy
FIFRA Section 9(a):
In General-(l) For the purposes of enforcing the provisions of this Act, officers or
employees of the Environmental Protection Agency or of any State duly designated by the
Administrator are authorized to enter at reasonable times (A) any establishment or other
place where pesticides or devices are held for distribution or sale..., or (B) any place
where there is being held any pesticide the registration of which has been suspended or
canceled for the purpose of determining compliance with section 19.
FIFRA Section 26(c):
The Administrator shall have primary enforcement responsibility for those States that do
not have primary enforcement responsibility under this Act. Not withstanding the
provisions of section 2(e)(1) of this Act, during any period when the Administrator has such
enforcement responsibility, section 8(b) of this Act shall apply to the books arid records of
commercial applicators and to any applicator who holds or applies pesticides, or use
U —I October 1997
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!I.A. ConsensuallWarranted Inspection II. EVIDENCE GAThERING
dilutions of pesticides, only to provide a service of controlling pests without delivering any
unapplied pesticide to any person so served, and section 9(a) of this Act shall apply to the
establishment or other place where pesticides or devices are held for application by such
persons with respect to pesticides or devices held for such application.
FIFRA Section 9(b):
Warrants-For purposes of enforcing the provisions of this Act and upon a showing to an
officer or court of competent jurisdiction that there is reason to believe that the provisions of
this Act have been violated, officers or employees duly designated by the Administrator are
empowered to obtain and execute warrants authorizing -
(1) entry, inspection, and copying of records for purposes of this section or section 8;
(2) inspection and reproduction of all records showing the quantity, date of shipment,
and the name of the consignor and consignee of any pesticide or device found in the
establishment which is adulterated, misbranded, not registered (in the case of a
pesticide) or otherwise in violation of this Act and in the event of the inability of any
person to produce records containing such information, all other records and
information relating to such delivery, movement, or holding of the pesticide or device;
and
(3) the seizure of any pesticide or device which is in violation of this Act.
TSCA Section 11(a):
For purposes of administering this chapter, the Administrator, and any duly designated
representative of the Administrator, may inspect any establishment, facility, or other
premises in which chemical substances, mixtures, or products subject to subchapter 1V of
this chapter are manufactured, processed, stored, or held before or after their distribution
in commerce and any conveyance being used to transport chemical substances, mixtures,
such products or such articles in connection with distribution in commerce.
EPCRA:
There is no explicit inspection authority under EPCRA. however, it is implied.
b) Case Law
WarrantedlWarrantless Search
US v. Biswejj .
406 US 311 (1972)
Background:
A pawn shop was searched under the Gun Control Act. The warrantless search was
authorized under the Act and therefore no warrant was obtained.
October 1997 II—2
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II. EVIDENCE GAThERING II.A. Consensual!Warrarited Inspection
Ruling:
A warrantless search authonzed by statute does not violate the 4th Amendment.
Donovan v. Dewey .
452 US 592 (1981)
Background:
A federal inspector attempted a warranfless inspection following the directives of the
Federal Mine Safety and Health Act. The stone quarry refused entry and the Secretai-y of
Labor filed, pursuant to the procedure outlined in the Act, for an injunction against the
refusal to allow the inspection. The District Court granted summary judgment for the
respondent on the grounds that the 4th Amendment prohibits warrantless searches. The
Supreme Court reversed.
Ruling:
• Unlike searches of private homes, legislative schemes authorizing warrantless
administrative searches of commercial property may be reasonable under the 4th
Amendment.
• A warrant may not be required where Congress has reasonably determined that
warrantless searches are required to further a regulatory scheme
Mendozp v. ThIS .
5559 F. Supp. 842, 847 (W.D. 7X, 1982)
Background:
Agents of the Immigration and Naturalization Service (INS) raided a bar in El Paso and
arrested two persons who subsequently filed suit against the INS alleging a violation of
their 4th Amendment right to be secure in their person. The persons arrested and the bar
owners sought declaratory and injunctive relief as well as monetary damages.
Ruling:
• The Court, upon determining that a ‘seizure” of a person has taken place, will then
consider whether that seizure was ‘unreasonabl&’ under the 4th Amendment.
• The Court has ruled, in an extensive line of cases, that there is no reasonable
expectation of privacy from administrative searches where the business voluntarily
participates in a regulated industry. Such participation is deemed to be consent to
such administrative searches and inspections.
October 1997
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II.A._Consensual/Warranted Inspection II. EVIDENCE GATHERING
• The INS search of private areas of the bar were beyond the regulatory scheme and
required a warrant.
• The INS was enjoined from arresting persons where there was no reasonable belief
that the person is ifiegally in this country and enjoined from repeatedly entering any
premises without reasonable suspicion of ifiegal activity within.
MarshalL Secretary of Labor et al, v Barlow, Inc .
436 US 307(1978)
Background:
This case presented a challenge to a warrantless OSHA search of a business. The
Supreme Court upheld the challenge and provided guidelines for administrative search
warrants. Leading case on administrative warrants. The Agency has developed its policy
to conform to this case.
Ruling:
• Probable cause standard satisfied by showing of reasonable administrative standards.
• Warrant showing inspection site selection under a neutral administrative plan protects
4th Amendment rights.
• Certain industries having a history of government oversight have no reasonable
expectation of privacy.
Boliden Metech Inc. v. United States .
Docket No. 88-0081L, (District of Rhode Island, 1988)
Background:
This challenge to a TSCA inspection warrant was based on the fact that TSCA does not
specifically grant authority to issue search warrants.
Ruling:
TSCA implicitly authorizes the EPA to obtain search warrants for the purpose of fulfilling its
inspection duties under the Act.
October 1997 Ii—4
-------
II. EVIDENCE GAThERING II.A. Consensual/Warranted Inspection
In re: N. Ton as & Co. Inc. ,
I.F.&R. Docket No. HI-121c
Background:
The Respondent refused to allow an EPA inspector to sample his product. The Court noted
that a search warrant would not have been necessary because the Respondent was
registered as a producer of pesticides
Ruling
Pesticides have a long history of regulation and can reasonably be considered within the
Barlow exception for closely-regulated industries. Refusal to permit inspection and
sampling pursuant to section 9 is a violation of section 12(a)(2)(B).
In re: Bradley Exterminating Company .
I.F.&R. V-604C
Background:
The Respondent, a pest control company, challenged evidence obtained under an
admu-iistrcrtive warrant. It based its challenge on the fact that the EPA warrant did not
specify the exact documents EPA wished to inspect.
Ruling:
Where circumstances make an exact description difficult, a warrant need not make exact
descnptions of the items sought, but only needs to describe generic classes of items.
Inxe Sporicidin InterncrtionaL
Docket No. FIFRA-88-H-02, Opinion and Order Den3thig Motion to Suppress and
Conditionally Granting Motion for Accelerated Decision
Background:
The Respondent successfully argued that the search of its premises was unlawful because
F]FRA Section 9 searches are limited to places where a pesticide is held for distribution
and sale The Court ruled against EPA.
Ruling.
When evidence that pesticides were held for distribution or sale on the premises is stale or
outdated the search cannot be justified on the basis of FIFRA section 9. Evidence that
pesticides were held for sale or distribution on the premises is stale if more than four years
old.
II—5 October 1997
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II.A. Consensual/Warranted Inspection II. EVIDENCE GATHERING
Informed Consent
In re: George I. Huth. dibla Huth Oil Company and Ioyce Nichols .
Docket No. TSCA -V-C-196
Background:
The Respondent filed a 4th Amendment challenge to information collected by a TSCA state
inspector.
Ruling:
A search conducted pursuant to valid consent is constitutionally permissible. Consent acts
as a waiver to any later defenses, both statutory and constitutional. Consent must be given
in the absence of threats, coercion, deception, or entrapment.
In re: Agland Incorporated .
CO-OP., LF.&R. No. VI1I-91C
Background:
For this case, the Respondent consented to an inspection and later changed his mind. He
argued at hearing that the evidence was invalid because EPA had not obtained a warrant.
Ruling:
A warrant is unnecessary when an inspection is consented to and documents requested
were voluntarily given.
In re: Lihue Plantation Co. Ltd. .
Docket No. TSCA-0990-0001, Initial Decision (1991)
Background:
While conducting an inspection to determine compliance with an NPDES permit under the
Clean Air Act, an EPA inspector requested an opportunity to look at any active PCB
transformers. The inspector did not provide a written notice of his intention to conduct an
inspection under TSCA.. Upon being shown a transformer, the inspector requested that
samples be collected from outside the transformer and analyzed, and that the results be
submitted to EPA. Respondent contended that the evidence obtained by the inspection
pertaining to an alleged TSCA violation be excluded and Complaint dismissed because
EPA failed to provide written notice of its inspection as required by TSCA..
Ruling:
Respondent s argument was rejected because Respondent in effect consented to a TSCA
inspection by failing to voice any objection to the inspection and by voluntarily complying
October 1997
-------
II. EVIDENCE GAThERING II.A. ConsensuaWWarranted Inspection
with the inspector’s requests. Nothing in the record suggested that this evidence was
obtained by threats or coercion either express or implied. Therefore, Respondent’s actions
operated as a waiver of any nght to challenge the admissibility of the evidence during the
inspection.
In re Rek-Chem Manufacturing Corp. .
I.F.&F?. Docket No. VI-437C
Background:
A FIFRA inspection was conducted pursuant to a tip. The Notice of Inspection was
checked “routine producer establishment inspection” and that no violation was suspected.
The AU excluded the evidence gathered during the inspection.
Ruling:
• Section 9(a)(2) of Fff’RA requires that inspectors present a written statement as to the
reason for the inspection before undertaking an inspection.
• Any consent that was given to the inspection was not informed consent because the
Respondent was not put on notice that a violation was suspected.
• Evidence from other sources was admissible.
In re: Avril. Inc .
I.F.&R. Docket No. Ifl-441C
Background:
The Respondent challenged the validity of the inspection, arguing that the inspector failed
to present a notice of inspection. Complainant contended that written notice was given as
well as verbal notice.
Ruling:
The ALl in Rek-Chem excluded evidence from a search where the notice of inspection did
not state that a violation was suspected as required by FIFRA and the Respondent,
therefore, did not give an informed consent to the inspection. In this case, the evidence
shows that the Respondent gave an informed consent to the inspection, regardiless of
whether he saw the notice of inspection.
11—7 October 1997
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HA. Consensual/Warranted Inspection II. EVIDENCE GAThERING
Open Fields
Oliver v. United States .
466 US 170
Background:
Two narcotics agents investigated a tip that marijuana was being grown on a farm and
inspected two fields. The Court upheld the search.
Ruling:
• An individual has no reasonable expectation of privacy that open fields will remain free
from warrantless intrusion by government officers under the 4th Amendment.
• An individual may not legitimately demand privacy for activities conducted out-of-doors
in fields, except in the area immediately surrounding the home.
Dow Chemical Co. v. United States ,
476 US 227 (1986)
Background:
In this case, A flew over Respondent’s facility and took photographs of smokestack
emissions. Respondent challenged the pictures as the product of an illegal search.
Ruling:
When the area observed is like an open field, an inspection which would otherwise be a
search becomes a nonsearch for 4th Amendment purposes.
In re: Boliden Metech, Inc . .
Docket No. TSCA 1-87-1097, Initial Decision (1989)
Ruling:
Collection of a sample of suspected PCB material on Respondent’s property but outside the
fence did not violate Respondent’s 4th Amendment protection from unreasonable search
and seizure. Respondent had no expectation of privacy in its parking lot which was open
to the public.
October 1997 II—8
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II. EVIDENCE GAThERING II.A. Consensual!Warranted Inspection
Plain View
Coolidge v. New Hampshire .
403 US 443 (1971)
Background:
The seizure of a murder suspect’s car on the basis of the plain view exception was denied
because there was an opportunity for police to obtain a valid warrant, the location of the
car was known in advance, and the car was intended to be seized as part of the murder
investigation.
Ruling:
Criteria for a plain view exception for warrantless search and seizure are that the
inspector:
• must have a prior, independent justification for physically being in a position to observe
the evidence;
• must have immediately recognized the information as evidence; and
• must have discovered the evidence inadvertently.
Horton v. California ,
496 US 128 (1990)
Background:
For probable cause, a California policeman asked for a warrant to search a private home
for proceeds from a robbery and for weapons used in the robbery. The warrant issued did
not cover the weapons. During the search of the premises, the officer did not find any
proceeds of the robbery but did seize weapons that were in plain view. The defendant
argued for the suppression of the evidence as the officer had not “inadvertently” discovered
the weapons arid therefore the seizure did not qualify as a “plain views’ exception to the 4th
Amendment. The Court denied the motion to suppress.
Ruling:
• An officer does not violate the 4th Amendment prohibition against warrantless seizure if
the object seized is “in plain view” and the search is within the limits of a legitimate
warrant.
• Inadvertent discovery of evidence is one characteristic of a legitimate, warrantless,
plain view seizure, but it is not a necessary condition.
11—9 October1997
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hA. ConsensuallWarranted Inspection II. EVIDENCE GAThERING
• This case modifies the prior holding in Coolidge v. New Hampshire . 404 US 443,
directing a reviewing court to apply objective standards of conduct to facts of the
situation rather than the subjective intent of the officer.
Emergency Situations
Cczrnara v. Municipal Court .
387 US 523 (1967)
Background:
Camara refused to allow city housing inspectors to enter his house without a warrant. The
city brought charges against Camcxra.
Ruling:
The Supreme Court found the 4th Amendment required that a warrant be obtained to
search a home, where exceptions of privacy are paramount, except in certain narrow
circumstances such as emergencies.
C) Special Considerations
1) Ensure all inspection targets are selected within Barlow’s framework.
2) Attempt consensual entry first. Elevate and document atempt to enter to the highest
available management level of the facility.
3) Obtain a warrant when:
• entry is denied or consent is withdrawn;
• facility has a history of refusal; or
• surpnse is necessary to obtain evidence.
d) Process
Inspection site selection is made on the basis of reasonable cause or pursuant to an
administrative plan or scheme.
Reasonable Cause includes information from any reliable source concerning a member of
the regulated community which would lead one to reasonably suspect that a violation may
have occurred. This would include:
• A complaint from a person outside the Agency; or
October 1997 11—10
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H. EVIDENCE GAThERING II.A. ConsensuallWarranted Inspection
• Information given to the Agency by a facility which would raise suspicion that a violation
occurred.
Example:
A facility reports the manufacture of a chemical substance pursuant to section 8 of TSCA
but fails to enter into a testing agreement for the same chemical substance pursuant to
section 4 TSCA. Sections 8(b) and 9(a) of FIFRA require that the Notice of Inspection
indicate if a violation of FIFRA is suspected.
A Valid Administrative Inspection Plan includes, but is not limited to, a scheme that targets
some members of a regulated community:
• on a random basis;
• within a definite time frame; or
• on the basis of a neutral, objective inspection strategy.
Example:
The PCB strategy targeted utilities as the first group to be inspected for violations of the
PCB rule because of the substantial quantities of electrical equipment and consequent
PCB dielectric fluid used by these facilities.
Section 8(b) and 9(a) of FIFRA require that the Notice of Inspection include an alternate
and sufficient reason for the inspection.
Procurement and Execution of an Adxninistrcitive Warrant
See Pesticide Inspection Manual
NOTE: All inspection forms must be completed during an inspection conducted
pursuant to a warrant as well as during a consensuai inspection.
2. Admittance Procedures/Demeanor - Entry
a) Statutory Requirements
FIFRA Section 8(b):
..Bef ore undertaking an inspection under this subsection, the officer or employee must
present to the owner, operator, or agent in charge of the establishment or other place
where pesticides or devices are held for distribution or sale, appropriate credentials and a
written statement as to the reason for the inspection including a written statement as to
whether a violation of the law is suspected. If no violation is suspected, an alternate and
U—Il October 1997
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LA. Consensual!Warrantecj Inspection II. EVIDENCE GAThERING
sufficient reason shall be given in writing. Each such inspection shall be commenced and
completed with reasonable promptness.
FIFRA Section 9(a)(2):
Before undertaking such inspection, the officers or employees must present to the owner,
operator, or agent in charge of the establishment or other place where pesticides or
devices are held for distribution or sale, appropriate credentials and a written statement as
to the reason for the inspection, including a statement as to whether a violation of the law is
suspected. If no violation is suspected, an alternate and sufficient reason shall be given in
writing. Each such inspection shall be commenced and completed with reasonable
promptness.
FIFRA Section 10(e):
Disclosures to contractors—Jnforrriatjon otherwise protected from disclosure to the public
under subsection (b) of this section may be disclosed to contractors with the United States
and employees of such contractors if, in the opinion of the Administrator, such disclosure is
necessary for the satisfactory performance of work in connection with this subchapter and
under such conditions as the Administrator may specify. The Administrator shall require
as a condition to the disclosure of information under this subsection that the person
receiving it take such security precautions respecting the information as the Administrator
shall by regulation prescribe.
TSCA Section 11(a):
...Such an inspection may only be made upon the presentation of appropriate credentials
and of a written notice to the owner, operator, or agent in charge of the premises or
conveyance to be inspected. A separate notice shall be given for each such inspection,
but a notice shall not be required for each entry made during the period covered by the
inspection. Each such inspection shall be commenced and completed with reasonable
promptness and shall be conducted at reasonable times, within reasonable limits, and in a
reasonable m mer.
TSCA Section 14:
(c). .Jn submitting data under this Act, a manufacturer, processor, or distributor in
commerce may (A) designate the data which such person believes is entitled to
confidential treatment under subsection (a), and (B) submit such designated data
separately from other data submitted under this Act. A designation under this paragraph
shall be made in writing in such m ner as the Administrator may prescribe.
(d) Criminal penalty for wrongful disdosure.
(1) Any officer or employee of the United States or former officer or employee of the United
States who by virtue of such employment or official position has obtained possession of, or
October1997 11—12
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II. EVIDENCE GATHERING VA. Consensual/Warranted Inspection
has access to, material the disclosure of which is prohibited by subsection (ci) of this
section, and who knowing that disclosure of such material is prohibited by such
subsection, willfully discloses the material in any mariner to any person not entitled to
receive it, shall be guilty of cx misdemeanor arid fined not more than $5,000 or imprisoned
for not more than one year, or both. Section 1905 of Title 18 does not apply with respect to
the publishing, divulging, disclosure, or making known of, or making available, information
reported or otherwise obtained under this chapter.
(2) For the purpose of paragraph (1), any contractor with the United States who is
furnished information as authorized by subsection (a)(2) of this section, and any employees
of any such contractor, shall be considered to be an employee of the United States.
EPCRA:
No explicit inspection authority.
b) Case Law
Status of Inspection Personnel
Aluminum Company of America (Alcoa) v Dubois ,
Docket No. C80-1178V(W.D. Wash, June11, 1981)
Background:
Alcoa contested EPA’s use of contractors to conduct inspections pursuant to Section 11 of
TSCk
Ruling:
The Federal District Court niled that the term uany duly designated representative” of the
Administrator included contractor employees.
In re Litton Industrial Automation Systems. Inc.. New Britain Machines Division ,
Docket No.11 TSCA-I-89-1042
Background:
Litton contended that based on statutory language and legislative history, state inspectors
could not be used to conduct inspections pursuant to Section 11 of TSCA.
Ruling:
Section 11 of the statute authorizes duly designated representative to conduct
inspections, and the language of Section 28 is broad enough to encompass the funding of
state programs to conduct TSCA compliance programs.
11 —13 October 1997
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II.A. ConsensuallWarrantecj Inspection II. EVIDENCE GATHERING
Note:
In Bunker Hill Co. v. EPA . 658 F. 2d 1280(9th Cir. 1981) the court held that private
contractors are “authorized representatives” pursuant to §114(a)(2) of the Clean Air Act.
However, this ruling was later contradicted by decisions in the tenth and sixth circuit. The
cases are United States v. Stouffer Chemical Co. . 647 F. 2d 1075(10th Cir. 1981) and United
States v. Stouffer Chemical Co . 684 F. 2d 1174 (6th Cir. 1982).
Agent in Charge
In re: Nello San tacroce arid Dominic Fanelli dibla Gilroy Associates ,
Docket No. TSCA-09-89-0014, Initial Decision and Order (1992)
Background:
The wife of the resident manager of a recreational vehicle park permitted the inspection of
the facthty by EPA. The resident manager was ill. Respondent contended that the
manager’s wife had neither actual nor apparent authority to be the agent in charge of the
park and that the inspector never inquired if she did have authority.
Ruling:
During the illness of her husband, the wife acted in her husband’s stead as agency on
behalf of the Respondents. She engaged in duties at the facility for the Respondent’s
benefit during her husband’s illness. Respondents cannot assume the benefits to them
flowing from the wife’s functions and then deny she had authority. An implied agency
relationship existed at the time of the inspection. The relation of agency need not depend
upon express appointment and acceptance. Under the facts, it was not unreasonable or
imprudent for the inspector to suppose the wife had authority.
C) Special Considerations
It is EPA practice under FIFRA, TSCA. and EPCRA to:
1) Credential all representatives of the Administrator that enter a site for the purposes of
inspection.
2) Present credentials and a notice of inspection even in the absence of a statutory
requirement under EPCRA. -
3) Enter at reasonable times (normal business hours).
4) Define a facility (establishment, premises, conveyance) as a contiguous site divided
simply by a public right-of-way for purposes of providing separate notices and
presentation of credentials.
October 1997 11—14
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II. EVIDENCE GAThERING hA. ConsensualIWarrarited Inspection
5) Use contractor personnel to conduct inspections when necessary.
d) Documentation/process
Documentation
The inspector credential serves not only as a means of identification but also constitutes
the official delegation of statutory authority from the Administrator to the person designated
to conduct the inspection. Credentials delegating the authority to conduct inspections
under all environmental statutes must be signed by the Administrator, Deputy
Administrator, or Regional Administrator. Statute specific credentials may be signed by
the Assistant Administrator, or the office director delegated inspection authority under that
statute.
The requirements of the inspection provisions are documented by the Notice of Inspection
arid Inspection Report.
The Notice of Inspection includes:
• entry time - establishes reasonable time and moment from which all inspection time
frames are measured.
• name. title, signature of the recipient - establishes operator, owner, or agent in charge.
• violation suspected/reason for inspection - indicates reasonable cause or neutral
administrative scheme (Fff’RA)
• specification of the nature of certain data to be inspected (TSCA - See: 1LA.3. Scope)
The notice to the facility explaining the right and prescribed method for designating data
for confidential treatment is the Notice of Confidentiality. (TSCA - See: 11A4. Edt
Requirements)
Process
Before reviewing the information obtained during an inspection, the Case Development
Officer should establish that the Agency has met its statutory obligations:
• The inspection report should clearly indicate that the inspector presented credentials to
the owner, operator, or agent in charge.
• Copies of the Notice of Inspection and Notice of Confidentiality should be contained in
the file.
Although there is no exclusionary rule in civil proceedings, the Rules of Practice at 40 CFR
Section 22.22, Evidence, provide that unreliable evidence need not be admitted.
Procedural errors underrn.ine the credibility of the evidence obtained during the conduct of
Il—I 5 October 1997
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II.A. ConsensuaIJWarrante j Inspection II. EVIDENCE GAThERING
the inspection. As part of the Initial Decision, the Administrative Law Judge specifically
reviews and evaluates the Agency’s compliance with the statutory requirements pertaining
to inspection procedures.
3. Scope Of Inspection
a) Statutory Requirements
FIFRA Section 8(b):
at all reasonable times to have access to, and to copy: (1) all records showing the
delivery, movement, or holding of such pesticide or device, including the quantity, the date
of shipment and receipt, and the name of the consignor and consignee; or (2) in the event
of the Inability of any person to produce records containing such information, all other
records and information relating to such delivery, movement, or holding of the pesticide or
device.
FIFRA Section 9(a)(1):
(A) any establishment or other place where pesticides or devices are held for distribution
or sale for the purpose of Inspecting and obtaining samples of any pesticides or devices,
packaged, labeled, and released for shipment, and samples of any containers or labeling
for such pesticides or devices, or (B) any place where there is being held any pesticide the
registration of which has been suspended or canceled for the purpose of determining
compliance with Section 19.
TSCA Section 11:
(b) Scope—( 1) Except as provided in paragraph (2), an inspection conducted under
subsection (a) shall extend to all things within the premises or conveyance inspected
(including records, files, papers, processes, controls, and facilities) bearing on whether the
requirements of this Act applicable to the chemical substances or mixtures within such
premises or conveyance have been complied with.
2) No inspection under subsection (a) shall extend to:
(A) financial data,
(B) sales data (other than shipment data),
(C) pricing data,
(D) personnel data, or
(E) research data (other than data required by this Act or under a ruie promulgated
thereunder), unless the nature and extent of such data are described with reasonable
specificity in the written notice required by subsection (a) for such inspection.
October 1997 1 1—16
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II. EVIDENCE GAThERiNG HA. ConsensuatiWarran ecj Inspection
EPCRA:
There is no explicit inspection authority under EPCRA; however, it is implied.
b) Case Law
Inspecting and Copying Records
CED’s Inc. v EPA .
745 F.2d 1092 (7th Cir 1984)
Background:
Respondent attempted to quash an administrative search warrant because Respondent
was not covered by the Clean Air Act. The Court held that everyone is prohibited from
certain activities under the CAA.
Ruling:
EPA has authority under the Clean Air Act to inspect and copy business records of a
manufacturer and distributor even though the Agency had never required the
manufacturer and distributor to keep any records.
Photographs
hire: Bunker Hill Co. .
80-2087, 15 ERC 1063 (D. Ida 1980)
Background:
The Respondent tried to limit the EPA clean air inspection including taking custody of any
film containing pictures of its facility. The Court held such limitation was not permissible.
Ruling:
The Environmental Protection Agency has authority under section 114 of the Clean Air Act
to take photographs of the facilities and equipment it inspects.
FIFRA Packaged, Labeled, and Released for Shipment
In re: Scrnico .
I.F.&R. Docket No. IV-234-C (1979)
Background:
An EPA FIFRA inspector asked to be shown pesticides held for sale which he sampled.
The Respondent challenged the evidence in the case arguing that EPA had not established
that the pesticide was actually held for sale. The Judicial Officer ruied in favor of EPA.
I t —I l October1997
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II.A. Consensual/Warranted Inspection H. EViDENCE GAThERING
Ruling:
To establish that a pesticide is being held for distribution or sale it is sufficient to show:
• the official in charge of the operation believed the product was being held for sale; and
• the individual containers were labeled, in plastic bags, in labeled cartons, and were
stored on shelves so that a purchaser would have been sold that product on the date of
inspection.
In re: Water Services Inc. ,
I.F.&R. Docket No. 1V-167-C, 12/22/76
Ruling:
In response to a similar challenge that a pesticide was not held for sale, the Judicial Officer
concluded that the sampled product was not held for sale. He applied the facts of the case
and found several determinative factors:
• the product had been returned to the company by ci purchaser;
• it was the policy and practice of the company to retest products returned by customers
prior to resale;
• the plant manager was misidentified on the receipt for samples and no person
occupied the position of plant superintendent at the time of the inspection; and
• the product sampled sat in the warehouse for 1-1/2 years while large quantities of the
pesticide were sold.
c) Special Considerations
Whatever the statute says, fairly and straight-forwardly construed, determines the nature
and extent of post-entry activities. Administrative warrants presuppose that a right to enter
is statutorily conferred and that a concomitant right to “search° likewise exists. While
language varies from statute to statute, the word “inspected’ or “inspections or “inspection”
appears in FIFRA and TSCA. It is A’s position as supported by case law that this word
includes the prerogative of recording by means of sample, photograph, tape recording,
graphic/electronic device, or any other method. The collection, recordation, or generation
of this information by the inspector constitutes a submission of data pursuant to Section
10(a) of FIFRA and Section 14(c) of TSCA and may be designated as trade secret or
confidential.
October1997 11—18
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II. EVIDENCE GAThERING ILA. ConsensuallWarranted Inspection
d) Documentation/process
FIFRA
The Receipt for Samples contains an acknowledgment that samples were obtained from
pesticides or devices that were packaged, labeled, and released for shipment. Although
the receipt is signed, the respondent may still contest a samples origin. If questions arise
concerning whether the sample was from a pesticide packaged, labeled, and released for
shipment, the evidence should be evaluated on the basis of:
• the position and authority of the person signing the receipt; and
• the policy and practice of the company regarding the release of pesticides for
shipment.
4. Exit Requirements
a) Statutory Requirements
FIFRA Section 9(a)(2):
...If the officer or employee obtains any samples, prior to leaving the premises, he shall
give to the owner, operator, or agent in charge a receipt describmg the samples obtained
and, if requested, a portion of each such sample equal in volume or weight to the portion
retained. If an analysis is made of such samples, a copy of the results of such analysis
shall be furnished promptly to the owner, operator, or agent in charge.
TSCA Section 11:
No e dt requirements at section 11.
TSCA Section 14(c):
Designation and release of confidential data.—( 1) In submitting data under this chapter, a
manufacturer, processor, or distributor in commerce may (A) designate the data which
such person believes is entitled to confidential treatment under subsection (a) of this
section, and (B) submit such designated data separately from other data submitted under
this chapter. A designation under this paragraph shall be made in writing and in such a
manner as the Administrator may prescribe.
EPCRA:
No explicit entry authority.
b) Case Law
None.
11—19 October 1997
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II.A. Consensual!Warrarited Inspection II. EViDENCE GAThERING
C) Special Considerations -
A receipt for samples is completed for all inspections under F’IFRA and TSCA. While TSCA
does not provide for the issuance of a receipt for samples and documents, the receipt is
the method prescribed by the Administrator to notify the manufacturer, etc., of the
information being submitted under TSCA. The Declaration of Confidential Jnformation is
the Administrator’s prescribed method for designating in writing information which
manufacturers’ believe is entitled to confidential treatment. Completion of the Declaration
form either in the affirmative or negative indicates that the person was provided the
opportunity to exercise his right to declare any information submitted at the time of the
inspection as TSCA-CBI.
d) Documentation/process
FIFRA - Receipt for Samples
TSCA - Receipt for Samples and Documents
- Declaration of Confidential Information
NOTE: The Declaration must be completed indicating that the collected information
was or was not designated as confidential in order to show that the
opportunity to designate data as confidential was exercised in accordance
with 40 CFR 2.203(b) or (c). The Declaration is not completed if the Receipt
for Samples and Documents states that no information was taken during the
inspection.
5. Post-Inspection Requirements
a) Statutory Requirements
FIFRA Section 9(a)(2):
.11 an analysis is made of such samples, a copy of the results of such analysis shall be
furnished promptly to the owner, operator, or agent in charge.
TSCA Section 14(c):
Designation and release of confidential data.—( 1) In submitting data under this chapter, a
manufacturer, processor, or distributor in commerce may (A) designate the data which
such person believes is entitled to confidential treatment under subsection (a) of this
section, and (B) submit such designated data separately from other data submitted under
this chapter. A designation under this paragraph shall be made in writing and in such a
mariner as the Administrator may prescribe.
October 1997 11—20
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H. EVIDENCE GAThERING II.B. Subpoena Authority
EPCRA:
No explicit entry authority.
b) Case Law
None.
c) Special Considerations
Fl FRA
The Agency provides the Results of Analysis of all pesticide samples that are analyzed.
TSCA
After the inspection, a copy of the receipt for samples and documents and Declaration of
Confidential Business Information may be sent to corporate officials in a better position to
make confidentiality determinations.
d) Documentation
F FRA - Results on Analysis
TSCA - Declaration of Confidential Business Information
Il.B. Subpoena Authority
1. Statutory Requirements
Administrative Procedure Act (APA)
5 Usc §555(d) Agency subpoenas authorized by law shall be issued to a party on request and,
when required by rules of procedure, on a statement or showing of general relevance and
reasonable scope of evidence sought. On contest, the court shall sustain the subpoena or
similar process or demand to the extent that it is found to be in accordance with law. In a
proceeding for enforcement, the court shall issue an order requiring the appearance of the
witness or the production of the evidence or data within a reasonable time under penalty of
punishment for contempt m case of contumacious failure to comply. (Although the APA allows
witnesses to be subpoenaed in administrative hearings, the Part 22 supplemental rules of
practice do not give ALJs subpoena authority for compelling witnesses to attend hearings for
FIFRk)
FIFRA:
No statutory authority.
11—21 October 1997
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It. B. Subpoena Authority II. EViDENCE GAThERING
TSCA Section 9: Relationship to Other Federal Laws
(a) Laws not Administered by the Administrator - (1) If the Administrator has reasonable basis
to conclude that the manufacture, processing, distribution in commerce, use, or disposal of a
chemical substance or mixture, or that any combination of such activities, presents or wifi
present an unreasonable risk of injury to health or the environment and determines in the
Administrator’s discretion, that such risk may be prevented or reduced to a sufficient extent by
action taken under a Federal law not administered by the Administrator, the Administrator shall
submit to the agency which administers such law a report which describes such risk and
includes in such description a specification of the activity or combination of activities which the
Admirustrator has reason to believe so presents such risk.
(b) Laws Administered by the Administrator - The Administrator shall coordinate actions taken
under this Act with actions taken under other Federal laws administered in whole or in part by
the Administrator. If the Administrator determines that a risk to health or the environment
associated with a chemical substance or mixture could be eliminated or reduced to a sufficient
extent by actions taken under the authorities contained in such other Federal laws, the
Administrator shall use such authorities to protect against such risk unless the Administrator
determines, in the Administrator’s discretion, that it is in the public interest to protect against
such nsk by actions taken under this Act. This subsection shall not be construed to relieve the
Administrator of any requirement imposed on the Administrator by such other Federal laws.
TSCA Section 11: Inspections and Subpoenas
Subpoenas - In canying out this Act, the Administrator may by subpoena require the
attendance and testimony of witnesses and the production of reports, papers, documents,
answers to questions, and other information that the Administrator deems necessary. In the
event of contumacy, failure, or refusal of any person to obey any such subpoena, any district
court of the United States in which venue is proper shall have jurisdiction to order any such
person to comply with such subpoena. Any failure to obey such an order of the court is
punishable by the court as a contempt thereof.
EPCRA Section 325(f)(2):
Procedures for Administrative Pen alties .—The Administrator may issue subpoenas for the
attendance and testimony of witnesses and the production of relevant papers, books, or
documents in connection with hearings under this section. In case of contumacy or refusal to
obey a subpoena issued pursuant to this paragraph and served upon any person, the district
court of the United States for any district in which such person is found, resides, or transacts
business, upon application by the United States and after notice to such person, shall have
jurisdiction to issue an order requiring such person to appear and give testimony before the
administrative law judge, or both, and any failure to obey such order of the court may be
punished by such court as a contempt thereof.
October 1997 11—22
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II. EVIDENCE GAThERING ILB. Subpoena Authority
2. Case Law
a) Statutory Authority
Sen v Sulhvcrn ,
390 F.2d 619 (3rd Cir. 1968)
Background:
Case involved the Federal Alcohol Administration Act, arid its enforcement by the Internal
Revenue Service. Under the statute, the IRS attempted to investigate perimttees No such
power existed under the statute, expressly, nor impliedly.
Ruling:
The law must authorize the administrator power to order a subpoena duces tecum. A
respondent may ignore a command to produce evidence or to testily in an investigation that
has not been expressly or impliedly authorized by the statute.
United States Environmental Protection Agency v. Alyeskcr Pipeline Service Compcrny
836 F.2d 443 (9th Cir. 1988)
Background:
A TSCA subpoena was issued to assist in an investigation of tanker discharges under the
Clean Water Act.
Ruling:
• Congress gave the EPA Administrator the authority to decide which environmental law is
appropriate to investigate individual cases. TSCA recp.ures resort to other environmental
laws only if the EPA has already determined that other laws would suffice.
• Section 11(C) imposes no requirement that subpoenas are issued only to investigate
discrete charges of violations of the law.
• TSCA is designed to regulate all chemical substances.
• An EPA subpoena is not sell-enforcing. A recipient may refrani from complying with it,
without penalty, until directed otherwise by a federal court order
In re: Minnesota Mining & Manufactunng and SET Errvironm ental, Inc
Docket No. TSCA-V-C-20-91, Order Granting Motion for Subpoena
Background:
The respondent sought issuance of a TSCA subpoena in order to obt n information about PCB
disposals from a waste hauler.
11—23 October 1997
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H. B. Subpoena Authority II. EVIDENCE GAThERING
Ruling:
The motion was granted and the Administrative Law Judge issued the subpoena. See motion
and subpoena at IIE-50a.
b) Subpoena Power
United States of America v. Morton Salt Company .
338 U. S. (1950)
Background:
This case involved an order by the Federal Trade Commission requiring the production of
reports showing the manner in which salt producers complied with a court decree.
Ruling:
An admimstrative agency has the power of inquisition analogous to the Grand Juxy, which does
not depend on a case or controversy for power to get evidence. The Grand Jury can investigate
merely on the suspicion that the law is being violated, or because it wants the assurance that it
is not.
C) Purpose of the Inquiry
Matter of Edge Holding Company .
256 N.Y. 374, 381-82
Background:
A New York company was subpoenaed duces tecum to produce their president, secretary, and
a number of financial records to the Commissioner of Accounts for the City of New York. The
company argued that the documents were not relevant.
Ruling:
Subpoena duces tecum to produce documents before an administrative officer will not be
vacated unless the subpoena is inevitably or obviously futile. The subpoenaed information only
needs to be related to the investigation.
Lee v. Federal Maritime Bocird .
284 F.2d 577(9th Cir. 1960)
Background:
This case involves rate increases in the shipping of Alaska oil. The Federal Maritime Board
(FMB) sought to subpoena a number of documents pert ning to Lee’s company’s billing
practices. Lee argued that such documents were irrelevant because the fl ’ {B’s prior history in
October 1997 11—24
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II. EViDENCE GAThERING II.B. Subpoena Authority
such actions was to only examine billing practices of large companies. His company was quite
small and had little influence on the market.
Ruling:
The couit will not judge whether or not a subpoena is relevant simply by an administrative
agenc s prior actions in a similar case. In short, the agency has latitude as long as the
subpoenaed information is relevant to the case at hand.
Oklahoma Press Publishing v. Walling .
327 U.s. 1 86-87 (1946)
Background:
The United States Department of Labor subpoenaed documents and records of a newspaper
publishing corporation, pursuant to the Fair Labor Standards Act. Petitioner argued that the
subpoena violated the 1st, 4th and 5th Amendments to the Constitution.
Ruling:
An administrative subpoena may be held unenforceable on the ground that the data called for
is in elevant to the purpose of the inquiry. The Administrator should be held to essentially the
same standard as a grand jury—that they shall not act arbitrarily or in excess of his statutory
authonty.
Federal Trade Commission v. Texaco. Inc. .
571 F.2d 137 (1975)
Background:
The Federal Trade Commission (FTC) sought to subpoena a number of files dealing with the
reporting of natural gas reserves in certain areas. Some of these files dealt with bidding files,
and other financial data.
Ruling:
The subpoena must be relevant to the intended purpose of the investigation. For example, in
this case, the purpose of the investigation was to determine the volume and location of natural
gas reserves. Bid files were not necessary, nor relevant to the Commission’s ongmal stated
purpose.
Adams v. Federal Trade Commission .
296 F2d 861 (8th Cir. 1961)
Background:
The Federal Trade Commission sought the district court to enforce subpoenas. Adams argued
that the subpoenas were too vague. Furthermore, he argued that the information the subpoena
sought was cumbersome and extremely difficult to retrieve.
11—25 October 1997
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II. B. Subpoena Authority II. EViDENCE GATHERING
Ruling:
The courts will only invalidate a subpoena if it is inconceivably vague or oppressive enough to
nm counter to “rudimentary principles of justice.” In this particular case, the court found that
while the subpoena was not overly vague, a 5-year time limit needed to be imposed so that the
request was not oppressive.
d) Scope of Court Review
Endicott Iohrison v Perkins ,
317 US 501-517 (1943)
Background:
The case involved the validity of an administrative subpoena issued by the Secretary of Labor
to investigate the overtime wages patd to employees engaged in work performed in connection
with government contracts.
Ruling:
It is the District Court’s duty to order compliance if the evidence sought by the subpoena was
not pl n1y incompetent or irrelevant to any lawful purpose.
Equal Employment Opportunity Commission v Children’s Hospital Medical Center of Northern
California ,
719 F.2d 1426(9th Cir. 1983)
Background:
The District Director of the Equal Employment Opportunity Commission (EEOC) issued three
subpoenas to gather information regarding the Center’s compliance with a district court
consent decree.
Ruling:
The scope of judicial inquiiy in an agency subpoena enforcement proceeding is narrow and
limited as to whether:
• Congress has granted the authority to investigate;
• Procedural requirements have been followed; and
• The evidence is relevant and material to the investigation.
October 1997 11—26
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II. EVIDENCE GAThERING II.B. Subpoena Authority
U.S. v. Feaster .
376 F.2d 147(5th Cir. 1967)
Background:
The case pertained to whether the Alabama State Docks Department was a carrier within the
me ing of the Railway Labor Act. Alabama refuted the arguments of the United States by
arguing that the evidence the United States sought was not sufficient to estabhsh the ultimate
issue of corner status.
Ruling:
The court ruled that the scope of review by a court is limited to whether evidence sought is
plainly incompetent or irrevelvant to any lawful purpose of the agency, and as to whether the
request is arbitr y, capricious and without foundation, and in the event evidence is sufficient
and board action is not incompetent or arbitrary, judicial aid must be given, even if evidence is
insufficient to establish the utlimate issue of can-ier status.
3. Special Considerations
TSCA Section 11
Subpoena authority pursuant to Section 11(C) of TSCA may be exercised in order to inquire
about the manufacture, processing, distribution, use, storage or disposal of chemical
substances, regardless of the ultimate statutory authority used to take compliance or
regulatory action.
Subpoenas may be issued to fulfill three purposes:
Regulation - To inquire about chemical substances in order to gather infonnation in
connection with the development of a rule or regulation. (0MB approval
required)
Investigation - To inquire into potential eiastence of hazards or violations posed by the
manufacture, processing, distribution, use, storage or disposal of chemical
substances. (No 0MB approval required)
Litigation - To obtain witness testimony and other evidence for presentation at a civil
administrative hearing. (No 0MB approval required) [ also EPCRA section
325(0(2)]
4. Documentation/process
Documentation
Prior to issuance of a subpoena, a management plan should be prepared. The plan will serve
as the official Agency record indicating the purpose of the action. The plan may be submitted
11—27 October 1997
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II. B. Subpoena Authority II. EViDENCE GAThERING
to the district court as background information should a court order be required to enforce the
subpoena. The plan should provide:
• Background concerning the events leading to a decision to issue a subpoena;
• Criteria used to evaluate the information;
• Description of the recipient(s); and
• Summary of the subpoena issuance, review, arid evaluation process including any
standard evaluation forms.
If subpoenas are to be issued to a subset of regulated facilities, a targeting strategy should be
prepared either separately or as part of the management plan explaining the rationale for
selecting a particular facility to receive a subpoena.
Several documents should be prepared in connection with the issuance of a subpoena:
1) Cover letter explaining:
(A) the purpose of the subpoena
(B) authority to issue the subpoena
(C) rights to declare information confidential
2) Subpoena commanding:
(A) the production of information, arid/or
(B) appearance of persons to testify
3) Specifications providing:
(A) definitions of the terms used in the subpoena
(B) directions for responding to the information requested
(C) list of information to be provided
(D) form/format for responding to the request (optional)
October 1997 11—28
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II. EVIDENCE GAThERING II.B. Subpoena Authority
4) Certificate of Service
The subpoena can be nended. after it is issued, to:
• extend the time to respond or appear;
• request additional information; and
• delete the requirement to appear and give testimony.
Process
a) Issuance
Investigatory subpoenas may be issued to require testimony and/or the production of
documents. It is recommended that subpoenas be issued for documents and written answers
to questions (Subpoena duces tecum) first, and subpoenas for oral testimony (Subpoena ad
testificaridum) at a later date. Scheduling the production of reports and wntten answers prior
to appearance for oral testimony allows the Agency time to review the documents in order to:
• formulate any questions concerning the materials; or
• determine that testimony is not required and cancel the appearance.
The subpoena recipient may be directed to provide written responses to questions in a
particular format or by completing a form provided along with the subpoena. [ By providing a
form, the person reviewing the subpoena response does not have to waste time reading
unnecessary verbiage and the respondent is not burdened with providing superfluous
non-ative statements.] The Agency can focus Respondent’s attention on the necessary
information thereby saving time and resources.
b) Service
A subpoena may be served by certified mail or in person upon completion of a certificate of
service.
c) Sworn Oral Testimony
Testimony under a subpoena is a nonpublic investigation. Attendees are limited to:
• EPA authonzed personnel;
• presiding officer (if any);
• the witness;
• the reporter of the proceedings (if any); and
11—29 October 1997
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II. B. Subpoena Authority II. EVIDENCE GAThERING
• the legal representative of the witness who is not also a prospective witness.
The interview is begun by requiring the witness to sigr an oath and application for fees.
The questions in the interview may extend to facts, opinions, suspicions, beliefs, m inor, gossip,
he say, or any other matter which in the opinion of the questioner may lead to the discovery of
evidence which would probably be admissible in civil administrative proceedings.
The witness cam iot raise objections to the questions except to make a claim of privilege or to
challenge the investigative jurisdiction of EPA.
More than one EPA employee may pose questions of the witness.
The interview may be adjourned from time-to-time to an hour and date certain or may be
continued to a new date and time certain. The interview should not be continued indefinitely.
At the conclusion of the interview, the witnesses legal representative may ask cl ifying
questions of the witness concerning any subject of inquiry of the EPA questioners.
Tape or written recordings of the interview by or for the witness may be prevented. However
the witness may inspect any recordation made by authorized EPA personnel.
The following examples e provided in the example section.
Example 11—1. T geting Strategy for Mercury Subpoena lIE—I
Example 11—2. TSCA Management Plan for Mercury Subpoena UE—3
Example 11—3. Preliminary Assessment Form for Mercury Subpoena ItE—7
Example 11—4. Follow-Up Questions for Mercury Subpoena IIE—9
Example 11—5. Mercury Subpoena Cover Letter IIE—1 1
Example 11—6. Mercury Subpoena IIE—13
Example 11—7. Extension for Response Letter — Mercury Subpoena . IIE—21
Example 11—8. Mercury Subpoena Modification Letter #1 11—23
Example 11—9. Mercury Subpoena Modification Letter #2 IIE—25
Example 11—10. Alyeska Subpoena — Precedent IIE—27
Example 11—11. Texas Eastern Subpoena 1 1—35
Example 11—12. 3M and SET Environmental, Inc. — Order Granting Motion
for Subpoena IIE—47
October 1997 11—30
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II. EVIDENCE GATHERING ll.C. Voluntary Disclosure/Self Confession
ll.C. Voluntary Disclosure/Self Confession
Documentation of Violation and Penalty Mitigation Factors
1. Statutory Requirements
FIFRA
Not an adjustment factor set forth in the Act, but included as part of the FIFRA Penalty Policy.
TSCA Section 16(a)(2)(B):
In determining the aniount of civil penalty, the Administrator shall take into account the nature,
circumstances, extent, and gravity of the vioiation or violations and, with respect to the violator,
abthty to pay, effect on abthty to continue to do business, any history of prior such violations, the
degree of culpability, and such other matters as justice may require.
TSCA Section 16(a)(2)(C):
The Admimstrator may compromise, modify, or remit, with or without conditions, any civil
penalty which may be imposed under this subsection. The aniount of such penalty, when
finally determined, or the nourxt agreed upon in compromise, may be deducted from any
sums owing by the United States to the person charged.
EPCRA
Not an independent adjustment factor.
2. Case Law
In re: Rocketdyrie Division. Rockwell International Corporation .
TSCA Docket No. 83-H -04
• First TSCA case involving sell-confessed violations.
• Consent Agreement and Compliance Schedule.
• Findings of Fact:
(A) Established date of discovery of violation;
(B) Stopped the violation;
(C) Immediate notification of Agency regarding violation; and
(D) Submitted evidence to Agency that it committed the violation.
11—41 October 1997
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Il.C. Voluntary Disclosure/Self Confession II. EViDENCE GAThERI
3. Policy
EPA encourages the voluntary disclosure of violations as a means of promoting compliance.
The Agency recognizes that the regulated community will expand environmental auditing in
exchange for reduced penalties. On December 22, 1996, EPA published a final policy
statement, Incentives for Self Policing: Discovery Disclosure, Correction and Prevention of
Violations (60FR66706, December 22, 1995). The policy establishes nine conditions that will be
used to determine penalty reduction. The conditions are:
1. Systematic Discovery
2. Vo1unt y Discovery
3. Prompt Disclosure
4. Discovery mid Disclosure Independent of Government or Third Party Plaintiff
5. Correction and Remediation
6. Prevention
7. Nonrepetitive Violation Commission
8. Violation Exclusion
9. Cooperation
Condition 2 through 9 must be met if the violator is to receive any penalty mitigation. If the
violator also meets Condition 1, the penalty will be reduced by 100%. If the violator has
received any economic benefit from the violation, EPA must recapture the full amount of the
penalty as part of settlement. -
EPA has issued another policy regarding penalty mitigation for small businesses, “Policy on
Compliance Incentives for Small Businesses,” effective June 10, 1996. This policy has many of
the same conditions used to determine penalty reduction as the policy regarding incentives for
self-policing. Although the violations detected in conjunction with these policies stem from self
disclosure and not through an inspection or subpoena action, the complete circumstances
surrounding the violation must be thoroughly documented for the case file.
4. Documentation/process
The initial disclosure of a violation may be made o 11 v r in writing. Upon notification, two
factors should be considered before proceeding. They are:
• Verification of a statutory violation; and
• Whether disclosure has been made prior to the notification to the facility of an investigation.
For example:
• A check should be made of the confidential as well as public inventory before assuming
there is a violation of the Pre-Manufacturing Notice (PMN) requirements.
October 1997 11—32
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II. EVIDENCE GAThERING IC. Voluntary DisclosurelSeif Confession
• The person disclosing the violation should be asked if there has already been contact by
the Agency to schedule an inspection.
If, after consideration of these factors, it appe s that the notification does constitute a
volunt y disclosure, the person making the disclosure should be advised that:
• The violative activity must cease and any further such violations may be considered
knowing and willful and subject to cnrninal action;
• Documentation must be submitted describing:
(A) the nature of the violation in detail;
(B) when arid how the person discovered the violation;
(C) when and how the violative conduct was discontinued, corrected, and
remediated.; and
(D) what measures have been implemented to prevent recurrence;
The documentation describing the nature of the violation should include as appropriate:
• Names and purposes of any chemical substances or pesticides involved including
Chemical Abstract Service numbers, EPA registration numbers, and brand names;
• Locations of manufacturing or testing facilities, producer establishments and their
numbers, ports of entry, or use sites;
• Descriptions of the manufacturing, production, or import process, or use or testing
procedures;
• Dates and amounts of chemical substances or pesticides involved in each violation;
• Description of the types of products or crops where the chemical substance or pesticide is
used;
• Description of the marketing practice of the chemical substance or pesticide;
• Dates of distribution or sale of the chemical substance or pesticide;
• Amounts of the chemical substance or pesticide in inventory and remaining unused in
channels of trade;
• The nature and extent of any human or environmental injury; and
• Size of the violator’s business.
11—33 October 1997
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ILC. Voluntary Disclosure/Self Confession II. EVIDENCE GAThERING
NOTE: In lieu of actual documents such as batch or shipping records, the violator may
provide lists of documents by date indicating the specific quantities
manufactured or distributed for that date. These lists should be accomp ied by
a letter indicating that copies of the actual documents will be provided upon
request.
From EPA and other records, the case development officer must determine if:
• the reported violation is a repeat violation;
• there was an economic benefit derived by the violator; and
• the violator has exhibited a cooperative attitude.
In advising the violator of the steps that must be taken to meet the requirements of the voluntary
disclosure policy, the Case Development Officer should not speculate on the actual size of the
penalty. A copy of the policy may be provided with an explanation that the Agency will
calculate the proposed penalty assessment using the factors outlined in the policy and that
until a complete evaluation of the documentation is made, no specific penalty figure can be
quoted. It is also recommended that no settlement negotiations be initiated until a proposed
penalty is memorialized by the issuance of a civil administrative complaint.
In order to avoid any ex pcxrte communication, the Office of Pollution Prevention and Toxics
Substances or Office of Pesticide Programs should be advised of any voluntary disclosure
involving a chemical substance or pesticide that is undergoing a sirnultcmeous review by their
offices.
NOTE: At the time of disclosure, the violator may request the exercise of enforcement
discretion. Enforcement discretion is discussed in VI.
The following examples are provided at the end of this chapter
Example 11—13. Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention
of Violations (EPA Final Policy Statement) 11-53
Example 11—14. EPA Policy on Compliance Incentives for Small Businesses 11-61
Example 11—15. Voluntary Disclosure Documentation Request 11—71
October 1997
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II. EVIDENCE GAThERING lI.D. Other Data Sources
II.D. Other Data Sources
1. Federal/State/Local Government Activities
40 CFR Part 22- Consolidated Rules of Practice Governing the Administrative Assessment of
Civil Penalties and the Revocation or Suspension of Permits
40 CFR Section 22.22 Evidence
(a) General. The Presiding Officer shall admit all evidence which is not irrelevant, immaterial,
unduly repetitious, or otherwise unreliable or of little probative value, except that evidence
relating to the settlement which would be excluded in the federal courts under Rule 408 of the
Federal Rules of Evidence is not admissible
a) Case Law
In re Sporiciden IriterncrtionaL
Docket No. FIFRA-88-H-02
Background:
DC inspectors entered arid searched Respondent’s office under a DC warrant. Subsequently,
EPA used the evidence in a case ag nst Sporiciden. Respondent argued that the evidence
must be suppressed in the federal hearing because EPA inspections were limited under FIFRA
section 9 to places where pesticides are held for distribution and sale.
Ruling:
A search conducted:
• by employees of the District of Columbia carrying both EPA arid District of Columbia
credentials;
• upon receipt of an Investigation Request from EPA; and
• under a warrant issued by the Superior Court of the District;
was held to be a federal search and federal standards were applicable. Because evidence
that pesticides were held for distribution or sale at the preimses searched was stale and
outdated, the search could not be justified under section 9 of FIFRA arid evidence seized during
the search was suppressed.
11—35 October 1997
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uI.D. Other Data Sources II. EViDENCE GAThERING
In re: Electric Service Company .
TSCA Appeal No. 82-2
Background:
Electric Service Company consented to an inspection by an Ohio inspector and later
challenged the admissibility of the evidence. It gued that the inspector was not duly
delegated the authority to conduct an EPA inspection and did not follow TSCA procedures.
Ruling:
An inspection was conducted:
• by an Ohio inspector carrying only state credentials;
• at the request of EPA; and
• without satisfying TSCA requirements such as providing a written notice of inspection.
The judge concluded that since the inspection was conducted on EPA’s behalf, the inspector
should have been a duly-designated representative of the Administrator regardless of his
authority under State laws and should have given a written notice of inspection. However, the
evidence obt ned during the inspection was admitted since the inspection was conducted on
the basis of consent.
In re: Georc e 1. Huth dibla Huth Oil Company and Ioyce Nichols .
Docket No. TS CA-V-C-i 96
Background:
Admissions entered in an unrelated civil action were later offered by EPA in a PCB storage
case. Huth objected and the court overruled.
Ruling:
Depositions taken in an action in the Court of Common Pleas, Cuyahoga County, Ohio, contain
relevant evidence and were properly admitted into the he ing record under 40 CFR Section
22.22. The general rule is that evidence properly taken by one court maybe used in
subsequent he -ings by another court.
b) Special Considerations
In addition to evidence gathered during EPA investigations, relevant evidence from the
following government sources may be used to support civil administrative cases:
• “Independent ” investigations conducted in accordance with state or local laws or statutes
administered by other Federal agencies;
October 1997 11—36
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II. EVIDENCE GAThERING II.D. Other Data Sources
• Inspections conducted by state employees duly designated as representative or officers of
the Administrator and in accordance with the applicable Federal statute;
• Exhibits admitted into evidence at any proceedings conducted in accordance with Federal,
State, or local law; and
• Records compiled in accordance with any Federal, State, or local statute
2. Finanóial Data
Sources of financial data can be used to detemiine the financial status of companies charged
with TSCA and FIFRA violations. The Agency is interested in this financial information for two
reasons: (1) to establish appropriate civil penalties in consideration of the size of the business
and (2) to challenge corporate claims that the civil penalty assessment will affect their ability to
continue in business. The Kcrtzspn Brothers decision requires the Agency to consider
adjustment factors, including ability to pay, prior to assessing a penalty figure in an
administrative complaint. In addition, New Waterbuzy requires Agency personnel to at least
have some information upon which to base a finding of ability to pay. Otherwise, if the
respondent raises the issue, and EPA has no information on the issue, the respondent wins the
issue. The challenge becomes getting enough information early on in the litigation process
upon which to base our analysis.’ This can be a daunting task if the respondent, as happens in
many cases, refuses to cooperate.
Generally, the first line of attack is verbally requesting financial data directly from the
respondent. Keep in mind a few things. First, any cooperation you get is likely to occur when
you first request the data. After that first request, cooperation will begin to rapidly slip away.
The bottom line is to make that first request reasonable, but thorough. The kinds of documents
we are looking for are, from for-profit entities, the most recent three to five years of:
1. Tcnc returns;
2. Balance sheets;
3. Income statements;
4. Statements of changes in financial position;
5. Statements of operations;
6. Retained earnings statements;
7. Loan applications, financing agreements, security agreements;
8. Annual reports; or
9. Audited financial statements.
Not every for-profit entity will have these, but almost all of them will have at least some of them.
The second line of attack is to file a discovery request. In this request you would ask for the
items listed above. II the respondent still refuses, there is some recent EPA case law that holds
1 Prior to New Waterbury . the rule was that if the respondent raised the ability to pay issue, it had to
prove it. That clearly is not the rule now. See In ye: New Waterbury at p. III -29.
ll—37 October 1997
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ul.D. Other Data Sources II. EViDENCE GATHERING
that the respondent is precluded from using data it refused to make available through
discovery. If the AU only orders a partial disclosure, there may not be sufficient infomiation
upon which to base an ability top analysis. At that point you should immediately contact
Jonathan Libber of OECA’s Multimedia Enforcement Division immediately at (202) 564-6011. A
motion for an interlocutory appeal should be ready to file in case this issue comes up. But
because of the Consolidated Rules of Practice, the Agency has a very short time to ifie the
motion.
Another point to keep in mind is the reliabthty of the data submitted. EPA has been recently
alerted to the extensive amount of data fraud going on this area. In regard to tax returns for an
example, you should always insist on getting signed returns. It is common practice for
accountants to send a copy for the respondent’s files that is never signed. Only the one
submitted to the RS is signed. While the unsigned return is probably okay, it also strips away
the main advantage of a tccc return: as long as it is signed, it is “self-authenticating.” But we
have been seeing doctored up signed returns. The safest course of action is to have the
violator fill out a special form that authorizes IRS to release the tax data directly to us. Tax
returns are the most complete and in the most consistent form for analysis. Tax returns also
provide financial information in a format for direct input into ABEL. Annual reports are the most
difficult to analyze and will probably require the assistance of a financial analyst. For
information on ABEL, contact Jonathan Libber at (202) 564-6011.
The third line of attack is to obtain publicly available data such as Dun & Bradstreet (D&B).
Those services provide data on even relatively small corporations. In addition, since the
source of the data is usually the company itself, and the company wants to make its D&B report
look as good as possible, the D&B’s tend to emphasize the positive parts of the companies’
financial situations. Thus a firm that “stonewalls” the Agency might find itself facing an ability to
pay analysis based solely upon a D&B report.
Financial information may also be useful in establishing a compan s violation history by
providing information on its parent and subsidiary companies, as companies with multiple
establishments generally are considered as one when determining violation history.
If you are litigating against an individual taxpayer as opposed to a firm, you will need to obtain
tax returns and have the respondent fill out a financial disclosure form. This will allow you to
run the INDIPAY model which is scheduled for release in the fall of 1997. While it is very difficult
to perform any analysis on an individual who refused to cooperate, there are ways of tracing
assets linked to the individual through some of the data bases on the Internet.
If you are litigating against a municipality, school district, county, drinking water authority or a
regulated utility, there are no standard financial reports we can request. As with the individual,
you will need to have the respondent fill out a financial disclosure form. This data should then
be entered in the MTJNIPAY model which should be available in the fall of 1997.
It is important to keep in mind that each type of financial report has its own purpose and slant.
For example, tax returns try to minimize financial health and annual reports tend to mardmize
financial health.
October 1997 11—38
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II. EVIDENCE GAThERING II.D. Other Data Sources
a) Securities and Exchange Commission (SEC) “10-K” and “lO-Q”
Statements
Description
The 10-K statement is the official annual business and financial report that must be ified by
companies that issue public stock. No other source of corporate information provides more
comprehensive or current information about a company than this report. The 10-K statement
contains the following items pertaining to a company’s financial status:
• Business information identifying principal products and services of the company, pnncipal
markets and methods of distribution, number of employees;
• Summary of operations for each of the last 5 fiscal years,
• Location and character of properties and if held or leased;
• Parents and subsidiaries;
• Description of material legal proceedings pending: and
• Executive officers and the nature of positions and offices held.
The 1 0-Q report is a condensed version of the 10-K and is completed on a quarterly basis by
compcmies as opposed to yearly. In addition to the basic location information, the 10-Q also
provides the following for any specific quarter: statements of financial position; statements of
earnings and earnings retained; statements of cash flows; notes to the financial statements;
and management’s discussion and analysis of financial condition and results of operations.
Process
The Securities and Exchange Commission (SEC) is located in Washington, DC. Statements
filed with the SEC can be viewed at its web site: www.sec.gov. Requests for certified copies of
10-K or 10-Q statements for submission as evidence in an enforcement proceeding must be
made on Agency letterhead and include:
• name of company;
• type of report required;
• date or year of filing;
• method of transmittal to EPA (mail, fax. etc.); and
• phone number of EPA contact point.
11—39 October 1997
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lID. Other Data Sources II. EVIDENCE GAThERING
The request could be mailed or faxed to:
Chief, Records Management Branch
Securities and Exchange Commission
Room 1C15, Stop 0-4
450 5th Street, NW
Washington, DC 20549
fax number: (202) 504-2699
b) Dun and Bradstreet (D&B)
Description
Dun and Bradstreet publications are used to determine the general financial condition of a
business enterprise. It can provide information on the size of a company, its gross sales, and
the names of its corporate officers. However, the D&B’s low level of detail may provide an
incomplete and potentially-misleading picture of a company’s financial condition. The D&B
should be used in conjunction with other financial data.
Process
To obtain a Dunn and Bradstreet Report regarding a company, contact Nancy Nibling, NEIC, at
(303) 236-3636.
Dun and Bradstreet (D&B) Million Dollar Directory
Description
The Million Dollar Directory is used to determine the general financial condition of a particular
business. In order to be listed in this publication, the company (or parent company) must have
gross sales that exceed one million dollars for a given year. The information provided
includes: legal name, address, and telephone number of the corporate headquarters; gross
sales; number of employees; products or services; and the company’s financial institution. It
also includes a listing of the corporate officers. The Directory supplies the name of the parent
company (where applicable) and also lists all of the subsidiary businesses. However, the
general level of detail provided by this publication, if used as the only source, can paint an
incomplete and potentially-misleading picture of a company’s financial condition.
Process
The Dun and Bradstreet Million Dollar Directory is available in the reference area of most
public or private libraries. The set usually consists of three volumes with the companies listed
in alphabetical order.
October 1997 Il—40
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H. EVIDENCE GAThERING liD. Other Data Sources
C) Financial Directories
Standard and Poor’s Register
Description
The Standard & Poor’s Register also provides general financial information about specific
companies. It contains a listing of over 55,000 businesses and is published yearly. The
information includes: legal name, address, and telephone number of the corporate offices;
corporate officers, main accounting firm, primary law firm, and primary financial institution;
yearly revenues; number of employees; products or services; and stock exchange listings. Also
listed is the parent company (where applicable) and all subsidiary businesses. Like the Million
Dollar Directory, if used as the sole source, this register can provide an incomplete and
misleading financial summary of a company.
Process
The Standard & Poor’s Register is available in the reference section of almost all public or
private libraries. The register is contained in three volumes; the corporate listings are usually
in Volume 1 in alphabetical order.
Moody’s Industrial Manual
Description
Mood s Industrial Manual provides a more comprehensive financial picture of a company
than D&B or Standard & Poor’s. This manual covers companies that are listed on the New
York. Amencan, or regional stock exchanges. The majority of the information available was
obtained from the corporations themselves, stockholders’ reports, and Securities and
Exchange Commission reports and registrations. The information includes: a brief history of
the company; products or services; location of corporate offices; corporate officers and
directors; primary accounting finn; number of stockholders; consolidated income account;
consolidated balance sheet; arid capital stock information. For the larger corporations, the
manual also lists all properties owned and managed. all subsidiaries, debt history, and
financial rating. In addition to the Industrial Manual, Moody also publishes manuals in the
areas of Bank and Finance, International Corporations, Municipal and Government, and Public
Utilities. Each manual is published yearly.
Process
Moody Manuals can be found at most public or private libraries in the reference area. The
manuals are a single volume; each volume represents a particular year. The index should be
consulted because compcmies can be listed in various places within the manual.
11—41 October 1997
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uI.D. Other Data Sources II. EVIDENCE GATHERING
3. Toxics Release Inventory System (TRIS)
Description
The Toxics Release Inventory System (TRIS), a key provision of EPCRA is an annual inventory
documenting the types and amounts of toxic chemical wastes released at manufacturing
facilities. It contains data submitted by certain manufacturers, processors, and users of over
600 listed toxic chemicals on their total annual releases, both routine and accidental, of these
chemicals to air, water, and land, or sent off-site to a waste treatment facility. Facilities e
required to report THIS data if they meet a combination of criteria concerning the size and type
of facility and the amount and nature of their use of THIS chemicals. Facilities must report: 1) if
they e a manufacturing facility, 2) employ ten or more full-time people, 3) manufacture,
import, process, or use THIS chemicals above threshold amounts. Facilities submit one THIS
form for each THIS chemical at the facility meeting reporting requirements.
The basic information contained in the THIS includes:
• Facility information including name, location, various business and regulatory identifying
numbers, and information on the company s parent company;
• Off-site transfer information including the names, addresses, and other information for all
sites to which chemical wastes were transported;
• Chemical use information such as the identity of the TRI chemical being reported, the uses
of the chemical at the facility, and the maximum amount present on-site;
• Chemical releases and transfers including the quantities of the chemical released to air,
water, or land and quantifies transported to off-site facilities;
• Waste treatment methods used to treat chemicals on-site and the efficiency of these
methods; and
• Waste minimization activities to reduce waste generation and the effect of these activities
on TFU releases and transfers.
Process
THIS can be accessed by all regions. Check with your regional automated data processing
(.ADP) coordinator to determine the method of access for your particular region.
4. FIFRA and TSCA Tracking System (FTTS)
Description - Violation History Report
The FIFRA and TSCA Tracking System (FT S) is a nationwide database that records
compliance history and other information on inspections, import reviews, samples, case
October 1997 11—42
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II. EVIDENCE GAThERING II.D. Other Data Sources
reviews, enforcement actions, and referrals. This system also produces standard arid ad hoc
reports on compliance/enforcement data.
FTI’S reports may cover any time period desired and provides information such as: the type
and date of cm action; the case/docket number; the type of violation; the proposed penalty and
the final penalty; the investigation type; and the region in which the violation was committed.
The system also indicates whether the violation falls under FIFRk Al-IERA , EPCRA. or TSCA.
The type of violation and the investigation type are coded; the FIFRA code definitions can be
found in the FIFRA Enforcement Response Policies (ERP). Code definitions for EPCRA TSCA
and Al-IERA can found in the FT S “Quick Reference Guide” (available from OCjData
Management Branch).
Vfl’S is useful for obtaining the violation history of a company or facility, both for information on
prior actions and the types of statutory violations previously issued.
Process
Each EPA region has its own FTFS. To find information about violations within a particular
region, that region’s FTFS can be accessed. If the need arises to obtain infonnation from
another region, there is the National Compliance Database (NCDB) maintained by the Office of
Compliance, EPA Headquarters, Washington, DC. The national database contains the
information from all of the regions. 1.1, for example, a case is being built against a company that
committed a violation in Region 10, the Region 10 P11 ’S can be used to find supplemental
compliance information on the company. It may also be useful to use NCDB to get a more
comprehensive look at the company in question. The name of the company is all that is
required to use FTIS and NCDB.
5. Shadowlaw
Shadowlaw is a commercial legal research tool, sold by Envires Corporation, which operates
like Lexis and Westlaw. It is a CD ROM system and only can be accessed through a CD ROM
terminal.
Shadowlaw contains all administrative decisions rendered by EPA under all statutes.
Decisions include all ALT Initial Decisions, any Order of an ALL as well as LAB Final Orders and
Decisions. Shadowlaw also includes all policies, gi.iidances, and CACOs issued by the EPA.
The system is updated quarterly.
Several Regional offices subscnbe to Shadowlaw. At EPA Headquarters Shadowlaw is used
by the Office of Administrative Law Judges and by the Office of Enforcement and Compliance
Assurance (OCEA). The OCEA Shadowlaw terminal is maintained by the Senior Enforcement
Counsel.
11—43 October 1997
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lID. Other Data Sources II. EVIDENCE GATHERING
6. Certified Statements
a) Rules of Practice
40 CFR Part 22 - Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
40 CFR Section 22.22 Evidence
(c) Verified statements. The Presiding Officer may admit an insert into the record as evidence,
in lieu of oral testimony, statements of fact or opinion prep ed by a witness. The admissibility
of the evidence contained in the statement shall be subject to the same rules as if the testimony
were produced under oral exciinination. Before any such statement is read or admitted into
evidence, the witness shall deliver a copy of the statement to the Presiding Officer, the reporter,
and opposing counsel. The witness presenting the statement shall swem to or affirm the
statement and shall be subject to appropriate oral cross-examination upon the contents
thereof.
b) Case Law
fr i re: A-2-Z Termite and Pest Control Corporation of Ocala
I. F. & R. Docket No. IV -308-C
Background:
At the hearing, EPA did not produce a witness it had identified in its prehearing exchange, and
offered an unsworn statement instead.
A-2-Z objected and the court agreed.
Ruling:
Objection to the introduction of a certified statement was sustained on the basis that:
• the statement was not in the form of an affidavit and sworn to; and
• the person making the statement was not present for cross examination.
Consequently, the Agency was unable to make a prima facie case for the violation.
C) Special Considerations
A certified statement is a statement of fact or policy made by:
• an EPA Division Director or above who has been delegated the authority for the conduct of
a particular activity or development of Agency policy concerning a specific subject;
October 1997 11—44
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II. EVIDENCE GAThERING uI.D. Other Data Sources
• an expert having the greatest knowledge or proficiency in a particular technical or
scientific subject; or
• a person having direct knowledge of the facts at issue in a particular case.
A certified statement will specify:
• the title, authority, responsibilities, andlor area of expertise of the person making the
statement;
• the Agenc s position on the issue; and
• the factual basis for that position.
A certified statement is useful in:
• formulating the testimony of an expert witness; and
• documenting direct evidence regarding Agency registrations, PMN reviews, and receipt of
vanous required reports.
d) Process
There are standard operating procedures for requesting routine statements such as the listing
of chemical substances on the inventory. Consult with your regional coordinator if unique
testimony is required.
The following examples for Orkin Extenninating Company/Rollins, Inc. are provided at the end
of the chapter.
Example 11—16. SEC lO-Q Statement HE—73
Example 11—17. Dun & Bradstreet IIE—83
Example 11—18 Standard and Poor’s Register Listing I]E—85
Example 11—19 D&B Million Dollar Directory listing IIE—87
Example 11—20 Moody Industrial Manual Listing IIE—89
Example 11—21 FTI’S ReportNiolation History IIE—9 1
The following example also is provided at the end of the chapter.
Example 11—22 Certified Statements IIE—93
11—45 October 1997
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II. EVIDENCE GATHERING
EXAMPLES
-------
Example Il—i TARGETING STRATEGY FOR MERCURY SUBPOENA .. HE—I
Example 11—2. TSCA MANAGEMENT PLAN FOR MERCURY SUBPOENA .. IIE—3
Example 11—3. PRELIMINARY ASSESSMENT FORM FOR MERCURY SUBPOENA.. . ... IIE—7
Example Il—4 FOLLOW-UP QUESTIONS FOR MERCURY SUBPOENA ... IIE—9
Example 11—5. MERCURY SUBPOENA COVER LETTER lIE—I I
Example 11—6 MERCURY SUBPOENA .. . . IIE—13
Example 11—7. EXTENSION FOR RESPONSE LITTER — MERCURY SUBPOENA .. IIE—21
Example II—8. MERCURY SUBPOENA MODIFICATION LETTER #1 IIE—23
Example 11—9 MERCURY SUBPOENA MODIFICATION Letter #2 .. IIE—26
Example Il—ID ALYESKA SUBPOENA— PRECEDENT IIE—27
Example Il—Il TEXAS EASTERN SUBPOENA. ... . ... IIE—35
Example 11—12. 3M AND SET ENVIRONMENTAL, INC. — ORDER GRANTING MOTION
FOR SUBPOENA IIE—47
Example 11—13. INCENTIVES FOR SELF-POLICIING. DISCOVERY, DISCLOSURE,
CORRECTION AND PREVENTION OF VIOLATIONS (EPA FINAL POLICY
STATEMENT) . IIE—53
Example 11—14 EPA POLICY ON COMPLIANCE INCENTiVES FOR SMALL BUSINESSES .. IIE—61
Example 11—15 VOLUNTARY DISCLOSURE DOCUMENTATION REQUEST IIE—71
Example 11—16 SEC 10-0 STATEMENT lIE—73
Example 11—17. DUN & BRADSTREET .... IIE—83
Example 11—18 STANDARD AND POOR’S REGISTER LISTING ... IIE—85
Example 11—19 D & B MILLION DOLLAR DIRECTORY LISTING.... IIE—87
Example 11—20 MOODY’S INDUSTRIAL MANUAL LISTING IIE—89
Example 11—21 FTTS REPORTNIOLATION HISTORY IIE—9I
Example 11—22 CERTIFIED STATEMENTS . .. IIE—93
October 1997
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Example Il—I. Targeting Strategy for Mercury Subpoena
TARGETING STRATEGY POR
XSSUAN E OP ) RCURY INVESTIGATIVE SVBPOE S
Total Initial Universe — 20
Subgroups
Paints, Coatings and Other Mixtures Manufacturers - 10
Building Materials Manufacturers - 5
Unique Users - 5
Rationales:
Paints, Coatings, and other Mixtures Manufacturers are the
principal purchasers of PMA pesticides. In order to review this
industrial group for potential violations of environmental laws
with respect to the chemical substance mercury, 10 PMA purchasers
will be randomly selected to inlude a range in size of quantities
purchased and geographic location.
Building Materials Manufacturers also purchase a substantial
amount of PICA pesticides. Based on purchase records, a group of
5 manufacturers will be randomly selected to represent one of each
different type of building material.
Five unique purchasers of PICA pesticides will also be
selected. The selection will be made on the basis that the types
of products that are believed to be manufactured by the company do
not have a pattern of use that would necessarily require the
incorporation of mercury.
lIE—I October 1997
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III. Proof/Evidence
Evaluation and
Organization
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III. PROOF/EVIDENCE
EVALUATION AND
ORGANIZATION
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III. PROOFIEVIDENCE EVALUATION AND ORGANIZATION . Ill—I
Ill A. BURDEN OF PROOF AND PERSUASION/PRIMA FAdE CASE . . .. Ill—I
I St at utoryiRegulatory Requirements Ill—I
2 Case Law IlI—4
3. Special Considerations 111—7
4 Process 111—7
llI.B STANDARDS AND LEVELS OF EVIDENCE Ill—B
I Statutory/Regulatory Requirements Ill—B
2 Case Law rn—b
3. Special Considerations 111—12
4. Process 111- 13
a) Civil Administrative Proceedings 111—13
b) Civil Judicial Proceedings (Injunction) 111- 13
c) Criminal Prosecution 111—13
III. C VIOLATiONS AND ELEMENTS OF PROOF 111- 13
I Constitutional/Statutory/Regulatory Requirements 111- 13
2. Case Law 111—16
3 Special Considerations . .. 111—19
4. Process 111-19
Ill D PENALTIES AND ADJUSTMENT FACTORS 111—21
I Statutory/Regulatory Requirements . 111—21
2 Case Law .... .. 111—24
3 Special Considerations 111—32
4 Process 111—32
Ill E ADEQUACY, QUALITY, AND AUTHENT1CI7Y OF EVIDENCE 111—33
1. Constitutional/Statutory/Regulatory Requirements 111—33
2. Case Law .. 111—34
3 Special Considerations 111—36
4 Process 111—37
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III. PROOF/EVIDENCE EVALUATION AND ORGANIZATION
III.A. Burden Of Proof And Persuasion/Prima Facie Case
1. Stat utoiy/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.24 Burden of Presentation; Burden of Persuasion.
The complainant has the burden of going forward with and of proving that the violation
occurred as set forth in the complaint and that the proposed civil penalty, revocation, or
Suspension, as the case may be, is appropnate. Following the establishment of a prima
facie case, respondent shall have the burden of presenting and of going forward with any
defense to the allegations set forth in the complaint. Each matter of controversy shall be
determined by the Presiding Officer upon a preponderance of the evidence.
Equal Access to Justice Act (5 U.S.C. 504) Effective 1 0/1/81:
(a)(l) An agency that conducts an adversary adjudication shall award, to a prevailing
party other than the United States, fees and other expenses incurred by that party in
connection with that proceeding, unless the adjudicative officer of the agency finds that the
position of the agency as a party to the proceeding was substantially justified or that
special circumstances make an award unjust.
40 CFR. Part 17—Implementation of the Equal Access to Justice Act in EPA
Administrative Proceedings
Section 17.3 Proceedings Covered.
(a) These rules apply to adversary adjudications required by statute to be conducted by
EPA under 5 U.S.C. 554. To the extent that they are adversary adjudications, the
proceedings conducted by EPA to which these rules apply include:
(1) A hearing to consider the assessment of any civil penalty under section 16(a) of the
Toxic Substances Control Act (15 U.S.C. 2615(a));
(2) A hearing to consider ordering a manufacturer of hazardous chemical substances or
mixtures to take action under section 6(b) of the Toxic Substance Control Act (15 U.S.C.
2605(b)), to decrease the unreasonable risk posed by a chemical substance or mixture;
(3) A hearing to consider the assessment of any civil penalty under section 14(a) of the
Federal Insecticide, Fungicide, and Rodenticide Act as amended (7 U.S.C. 136);
Ill—I October 1997
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III.A. Burden Of Proof And Persuasion/prima Facie Case HI. PROOF/EViDENCE EVALUATiON AND ORGANIZATION
(4) A hearing to consider suspension of a registrant for failure to take appropriate steps in
the development of registration data under section 3(c)(2)(B) of the Federal Insecticide,
Fungicide, arid Rodenticide Act as amended (7 U.S.C. 136a); and
(5) A hearing to consider the suspension or cancellation of a registration under section 6
of the Federal Insecticide, Fungicide and Rodenticide Act as amended (7 U.S.C. 136d);
40 CFR Section 17.5 Eligibility of applicants.
(a) To be eligible for an award of attorney’s fees and other expenses under the Act, the
applicant must be a prevailing party in the adversary adjudication for which it seeks an
award. The term “party” is defined in 5 U.S.C. 55 1(3). The applicant must show that it
meets all conditions of eligibility set out in this subpart and in subpart B.
(b) The types of eligible applicants are as follows:
(1) An individual with a net worth of not more that $1 million;
(2) The sole owner of an unincorporated business which has a net worth of not more than
$5 million and not more than 500 employees;
(3) A charitable or other tax-exempt organization described in section 501 (c)(3) of the
Internal Revenue Code (26 U.S.C. 501(c)(3)) with not more than 500 employees;
(4) A cooperative association as defined in section 15(a) of the Agricultural Marketing Act
(12 U.S.C. 114j(a)) with not more than 500 employees; and
(5) Any other partnership, corporation, association, or public or private organization with
a net worth of not more than $5 million and not more than 500 employees.
(c) For the purpose of eligibility, the net worth and number of employees of an applicant shall
be determined as of the date adversary adjudication was initiated.
(d) An applicant who owns an unincorporated business will be considered as an
“individual” rather than a “sole” owner of an unincorporated business if the issues on which
the applicant prevails are related primarily to personal interests rather than to business
interest.
(e) The employees of an applicant include all persons who regularly perform services for
remuneration for the applicant under the applicant’s direction and control. Part-time
employees shall be included.
(f) The net worth and number of employees of the applicant and all of its affiliates shall be
aggregated to determine eligibility. An individual or group of individuals, corporation, or
other entity that directly or indirectly controls or owns a majority of the voting shares of
another business’ board of directors, trustees, or other persons exercising similar functions,
October 1997 111—2
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III. PROOF/EVIDENCE EVALUATION AND ORGANIZATION III A. Burden Of Proof And Persuasion/prima Facie Case
shall be considered an affiliate of that business for purposes of this part In addition, the
Presiding Officer may determine that financial relationships of the applicant other than
those described in this paragraph constitute special circumstances that would make an
award unjust.
(g) An applicant is not eligible if it has participated in the proceedmg on behalf of other
persons or entities that are ineligible.
5 CFR Part 1320 Reporting and Recordkeeping Requirements, §1320.6 Public Protection
(a) Notwithstanding any other violation of law, no person shall be subject to any penalty for
failing to comply with a collection of information that is subject to the requirements of this
Part if:
(1) the collection of information does not display, in accordance with Sec. 1320.3(0 and
Sec. 1320.5(b)(1), a currently valid 0MB control number assigned by the Director in
accordance with the Act; or
(2) the agency fails to inform the potential person who is to respond to the collection of
information, in accordance with Sec. 1320.5(b)(2), that such person is not required to
respond to the collection of information unless it displays a currently valid 0MB control
number.
(b) The protection provided by paragraph (a) of this section may be raised in the form of a
complete defense, bar, or otherwise to the imposition of such penalty at any time during the
agency administrative process in which such penalty may be imposed or in any judicial
action applicable thereto.
(c) Whenever an agency has imposed a collection of information as a means for proving or
satisfying a condition for receipt of a benefit or the avoidance of a penalty, and the
collection of information does not display a currently valid 0MB control number or inform
the potential persons who are to respond to the collection of information, as prescribed in
Sec. 1320.5(b), the agency shall not treat a person’s failure to comply, in and of itself, as
grounds for withholding the benefit or imposing the penalty. The agency shall instead
permit respondents to prove or satisfy the legal conditions in any other reasonable
manner.
(1) If 0MB disapproves the whole of such a collection of information (and the disapproval
is not overridden under Sec. 1320.15), the agency shall grant the benefit to (or not impose
the penalty on) otherwise qualified persons without requesting further proof concerning the
condition.
(2)110MB instructs an agency to make a substantive or material change to such a
collection of information (and the instruction is not overridden under Sec. 1320.15), the
lQ—3 October 1997
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III.A. Burden Of Proof And Persuasjonlprjma Facie Case III. PROOF/EVIDENCE EVALUATION AND ORGANIZATION
agency shall permit respondents to prove or satisfy the condition by complying with the
collection of information as so changed.
(d) Whenever a member of the public is protected from imposition of a penalty under this
section for failure to comply with a collection of information, such penalty may not be
imposed by an agency directly, by an agency through judicial process, or by any other
person through administrative or judicial process.
Ce) The protection provided by paragraph (a) of this section does not preclude the
imposition of a penalty on a person for failing to comply with a collection of information that
is imposed on the person by statute—e.g., 26 U.S.C. Sec. 60 11(a) (statutory requirement for
person to file a tax return), 42 U.S.C. Sec. 6938(c) (statutory requirement for person to
provide notification before exporting hazardous waste).
2. Case Law
Prima Fade
In re: Celotex Corporation .
Docket No. TSCA-V-C-022-88, Initial Decision
Background:
The respondent was alleged to have violated the PCB Rule. Respondent’s testimony at the
hearing dad not address any of the allegations in the complaint.
Ruling:
Where the Agency presents a prima facie case establishing the violations alleged in the
complaint and the respondent presents no evidence in rebuttal thereof, the Court wifi make
a finding that the violations occurred.
Preponderance of Evidence
Inre: Empire Ace Insulation Manufacturing Corporation ,
Docket No. TSCA AS.B-8a-85-02 16, Initial Decision (1986)
Background:
Empire failed to file the required forms for the importation of asbestos. The president
testified he mailed the forms to EPA which EPA had lost. The judge found this and other
testimony was not credible.
Ruling:
It is to be determined in a civil administrative hearing whether or not the alleged violation is
supported by a preponderance of the evidence. ‘Preponderance of the evidence” is that
October 1997 111 —4
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III. PROOF/EVIDENCE EVALUATiON AND ORGANIZATION WA. Burden Of Proof And Persuasion/Prima Facie Case
degree of relevant evidence which a reasonable mind, considering the record as a whole,
might accept as sufficient to support a conclusion that the matter asserted is more likely to
be true than not true.
hire: Swina-A-Way Manufacturinçt Co. ,
Docket No. Vfl-910-T-650B
Background:
Swing-A-Way Manufacturing failed to file a timely To dc Release Inventoiy Report. The
Region produced invoices, statements, and processing records to establish that
Respondent was required to file a report.
Ruling:
The “preponderance of the evidence” standard has been interpreted to mean that a
reasonable person would find “a contested fact more probably true than untrue.” Having
failed to produce any evidence to show that it processed less than the amount requiring
the submission of a report, the Board ruled that the Presiding Officer properly determined
that the region had met its burden of proof by a preponderance of the evidence.
In re: Harold L Thomsen. and Thomsen Serial Spraying. Inc. .
Docket No. LF.&F?. VIh-1123C-92P
Background:
The respondent was charged with using a pesticide in a manner inconsistent with its
labeling It was alleged that the restncted use pesticide drifted onto adjacent property and
onto a person.
Ruling:
Complainant’s burden is to prove the violation alleged by a preponderance of the
evidence. If the evidence is thought to be in equipoise, the party having the burden of proof
cannot prevail. The complaint was dismissed.
Paperwork Reduction Act
In re: Lazarus, Incorporated .
Docket No. TSCA-V-C-32-93
Background:
The respondent contended that EPA was barred by the Paperwork Reduction Act (PRA)
from enforcing the requirements to keep annual records.
111—6 October 1997
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lILA. Burden Of Proof And Persuasjorilprima Facie Case III. PROOF/EVIDENCE EVALUATION AND ORGANIZATION
Ruling:
The PRA provides that no person shall be subject to any penalty for failing to maintain or
provide information to an agency unless the information collection requests display the
current 0MB control number. The 0MB control number, however, was not displayed in the
text of the regulations published in the Federal Register or in the Code of Federal
Regulations until the regulation’s amendment in 1989. Accordingly, the respondent cannot
be assessed a penalty for its failure to keep and, therefore, produce annual records on the
disposition of PCBs and PCB items prior to the inclusion in the 1989 Federal Register of the
0MB control number. Counts X and X I were dismissed.
Equal Access to Justice
In re: Robert Ross and Sons, I nc. .
Docket No. TSCA-V-C-008, Recommended Decision (1984)
Background:
In this case, the Agency charged Ross with the improper disposal of PCBs greater than the
500 ppm. The evidence presented showed PCBs of 4.4 ppm. The ALT dismissed EPA’s case
for failure to sustain its burden of proof. Ross sued for fees and expenses incurred in this
hearing.
Ruling:
Under the Equal Access to Justice Act (EAJA), a ‘substantially justified” standard requires
more of the government than the establishment of a prima facie case. The government
must show that the action had a reasonable basis in law and fact requiring as a minimum
some evaluation of opposing evidence. The application for fees and expenses was
allowed.
Irn-e Reabe Sprciyinçt Service. Inc. .
Docket No. V-651-C, Appeal No. 83-4
Background:
This FIFRA case was brought by EPA based on complaints from several day care workers
that they had been sprayed by an aerial applicator with parathion. Respondents
successfully rebutted the testimony and these counts were dismissed. Reabe sued for fees
and expenses.
Ruling:
Even if the Region’s interpretation is not “substantially justified,” it is justified by the EAJA’s
“special circumstances” exemption which allows an agency latitude to advance in good
faith the novel but credible extensions and interpretations of the law that often underlie
vigorous enforcement efforts, without being deterred by the prospect of attorney’s fees and
October 1997 111—6
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III. PROOF/EVIDENCE EVALUATiON AND ORGANIZATiON III.A. Burden Of Proof And Persuasion/Prima Facie Case
expenses, should it fail to prevail. Therefore the application for fees and expenses was
denied.
In re: Leo Stan cue I/b/a Gopher Choker .
Docket No. I.F.&F?. VIII-96-04
Bcxckground:
Complainant requested the withdrawal of the complaint without prejudice Respondent
requested that he receive attorneys’ fees because he had prevailed in the case.
Ruling:
The respondent did not oppose the complainant’s withdrawal request. No determination
was made about the merits of the case, and neither party could point to an order in the
proceeding in which they prevailed on an issue posed in the complaint. Since the
respondent has not demonstrated that he is a prevailing party in the adversary
adjudication for which he seeks an awards, respondent’s application for fees and
expenses pursuant to the Equal Access to Justice Act is denied.
3. Special Considerations
It is EPA’s practice to go forward with an action if a prima facie case can be established.
4. Process
In preparing a case, the Case Development Officer must ensure that there is sufficient
evidence to support:
• each factual allegation; and
• the appropriateness of the penalty assessment.
In preparing a Consent Agreement, the agreement should state: “This agreement settles
all claims arising from the facts in the case.” This statement prevents the filing of an Equal
Access to Justice or other claim once the settlement is finalized by the Consent Order.
111—7 October 1997
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lll.B. Standards And Levels Of Evidence iii. PROOFIEV1DENCE EVALUATION AND ORGANIZATION
III.B. Standards And Levels Of Evidence
1. Statutory/Regulatory Requirements
FIFRA Section 14:
(a) Civil penalties.—
(1) In general.—Any registrant, commercial applicator, wholesaler, dealer, retailer, or
other distributor who violates any provision of this subchapter may be assessed a civil
penalty by the Administrator of not more than $5,000 for each offense.
(2) Private applicator.—Any private applicator or other person not included in paragraph
(1) who violates any provision of this subchapter subsequent to receiving a written warning
from the Administrator or following citation for a prior violation, may be assessed a civil
penalty by the Administrator of not more than $1,000 for each offense Provided, That any
applicator not included under paragraph (1) of this subsection who holds or applies
registered pesticides, or uses dilutions of registered pesticides, only to provide a service of
controlling pests without delivering any unapplied pesticide to any person so served, and
who violates any provision of this subchapter may be assessed a civil penalty by the
Administrator of not more than $500 for the first offense nor more than $1,000 for each
subsequent offense.
(b) Criminal penalties.—
(1) In general.—.Any registrant, commercial applicator, wholesaler, dealer, retailer, or
other distributor who knowingly violates any provision of this subchapter shall be guilty of a
misdemeanor and shall on conviction be fined not more than $25,000, or imprisoned for not
more than one year, or both.
(2) Private applicator.—Any private applicator or other person not included in paragraph
(1) who knowingly violates any provision of this subchapter shall be guilty of a
misdemeanor and shall on conviction be fined not more than $1,000, or imprisoned for not
more than 30 days, or both.
TSCA Section 16:
(a) Civil penalties.--
(‘1) Any person who violates a provision of section 15 shall be liable to the United States for
a civil penalty in an arnouiit not to exceed $25,000 for each such violation. Each day such a
violation continues shall, for purposes of this subsection, constitute a separate violation of
section 15.
(2)(A) A civil penalty for violation of section 15 shall be assessed by the Administrator by an
order made on the record after opportunity (provided in accordance with this subparagraph)
for a hearing in accordance with section 554 of Title 5. Before issuing such an order, the
Administrator shall give written notice to the person to be assessed a civil penalty under
October 1997 IlI ---8
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Ill. PROOFIEV1DENCE EVALUATION AND ORGANIZATION IILB. Standards And Levels Of Evidence
such order of the Administrator’s proposal to issue such order and provide such person an
opportunity to request, within 15 days of the date the notice is received by such person, such
a hearing on the order.
(b) Criminal penalties.—Any person who knowingly or willfully violates any provision of
section 15, shall, in addition to or in lieu of any civil penalty which may be imposed under
subsection (a) of this section for such violation, be subject, upon conviction, to a fine of not
more than $25,000 for each day of violation, or to impnsonment for not more than one year,
or both.
EPCRA Section 325(c):
Civil and administrative penalties for reporting requirements.
(1) Any person (other than a governmental entity) who violates any requirement of section
312 or 313, shall be liable to the United States for a civil penalty in an amount not to exceed
$25,000 for each such violation.
(2) Each day a violation described in paragraph (1) or (2) continues shall, for purposes
of this subsection, constitute a separate violation.
(3) The Administrator may assess any civil penalty for which a person is liable under this
subsection by administrative order or may bring an action to assess and collect the penalty
in the United States district court for the district in which the person from whom the penalty
is sought resides or in which such person’s principal place of business is located.
40 CFR Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.24 Burden of Presentation; Burden of Persuasion.
The complainant has the burden of going forward with and of proving that the violation
occurred as set forth in the complaint and that the proposed civil penalty, revocation, or
suspension, as the case may be, is appropriate. Following the establishment of a prima
facie case, respondent shall have the burden of presenting and of going forward with any
defense to the allegations set forth in the complaint. Each matter of controversy shall be
determined by the Presiding Officer upon a preponderance of the evidence.
111—9 October 1997
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llI.B. Standards And Levels Of Evidence Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATiON
2. Case Law
Strict Liability
Knowledge
Fl FRA
Ln re: Harmack Grain Company. Inc. ,
Docket No. I.F.&F?. VIII-150-C, Order Granting Motion for Accelerated Decision and
Accelerated Decision (1986)
Background:
This case alleged a sale by Harxnack of a restricted use pesticide (RU?) while Harmack
was not registered as a RU? dealer. Harmack’s defense was that it did not know of the
regulation.
Ruling:
F [ FRA and its regulations impose strict liability on pesticide dealers and other persons. In
order to establish a violation, it is not necessary to show that the violator had actual
knowledge of statutory and regulatory requirements.
TSCA
In re: 1-Jodag Chemical Corporation .
Docket No. TSCA-V-C-025-88, Initial Decision (1988)
Background:
Respondent argued that it failed to keep PCB records because it did not know of the
presence of PCBs. The Court disagreed that this was a legal defense.
Ruling:
• While section 15(2) of TSCA includes the requirement that respondent “knew or had
reason to know,’ sections 15(1) and (3) contain no requirement for knowledge by the
respondent.
• Knowledge by the respondent that it is committing a violation of sections 15(1) and (3) of
TSCA is not a requirement for the finding a violation thereof nor for the resulting
imposition of a civil penalty under section 16(a).
• A person who “knowingly and willfully ’ violates section 15 shall be subject to certain
criminal penalties
October 1997 Ill—jO
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Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZATION llI.B. Standards And Levels Of Evidence
EPCRA
In re: Riverside Furniture Corporation .
Docket No. EPCRA-88-H-VI-4 065, Initial Decision
Background:
Respondent argued that it did not know about the subject reporting requirements which it
alleged Congress and EPA knew would take a considerable effort to communicate to the
regulated community.
Ruling:
The failure of a corporation to know what could have been known in the exercise of due
diligence amounts to knowledge in the eyes of the law.
FIFRA
In re: South Coast Chemical, Inc. .
Docket No. TX-0372-C-84-5,
Order Reversing and Remanding Initial Decision (1986)
Background:
EPA Region DC appealed the dismissal of the complaint allegmg the sale of an unregistered
pesticide by an unregistered production establishment. In the underlying case, the AU
found that South Coast had attempted to find out if its product was a pesticide and
received no answer. Because of this good faith effort, the AU dismissed the case. The
Chief Judicial Officer overruled the AU.
Ruling:
FIFRA is a strict liability statute. Accordingly, a respondent’s good faith is not a defense to
a charge that the statute has been violated. Good may be a factor to weigh in
considering whether a proposed penalty should be reduced, or even eliminated
Fair Notice
TSCA
Rollins Environmental Services (ND. Inc. v. U.S. Environmental Protection Agency .
Docket No. 90-1508 (DC Cir. 1991)
Background:
Rollins sought review of a $25,000 penalty assessed in a Final Decision by the Chief Judicial
Officer. The finding of violation and penalty assessment was based upon EPA’s
interpretation of a rinsate disposal provision of TSCA’s Section 6 PCB Rule.
Ill—Il October 1997
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IIIB. Standards And Levels Of Evidence iii. PROOF/EViDENCE EVALUATION AND ORGANIZATION
Ruling:
When the Agency itself is uncertain of the meaning of its regulations, when Agency
personnel give conflicting advice to private parties about how to comply with it, and when
the Agenc s chief legal officer finds the regulatory language equally supportive of one of
two possible constructions, it is arbitrary to find the regulation clear. Traditional concepts
of due process incorporated into administrative law preclude an agency from pena]izing a
private party for violating a rule without first providing adequate notice of the substance of
the rule. The Chief Judicial Officer’s penalty determination was set aside and the zero
penalty assessment was reinstated.
In re CWM Chemical Services, Inc., Chemical Waste Man aaement Inc.. and Waste
Management Inc .
Docket No. TSCA-PCB-91-0213, TSCA Appeal No. 93-1
Background:
The respondent was alleged to have violated the 500ppm PCB limitation in its landfill
approval by disposing of 260 shipments of sludge with PCB concentrations in excess of 500
ppm. The respondent contended that the levels were less than 500 ppm when measured
on a wet weight basis rather than a dry weight basis.
Ruling:
There was no legally enforceable obligation upon CWM to measure PCB on a thy weight
basis. Such an obligation had not appeared in applicable regulations since 1984. Under
the principles of due process, no violation can occur unless the Agency gives fair and clear
warning of the conduct required. The applicable regulations did not contain a requirement
to determine PCB concentration on a dry weight basis. Once removed from the regulations
regardless of the reason for such removal, the Agency no longer had a clear authority for
requiring PCB concentrations on a thy weight basis. A regulation cannot be construed to
mean what an agency intended but did not adequately express. Under the Administrative
Procedure Act, such an enforceable obligation could only be created through the
rulemaking or an adjudication. In the latter instance, where penalties are being sought,
the principles of due process require that the language of the regulation itself or the
express terms of the Agency’s landfill approval provide fair notice to the regulated entity of
the conduct required or prohibited by the Agency. Here, the enforceable obligation was
not created. The Presiding Officer’s order granting a motion for accelerated decision and
dismissal was upheld.
3. Special Considerations
In establishing a prima facie case for the alleged violation in a civil administrative case,
the Case Development Officer should disregard good faith efforts or lack of knowledge of
the violator. These factors should be considered only in establishing a prima face case for
the appropriateness of the penalty.
October 1997 111—12
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III. PROOFIEVIDENCE EVALUATION AND ORGANIZATION IILC. Violations And Elements Of Proof
4. Process
a) Civil Administrative Proceedings
• Burden of Proof - Strict liability, showing of intent is not required, only the fact that the
violation occurred.
• Burden of Persuasion - Preponderance, evidence standard which is of greater weight or
more convincing than the evidence which is offered in opposition to it.
b) Civil Judicial Proceedings (Injunction)
In addition to strict liability and preponderance of the evidence, a further showing must be
made that:
• there is an inadequate remedy at law;
• applicable administrative remedies have been exhausted; and
• irreparable injury, loss, or damage will result if the relief is not granted.
A preliminary injunction or temporary restraining order would require showing:
• immediate and irreparable injury, loss, or damage will result if relief is not granted; and
• there is a likelihood of success at trial, based on facts before the court.
c) Criminal Prosecution
• Burden of Proof - The violation occurred and was committed knowingly and willfully,
consciously and intentionally.
• Burden of Persuasion - All elements of the crime must be proved by the government
beyond a reasonable doubt
lll.C. Violations And Elements Of Proof
1. Constitutional/StatutoiyfRegulato,y Requirements
5th Amendment:
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a
presentment or indictment of a Grand Jury, except in cases arising in the land or naval
forces, or in the Militia, when in actual service in time of War or public danger; nor shall
any person be subject for the same offense to be twice put in jeopardy of life or limb; nor
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Hl.C. Violations And Elements Of Proof Ill. PROOF/EVIDENCE EVALUATiON AND ORGANIZATION
shall be compelled in any criminal case to be a witness against himseli, nor be deprived of
life, liberty, or property, without due process of law; nor shall private property be taken for
public use, without just compensation.
FIFRA Section 12:
Unlawful Acts. (a) In General.—(1) Except as provided by subsection (b), it shall be unlawful
for any person in any State to distribute or sell to any person—
(A) any pesticide that is not registered under section 3 or whose registration has been
canceled or suspended, except to the extent that distribution or sale otherwise has been
authonzed by the Admimstrator under this Act;
(B) any registered pesticide if any claims made for it as a part of its distribution or sale
substantially differ from any claims made for it as part of the statement required in
connection with its registration under section 3;
(C) any registered pesticide the composition of which differs at the time of its distribution
or sale from it composition as described in the statement required in connection with its
registration under section 3;
CD) any pesticide which has not been colored or discolored pursuant to the provisions of
section 25(c)(5);
(E) any pesticide which is adulterated or misbranded; or
(F) any device which is misbranded.
(2) It shall be unlawful for any person—
(A) to detach, alter, deface, or destroy, in whole or in part, any labeling required under this
Act;
(B) to refuse to—
(i) prepare, maintain, or submit any records required by or under section 5, 7, 8, 11, or 19;
( ii) submit any reports required by or under section 5, 6, 7, 8, 11, or 19; or
(iii) allow any entry, inspection, copying of records, or sampling authorized under this Act;
(C) to give a guaranty or undertaking provided for in subsection (b) which is false in any
particular, except that a person who receives and relies upon a guaranty authonzed under
subsection (b) may give a guaranty to the same effect, which guaranty shall contain, in
addition to his own name and address, the name and address of the person residing in the
United States from whom he received the guaranty or undertaking;
(D) to use for his own advantage or to reveal, other than to the Administrator, or officials or
employees of the Environmental Protection Agency or other Federal executive agencies, or to
the courts, or to physicians, pharmacists, and other qualified persons, needing such
information for the performance of their duties, in accordance with such directions as the
October 1997 111—14
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Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZATION lll.C. Violations And Elements Of Proof
Administrator may prescribe, any information acquired by authority of this Act which is
confidential under this Act;
(E) who is a registrant, wholesaler, dealer, retailer, or other distributor to advertise a
product registered under this Act for restricted use without giving the classification of the
product assigned to it under section 3;
(F) to distribute or sell, or to make available for use, or to use, any registered pesticide
classified for restricted use for some or all purposes other than in accordance with section
3(d) and any regulations thereunder. It shall not be unlawful to sell, under regulations
issued by the Administrator, a restricted use pesticide to a person who is not a certified
applicator for application by a certified applicator;
(G) to use any registered pesticide in a manner inconsistent with its labeling;
(H) to use any pesticide which is under an experimental use permit contrary to the
provisions of such permit;
(I) to violate any order issued under section 13,
(J) to violate any suspension order issued under section 3(c)(2)(B), 4, or 6;
(K) to violate any cancellation order issued under this Act or to fail to submit a notice in
accordance with section 6(g);
(L) who is a producer to violate any of the provisions of section 7;
(M) to knowingly falsify all or part of any application for registration, application for
experimental use permit, any information submitted to the Administrator pursuant to
section 7, any records required to be maintained pursuant to this Act, any report filed
under this Act, or any information marked as confidential and submitted to the
Administrator under any provision of this Act;
(N) who is a registrant, wholesaler, dealer, retailer, or other distributor to fail to file reports
required by this Act;
(0) to add any substance to, or take any substance from, any pesticide in a manner that
may defeat the purpose of this Act; or
(P) to use any pesticide in tests on human beings unless such human beings (i) are fully
informed of the nature arid purposes of the test and of any physical and mental health
consequences which are reasonably foreseeable therefrom, and (ii) freely volunteer to
participate in the test.
(0) to falsify all or part of any information relating to the testing of any pesticide (or any
ingredient, metabolite, or degradation product thereof), including the nature of any protocol,
procedure, substance, organism, or equipment used, observation made, or conclusion or
opinion formed, submitted to the Administrator, or that person knows will be furnished to the
Administrator or will become part of any records required to be maintained by this Act;
(B) to submit to the Administrator data known to be false in support of a registration; or
(S) to violate any regulation issued under section 3(a) or 19.
lIl—15 October 1997
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lll.C. Violations And Elements Of Proof iii. PROOF/EViDENCE EVALUATION AND ORGANIZATION
TSCA Section 15:
Prohibited Acts. It shall be unlawful for any person to—
(1) fail or refuse to comply with (A) any rule promulgated or order issued under section 4,
(B) any requirement prescribed by section 5 or 6; (C) any rule promulgated or order issued
under section 5 or 6; or (D) any requirement of Title II;
(2) use for commercial purposes a chemical substance or mixture which such person knew
or had reason to know was manufactured, processed, or distributed in commerce in
violation of section 5 or 6, a rule or order under section 5 or 6, or an order issued in action
brought under section 5 or 7;
(3) fail or refuse to (A) establish and maintain records; (B) submit reports, notices, or other
information; or (C) permit access to or copying of records, as required by this Act or a rule
thereunder; or
(4) fail or refuse to permit entry or inspection as required by section 11.
EPCRA Section 325(c):
Civil and administrative penalties for reporting requirements. (1) Any person (other than a
governmental entity) who violates any requirement of section 312 or 313, shall be liable to
the United States for a civil penalty in an amount not to exceed $25,000 for each such
violation.
2. Case Law
Unit of Violation
In re: McLoughlin Gormley King Co.. S.C. Iohn son & Son, Inc., Tarkasago International
Corp. USA. Ag’revp Environmental Health. Prentis Inc., Goocleed Chemical Co., Division of
Endura SPA .
F’IFRA Appeal Nos. 95-2 through 95-7, Docket Nos. F1FRA 94-H-lU through 94-H-i 5
Background:
The respondents were alleged to have committed four violations of FIFRA Section
12(a)(2)(Q) for falsifying “. . . all or part of any information relating to the testing of any
pesticide... submitted to the Administrator.” The complaint charged four separate
falsifications of the GLP compliance statement submitted with the results of a study, one
violation for each alleged deviation from the GLP standards.
Ruling:
Nothing in the statutory language or the legislative history suggests that there can be
multiple charges for submission of an allegedly false piece of information (i.e., a simple
compliance statement). Rather, the only logical reading of 12(a)(2)(Q) is that a single
penalty is chargeable per piece of information, irrespective of whether the information is
October 1997 111—16
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Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZAflON IH.C. Violations And Elements Of Proof
false in one or more respects. The compliance statement is clearly the sole item of
allegedly false “information” that was furnished to the Administrator. The complainant
confuses the “information” that is falsified with the evidence that the complainant intends to
use to support its claim of falsification. Therefore, the submission of the compliance
statement in question could have resulted in no more than one violation.
Elements of Proof
In re: N.O C.. Inc. TIA Noble Oil Company .
Docket No. II-TSCA-PCB-81-105, Initial Decision (1982)
Background:
Noble Oil challenged EPA’s method of sampling PCBs.
Ruling:
Complainant has burden of establishing all elements of a violation charged by a
preponderance of the evidence.
Culpability
Erisman Spraying Company. Inc. and Gerald P SchreineL
F7FRA VJJ-1134C-92P (1994)
Background:
EPA alleged the drift of parathion onto property adjacent to Respondent’s application site.
Sampling evidence of the presence of parathion was presented. Conflicting testimony was
given at trial as to whether Respondent’s plane was the actual plane which sprayed the
herbicide. The AU found EPA had not met its burden of proof.
Ruling:
It is incumbent on the Agency to prove:
• A duty placed upon Respondent;
• a dereliction of that duty; and
• EPA did not go far enough in its investigation and did not present evidence to prove
beyond a preponderance of the evidence that Respondent sprayed the property.
111—17 October 1997
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lll.C. Violations And Elements Of Proof Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATION
Double Jeopardy
United States of America v. Robbins
476 F.2d 26 (10th Cir. 1973)
Background:
In this criminal case, Robbins was charged with possession of an unregistered uirearrn and
possession of a firearm not identified by a serial number. Robbins argued that because
there was only one firearm, he could not be charged with both crimes. The court ruled
against him.
Ruling:
• The well-settled rule is, that for the double jeopardy provision to apply, the offense
charged and tried in the first count and the offense charged in the second count must
be identical in law and fact.
• The test for determining whether the offenses charged are identical is whether the facts
alleged in one, if offered in support of the other, would sustain a conviction.
Jn re: Amvac Chemical Corporation .
LF’.&R. Docket No. IX-98C, Final Decision (1976)
Background:
hi this FIFRA label case, Amvac was charged with misbranding and sale of an adulterated
product. The court found both resulted from one act on the part of the Respondent.
Ruling:
The actual test which must be applied to determine whether separate civil penalties shall
be assessed is a two-pronged test:
(1) Each violation must result from an independent act (or failure to act) of the
respondent; and
(2) Each violation must be substantially distinguishable from any other charge.
Complainants showing that each charge requires an element of proof not required by the
other does not negate the fact that both charges resulted from one independent act.
October 1997 111—18
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Ifl. PROOFIEVIDENCE EVALUATION AND ORGANIZATION IILC. Violations And Elements Of Proof
In re: Cooperative Grain and Supply Company
I.F.&R. VII 719C-86P, 739C-86P, 740C-86P
Final Decision (1990)
Background:
Region VU appealed from an ALT decision that held Co-op Grain’s failure to file as a RIJP
distributor for two dealerships was one violation of FIFRA and not two as the Region had
alleged The Chief Judicial Officer affirmed the lower finding against the Region.
Ruling:
Two charges are independently assessable only if each charge results from an
independent act or failure to act and each charge requires an element of proof not
required by the other charge.
3. Special Considerations
If it appears that two potential counts have identical elements of proof and evidence to
support those elements of proof, there may be potential for double jeopardy. Consult with
your attorney to determine if separate penalties may be assessed for both counts. If not,
both counts may be cited but only one penalty assessed.
4. Process
A violation is an act or failure to act defined by statute. Each violation contains several
elements that must be proven in order to establish the violation. Sometimes, as with FIFRA,
these elements are evident within the statute itself. In other cases, TSCA and EPCRA, the
rules and regulations may have to be consulted to determine the elements of proof.
Fl FRA
The FFRA Compliance /Enforcement Guidance Manual, Chapter 7, breaks down the
elements of proof for each FIFRA violation.
TSCA
Violation
Section 15-It shall be unlawful for any person to (I) fail or refuse to comply with ...(B) any
requirement prescribed by section 5 or 6.
Section 5(a) In general.—(1) Except as provided in subsection (h), no person may—
(A) manufacture a new chemical substance on or after the 30th day after the date on which
the Administrator first publishes the list required by section 8(b) unless such person
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IH.C. Violations And Elements Of Proof Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATION
submits to the Administrator, at least 90 days before such manufacture or processing, a
notice, in accordance with subsection (d), of such person’s intention to manufacture, or
process, such substance and such person complies with any applicable requirement of
subsection (b).
Elements of Proof
For violation of section 5(a), the elements of proof are:
• manufacture;
• date of manufacture 30 days after publication of the Inventory;
• substance is a new chemical not on the Inventory;
• activity is not exempted under section 5(h); and
• no PMN has been submitted 90 days prior to the date of manufacture.
EPCRA
Violation
Section 325(c)(l)—Any person (other than a governmental entity) who violates any
requirement of section 312 or 313, shall be liable to the United States for a civil penalty in
an amount not to exceed $25,000 for each such violation.
Section 313 Toxic Chemical Release Forms
(a) Basic requirement.—The owner or operator of a facility subject to the requirements of
this section shall complete a toxic chemical release form as published under subsection
(g) for each toxic chemical listed under subsection (c) that was manufactured, processed,
or otherwise used in quantities exceeding the toxic chemical threshold quantity established
by subsection (f) during the preceding calendar year at such facility. Such form shall be
submitted to the Administrator and to an official or officials of the State designated by the
Governor on or before July 1, 1988, and annually therealter on July 1 and shall contam data
reflecting releases during the preceding calendar year.
(b) Covered owners and operators of facilities.—( 1) In general.—(A) The requirements of this
section shall apply to owners and operators of facilities that hove 10 or more full-time
employees and that are in Standard Industrial Classification Codes 20 through 39 (as in
effect on July 1, 1985) and that manufactured, processed, or otherwise used a toxic
chemical listed under subsection (c) in excess of the quantity of that toxic chemical
established under subsection (f) during the calendar year for which a release form is
required under this section.
October 1997 111—20
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III. PROOF/EVIDENCE EVALUATION AND ORGANIZATION III.D. Penalites and Adjusthient Factors
Elements pal
For failure to submit a To dc Chemical Release Form, the elements of proof are:
• toxic chemical listed under subsection (c);
• date of manufacturing, processing, or use;
• manufactured, processed, or otherwise used chemical above the threshold quantities;
• facility within designated SIC Codes;
S
• facility has 10 or more full time employees; and
• no form has been received by the Agency.
To assist yourself in identifying violations, elements of proof, and the evidence available to
you to establish the violation, you may wish to use a worksheet. A blank worksheet and an
example of a worksheet used in an actual case are attached.
The following e
xcimples are provided at the end of this chapter.
Example I L l—i.
Blank Violation Worksheet
IIIE—l
Example 111—2.
Completed Violation Worksheet
]ILE—3
Example 111—3.
Elements of a Violation
I I LE—5
IILD. Penalties And Adjustment Factors
1. Statutory/Regulatory Requirements
FIFRA Section 14:
(a) Civil penalties.—
(1) In general—Any registrant, commercial applicator, wholesaler, dealer, retailer, or other
distributor who violates any provision of this subchapter may be assessed a civil penalty by
the Admimstrator of not more than $5,000 for each offense.
(2) Private applicator—Any private applicator or other person not included in paragraph (1)
who violates any provision of this subchapter subsequent to receiving a written warning
from the Administrator or following citation for a prior violation, may be assessed a civil
penalty by the Administrator of not more than $1,000 for each offense: Provided, That any
applicator not included under paragraph (1) of this subsection who holds or applies
111—21 October 1997
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lll.D. Penalties And Adjustment Factors Ill. PRooFIEvi c EVALUATION AND ORGANIZATION
registered pesticides, or uses dilutions of registered pesticides, only to provide a service of
controlling pests without delivering any unapplied pesticide to any person so served, and
who violates any provision of this subchapter may be assessed a civil penalty by the
Administrator of not more than $500 for the first offense nor more than $1,000 for each
subsequent offense.
(3) Hearing.—No civil penalty shall be assessed unless the person charged shall have been
given notice and opportunity for a hearing on such charge in the county, parish, or
incorporated city of the residence of the person charged.
(4) Determination of penalty.—In determining the amount of the penalty, the Administrator
shall consider the appropriateness of such penalty to the size of the business of the person
charged, the effect on the person’s ability to continue in business, and the gravity of the
violation. Whenever the Administrator finds that the violation occurred despite the exercise
of due care or did not cause significant harm to health or the environment, the
Administrator may issue a warning in lieu of assessing a penalty.
(5) References to Attorney General.—In case of inability to collect such civil penalty or
failure of any person to pay all, or such portion of such civil penalty as the Adrnmistrator
may determine, the Administrator shall refer the matter to the Attorney General, who shall
recover such amount by action in the appropriate United States district court.
TSCA Section 16:
(a) Civil penalties.—
(1) Any person who violates a provision of section 15 shall be liable to the United States for
a civil penalty in an amount not to exceed $25,000 for each such violation. Each day such a
violation continues shall, for purposes of this subsection, constitute a separate violation of
section 15.
(2)(A) A civil penalty for violation of section 15 shall be assessed by the Administrator by an
order made on the record after opportunity (provided in accordance with this
subparagraph) for a hearing in accordance with section 554 of Title 5. Before issuing such
an order, the Administrator shall give written notice to the person to be assessed a civil
penalty under such order of the Administrator’s proposal to issue such order and provide
such person an opportunity to request, within 15 days of the date the notice is received by
such person, such a hearing on the order.
(B) In determining the amount of a civil penalty, the Administrator shall take into account
the nature, circumstances, extent, and gravity of the violation or violations and, with respect
to the violator, ability to pay, effect on ability to continue to do business, any history of prior
such violations, the degree of culpability, and such other matters as justice may require.
(C) The Administrator may compromise, modify, or remit, with or without conditions, any
civil penalty which may be imposed under this subsection. The amount of such penalty,
when finally determined, or the amount agreed upon in compromise, may be deducted
from any sums owing by the United States to the person charged.
October 1997 111—22
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HI. PROOF/EViDENCE EVALUAtiON AND ORGANIZATION lII.D. Penalties And Adjustment Factors
(3) Any person who requested in accordance with paragraph (2)(A) a hearing respecting
the assessment of a civil penalty may ifie a petition for judicial review of such order with the
United States Court of Appeals for the District of Columbia Circuit or for any other circuit in
which such person resides or transacts business. Such petition may only be filed within
the 30-day period beginning on the date the order making such assessment was issued.
(4)11 any person fails to pay an assessment of a civil penalty—
(A) after the order making the assessment has become a final order if such person does
not file a petition for judicial review of the order in accordance with paragraph (3), or
(B) after a court in an action brought under paragraph (3) has entered a final judgment in
favor of the Administrator, the Attorney General shall recover the amount assessed (plus
interest at currently prevailing rates from the date of the expiration of the 30-day period
referred to in paragraph (3) or the date of such final judgment, as the case may be) in an
action brought in any appropriate district court of the United States. In such an action, the
validity, amount, and appropriateness of such penalty shall not be subject to review.
EPCRA Section 325(c)
Civil and administrative penalties for reporting requirements.—(l) Any person (other than a
governmental entity) who violates any requirement of section 312 or 313, shall be liable to
the United States for a civil penalty in an amount not to exceed $25,000 for each such
violation.
(2) Any person (other than a governmental entity) who violates any requirement of section
311 or 323(b), and any person who fails to furnish the Administrator information required
under section 322(a)(2) or requested by the Administrator under section 322(d) shall be
liable to the United States for a civil penalty in an amount not to exceed $10,000 for each
violation.
(3) Each day a violation described in paragraph (1) or (2) continues shall, for purposes of
this subsection, constitute a separate violation.
(4) The Administrator may assess any civil penalty for which a person is liable under this
subsection by administrative order or may bring an action to assess and collect the penalty
in the United States district court for the district in which the person from whom the penalty
is sought resides or in which such person’s principal place of business is located.
40 CFR Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.14 Content and Amendment of the Complaint.
(c) Derivation of proposed civil penczliy. The dollar amount of the proposed civil penalty
shall be determined in accordance with any criteria set forth in the Act relating to the proper
amount of a civil penalty and with any civil penalty guidelines issued under the Act.
111—23 October 1997
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M.D. Penalties And Adjustment Factors Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZATION
40 CFR Section 22.27 Initial Decision
(b) Amount of civil penalty. If the Presiding Officer determines that a violation has
occurred, the Presiding Officer shall determine a dollar amount of the recommended civil
penalty to be assessed in the initial decision in accordance with any criteria set forth in
the Act relating to the proper amount of a civil penalty, and must consider any civil
penalty guidelines issued under the Act. If the Presiding Officer decides to assess a
penalty different in amount from the penalty recommended to be assessed in the
complaint, the Presiding Officer shall set forth in the initial decision the specific reasons for
the increase or decrease. The Presiding Officer shall not raise a penalty from that
recommended to be assessed in the complaint if the respondent has defaulted.
2. Case Law
Litton Industries, Inc. .
TSCA-I-89- 1042 (1993)
Respondent argued that the TSCA Penalty Policy is subject to notice and comment under
the Administrative Practice Act (APA).
The AU disagreed.
• Penalty policies are guidance and as such are not subject to notice and comment.
• Penalty polices do not amend regulations nor subject Respondent to any new
requirement.
AU Responsibilities
In re: National Railroad Passenger Corporation (AMTRAK) .
TSCA Docket No. VI-24C, Initial Decision (1981)
Background:
In calculating the penalty, the AU performed his own calculations using the facts of the
case and the penalty policy.
Ruling:
The Rules of Practice (40 CFR Part 22) provide for the consideration of EPA’s penalty policy
in determining the appropriate penalty. The Administrative Law Judge (ALP need not,
however, accept the penalty proposed in the complaint, even if it originally conforms to the
policy, if the AU finds the penalty so calculated is inappropriate.
October 1997 lll—24
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Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATION hiD. Penalties And Adjustment Factors
Izire Colonial Processing, Inc. .
Docket No. IJEPCRA-89-QJ 14, Initial Decision (1991)
Background:
The AU rejected Complainant’s characterization of his role in determining the penalty as
merely that of a “reviewing court.”
Ruling:
The ALl is not bound to assess the same penalty as that proposed by Complainant. Upon
consideration, the ALT may conclude:
• the guidelines have been improperly interpreted and applied by Complainant;
• circumstances in the case warrant recognition or if recognized warrant a weight not
accorded them by EPA; or
• the penalty calculated and recommended by the Complainant under the guidelines is
somehow not consistent with the critena set forth in the Act.
In re: High Plains Cooperative. Inc. .
Docket No. I.F.&F?.-VIII-1990, Final Decision
Background:
The region appealed an initial decision arguing that the Administrative Law Judge failed to
appropriately take the penalty policy into account.
Ruling.
The Chief Judicial Officer affirmed the judge’s decision. He stated that the judge must:
• set the penalty amount in accordance with statutory criteria;
• consider any civil penalty guidelines issued under the Act; and
• set forth in his decision the reasons for any increase or decrease in the penalty
recommended in the complaint.
While the judge in this case did not follow the guidelines, the judge did consider them as
required by Section 22.27(b) of the Rules of Practice and did articulate his reasons for
lowering the penalty.
IH—.25 October 1997
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hiD. Penalties And Adjustment Factors iii. PROOF/EV1DENcE EVALUATION AND OR3AMzAnoN
In re: DIC Americas, Inc. .
TSCA Appeal No. 94-2
Background:
The respondent argued that the presiding officer erred because she adopted the Region’s
“mechanical” approach to calculating a gravity-based penalty based on the Enforcement
Response Policy instead of exercising her independent judgement as to an appropriate
penalty for the violations.
Ruling:
EPA has developed penalty policies to assure that Regional enforcement personnel
calculate civil penalties that are not only appropriate for the violations committed but are
assessed fairly and consistently. Agency regulations specifically provide that the Presiding
Officer “must consider any civil penalty guidelines issued under the Act” and must set forth
in the Initial Decision specific reasons for deviating from them. The Presiding Officer may
either approve or reject a penalty suggested by the guidelines. In this case, the Presiding
Officer indicated she was open to respondent’s arguments why she should deviate from
the penalty amount derived from the matrix. She stated that she has exercised
independent judgement, and DICA has pointed to no evidence to show otherwise. DICA
must demonstrate that the assessed penalty is not consistent with the statutory penalty
factors and has not done so. The penalty assessment set forth in the Initial Decision is
affirmed.
EPA Responsibilities
In re: Employers Insurance of Wausau and Group Eight Technology. Inc. .
TSCA Appeal No. 95-6, Docket Nos. TSCA-V-C-62-90
Background.
In the Initial Decision, the Administrative Law Judge concluded that EPA failed to
demonstrate the appropriateness of the proposed civil penalty. The Administrative Law
Judge also concluded that it was impermissible for EPA to rely on proof of its adherence to
the PCB Penalty Policy without also introducing evidence to substantiate the “finding
assumptions and determinations” underlying the penalty policy itself.
Ruling:
The Environmental Appeals Board concluded that nothing in the statute, the Rules of
Practice, or the Administrative Procedure Act (.APA) dictates such an onerous burden of
proof. The EAB held that fri order to establish the “appropriateness” of a recommended
penalty, EPA must demonstrate how the statutory penalty criteria relate to the particular
facts of the violations alleged. By reviewing the EPA analysis of the statutory factors and
independently determining that the analysis is a reasonable one, the Presiding Officer acts
to ensure that the assessment satisfies the APA abuse of discretion standard that the
October 1997 111—26
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HI. PRooF/Ev1D CE EVALUATION AND ORGANIZATION lII.D. Penalties And Adjusthient Factors
assessment is neither “unwarranted in law” nor “without justification in fact.” Proof of
adherence to a penalty policy can legitimately form a part of the complainant’s prima Icicle
case. The Initial Decision’s conclusion that the complainant failed to prove the
appropriateness of the proposed penalty was vacated.
Equity/Fairness
hire Iohri son Pacific. Incorporated .
FIFPLA Appeal No. 93-4, Docket No. FIFRA-09-069J-C-89 -56
Background:
EPA appealed an Initial Decision reducing the Region’s proposed penalty for three
violations of FIFRA. The Region asserted that the Presiding Officer erred by taking equity
into consideration in assessing an appropnate penalty.
Ruling:
Fairness and equity are appropriate considerations in assessing civil penalties under
FIFRA. Although “fairness”, “equity”, and “other matters as justice may require” are not
specifically mentioned in the FIFRA penalty provisions, they are nonetheless fundamental
elements of the regulatory scheme. EPA’s Policy on Civil Penalties dated February 6, 1984
sets forth three goals for penalty assessment: deterrence, fair and equitable treatment of
the regulated community, and swift resolution of the environmental problems. The Board
affirmed the penalty assessment in the Initial Decision.
In re: Aquarium Products, Inc. .
I.F.&R. Docket No. 111-439-C
Background:
The Respondent was alleged to have sold and distributed an unregistered pesticide. The
Complainant proposed a civil penalty of $21,000.
Ruling:
Based on equity factors, the Presiding Officer issued a warning in lieu of assessment of a
civil penalty. The Presiding Officer determined that a warning letter was adequate since
there was no evidence of harm to human health or the environment and the Respondent
exercised due care in selling the product and was fully cooperative in taking remedial
action.
111—27 October 1997
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HID. Penalties And Adjusirnent Factors I II. PROOFIEVIDENCE EVALUATION AND ORGANIZATION
Attitude of the Violator
In re Alden-Leeds, Inc .
I.F.&R. Docket No. Il-i 1OC and ii JC, Initial Decision (1976)
Background:
The AU considered all aspects of the penalty policy.
Ruling:
Violations such as misbranding swimming pool treatment chemicals in addition to a lack of
a quality control program constitute negligence and demonstrate a disregard for the
requirements of the Act. Based upon this record, it is difficult to find even a small degree of
good faith effort to comply with the requirements of the Act.
History of Prior Violations
In re Celotex Corporation .
Docket No. TSCA-V-022-88
Background.
In 1983, the respondent entered into a consent agreement with the Agency. The consent
agreement involved the sefflement of a prior PCB case. The agreement stated: “the
provisions of this Consent Agreement may not be used as an admission of any other type of
evidence in any other administrative, civil or criminal proceeding by any party, or any
court, or by any other person, corporation, or unit, or agency of government, or by multiple
of combination thereof.”
Ruling:
Where the Agency and the respondent had executed a Consent Agreement and Final
Order (CAFO) in regard to a prior complaint which stated that the Agency was prohibited
from using such CAFO for any purpose in any future litigation, the Agency’s use thereof to
increase the gravity-based penalty calculation in this case was improper and the proposed
penalties were reduced accordingly.
Settlements in Other CaseslSelective Enforcement
In re: State of West Virginia Highways .
Docket No. 7 CA 111-136, Initial Decision (1986)
Background:
The EPA penalty policy was accepted by the court “as being a rational and logical means
of calculating penalties.”
October 1997 111—28
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Ill. PROOFIEVIDENCE EVALUATION AND ORGANIZATION Ill.D. Penalties And Adjustment Factors
Ruling:
• Where the Agency correctly applied the Agency’s published penalty policy in arriving at
the proposed penalty, the burden for showing that such penalty amount should be
reduced shifts to the respondent.
• The mere fact that a respondent is a government entity and supported solely by tax
revenues is not a valid basis for reducing a penalty.
• Presentation of data which purports to show that, in other cases the Agency has,
through settlement, accepted a reduced penalty is not a persuasive or valid reason to
reduce a penalty in another case.
In re: Colonial Processing. Inc
Docket No. II-EPCRA-89-O1 14, Initial Decision
Background:
Respondent contended that it did not have the ability to pay the $10,000 proposed penalty
and that it was the victim of selective enforcement.
Ruling:
The Administrative Law Judge rejected the respondent’s arguments stating “EPA can
legitimately enforce EPCRA against a few persons (even just one) to establish a precedent,
ultimately leading to widespread compliance.” Selectivity in prosecution of violations of the
statute is not only inevitable, but also desirable when it conserves resources. EPA
rationally may decide that imposing civil penalties on ten percent or so of offenders is the
best way to enforce the law against all. This means that no firm may insist that its rival be
prosecuted. [ Falls v. Town of Dyer. Indiana . 875 F.2d 146, 148 (7th Cir. 1989)] The Judge
reduced the penalty to $6,000, but determined that the company was economically viable
based on analysis of the company’s finances by the ABEL computer system.
Respondents have the burden to raise and establish their inability to pay proposed
penalties. Thus, the inability to pay a penalty is an affirmative defense and the Respondent
bears the burden of going forward with the evidence to establish it.
Ability to Pay
Katzson Brothers. Inc. v. United States Environmental Protection Agency .
839 F.2d 1396 (10th Cir. 1988)
Background:
The respondent was found in default and was subject to a final order assessing $3,200 for
failure to file an annual pesticide production report. The respondent appealed the order.
IIl—29 October 1997
-------
lIl.D. Penalties And Adjustment Factors HI. PROOF/EViDENCE EVALUATION AND ORGANIL rnON
Ruling:
The court set aside the penalty amount because of a deficient review by the Regional
Administrator. The Administrator failed to make findings regarding factors that might
mitigate the penalty, such as prior compliance history and ability to pay. The case was
remanded to EPA with instructions to grant the respondent a hearing to consider mitigating
factors.
In re: New Wcxterbur i. LTD .
TSCA 1-88-i 069, Appeal No. 93-2 (1994)
Background:
Region I appealed the ALT upholding of Respondent’s Motion to Re-open a hearing and
recision of the $35,750 civil penalty. The AU held that the Agency had not rebutted
Respondent’s evidence showing an inability to pay. The EAB remanded the case for further
evidentiary hearings. Upon re-hearing, the AU rescinded the penalty.
Ruling:
• Inability to pay is not an affirmative defense, it is a factor which the Region must
consider in assessing a penalty.
• The Region must show, as part of its prima facie case, a general financial condition of
Respondent from which it was reasonably inferred that Respondent’s ability to pay does
not affect the amount of the proposed penalty.
• Once the Respondent puts ability to pay before the court as an issue, then it must allow
the Region access to its financial records before a hearing on the issue.
Economic Benefit
In re: Revere Products Corporation .
Docket No. I.F.&R.-07-90, Initial Decision (1992)
Background:
Respondent admitted that it failed to file a timely pesticide production report but argued
that it derived no economic benefit from the violation.
Ruling:
The purpose of the reporting requirements in the Act is to foster the gathering of
information necessal-y for the Agency to fulfill it mission. Whether the Respondent
benefited economically from its late reporting is of no consequence in meeting the
statutory purpose. Therefore, the fact that the Respondent derived no economic benefit by
October1997 111—30
-------
lii. PROOF/EVIDENCE EVALUATION AND ORGANIZATION lll.D. Penalties And Adjustment Factors
failing to file on time is not a relevant factor to be considered in determining the amount of
the penalty.
In re: B.1. Carney Industries, Inc. ,
CWA Appeal No. 96-2, Docket No. CWA 109 O-O 9 - 13 - 3 09(g)
Background:
The Presiding Officer concluded that no economic benefit could be assessed based on the
record.
Ruling:
A complainant need not demonstrate the exact amount of economic benefit a violator
enjoyed from a violation; a reasonable approidmation will suffice. If the full benefit can be
reasonably approidmated, such benefit should be recovered as part of the penalty
assessment. If the record supports a partial economic benefit and the only choice is
between finding a partial economic benefit or none at all, itis error to find none at all.
Since 1984, the Agency s stated enforcement policy has been to recover a violator’s
economic benefit of noncompliance in order to deter violations. This continues to be a core
principle of the Agency’s enforcement and compliance assurance program. The case was
remanded for recalculation of the penalty.
Harm/Circumstances
All Regions Chemical Labs. Inc v. United States Environmental Protection Agency .
(lst Cir. 1991)
Background:
Respondent failed to immediately notify the Agency of the release of a hazardous
substance pursuant to Section 103(a) of CERCLA. However, a private citizen and the
Massachusetts Department of Environmental Quality did notify the Agency within hours of
the release. Respondent argued that the penalty assessment was too high since the actual
circumstances did not result in “major” damage.
Ruling:
The Agency has the legal power to assess penalties in terms of what might have happened
(in the absence of appropriate responses and notifications by others) rather than what
happen. The ruling supports the Agency’s TSCA Penalty Guidelines, 45 Federal Register at
59,772, which states: “a violation which presented a high probability of causing harm when
it was committed must be classified as a “high probability ’ violation and penalized as such,
even if through some fortuity no actual harm resulted in that particular case.”
111—31 October 1997
-------
lll.D. Penalties And Adjustment Factors iii. PROOF/EViDENCE EVALUATION AND ORGANIZATION
Initial Decision Overturned
In re: Pacific Refininci Company .
Appeal No 94-1, Final Decision and Order (1994)
Background:
The Agency appealed the AU’s decision that the failure to mark a fence enclosing its PCB
transformer was a “minor” gravity based penalty.
Ruling:
The EAB held that the Agency designation of the gravity as a “major” violation under the
penalty policy was rational and reversed the ALT.
3. Special Considerations
Penalty policies and guidelines are developed to ensure the consideration of all the factors
set forth in the statute for determining the amount of the penalty. Although TSCA provides
for the remission of a civil penalty (section 16(c)), guidelines under both FIFRA arid EPCRA
and EPA policy permit the remission of penalties for the implementation of Supplemental
Environmental Projects (SEPs).
4. Process
To establish a prima fade case for the size and equity of the penalty, the Agency must
show that it considered all factors established by statute for consideration of the size of the
penalty. These factors are presented in table form as part of the guidelines. It is the Case
Development Officer who will be called upon during the administrative hearing to provide
testimony concerning the basis for arriving at the proposed penalty. The evidence to
support the calculation will include such documents as D&B reports, Agency records of
compliance history, and certified statements regarding the hazards presented by the
pesticide or chemical substance.
The following examples are provided at the end of this chapter.
Example ffl—4. Blank FIFRA Civil Penalty Calculation Worksheet fflE—7
Example ffl—5. Completed FIThA Civil Penalty Calculation Worksheet IIEE—9
Example 111—6. TSCA Civil Penalty Assessment Worksheet flIE—1 1
Example ffl—7. Extent Calculation Rationale IliE—13
Example lII—8. Penalty Calculation Rationale ]IIE—15
October1997 111—32
-------
Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZATION lll.E. Adequacy, Quality, And Authenticity Of Evidence
Example 111—9. Memorandum: Penalty Rationale for Rohr Industries Inc. termed
by Judge Vanderheyden in his Order Granting Accelerated
Decision on Liability and Penalty as “clear, complete, and
persuasive” lI1E- -25
llI.E. Adequacy, Quality, And Authenticity Of Evidence
1. Constitutional/Statuto,y/Regulatory Requirements
5th Amendment
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a
presentment or indictment of a Grand Jury, except in cases arising in the land or naval
forces, or in the Militia, when in actual service in time of War or public danger; nor shall
any person be subject for the same offense to be twice put in jeopardy of life or limb; nor
shall be compelled in any criminal case to be a witness against himself, nor be deprived of
life, liberty, or property, without due process of law; nor shall private property be taken for
public use, without just compensation.
40 CFR Part 22 - Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.22 Evidence
(a) General. The Presiding Officer shall admit all evidence which is not irrelevant,
immaterial, unduly repetitious, or otherwise unreliable or of little probative value, except
that evidence relating to the settlement which would be excluded in the federal courts
under Rule 408 of the Federal Rules of Evidence is not admissible. In the presentation,
admission, disposition, and use of evidence, the Presiding Officer shall preserve the
confidentiality of trade secrets and other commercial and financial information. The
confidential or trade secret status of any information shall not, however, preclude its being
introduced into evidence. The Presiding Officer may make such orders as may be
necessary to consider such evidence in camera, including the preparation of a
supplemental initial decision to address questions of law, fact, or discretion which arise out
of that portion of the evidence which is confidential or which includes trade secrets.
(b) Examination of witnesses. Witnesses shall be examined orally, under oath or
affirmation, except as otherwise provided in these rules of practice or by the Presiding
Officer. Parties shall have the right to cross-examine a witness who appears at the hearing
provided that such cross-examination is not unduly repetitious.
(c) Verffied statements. The Presiding Officer may admit an insert into the record as
evidence, in heu of oral testimony, statements of fact or opinion prepared by a witness. The
admissibility of the evidence contained in the statement shall be subject to the same rules
as if the testimony were produced under oral examination. Before any such statement is
read or admitted into evidence, the witness shall deliver a copy of the statement to the
111—33 October 1997
-------
lll.E. Adequacy, Quality, And Authenticity Of Evidence Ill. PROOFIEV DENCE EVALUA11ON AND ORGANIZATiON
Presiding Officer, the reporter, and opposing counsel. The witness presenting the
statement shall swear to or affirm the statement and shall be subject to appropriate oral
cross-examination upon the contents thereof.
Cd) Admission of affidavits where the witness is unavailable. The Presiding Officer may
admit into evidence affidavits of witnesses who are unavailable. The term “unavailable”
shall have the meaning accorded to it by Rule 804(a) of the Federal Rules of Evidence.
(e) Exhibits. Where practicable, an original and one copy of each exhibit shall be filed with
the Presiding Officer for the record and a copy shall be furnished to each party. A true
copy of any exhibit may be substituted for the original.
(0 Official notice. Official notice may be taken of any matter judicially noticed in the
Federal courts and of other facts within specialized knowledge and experience of the
Agency. Opposing parties shall be given adequate opportunity to show that such facts are
erroneously noticed.
2. Case Law
Type of Evidence
In re: Farmers Cooperative Elevator Company .
Docket No. VII-632C-85P, Initial Decision (1986)
Background:
The EPA inspector was told by the production manager that the toxaphene (a canceled
pesticide) in the company warehouse was for sale and he signed a statement to that effect.
At the hearing, the Respondent’s general manager testified the production manager did
not know what he was signing.
Ruling:
No substantial evidence was introduced in the form of written documents to support
respondent’s testimony. Therefore, respondent’s testimony must be disregarded in favor of
the best evidence which is the signed written statement and direct testimony concerning
respondent’s operations.
In re: National Railroad Passençier Corporation (AMTRAK) .
Appeal No. 82-1, Final Decision (1982)
Background:
In this TSCA appeal, the company argued that EPA had not proved that a transformer
labeled “Irierteen” actually contained PCBs. The Chief Judicial Officer disagreed.
October 1997 111—34
-------
Ill. PROOF/EVIDENCE EVALUATION AND ORGANIZATION IILE. Adequacy, Quality, And Authenticity Of Evidence
Ruling:
Direct evidence is not essential to prove a fact. Facts may also be proved by
circumstantial or indirect evidence. Certain presumptions or inferences of fact may arise
or be drawn in the course of proving a fact. Thus, absent evidence to the contrary, it may
be presumed or inferred that things are what they purport to be.
rcepresentative Sampling/Analytical Quality
Inre Electric Service Company .
Appeal No. 82-2, Final Decision (1985)
Background:
This TSCA appeal argued that samples taken by EPA were not representative because
EPA inspectors did not follow Agency sampling procedures. The court disagreed and
found both the representative and grab samples to have evidentiary value.
Ruling:
• If proof of a violation depends on producing evidence that accurately describes some
quality or condition of the larger body, a representative sample is essential.
• Proof of a disposal violation does not hinge on accurately describing the condition or
quality of some larger body. The sample itself is the uncontrolled discharge. If
unrebutted, it is sufficient evidence to establish a violation.
Ir.Lre: Robert Ross and Sons. Inc. .
Appeal No. 82-4, Final Decision (1984)
Background:
In this TSCA appeal, Ross challenged the evidence presented by EPA. The Chief Judicial
Officer ruled for EPA on its grab sample and analytical procedures.
Ruling:
• Although a grab sample cannot be regarded as representative of the contents of the
tank as a whole, the sample, if analyzed properly is circumstantial that PCBs were
added to the tank in concentrations as high as those found in the sample. The
presumption that arises from finding the PCBs in the tank is sufficient basis for
establishing a violation.
• The discrepancies between a computer printout and the analyst’s final determination of
the dilution are not supported by solid evidence, but only speculation. Therefore, it is
not sufficient for purposes of sustaining complainant’s burden of proof. Even if the
111—35 October 1997
-------
lIl.E. Adequacy, Quality, And Authenticity Of Evidence II I. PROOF/EVIDENCE EVALUA11ON AND ORGANIZATION
analyst who performed the analysis had testified at the hearing, the lack of
documentation would still be a matter of serious concern.
Hearsay
In re: Evergreen Pest Control .
I.F.&R. Docket No. IX-157C, Initial Decision (1977)
Background:
EPA charged that Evergreen had failed to follow label procedures when fumigating a
house. Evergreen objected to the use at hearing of affidavits of people not present at the
hearing. The AU disagreed.
Ruling:
The introduction of hearsay is not inconsistent with the rules. Affidavits and reports were
properly admissible arid entitled to some weight because they contained relevant
information by eyewitnesses. The facts in them were corroborated and such use of
hearsay is entirely proper.
In re: Cantor Brothers. Inc. .
I.F.&R. Docket No. II-93C, Initial Decision (1976)
Background:
Cantor challenged the admission of sworn statements made by people not present at
hearing and not available for cross examination. The court allowed the statements into
evidence.
Ruling:
It is well established that hearsay evidence is admissible in administrative hearings. The
rules permit evidence that is reliable, relevant, competent, material, and substantial
3. Special Considerations
Adequacy and Quality
It is the Case Development Officer’s responsibility to review arid determine the adequacy of
the documentation for each element of proof. To prove each element of the case, the Case
Development Officer should seek to establish each fact by direct evidence. Direct
evidence proves e nstence of the fact without inference or presumption. If direct evidence
is not available, the fact may be established by circumstantial or indirect evidence.
October 1997 IlI—36
-------
Ill. PROOFIEV1DENCE EVALUATION AND ORGANIZATION lll.E. Adequacy, Quality, And Authenticity Of Evidence
Authenticity
The Case Development Officer is also responsible for ensuring that oily items presented as
evidence are authentic. Proving authenticity includes showing that:
• all items are the actual objects on which the inquiry is focused; and
• the condition of the items is substantially the same as it was at the time of the
investigation.
4. Process
Adequacy and Quality
The Case Development Officer should prepare a list of the type (direct or circumstantial) of
evidence to support each element of proof and the form (oral testimony, photographs, or
samples) of the evidence to support the element of proof. Direct oral testimony,
photographs, videotapes, samples, and business records are the best forms of evidence to
support an element of proof However, all corroborative circumstantial evidence should
also be included to further support the Agency’s prima facie case.
Authenticity
To ensure authenticity, the Case Development Officer should check that all documents
have been appropriately identified and that the chain of custody has been maintained for
all collected documents.
111—37 October 1997
-------
III. PROOF/EVIDENCE
EVALUATION AND
ORGANIZATION
EXAMPLES
-------
EXAMPLE Ill—i BLANK VIOLATiON WORKSHEET . . IIIE—1
EXAMPLE 111—2. COMPLETED VIOLATION WORKSHEET . IIIE—3
EXAMPLE 111—3. ELEMENTS OF A VIOLATION . . ... . . IIIE—5
EXAMPLE III—4 BLANK FIFRA CIVIL PENALTY CALCULATION WORKSHEET IIIE—7
EXAMPLE 111—5 COMPLETED FIFRA CIVIL PENALTY CALCULATION WORKSHEET . IIIE—9
EXAMPLE 111—6. TSCA CML PENALTY ASSESSMENT WORKSHEET . . IIIE—1 1
EXAMPLE 111—7 EXTENT CALCULATION RATIONALE. . . . . IIIE—13
EXAMPLE 111—8 PENALTY CALCULATION RATIONALE. .. . . . . IIIE—15
EXAMPLE 111—9 PENALTY RATIONALE FOR ROHR INDUSTRIES, INC MEMORANDUM IIIE—25
-------
m
x
0 )
2.
CD
—
0 )
0
0)
0
0
1
C l )
CD
CD
0
0
(D
-I
-I
(0
(0
-1
-------
DATE
ACTIVITY
SUBSTANCE
AMOUNT
EVIDENCE
5/25/84
6/29/84
8/31/84
9/7/84
11/2/84
IMPORT/MANUFACTURE
FALSE CERTIFICATION
IMPORT/MANUFACTURE
FALSE CERTIFICATION
IMPORT/MANUFACTURE
FALSE CERTIFICATION
IMPORT/MANUFACTURE
FALSE CERTIFICATION
“
2,205
“
CUSTOMS ENTRY DOCUMENT INVOICE
UNDATED/STAMPED CERTIFICATION
11,023
CUSTOMS ENTRY DOCUMENT INVOICE
“
“
39,600
“
39,600
“
CUSTOMS ENTRY DOCUMENT INVOICE
UNDATED/STAMPED CERTIFICATION
“
CUSTOMS ENTRY DOCUMENT INVOICE
“
UNDATED/STAMPED CERTIFICATION
IMPORT/MANUFACTURE
39,600
CUSTOMS ENTRY DOCUMENT INVOICE
FALSE CERTIFICATION
“
“
UNDATED/STAMPED CERTIFICATION
11/9/84
12/ / - -
4 84
IMPORT/MANUFACTURE
11,000
CUSTOMS ENTRY DOCUMENT INVOICE
FALSE CERTIFICATION
“
I’
UNDATED/STAMPED CERTIFICATION
* AGENCY NOTIFICATION
FILED
,,
N
IA
* MEETING SIGN-OFF SHEET
* CERTIFIED STATEMENT
1/2/85? WRITTEN NOTIFICATION OF
,
BADISCHE LETTER
FALSE CERTIFICATION
“
“ UNDATED/STAMPED CERTIFICATION
m
x
A)
3
C)
0
3
m
0.
0
A)
I-p
0
0
-I
CR
CD
CD
P.
0
-------
Example 111—3. Elements of a Violation
Chapter Seven Elements of a Violation Administration
Section 12 (a)(1)(A)
Any pesticide not registered under Section 3
ELEMENTS OF THE VIOLATION
ESTABLISHING THE VIOLATION
1. Respondent (person) distributed, sold, offered
for sale, held for sale, shipped, delivered for
shipment, or received and (having so received)
delivered or offered to deliver a pesticide
I Identification of the responsible party for
suspected violation in commerce See
additional Sources of Documentation”
(Chapter 4)
2 Determination that the product is a pesticide
2 Appropriate regional or Registration Division
(RD) personnel review product labeling claims
to determine whether the product is a pesticide
See “Further Processing of the ID Jacket —
Enforcement Case Review” (Chapter 4)
3 Appropnate regional or RD personnel
determine registration status after a search of
their files See “Further Processing of the ID
Jacket — Enforcement Case Review” (Chapter
4)
3 Determination that the pesticide is not
registered
4 Determination that the continued sale and use
of existing stocks is not permitted under §
6(a)(1) jf the product has been canceled
4 Same as No 3, above.
IIIE—5 - - October 1997
-------
Example Ill—4. Blank FIFRA Civil Penalty Calculation Worksheet
FIFRA CIVIL PENALTY CALCULATION Prepared by
WORKSHEET Date
RESPONDENT NAME:
C0uNTI
COUNT 2
COUNT3
COUNT4
APPENDIX A (page A-2)
1 Statutory Violation
2. FTTS Code
3. Gravity Level (of the statutory
violation in item 1)
4. Violator Category -
§14(a)(1)_or §14_(a)(2)
TABLE 2 (page 20)
5. Size of business category
TABLE 1 ( aae 19)
6 Gravity Base Penalty
APPENDIX B (page B-I & B-2)
7 Gravity Adjustments.
a Pesticide Toxicity
b. Human Harm
c. Environmental Harm
d Compliance History
e. Culpability
f. Total Gravity Adjustment
Value (add items 7a-7e)
TABLE 3 (page 22)
g Percent Adjustment
h Dollar Adjustment
8. Penalty after adjustments
9. Ability to Pay: 4% gross
sales guideline (page 24)
10. TOTAL PROPOSED PENALTY
(total of ali columns for line 8,
above)=
IIIE—7 - October 1997
-------
Example 111—5. Completed FIFRA Civil Penalty Calculation
Worksheet
FIFRA CIVIL PENALTY CALCULATION
WORKSHEET
Prepared by Yvette P Hellyer
Date August 8, 1997
El. DUPONT de NEMOURS & CO.,
INC.
BLADEX4L
HERBICIDE
BLADEX9ODF
HERBICIDE
EXTRAZINEII
4L HERBICIDE
EXTRAZINEII
DF HERBICIDE
APPENDIX A (t ape A-2 )
12(a)(1 )(E)
I 2(a)(1 )(E)
12(a)(1 )(E)
1 2(a)(1 )(E)
1 Statutory Violation
2 FTTS Code
1EF, lEG
1EF, lEG
1EF, lEG
1EF, lEG
3 Gravity Level (of the statutory
violation in item 1)
2
2
2
2
4 Violator Category -
§14(a)(1) or §14 (a)(2)
§14(a)(1)
§14(a)(l)
§14(a)(1)
§14(a)(1)
TABLE 2 (pacie 20)
5 Size of business Category
I
I
I
I
TABLE 1 (oaae 19)
$5,000
$5,000
$5,000
$5,000
6 Gravity Base Penalty
APPENDIX B (oage B-i & B-2)
1
1
1
1
7 Gravity Adjustments.
a Pesticide Toxicity
b HumanHarm
3
3
3
3
c Environmental Harm
3
3
3
3
d Compliance History
2
2
2
2
e Culpability
4
4
4
4
f Total Gravity Adjustment
Value (add items 7a-7e)
13
13
13
13
TABLE 3 (pacie 22)
10% 1
10% 1
10% 1
10%
g. Percent Adjustment
h Dollar Adjustment
0
0
0
0
8 Penalty after adjustments
[ (item 7h from item 6) + item 91 x
number of counts = penalty per
product
$5,000 x 32
counts =
$160,000
5,000 10
counts =
50,000
5,000 x 325
counts =
1,625,000
5,000 x 12
counts =
60,000
9 Ability to Pay 4% gross
sales guideline (page 24)
Gross sales (avg) $40,601,000,00.OO x 4% guideline =
$1,624,040,000.00
10 TOTAL PROPOSED PENALTY
(total of all columns for line 8,
above)=
$1,895,000.00
NOTE This calculation was made on a product-by-product basis rather than on a count-by-count basis as
illustrated by the blank worksheet The number of counts are factored into the Calculation at step 8
IIIE—9 October 1997
-------
Example 111—6. TSCA Civil Penalty Assessment Worksheet
Name of Respondent ____________
Address of Respondent __________
(1) Complaint 1.0 Number _______________________________________________
(2) Date Complaint lssued ___________________________________________________
(3) Date Answer Received _________________________________________________
(4) Date Default Order Sent __________________________________________
(5) Date Consent Agreement Signed ____________________________________
(6) Date Final Order Sent __________________________________________________
(7) Date Remittance Received: ________________________________________
1. Gravity Based Penalty (GBP) from matnx $ ______________
2. Percent increase or decrease for culpability % _______________
3 Percent increase for violation history % _______________
4 Add lines2and3 % ____________
5 Multiply GBP by percentage total on line 4 $ _______________
6. Add lines 1 and 5 (subtract line 5 from line 1
if negative percentage) $ _______________
7 Enter line 6 amount or $25,000, whichever is less $ _______________
8 Multiply line 7 by the number of days of violation $ _______________
9 Government cleanup costs, if any $ _______________
10 Economic gains from non-compliance, if appropnate $ _______________
11. Add lines 8 through 10 $ ______________
12. Total of other adjustments as justice may require $ _______________
13. If line 12 represents a net increase to the penalty,
addlinel2to l l $ ____________
-or-
If line 12 represents a net decrease to the penalty,
subtract line 12 from line 11 $ ______________
Note. Line 13 should be the proposed penalty for a given violation This procedure is repeated for each
violation
lllE—11 October 1997
-------
Example 111—7. Extent Calculation Rationale
1=3-4 LITERS
3 785 LITERS = 1 Gallon
MAX DETECTED LEVEL = 420 ppm
< 499 ppm = 70 reduction
Therefore 1 = 30 Gallons Extent
Major 1100 Gallons
Therefore > 3667 = Major
220 significant < 1100 Gallons
Therefore 733 significant < 3667 = significant
Minor < 220 Gallons
Therefore minor < 733
Import = Manufacture = Level 1
DATE CALCULATION
• Typed or stamped date on the bill of lading
• Typed or stamped date on the latest invoice
II IE—13 October 1997
-------
Example 111—8. Penalty Calculation Rationale
PENALTY CALCULATION FACTORS
NATURE “Failure to Notify” is a “Hazard Assessment Violation” Each date of
manufacture (importation) of each new chemical substance constitutes one
violation
EXTENT Calculated on the number of pounds of product manufactured
CIRCUMSTANCES Calculated on the basis that all the manufactured product was distnbuted to
customers or was part of inventory transferred
________ control
CULPABILITY ___________ informed _______ onApnl 1,1981, that there was no CAS
NO for the chemical substances but that they were submitted for the —
inventory and the numbers would be provided to ______ as soon as they
were available There is no document available showing that _________
followed up on the numbers (±0)
VIOLATION HISTORY- There is no record of any pnor civil administrative actions. (+0)
GOVERNMENT CLEAN- There was no monetary expenditure by the government (+0)
UP COSTS
ECONOMIC GAIN FROM __________invoices indicate the product was sold for $2 75 per pound
NON-COMPLIANCE, ___________ reported ___________ sold 103,310 lbs
Therefore, the firms gross sales were approximately $284,102 50. (+0)
lIIE—15 October 1997
-------
COUNT NATURE EXTENT CIRCUMSTANCES GBP
I HAZ-ASSESS, MAJOR LEVEL I $25,000
FrN 3,031.3 LBS. DIST. TO CUSTOMERS
I I “ MAJOR •1
5,291 LBS.
III “ MAJOR “ “ $17,000
881.8 LBS.
IV “ MAJOR $25,C
2,645.5 LBS.
V MAJOR 0
6,613.8 LBS.
VI MAJOR “ “
2,417 LBS.
I, , ,, I, It II I ,
VIII MAJOR
19,276 LBS.
“ “ “
X It MAJOR It Vt
18.974 LBS.
XI Vt II Vt VI II VI
XII MAJOR “
20,178 LBS.
x i i i ,, “ I ,
X IV MAJOR Vt II VI
49,409 LBS.
x.s.i II II II Vt II VI VI I t
II IV Vt fl VI It I, It
c\TII ft VI VI It I II Vt
II Vt it ii it it it f t
xrx it ,, tt it n it
CC MAJOR II II it II
5,079 LBS.
it •t tt II II Vt
October 1997 IIIE—16
-------
COUNT NATURE EXTENT CIRCUMSTANCES GBP
XXI I “ MAJOR LEVEL I $25,000
21,017 LBS. DIST. TO CUSTOMERS
XXIII MAJOR II
21,017 LBS.
XXIV MAJOR “
23,064 LBS.
ft ft ft
“ “ “ “ I,
xxvn ,, ,, “ ,,
IMPORT
18.463.4 LBS.
MANUFACTU
RE
159,877.4 LBS.
TOTAL 177,877.4 LBS. TOTAL $667,000
IIIE—17 October 1997
-------
DATE
B/L NUMBERS
IN VOICE
NUMBERS
NUMBER OF
UNITS
EXTENT
LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
5/21/85
220943
578 & 586
11,300
MAJOR
I (IMPORT)
$25000
5/29/85
1004
566
5,650
MAJOR
I (IMPORT)
$25,000
6/4/85
752031J
568, 569, 573
16,950
MAJOR
I (IMPORT)
$25,000
6/6/85
N/A
665
5,650
MAJOR
I (IMPORT)
$25,000
6/7/85
LIV/37
600, 602, 606
16,950
MAJOR
1 (IMPORT)
$25,000
6/11/85
221107
589, 593, 670,
675, 673, 681,
683
MAJOR
I (IMPORT)
$25,000
6/11/85
(2)
N/A
654, 659, 657,
658
30,510 Total
MAJOR
I (IMPORT)
$25,000
6/13/85?
916
682, 688, 698
9,040
MAJOR
1 (IMPORT)
$25,000
6/14/85
N/A
703, 704
7,910
MAJOR
I (IMPORT)
$25,000
6/17/85
N/A
707 & 713
11,300
MAJOR
I (IMPORT)
$25,000
6/18/85
221103
686
5,650
MAJOR
I (IMPORT)
$25,000
6/19/85
N/A
720
2,260
SIGNIFICANT
1 (IMPORT)
$17,000
6/20/85
(2)
N/A
LGHJ133O9
729 & 731
709, 716, 730
3,840
5.800
9,640
MAJOR
1 (IMPORT)
$25,000
6/25/85
N/A
760
3,390
SIGNIFICANT
I (IMPORT)
$17,000
6/26/85
1002
694
5,120
MAJOR
- 1 (IMPORT)
$25,000
7/2/85
N/A
749, 758, 759,
812, 813
7,530
MAJOR
I (IMPORT)
$25,000
7/5/85
3925
818, 834, 848
4,970
MAJOR
I (IMPORT)
$25,000
7/8/85
N/A
857
1,114
SIGNIFICANT
1 (IMPORT)
$17,000
7/9/85
(3)
221419
221404
221392
768, 778. 781,
721,740,747
748,769,770
779, 795, 741,
771
32,690
5,897
1.280
10,867
MAJOR
I (IMPORT)
$25,000
7/11/85
1002
855
2,260
SIGNIFICANT
I (IMPORT)
$17,000
0
-------
TVSSUN21O8
TVS BAL
854, 856, 911,
912, 974, 975,
976
809
817
071
5,264 MAJOR
3,390
2,324
2,410
DATE
B/L NUMBERS
IN VOICE
NUMBERS
NUMBER OF
UNITS
EXTENT
LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
7/12/85
TVSCHI 9066
TVSATL 9089
TVSNYC 2039
TVSSLU 9097
TVSCHI 9065
790
780 & 782
839 & 846
739
5,650
2,260
3,840
2.560
14,310
MAJOR
1 (IMPORT)
$25,000
7/13/85
022 1366
022 1323
0221333
12/LIV
837 & 845
836
810&820
894, 895, 914
6,400
2,000
3,060
100
11,560
MAJOR
I (IMPORT)
$25,000
7/14/85
17046L
17059L
17045L
827 & 828
800,811,819
853
5,950
5,650
1.130
12,730
MAJOR
I (IMPORT)
$25,000
7/15/85
LGHT 14090
75450/J
75451/J
926
887&888
899, 903, 905
5,000
6,780
3.690
15,470
MAJOR
I (IMPORT)
$25,000
7/19/85 221511
0
C,
1 (IMPORT)
$25,000
$5,000
“UPORT)
$17,000
-------
DATE
BIL NUMBERS
INVOICE
NUMBERS
NUMBER OF
UNITS
EXTENT
LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
7/25/85
LEDA 800
925
929
N/A
910 & 1001
982, 983, 985
1002
984 & 986
1018
2,560
3,840
1,280
2,560
10,240
MAJOR
I (IMPORT)
$25,000
7/29/85
17162L
17165L
17173L
1009
948,970,972
932,947,969
1010
2,560
2,260
4,970
9,790
MAJOR
1 (IMPORT)
$25,000
7/31/85
75576/J
1008
3,840
MAJOR
I (IMPORT)
$25,000
8/2/85
22
843, 870, 922,
923, 933, 973
5,430
MAJOR
I (IMPORT)
$25,000
8/4/85
906
1041
5,650
MAJOR
1 (IMPORT)
$25,000
8/5/85
LGHI 15164
1081
5,120
MAJOR
I (IMPORT)
$25,000
8/6/85
LGHJ 14949
022 1751
1088
1025, 1053,
1058, 1064,
1065, 1084,
1085
1,280
7,440
8,720
MAJOR
I (IMPORT)
$25,000
8/7/85
N/A
1011, 1044,
1052, 1089,
1090
9,040
MAJOR
I (IMPORT)
$25,000
8/12/85
022 1753
977, 1101,
1107, 112
6,765
MAJOR
1 (IMPORT)
$25,000
8/13/85
174 16L
1023, 1026,
1045, 1059
5,120
MAJOR
I (IMPORT)
$25,000
8/14/85
022 1752
905
944
1024 & 1111
1016, 1114,
1123,
1042& 1043
2,260
10,170
2.260
14,690
MAJOR
1 (IMPORT)
$25,000
0
C)
ID
-I
(0
(0
-J
‘p
0
-------
DATE
B/L NUMBERS
INVOICE
NUMBERS
NUMBER OF
UNITS
EXTENT
LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
8/15/85
814
1124
1,130
SIGNIFICANT
I (IMPORT)
$17,000
8/26/85
17499L
17501L
17502L
1108 & 1169
1152
1161, 1182
1168
1,130
1,130
5,650
7,910
MAJOR
I (IMPORT)
$25,000
8/30/85
022 1877
022 1879
1136 & 1219
1137
3,390
1,280
4,670
MAJOR
I (IMPORT)
$25,000
9/7/85
904
908
904
1138 & 1210
1140, 1150,
1151, 1153,
1158, 1139
1,130
5,800
1,224
8,154
MAJOR
1 (IMPORT)
$25,000
9/9/85
922
1149
1,130
SIGNIFICANT
I (IMPORT)
$17,000
9/12/85
17537L
17558L
1297
1186, 1202
1296
880
6.780
7,660
MAJOR
I (IMPORT)
$25,000
9/18/85
53
1408, 1409,
1411
5,650
MAJOR
I (IMPORT)
$25,000
9/19/85
903
903
920(44)
1159, 1369,
1328, 1329,
1330, 1350,
1368
3,690
2,260
4,670
10,620
MAJOR
1 (IMPORT)
$25,000
9/23/85
222173
1284, 1285,
1351, 1410,
1457
3,894
MAJOR
I (IMPORT)
$25,000
9/24/85
LGHJ 15741
1398, 1431,
1446
8,960
MAJOR
1 (IMPORT)
$25,000
10/1/85
908
1491
4,520
MAJOR
1 (IMPORT)
$25,000
10/7/85
17725L
1520 & 1551
2,504
SIGNIFICANT
I (IMPORT)
$17,000
10/8/85
N/A
1596 & 1598
1,612
SIGNIFICANT
I (IMPORT)
$17,000
p 3
0
-------
DATE
B/L NUMBERS
INVOICE
NUMBERS
NUMBER OF
UNITS
EXTENT
LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
10/10/85
17818L
177581
177441
1519
1552
1425, 1521,
1530, 1553
1,130
1,130
5,650
7,910
MAJOR
I (IMPORT)
$25,000
10/16/85
87
88
90
2
89
1012
1465
1507
1569& 1570
1603
1508
1672
6,780
1,130
2,410
7,910
3,390
1.130
22,750
MAJOR
-
1 (IMPORT)
$25,000
10/17/85
1011
1038
1020
1668
1630
1580, 1644,
1643, 1671
2,260
504
5.650
8,414
MAJOR
I (IMPORT)
$25,000
10/25/85
TVS NYC 2013
1731
3,390
SIGNIFICANT
I (IMPORT)
$17,000
10/26/85
74
1779
490
MINOR
I (IMPORT)
$5,000
10/29/85
022 2266
1352
1,130
SIGNIFICANT
I (IMPORT)
$17,000
11/7/85
1797 IL
1818, 1821,
1829, 1830
1,160
MAJOR
I (IMPORT)
$25,000
11/15/85
1017
1891, 1900,
1912, 1914
12,957
MAJOR
I (IMPORT)
$25,000
11/18/85
501
LGHJ 17308
1928
1953
792
3.390
4,182
MAJOR
1 (IMPORT)
$25,000
11/21/85
GOAJ 07075
1958
7,910
MAJOR
I (IMPORT)
$25,000
11/28/85
18100L
1951 & 1952
4,520
MAJOR
1 (IMPORT)
$25,000
3/27/86
N/A
499
3
MINOR
I (IMPORT)
$5,000
4/8/86
N/A
392
392
MINOR
I (IMPORT)
$5,000
5/2/86
N/A
663
90
MINOR
I (IMPORT)
$5,000
6/9/86
N/A
827 & 829
3,540
SIGNIFICANT
I (IMPORT)
$17,000
7/23/86
N/A
1167, 1169,
1170
4,520
MAJOR
1 (IMPORT)
$25,000
0
a
a.
-I
(0
(0
-1
Total $1,454,000
-------
DATE
G/L NUMBERS
INVOICE
NUMBERS
NUMBER OF
UNITS
EXTENT LEVEL
CIRCUMSTANCES
LEVEL
PROPOSED
PENALTY
7/25/86
811143595
M00157
MOOl 59
M00158
M00160
MOO 161
M00156
M00163
M00164
MOO 166
M00165
MOO15O
M00147
M00151
M00152
M00154
M00155
M00148
M00153
M00149
22,447
MAJOR
2 (Distribution in
commerce for export)
$20,000
8/1 /86
LAX600086
M00176
MOOl 75
M00169
MOOl 71
M00172
M00173
M00170
M00179
M00177
M00174
M00178
M00168
14096
MAJOR
2 (Distribution in
commerce for export)
$20,000
8/2/86
811144541
M00180
851
SIGNIFICANT
2 (Distribution in corn-
merce for export) TOTAL
$13.000
$53,000
0
a
0
-------
Example 111—9. Penalty Rationale for Rohr Industries, Inc.
Memorandum
ApnI 19, 1990
Reply to
Attn. of AT 083
MEMORANDUM
Subject Rohr lndustnes, mc, Docket No EPCRA 1089-04-08-325
Penalty Calculations
To Joan Shirley, Assistant Regional Counsel
From: Philip Wong, Program Manager
Toxic Chemical Release Inventory
In response to your request, I am providing you with an explanation of my rationale in calculating
the proposed penalty in this case I have also included an explanation of how my penalty computation
conforms to EPA’s Emergency Planning and Community Right To Know Act (EPCRA) Section 313
Enforcement Response Policy (ERP) dated December 2, 1988 Per your request, I am also providing you
with my assessment of the gravity of the alleged violation of EPCRA including the actual or potential harm
to public health or the environment resulting from the violation I understand that this information is to be
submitted as part of the pre-heanng exchange submission in this case, pursuant to the directive of Judge
Vanderheyden I discuss “Gravity” and Potential Harm” of the violation on pages 2, 7-9 of this memo and
“Pnor History” on page 5.
Introduction
Section 325 of EPCRA, 42 U S C. 1 1045, authorizes EPA to assess a civil penalty of up to
$25,000 per day for each violation of EPCRA Section 313. Based upon the violation cited in the Rohr
complaint, I calculated the proposed penalty for the Respondent, Rohr, in accordance with the EPA
Enforcement Response Policy for Section 313 of EPCRA dated December 2, 1989
The factors I considered are those stated in Section 325 of EPCRA Those factors include: 1)
with respect to the violation, the nature, circumstances, extent, and gravity of the violation, and, 2) with
respect to the violator, the ability to pay a penalty; the prior history of such violations, the degree of
culpability, the economic benefit or saving resulting from the violation, and such other matters as justice
may require The Enforcement Response Policy, on page 9, sets out a penalty matrix which takes into
account EPCRA statutory factors in determining the proposed penalty On the left side of the matrix are
circumstance Levels from 1 to 6, with Level 1 being the most senous At the top of the matrix are
Adjustment Levels A, B, and C, with Level A being the highest amount and C being the lowest
Nature of the Violation
In this case, the nature of the EPCRA violation was the failure by the Respondent, Rohr, to
provide timely, complete, and accurate information to EPA and the State of Washington as required by
Section 313 of EPCRA. The information is required to be filed on an EPA Form R for each chemical at a
facility meeting the statutory cntena. (The cntena are that the facility be a manufacturer (SIC Code Major
Group 20-39) with more than ten employees and that the facility manufactures, imports, processes, or
otherwise uses any of more than 300 EPA-specified chemicals and chemical compounds in amounts
llIE—25 October 1997
-------
greater than certain threshold quantities.) The information required to be reported deals with the releases
— routine and accidental — of toxic chemicals, including carcinogenic compounds The failure to provide
this information depnves the public of information on the use of chemicals in the community and could
result in increased nsk to the community.
I determined, based on the information obtained through our inspection, that the Respondent,
Rohr, failed to submit the required Form R for its Auburn, Washington facility by July 1, 1988 for the 1987
calendar year as required by EPCRA. Respondent’s facility met the statutory cntena set forth in 42 u.s.c
11045 and otherwise used” the chemical 1,1,1 - tnchloroethane in amounts exceeding the appropnate
reporting thresholds as set forth in 40 CFR Part 372.
Gravity of the Violation
The Enforcement Response Policy sets forth Circumstance Levels which descnbe specific
violations of the regulations (ERP pp. 10-11) A proposed penalty is assigned to each Circumstance
Level in the Enforcement Response Policy based upon the gravity of each violation. (ERP p 9)
Failure to report is the most senous violation noted in the Enforcement Response Policy in that
such failure depnves the public of information on chemical releases which may affect public health and the
environment A major component of EPCRA is the development and maintenance of a correct and
comprehensive computer database, which is to be maintained for, and made readily accessible to, the
public. The integnty and value of the database, called the Toxic Chemical Release Inventory, are entirely
dependent on the accurate and timely reports submitted by the regulated community. The senousness of
the failure to report is reflected in its categonzation as a Circumstance Level 1 violation. Circumstance
Level 2 is reserved for instances in which reports are not submitted in a timely manner. A Circumstance
Level 2 violation represents lesser harm to the process of distributing and using information since the late
submission, while compromising the full utility of the data base, does not permanently impair it, as
happens when reporting never occurs
A significant purpose in establishing these two Circumstance Levels is that this distinction
encourage facilities to come forward and report voluntanly. If there were no difference in the penalties in
these two levels, a facility might simply avoid or neglect reporting until and unless EPA independently
discovered the violation.
The remaining Circumstance Levels (Levels 3-6) reflect other violations of somewhat lesser
significance. These include errors in reporting, reports which are submitted no later than 180 days after
the reporting deadline, and reports which are not submitted to the states as required. The other
circumstance levels have proposed penalties of lesser size I determined that these other Circumstance
Levels did not apply to the Respondent, Rohr
Circumstance Level
I determined that the appropriate Circumstance Level in this case was Circumstance Level 1 I
based that determination on the fact that the Respondent, Rohr, failed to submit a Form R for the
chemical 1,1,1 -tnchloroethane for its Auburn, Washington facility by the statutory reporting date of July 1,
1988.
A Form R for the chemical 1,1,1-tnchloroethane eventually submitted for the Auburn, Washington
facility showed a dated signature of January 26, 1989, more than 180 days after the July 1, 1988 reporting
deadline for the 1987 calendar year. The Form R was submitted only after EPA contacted the
Respondent, Rohr, to determine Rohr’s compliance with the regulations As noted on Page 8 of the
Enforcement Response Policy, a report which is submitted after the reporting deadline and after the facility
October1997 lllE—26
-------
is contacted in preparation for an inspection or for the purposes of determining compliance is considered a
failure to report.
I determined that Circumstance Level 2, late reporting did not apply in this case as the
Respondent, Rohr, had not reported for the chemical 1,1,1 -tnchloroethane at the Auburn facility when that
facility was contacted by the EPA on January 25,1989, to determine that facility’s compliance and to set
up an inspection (ERP p 8) Further, although the Respondent, Rohr, had previously submitted Form Rs
for two other facilities which it operates, the Form R submitted by the Respondent, Rohr, on January 26,
1989, could not be considered an amendment to a previously filed Form R since no pnor Form R was ever
submitted to EPA or the State of Washington for the Auburn, Washington facility for the chemical 1,1,1-
tnchloroethane for the calendar year 1987
Extent and Circumstance of the Violation
The concepts of extent and circumstance of a violation are addressed in the Adjustment Levels in
the Enforcement Response Policy. (ERP pp. 7, 10-11) A violation is deemed more substantial if the
Respondent used an amount of chemical more than ten times the amount of the appropnate reporting
threshold for that chemical within that calendar year. The adjustment in the Enforcement Response Policy
for the amount of a chemical used is based on the assumption that the lack of information from a facility
using larger amounts of chemicals and/or not reporting very large releases would be more important and
cause more harm to the validity and utility of the national EPCRA data base than would the lack of
information from a smaller chemical user with smaller releases The Enforcement Response Policy
penalty matnx takes this factor into account by providing for adjustment of the level of the penalty
according to the amount of the chemical handled at the facility relative to the appropriate reporting
threshold (ERP pp 7-8, 9)
The Respondent, Rohr, “otherwise used” more than 27,900 pounds of the chemical 1,1,1-
trichloroethane in calendar year 1987 The reporting threshold for a facility which “otherwise used” a listed
chemical is 10,000 pounds The Respondent, Rohr, used less than ten times the applicable threshold
amount Based in part on that information, I determined the appropnate Adjustment Level in accordance
with Enforcement Response Policy as noted below
Ability to Pay
The ability to pay a penalty and to remain in business is initially addressed in the Enforcement
Response Policy Adjustment Levels. (ERP pp 7-8, 16) This statutory factor requires that EPA consider
the level of penalty in relation to the company’s economic viability The economic viability is represented
in this instance in part by the size of Rohr Industries, Inc In applying this factor the assumption is made
that a smaller company will have less ability than a larger company to pay the same penalty. The
assumption is also made that a smaller penalty would have a deterrent effect on a small company similar
to the effect that a larger penalty would have for a large company. Initially, for the purpose of issuing the
Complaint, the size is determined by the number of employees or the total sales of the corporation The
number of employees is generally the information most readily available and is the approach most
commonly used by EPA staff
The Respondent has a second opportunity to have its ability to pay a penalty taken into account
following the issuance of the Complaint. In the Complaint, at Paragraph 17, the Respondent is invited to
submit financial information to rebut the presumption of ability to pay. The respondent may choose to
provide EPA with information which documents the company’s financial status. This information, if
provided, undergoes an economic review by EPA If it is determined that the penalty would inflict financial
hardship of such a nature as to jeopardize the Respondent’s ability to continue in operation, the penalty
may be reduced
IIIE—27 October 1997
-------
Based on information obtained from the company during the inspection, I determined that
Respondent, Rohr, had approximately 100 employees at its Auburn, Washington facility According to the
Enforcement Response Policy, a downward adjustment of the penalty is not made unless the company
has fewer than 50 full time employees. (ERP 9, 11-12) This information is factored into the Adjustment
Level of the Enforcement Response Policy penalty matnx as noted below
Pnor History of Such Violations
The effect on the penalty of a Respondent’s pnor history of such violations is addressed in the
Enforcement Response Policy on Page 15. If a company had previously violated Section 313 of EPCRA,
the penalty may be adjusted upwards. Calendar year 1987 was the first year for which Form Rs were
required under EPCRA Section 313. The Respondent, Rohr, failed to report for the calendar year 1987
and had no previous opportunity to have been in (or out of) compliance with Section 313 Since there was
no prior history of Rohr’s lack of compliance with EPCRA, this factor was not applicable to the proposed
penalty in this case.
Economic Benefit or Savings Resulting from the Violation
Section 313 of EPCRA requires that companies report the release of chemicals to the
environment A violator may benefit financially through not reporting by saving the cost associated with
reporting There may also be tangible benefit or savings derived from not having information about the
company’s operations revealed to the public. This factor is not explicitly discussed in the Enforcement
Response Policy but could be employed in considenng other factors as justice may require. Such a factor
might be applied to increase the penalty should it be determined that the company gained through
noncompliance. EPA had no information that the Respondent, Rohr, accrued any benefit from the
violation Therefore, this factor was not used to adjust the proposed penalty in the Complaint
Adjustment Level
I determined based on the inspection report that Respondent, Rohr, used in calendar year 1987
approximately 27,900 pound of the chemical 1,1,1 -tnchloroethane, substantially in excess of the
appropnate “otherwise used” reporting threshold of 10,000 pounds, but less than ten times the amount of
that threshold. The Respondent, Rohr, had more than 50 employees which charactenzes it as a larger
company These two factors of quantity of chemical use and company size approximately fit into
Adjustment Level B of the penalty matrix, as noted on pages 9 and 12 of the Enforcement Response
Policy.
The Enforcement Response Policy provides that either of two critena may be used in making this
evaluation The two criteria are the number of employees total corporate sales of the Respondent,
Rohr, at the time the Complaint was issued, therefore, the number of employees (supplied from the
inspector’s report) was the critenon used for this evaluation.
Proøosed Penalty
I determined the proposed penalty for Rohr’s violation using the matnx in the Enforcement
Response Policy on Page 9. Using Circumstance Level 1 and Adjustment Level B as explained above, I
determined that the appropriate proposed penalty in the Complaint should be $17,000.
October 1997 lllE—28
-------
Other adjustment factors can be applied following the issuance of the Complaint One is the
ability to pay which is addressed above Other factors include the culpability of the violator, and other
factors as justice may require The reason for considenng these factors issuance of the Complaint is
that, commonly, information which would influence their application is not usually available until settlement
negotiations begin During negotiations, as appropriate information becomes available, these statutory
factors, if applicable, may be used to adjust the proposed penalty
CulDability of the Violator
The culpability of the violator is addressed in the Enforcement Response Policy (ERP p 14) The
factor of culpability is addressed through an evaluation of the Respondent’s knowledge of the
requirements precipitating the violation, the Respondent’s degree of control over the violation, and the
attitude of the violator. Prior to the issuance of the complaint, culpability is addressed to the extent that
information concerning the components of culpability is available The consideration of these factors may
decrease, increase, or have no effect on the proposed penalty
Based on the fact that the Respondent, Rohr, had previously filed Form Rs for two facilities which
it operates, I determined that the Respondent, Rohr, knew of the requirements of EPCRA Section 313
However, no Form Rs were filed for 1987 for the Auburn, Washington facility which is the subject of this
Complaint. Further, Respondent, Rohr, had control over that part of the Auburn facility operations which
dealt with the purchase and inventory of chemicals which are subject to reporting under EPCRA Section
313.
The attitude of the Respondent, Rohr, was cooperative when Initially contacted and during the
inspection. The Respondent, Rohr, filed the required Form R for the Auburn facility immediately upon
being notified by EPA that filing for that facility was possibly required. However, the Enforcement
Response Policy provides that any adjustment for attitude be made only in the context of settlement.
At the time of the issuance of the Complaint, consideration of the culpability factor with all its
components did not serve to either increase or decrease the proposed penalty.
Other Factors as Justice May Require
This factor allows EPA to consider particular, unusual matters in the case that are unique to that
case and which are not addressed in other factors (ERP p. 16-17) One example of such unique matters
specifically addressed in the Enforcement Response Policy is that of Environmental Beneficial
Expenditures. These are expenditures which a Respondent elects to makes voluntarily, above and
beyond the requirements of any law. In return for such expenditures, the penalty may be adjusted
downwards taking into account the value to the environment and the true cost of the project to the
company Such expenditures may include projects which emphasize the re-use and recycling of
chemicals and efforts to reduce the releases of chemicals to the environment. The Enforcement
Response Policy provides that Environmentally Beneficial Expenditures be considered normally only in the
context of settlement
In determining the proposed penalty in the Complaint, I had no information regarding the
Respondent, Rohr, which would make the factor of “other matter as justice may require” applicable to the
circumstances of this case Hence, this factor did not affect the amount of the proposed penalty in the
Complaint
IllE—29 October 1997
-------
Gravity of Alleged Violations and Actual or Potential Harm to Public Health and the Environment
The purpose of Section 313 reporting and the associated regulations is to gather information on
the releases of certain chemicals to the environment and to make that information available to the public
That information is compiled in the Toxic Chemical Release Inventory The more than 300 chemicals and
chemical compounds which are subject to reporting are among the most common substances in industry
Many of the chemicals are considered carcinogenic or acutely toxic. Most of the chemicals on the list
have some associated adverse health or environmental effect Some are specifically implicated in
causing depletion of the earth’s ozone layer
It is important that the Toxic Chemical Release Inventory information on the releases of these
chemicals into the environment be evaluated so potential problems may be avoided and that public
pnonties may address the most pressing issues. EPA uses this information to influence the direction of
environmental programs which directly regulate the amount of toxic chemicals which may be released to
the air. Other programs such as the Pollution Prevention Initiative are using the Inventory to highlight
priority industries where toxic and carcinogenic chemicals are being released
The Toxic Chemical Release Inventory is also the only source of information which has been
specifically mandated by Congress to be directly accessible to the public The information resides in a
publicly accessible computerized data base and is also made available to the public through such other
means as reports and microfiche Data from the Inventory is placed in many cities and counties
throughout the country.
Only a limited amount of the information in the Toxic Chemical Release Inventory is otherwise
available to EPA for some facilities and some chemicals. The Toxic Chemical Release Inventory is a
unique, substantial, and cntically important resource. Further, the Toxic Chemical Release Inventory is
the only source of information which catalogues a company’s chemical releases to several environmental
media in one report
Although Rohr’s failure to provide the required report on the release of more than 19,000 pounds
of the chemical 1,1,1 -trichloroethane may not have an easily discernible or immediate impact on public
health or the environment, there is significant harm whenever important information concerning toxic
chemical releases is not available, especially since it compromises a community’s ability to obtain an
accurate and complete picture of releases of potential concern. For example, individual sources of
chemical releases which are not contained in the database might remain unknown and have releases
which are not properly regulated EPA and the public would be depnved of the information which is
needed to reliably set pnonties and policy concerning the releases of chemicals.
October 1997 IllE—30
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IV. C lvii Administration
Process
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IV. CIVIL ADMINISTRATIVE
PROCESS
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IV. CML ADMINISTRATIVE PROCESS . tV—I
IV.A ISSUANCE OF THE COMPLAIWT . IV—1
I Statutory/Regu!ato,y Requirements IV—I
2 CaseLaw
.
IV.B. C0NrEwr OF THE COMPLAINT !V—5
I. Statutory/Regulatory Requirements IV—5
2. Case Law IV—6
3 Special Considerations lV—7
4. Process lV—7
IV. C SERVICE OF THE COMPLAINT AND TIMELY AND APPROPRIATE FlUNG OF OTHER PLEADINGS IV—8
I. Statutory/Regulatory Requirements IV—8
2. Case Law lv—II
3. Special Considerations lV—13
4. Process lV—j3
!V.D. ANS RTOTHECOMPLAINT IV—13
I. StatutoiyiRegulato,’y Requirements lV—13
2 CaseLaw IV—14
3. Special Considerations .. IV—15
4 Process IV—15
IV.E MO77ONS /V—16
I. Statutory/Regulatory Requirements lV—16
2. Case Law IV—19
3. Special Considerations IV—22
IV.F INFORMAL SETrL.EMENT . .. IV—23
I. Statutory/Regulatory Requirements .... IV—23
2. Case Law . IV—24
3. Special Considerations .. lV—26
4. Process lV—26
a) Settlement Negotiation .. lV—26
b) Supplemental Environmental Projects . .. IV—26
c) Consent Agreement Oversight lV—27
lV.G. HEARING PROCESS . . . lV—28
I. Statutory/Regulatory Requirements lV—28
2. Case Law . IV—33
3. Special Considerations IV—37
4 Process . IV—37
IVH. APPEALS . lV—37
I. StatutoryiRegulatory Requirements lV—37
2. Case Law lV—39
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IV. CIVIL ADMINISTRATIVE PROCESS
IV.A. Issuance Of The Complaint
1. Statutoiy/Regulato,y Requirements
FIFRA Section 14:
(a) Civil penalties.—
(1) In general.--Ariy registrant, commercial applicator, wholesaler, dealer, retailer, or
other distributor who violates any provision of this subchapter may be assessed a civil
penalty by the Administrator of not more than $5,000 for each offense.
(2) Private applicator.—Any private applicator or other person not included in paragraph
(1) who violates any provision of this subchapter subsequent to receiving a written warning
from the Administrator or following citation for a prior violation, may be assessed a civil
penalty by the Administrator of not more than $1,000 for each offense: Provided, That any
applicator not included under paragraph (1) of this subsection who holds or applies
registered pesticides, or uses dilutions of registered pesticides, only to provide a service of
controlling pests without delivering any unapplied pesticide to any person so served, and
who violates any provision of this subchapter may be assessed a civil penalty by the
Administrator of not more than $500 for the first offense nor more than $1,000 for each
subsequent offense.
(3) Hearing.—No civil penalty shall be assessed unless the person charged shall have
been given notice and opportunity for a hearing on such charge in the county, parish, or
incorporated city of the residence of the person charged.
(4) Deterrriination of penalty.—In determining the amount of the penalty, the Administrator
shall consider the appropriateness of such penalty to the size of the business of the person
charged, the effect on the person’s ability to continue in business, and the gravity of the
violation. Whenever the Administrator finds that the violation occurred despite the exercise
of due care or did not cause significant harm to health or the environment, the
Administrator may issue a warning in lieu of assessing a penalty.
(5) References to Attorney General.—In case of inability to collect such civil penalty or
failure of any person to pay all, or such portion of such civil penalty as the Administrator
may determine, the Administrator shall refer the matter to the Attorney General, who shall
recover such amount by action in the appropriate United States district court.
IV—1 October 1997
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IVA. Issuance of the Complaint iv. CML ADMINISTRATIVE PROCESS
TSCA Section 16:
Penalties (a) Civil—( 1) Any person who violates a provision of section 15 shaU be liable to
the United States for a civil penalty in an amount not to exceed $25,000 for each such
violation. Each day such a violation continues shall, for purposes of this subsection,
constitute a separate violation of section 15.
(2)(A) A civil penalty for violation of section 15 shall be assessed by the Administrator by
an order made on the record after opportunity (provided in accordance with this
subparagraph) for a hearing in accordance with section 554 of Title 5. Before issuing such
an order, the Administrator shall give written notice to the person to be assessed a civil
penalty under such order of the Administrator’s proposal to issue such order and provide
such person an opportunity to request, within 15 days of the date the notice is received by
such person, such a hearing on the order.
(B) In determining the amount of a civil penalty, the Administrator shall take into account
the nature, circumstances, extent, and gravity of the violation or violations and, with respect
to the violator, ability to pay, effect on ability to continue to do business, any history of prior
such violations, the degree of culpability, and such other matters as justice may require.
(C) The Administrator may compromise, modify, or remit, with or without conditions, any
civil penalty which may be imposed under this subsection. The amount of such penalty,
when finally determined, or the amount agreed upon in compromise, may be deducted
from any sums owing by the United States to the person charged.
(3) Any person who requested in accordance with paragraph (2)(A) a hearing respecting
the assessment of a civil penalty may file a petition for judicial review of such order with the
United States Court of Appeals for the District of Columbia Circuit or for any other circuit in
which such person resides or transacts business. Such petition may only be filed within
the 30-day period beginning on the date the order making such assessment was issued.
(4) If any person fails to pay an assessment of a civil penalty—
(A) after the order making the assessment has become a final order if such person does
not file a petition for judicial review of the order in accordance with paragraph (3), or
(B) after a court in an action brought under paragraph (3) has entered a final judgment in
favor of the Administrator, the Attorney General shall recover the amount assessed (plus
interest at currently prevailing rates from the date of the expiration of the 30-day period
referred to in paragraph (3) or the date of such final judgment, as the case may be) in an
action brought in any appropriate district court of the United States. In such an action, the
validity, amount, and appropriateness of such penalty shall not be subject to review.
October 1997 IV—2
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IV. CML ADMINISTRATIVE PROCESS IV.A. Issuance Of The Complaint
EPCRA Section 325(c)
Civil and administrative penalties for reporting requirements.—( 1) Any person (other than a
governmental entity) who violates any requirement of section 312 or 313, shall be liable to
the United States for a civil penalty in an amount not to exceed $25,000 for each such
violation.
(2) Any person (other than a governmental entity) who violates any requirement of section
311 or 323(b), and any person who fails to furnish the Administrator information required
under section 322(a)(2) or requested by the Administrator under section 322(d) shall be
liable to the United States for a civil penalty in an amount not to exceed $10,000 for each
violation.
(3) Each day a violation described in paragraph (1) or (2) continues shall, for purposes of
this subsection, constitute a separate violation.
(4) The Administrator may assess any civil penalty for which a person is liable under this
subsection by administrative order or may bring an action to assess and collect the penalty
in the United States district court for the district in which the person from whom the penalty
is sought resides or in which such person’s principal place of business is located.
EPCRA Section 325(f):
Procedures for Administrative Penalties.—( 1) Any person against whom a civil penalty is
assessed under this section may obtain review thereof in the appropriate district court of
the United States by filing a notice of appeal in such court within 30 days from the date of
such order and by simultaneously sending a copy of such notice by certified mail to the
Administrator. The Administrator shall promptly file in such court a certified copy of the
record upon which such violation was found or such penalty imposed. If any person fails to
pay an assessment of a civil penalty after it has become a final and unappealable order or
after the appropriate court has entered final judgment in favor of the United States, the
Administrator may request the Attorney General of the United States to institute a civil
action in an appropriate district court of the United States to collect the penalty, and such
court shall have jurisdiction to hear and decide any such action. In hearing such action,
the court shall have authority to review the violations and the assessment of the civil
penalty on the record.
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.13 Issuance of complaint.
If the complainant has reason to believe that a person has violated any section of the Act or
regulations promulgated or a permit issued under the Act, he may institute a proceeding
for the assessment of a civil penalty by issuing a complaint under the Act and these rules of
practice. If the complainant has reason to believe that:
IV—3 October 1997
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IV.A. Issuance of the Complaint iv. CiviL ADMINISTRATIVE PROCESS
(a) A permittee violated any term or condition of the permit, or
(b) A permittee misrepresented or inaccurately described any material fact in the permit
application or failed to disclose all relevant facts in the permit application, or
(c) Other good cause e dsts for such action, he may institute a proceeding for the
revocation or suspension of a permit by issuing a complaint under the Act and these rules
of practice. A complaint may be for the suspension or revocation of a permit in addition to
the assessment of a civil penalty.
28 U.S.C. Section 2462 - Statute of Limitations
Except as otherwise provided by an Act of Congress, an action, suit, or proceeding for the
enforcement of any civil fine, penalty, or forfeiture, precursory or otherwise, shall not be
entertained unless commenced within five years from the date when the claims first
occurred.
2. Case Law
In re: 3M Company v. Carol M. Browner ,
Docket No.92-1126 (DC Cir 1994), Docket No. TSCA 88-H-06
Background:
Respondent contended that the five-year statute of limitations applied to certain allegations
in the Complaint. These allegations related to events that occurred more than five years
prior to the issuance of the Complaint.
Ruling:
• The general five year statute of limitations on federal actions set by 28 U.S.C. §2462
applies to administrative proceedings as well as judicial actions.
• The statute of limitations applies to all cases where liability is adjudicated and sets a
penalty or fine.
• Pursuant to §2462, a suit or proceeding to assess or impose a civil penalty or Erie must
be commenced within five years of the date of the violation.
October 1997 IV—4
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IV. CML ADMINIsTR rlvE PROCESS IV.B. Content of the Complaint
In re Lazarus. Incorporated .
Docket No. TSCA-V-32-93
Backg-round
The Complainant alleged that among other things, Respondents failed to register PCB
transformers with fire response personnel, stored combustible materials next to a PCB
transformer, and failed to dispose of PCBs in accordance with applicable disposal
requirements. The Respondent argued that these violations were barred by the statute of
limitations.
Ruling:
The alleged violations are continuing ones. The danger of injury eidts so long as the PCB
transformers are not registered. The charge of stonng combustible materials near a PCB
transformer is based on the date of inspection and not storage of the items five years pnor
to the issuance of the complaint. The obligation to properly dispose of spilled PCBs is a
continuing one.
IV.B. Content Of The Complaint
1. Statutory/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.03 Definitions.
(a) The following definitions apply to Part 22:
“Complainant” means any person authorized to issue a complaint on behalf of the Agency
to persons alleged to be in violation of the Act. The complainant shall not be the Judicial
Officer, Regional Judicial Officer, or any other persons who will participate or advise in the
decision.
“Complaint” means a written communication, alleging one or more violations of specific
provisions of the Act, or regulations promulgated thereunder, issued by the complainant to
a person under sections 22.13 and 22.14
40 CFR. Section 22.14 Content and Amendment of the Complaint.
(a) Complaint for the assessment of a civil penalty. Each complaint for the assessment of
a civil penalty shall include:
(1) A statement reciting the section(s) of the Act authonzing the issuance of the complaint;
IV—5 October 1997
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IV.B. Content of the Complaint iv. CML ADMINISTRATIVE PROCESS
(2) Specific reference to each provision of the Act and implementing regulations which
respondent is alleged to have violated;
(3) A concise statement of the factual basis for alleging the violation;
(4) ‘the amount of the civil penalty which is proposed to be assessed;
(5) A statement explaining the reasoning behind the proposed penalty;
(6) Notice of respondent’s right to request a hearing on any material fact contained in the
complaint, or on the appropriateness of the amount of the proposed penalty.
A copy of these rules of practice shall accompany each complaint served.
(c) Derivation of proposed civil penalty. The dollar amount of the proposed civil penalty
shall be determined in accordance with any criteria set forth in the Act
relating to the proper amount of a civil penalty and with any civil penalty guideline issued
under the Act.
2. Case Law
In re: Willis Stores .
I.F.&R. No. Viii 59C, Accelerated Decision Dismissing Complaint and Denying Motion to
Amend (1981)
Background:
In this FIFRA case, a Suspension Order omitted the words “offer for sale.” When a FIFRA
inspector found the suspended pesticide on the store shelf, this case was brought.
Ruling:
The respondent was alleged to have violated a suspension order by offering a suspended
pesticide for sale. The suspension order prohibited sale of the pesticide, but did not
prohibit the offering for sale. The complaint was dismissed because the respondent’s
activities did not constitute a violation of the suspension order.
In re: Sporicidin International .
Docket No. Fl’FRA-88-H-02, Final Order
Background:
Respondent argued an appeal that certain counts did not state causes of action because
the counts used the phrase “in connection with ...“ instead of the statutory language as part
of distribution or sale.
October 1997 IV—6
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IV. CML ADMINISTRATIVE PROCESS IV.B. Content of the Complaint
Ruling:
A complaint need not track the statutory language exactly, but must merely be sufficiently
precise to alert a respondent to the charges against it and the matters at issue.
In re: Weçzo Chemical & Mineral Corp. .
Docket No. TSCA-8(a)-88-0228, Initial Decision (1992)
Background:
One count of the complaint contained an inaccurate citation of the violation. Respondent’s
answer did not raise the faulty citation as an issue. EPA and Respondent discussed the
violation for over two years, during which time Respondent was aware of, and discussed at
length, all of the relevant factual allegations. However, at the hearing, Respondent moved
to strike the count with the inaccurate citation.
Ruling:
The AU ruled that the Respondent failed to present evidence to show that it was prejudiced
by Complainant’s typographical error and that to accept Respondent’s arguments would
exalt form over substance. The factual allegation of the Complaint was accurate, and the
parties negotiated and discussed the alleged violations for over two years. It was too late
for Respondent to make its motion to strike at the beginning of the hearing.
3. Special Considerations
In preparing the civil complaint, the Case Development Officer should be mindful that the
ultimate audience for the document is the Administrative Law Judge. The complaint should
be written and organized to clearly explain what happened and that what happened
constitutes a violation.
4. Process
The Case Development Officer must ensure that the complaint contains the six elements
set forth at Section 22.14 of the Rules of Practice:
• Statement of authonty;
• Reference to each provision of the Act or regulations violated;
• Factual basis for alleging the violation;
• Amount of proposed penalty;
IV—7 October1997
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IV.C. Service of the Complaint IV. CML ADMINIsT rIvE PROCESS
• Reasoning for the penalty; and
• Notice of respondent’s rights.
Section 22.14 also requires that a copy of the Rules of Practice accompany each
complaint.
A copy of the pertinent penalty policy is usually included along with the Rules to support
the reasoning for the penalty proposed in the complaint.
The complaint should be signed by the person officially delegated the authority to issue the
complaint as designated in the PIFRA. TSCA. and EPCRA chapters of the Agency
delegations manual. This delegation should be a person who will never participate or
advice in the decision.
Confidential Business Information (CBI)
If a complaint must contain confidential business information (CBI), two separate
complaints must be filed. One containing the confidential business information and a
“sanitized” version with the CBI deleted or with substitute designations. The nonconfidential
complaint will be accompanied by a statement explaining the deletions and is filed by the
clerk in the public record.
The following Example is provided at the end of this chapter.
Example N-i Complaint with Confidential Information Deleted PIE—i
IV.C. Service Of The Complaint And Timely And Appropriate
Filing Of Other Pleadings
1. Stat utoiy/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.05 Filing, Service, and Form of Pleadings and Documents.
(a) Filing of pleadings and documents.—(i) Except as otherwise provided, the original and
one copy of the complaint, and the original of the answer and of all documents served in
the proceedings shall be flied with the Regional Hearing Clerk.
(2) A certificate of service shall accompany each document filed or served. Except as
otherwise provided, a party filing documents with the Regional Hearing Clerk, alter the
filing of the answer, shall serve copies thereof upon all other parties and the Presiding
October 1997 IV—8
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IV. CML ADMINISTRATIVE PROCESS IV.C. Service of the Complaint
Officer. The Presiding Officer shall maintain a duplicate file during the course of the
proceeding.
(3) When the Presiding Officer corresponds directly with the parties, the original of the
correspondence shall be sent to the Regional Hearing Clerk, a copy shall be maintained
by the Presiding Officer in the duplicate file, and a copy shall be sent to all parties. Parties
who correspond directly with the Presiding Officer shall in addition to serving all other
parties send a copy of all such correspondence to the Regional Hearing Clerk. A
certificate of service shall accompany each document served under this subsection.
(b) Service of pleadings and documents.—(l) Service of complaint. (I) Service of a copy of
the signed onginal of the complaint together with a copy of these rules of practice, may be
made personally or by certified mail, return receipt requested, on the respondent (or his
representative).
(ii) Service upon a domestic or foreign corporation or upon a partnership or other
unincorporated association which is subject to suit under a common nan ie shall be made
by personal service or certified mail, as prescribed by paragraph (b)(l)(I) of this section,
directed to an officer, partner, a managing or general agent, or to any person authorized
by appointment or by Federal or State law to receive service of process.
(iii) Service upon an officer or agency of the United States shall be made by delivering a
copy of the complaint to the officer or agency, or in any manner prescribed for service by
applicable regulations. If the agency is a corporation, the complaint shall be served as
prescribed in paragraph (b)(1)(ii) of this section.
(iv) Service upon a State or local unit of government, or a State or local officer, agency,
department, corporation, or other instrumentality shall be made by serving a copy of the
complaint in the manner prescribed by the law of the State for the service of process on
any such persons, or:
(A) If upon a State or local unit of government, or a State or local department, agency,
corporation, or other instrumentality, by delivering a copy of the complaint to the chief
executive officer thereof;
(B) If upon a State or local officer by delivering a copy to such officer.
(v) Proof of service of the complaint shall be made by affidavit of the person making
personal service, or by properly executed return receipt. Such proof of service shall be
filed with the complaint immediately upon completion of service.
(2) Service of documents other than complaint, rulings, orders, and decisions All
documents other than the complaint, rulings, order, and decision, may be served
personally or by certified or first class mail.
IV—9 October 1997
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IV.C. Service of the Complaint IV. CML ADMINISTRATIVE PROCESS
(c) Form of pleadings and documents.—(l) Except as provided herein, or by order of the
Presiding Officer or Administrator, there are no specific requirements as to the form of
documents.
(2) The first page of every pleading, letter, or other document shall contain a caption
identifying the respondent and the docket number which is exhibited on the complaint.
(3) The original of any pleading, letter, or other document (other than exhibits) shall be
signed by the party filing or by his counsel or other representative. The signature
constitutes a representation by the signer that he has read the pleading, letter, or other
document, that to the best of his knowledge, information, and belief, the statements made
therein are true, and that it is not interposed for delay.
(4) The initial document ified by any person shall contain his name, address, and
telephone number. Any changes in this information shall be communicated promptly to
the Regional Hearing Clerk, Presiding Officer, and all parties to the proceeding. A party
who fails to furnish such information shall be deemed to have waived his right to notice and
service under these rules.
(5) The Administrator, Regional Administrator, Presiding Officer, or Regional Hearing
Clerk may refuse to ifie any document which does not comply with this paragraph. Written
notice of such refusal, stating the reasons therefor, shall be promptly given to the person
submitting the document. Such person may amend and resubmit any document refused
for filing upon motion granted by the Admimstrator, Regional Administrator, or Presiding
Officer, as appropriate.
40 CFR. Section 22.06 Filing and Service of Rulings, Orders, and Decisions.
All rulings, orders, decisions, and other documents issued by the Regional Administrator,
Regional Judicial Officer, or Presiding Officer, as appropriate shall be filed with the
Regional Hearing Clerk. All such documents issued by the Administrator or Judicial Officer
shall be filed with the Hearing Clerk. Copies of such rulings, orders, decisions, or other
documents shall be served personally, or b certified mail, return receipt requested, upon
all parties by the Administrator, Regional Administrator, Judicial Officer, Regional Judicial
Officer, or Presiding Officer, as appropriate.
40 CFR. Section 22.07 Computation and Extension of Time.
(a) Computation. In computing any period of time prescribed or allowed in these rules of
practice, except as otherwise provided, the day of the event from which the designated
period begins to run shall not be included. Saturdays, Sundays, and Federal legal
holidays shall be included. When a stated time expires on a Saturday, Sunday, or legal
holiday, the stated time period shall be extended to include the next business day.
(b) Extensions of time. The Administrator, Regional Administrator, or Presiding Officer, as
appropriate, may grant an extension of time for the filing of any pleading, document, or
October1997 IV—1O
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IV. CML ADMINISTRATIVE PRocEss IV.C. Service of the Complaint
motion (1) upon timely motion of a party to the proceeding, for good cause shown, and after
consideration of prejudice to other parties, or (2) upon his own motion. Such a motion by a
party may only be made after notice to all other parties, unless the movant can show good
cause why serving notice is impracticable. The motion shall be filed in advance of the date
on which the pleading, document, or motion is due to be filed, unless the failure of a party
to make timely motion for extension of time was the result of excusable neglect.
(c) Service by mail. Service of the complaint is complete when the return receipt is
signed. Service of all other pleadings and documents is complete upon mailing. Where a
pleading or document is served by mail, five (5) days shall be added to the time allowed
by these rules for the filing of a responsive pleading or document.
2. Case Law
Klatzson Brothers. Inc. v United States Environmental Protection Aaency .
839 F. 2d 1396(10th Cfr. 1988) (F7FRA)
Background:
Katzson Brothers raised failure of service as a defense in this FIFRA case, alleging that the
employee who signed for the registered mail was sabotagmg” the company. The court
disallowed the defense holding the secretary who routinely received the mail was a
“representativ&’ of Mr. Katzson.
Ruling:
• EPA properly served a complaint by sending the complaint to the secretary-treasurer of
the producer by certified mail, return receipt requested.
• If the Agency employs procedures reasonably calculated to achieve notice, successful
achievement is not necessary to satisfy due process requirements.
Patrick I. Neman .
TSCA Appeal No. 93-3, Remand Order (1994)
Background:
Respondent had been charged under a TSCA complaint and EPA filed an amended
Complaint alleging later violations and a considerably higher penalty. Respondent did not
respond to the amended complaint and a Default Order was issued: Respondent
appealed the Default Order because he never had notice of the amended complaint or
Motion for Default. The EAB vacated the Default Order.
Ruling:
• There was nothing in the record to show that Respondent had received the amended
Complaint.
lV—11 October 1997
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IV.C. Service of the Complaint IV. CML ADMINISTRATIVE PROCESS
• The return mail receipt was not signed and Respondent testified that the address to
which the Complaint was sent was not his current residence.
• The Agency has an affirmative duty to achieve service.
In re: Medzcrrn. Ltd. .
Docket No. I.F.&R. 11-470-C, FIFRA Appeal No. 91 - 1, Final Decision (1992)
Background:
Respondent appealed the issuance of a Default Order contending that it was not properly
served because the Order was improperly directed. The receipt for the Complaint was
signed by a bookkeeper not an officer, partner, or managing agent of the firm.
Ruling:
To be properly directed, a Complaint must be addressed and mailed to a person within
one of the classes of persons specified in the Rules of Practice. In this case, the Complaint
was addressed and mailed to Respondent without being further directed to any person
within the classes listed in 22.O5 (b)(l)(ii). Therefore, service of the Complaint was not
properly directed to the Respondent and thus was invalid. Accordingly, the Default Order
was vacated and the Complaint dismissed.
In re: Robert Ross and Sons, Inc. .
Docket No. TSCA-V-C-008, Appeal No. 82-4 (1985)
Background:
Robert Ross was awarded attomey s fees under the Equal Access to Justice Act. The Act
provides for 20 days in which to file an appeal. EPA missed the deadline by almost two
weeks.
Ruling:
Motion to Appeal is denied because the region did not provide a legitimate excuse for its
failure to file the motion for appeal on time.
In re: State of Maryland .
Docket No. TSCA-Ifl-289, Order Denying Motion for Default Order (1987)
Background:
EPA filed a complaint and the State of Maryland failed to respond in the required 20 days.
While EPA ’s motion for default judgment was denied, the Judge’s ruling made several
important points:
October 1997 IV—1 2
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IV. CML ADMINISTRATIVE PROCESS IV.C. Service of the Complaint
• Under 40 CFR. Section 22.07(c), service of the complamt is complete when return
receipt is signed.
• All other pleadings’ service is complete upon mailing; and five (5) days are added to the
relevant filing deadline where a pleading is served by mail.
• CFR. Section 22.05(b)(1)(iv)(A) authorized service upon the chief executive officer of the
state Agency. The Secretary of the Maryland State Department of Transportation is the
chief executive officer of the Maryland Port Authority.
3. Special Considerations
It is the joint responsibility of the Case Development Officer and Attorney to ensure that the
case is well managed by ensuring that all activities in support of the case are performed in
a timely fashion.
4. Process
Use the D&B or other source of corporate information to determine the appropriate person
to be served with the complaint. In the case of a corporation, the complaint may be sent to
the President, Chief Executive Officer, or Statutory Agent for Service of Process. In the
case of a partnership, the complaint should be served on one of the partners.
The complaint should be sent certified mail, return receipt requested. The certified receipt
should contain the name, title, and address of the recipient and the name, title, and
address of the Agency employee responsible for maintaining evidence of service.
IV.D. Answer To The Complaint
1. Statutory/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.15 Answer to the Complaint.
(a) General. Where respondent (1) contests any material fact upon which the complaint is
based, (2) contends that the amount of the penalty proposed in the complaint or the
proposed revocation or suspension, as the case may be, is inappropriate; or (3) contends
that he is entitled to judgment as a matter of law, he shall file a written answer to the
complaint with the Regional Hearing Clerk. Any such answer to the complaint must be
filed within twenty (20) days after service of the complaint.
(b) Contents of the answer. The answer shall clearly and directly admit, deny, or explain
each of the factual allegations contained in the complaint with regard to which respondent
IV—1 3 October 1997
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IV.D. Answer to the Complaint IV. CML ADMINISTRATIVE PROCESS
has any knowledge. Where respondent has no knowledge of a particular factual
allegation and so state, the allegation is deemed demed. The answer shall also state (1)
the circumstances or arguments which are alleged to constitute the grounds of defense, (2)
the facts which respondent intends to place at issue, and (3) whether a hearing is
requested.
(c) Request for hearing. A hearing upon the issues raised by the complaint and answer
shall be held upon request of respondent in the answer. In addition, a hearing may be
held at the discretion of the Presiding Officer, sua sponte, if issues appropriate for
adjudication are raised in the answer.
(d) Failure to admit, deny, or explain. Failure of respondent to admit, deny, or explain any
material factual allegation contained in the complaint constitutes an admission of the
allegation.
(e) Amen drn ent of the answer. The respondent may amend the answer to the complaint
upon motion granted by the Presiding Officer.
2. Case Law
In re: Electric Service Company .
TSCA Docket No. V-C-02, Order (1981)
Background:
Electric Services filed an answer which stated generally that it did not have enough facts to
respond to the allegations of the complaint. EPA moved for an order to require the
Respondent to place defensive facts before the court. The court agreed.
Ruling:
40 CFR. Section 22.15 contemplates that a specific, as opposed to a general denial, is
contemplated and that to place “at issue” facts in the complaint, respondent must plead
material facts which contradict complainant’s allegations.
In re: Frankfort Power and Liçtht .
Docket No TSCA-H-PCB-85-0258, Initial Decision (1986)
Background:
Frankfurt filed an answer and request for a hearing which it then withdrew. EPA filed a
motion for default. Based on the fact that Frankfurt sent a letter saying that the proposed
penalty was excessive, the AU overruled EPA’s motion.
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IV. CML ADMINISTRATIVE PROCESS IV.D. Answer to the Complaint
Ruling:
Withdrawal of an answer and request for a heanng will ordinarily be construed as an
admission of the facts alleged in the complaint and a consent to the imposition of the
proposed penalty. However, since the respondent insists that the penalty is excessive and
the record contains support for the contention, the Motion for Default is denied and an
Initial Decision is issued ordering a lower penalty.
In re: Thermal Reduction Company. Inc. ,
Docket No. IIEPCRA 91-0102, EPCRA Appeal No. 91-2 (1992)
Background:
Respondent failed to file an Answer to a Complaint filed by A and served on the
president of the corporation. Respondent acknowledged receiving two follow-up letters
regarding the Complaint and also failed to reply in opposition to the Motion for Default
Order. In appealing the Default Order, Respondent denied it was the owner of the facility
that was inspected but acknowledged that it shared sane form of legal relationship.
Ruling:
It is not necessary to decide whether Respondent could have successfully defended against
the Complaint. Respondent’s current assertions should have been made in an Answer to
the Complaint or included in c x reply to the Motion for Default Order. Nothing was filed.
Assertions raised for the first time on appeal are not accepted as a basis for overturning a
properly issued Default Order. The Default Order was affirmed.
3. Special Considerations
Extensions of time to file an answer pending settlement negotiations are discouraged. By
filing an answer, the respondent places the issues in dispute on the table, triggers the
assignment of an Administrative Law Judge, and begins moving the case forward to
resolution.
4. Process
In the answer the respondent contests the alleged facts, the size of the penalty, or raises
issues of law.
Upon receipt, the answer should be reviewed by the Case Development Officer and
Attorney to determine if any unanticipated facts or arguments are raised that require
further investigation. If the facts are uncontested, a motion for accelerated decision should
be considered.
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IV.E. Motions IV. CML ADMINISTRATIVE PROCESS
IV.E. Motions
1. Statutory/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.16 Motions.
(a) General. All motions, except those made orally on the record during a hearing, shall
(1) be in writing; (2) state the grounds therefore with particularity; (3) set forth the relief or
order sought; and (4) be accompanied by any affidavit, certificate, other evidence, or legal
memorandum relied upon. Such motions shall be served as provided by Section
22.05(b)(2).
(b) Response to motions. A party s response to any written motion must be filed within ten
(10) days after service of such motion, unless additional time is allotted for such response.
The response shall be accompanied by any affidavit, certificate, other evidence, or legal
memorandum relied upon. If no response is filed within the designated period, the parties
may be deemed to have waived any objection to the granting of the motion. The Presiding
Officer, Regional Administrator, or Administrator, as appropriate, may set a shorter time
for response, or make such other orders concerning the disposition of motions as they
deem appropriate.
(c) Decision. Except as provided in Section 22.04(d)(1) and Section 22 .28(a), the Regional
Administrator shall rule on all motions filed or made before an answer to the complaint is
filed. The Administrator shall rule on all motions filed or made after service of the initial
decision upon the parties. The Presiding Officer shall rule on all other motions. Oral
argument on motions will be permitted where the Presiding Officer, Regional
Administrator, or the Administrator considers it necessary or desirable.
40 CFR. Section 22.14 Content and Amendment of the Complaint.
(d) Amendment of the complaint. The complainant may amend the complaint once as a
matter of right at any time before the answer is filed. Otherwise the complainant may
amend the complaint only upon motion granted by the Presiding Officer or Regional
Administrator, as appropriate. Respondent shall have twenty (20) additional days from the
date of service to file his answer.
(e) Withdrawal of the complaint. The complainant may withdrawal the complaint, or any
part thereof, without prejudice one time before the answer has been filed. After one
withdrawal before the filing of an answer, the complainant may withdrawal the complaint,
or any part thereof, without prejudice, only upon motion granted by the Presiding Officer or
Regional Administrator, as appropriate.
October 1997 IV—1 6
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tV. CML ADMIwsm mJE PROCESS IV.E. Motions
40 CF’R. Section 22.20 Accelerated Decision; Decision to Dismiss.
(a) General. The Presiding Officer, upon motion of any party or sua sponte, may at any
time render an accelerated decision in favor of the complainant or the respondent as to all
or any part of the proceeding, without further hearing or upon such limited additional
evidence, such as affidavits, as he may require, if no genuine issue of matenal fact exists
and a party is entitled to judgment as a matter of law, as to all or any part of the
proceeding. In addition, the Presiding Officer, upon motion of the respondent may at any
time dismiss an action without further hearing or upon such limited additional evidence as
he requires, on the basis of failure to establish a prima facie case or other grounds which
show no right to relief on the part of the complainant.
(b) Effect.—(l) If an accelerated decision or a decision to dismiss is issued as to all the
issues and claims in the proceeding, the decision constitutes an initial decision of the
Presiding Officer, and shall be filed with the Regional Hearing Clerk.
(2)11 an accelerated decision or decision to dismiss is rendered on less than all issues or
claims in the proceeding, the Presiding Officer shall determine what material facts exist
without substantial controversy and what material facts remain controverted in good faith.
He shall thereupon issue an interlocutory order specifying the facts which appear
substantially uncontroverted, and the issues and claims upon which the hearing will
proceed.
40 CFR. Section 22.11 Intervention.
(a) Motion. A motion for leave to intervene in any proceeding conducted under these
rules of practice must set forth the grounds for the proposed intervention, the position and
interest of the movant and the likely impact that intervention will have on the expeditious
progress of the proceeding. Any person already a party to the proceeding may file an
answer to a motion to intervene, making specific reference to the factors set forth in the
foregoing sentence and paragraph (c) of this section, within ten (10) days after service of
the motion for leave to intervene.
(b) When filed. A motion for leave to intervene in a proceeding must ordinarily be filed
before the first prehearing conference or, in the absence of a prehearing conference,
before the initiation of correspondence under Section 2 2.19(e), or if there is no such
correspondence, prior to the setting of a time and place for a hearing. Any motion filed
after that time must include in addition to the information set forth in paragraph (a) of this
section, a statement of good cause for the failure to file in a timely manner. The intervenor
shall be bound by any agreements, arrangements, and other matters previously made in
the proceeding.
(c) Disposition. Leave to intervene may be granted only if the movant demonstrates that
(1) his presence in the proceeding would not unduly prolong or otherwise prejudice the
adjudication of the rights of the original parties; (2) the movant will be adversely affected by
a final order; and (3) the interests of the movarit are not being adequately represented by
IV—17 October 1997
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IV.E. Motions IV. CML ADMINISTRATIVE PROCESS
the onginal parties. The intervenor shall become a full party to the proceeding upon the
granting of leave to intervene.
(d) Arnicus curiae. Persons not parties to the proceeding who wish to file briefs may so
move. The motion shall identify the interest of the applicant and shall state the reasons
why the proposed amicus brief is desirable. If the motion is granted, the Presiding Officer
or Administrator shall issue an order setting the time for filing such brief. An amicus curiae
is eligible to participate in any briefing after his motion is granted, and shall be served with
all briefs, reply briefs, motions, and orders relating to issues to be briefed.
40 CFR. Section 22.17 Default Order.
(a) Default. A party may be found to be in default (1) after motion, upon failure to file a
timely answer to the complaint; (2) after motion or sua sponte, upon failure to comply with
a prehearing or hearing order of the Presiding Officer; or (3) after motion or sua sponte,
upon failure to appear at a conference or hearing without good cause being shown. No
finding of default on the basis of a failure to appear at a hearing shall be made against the
respondent unless the complainant presents sufficient evidence to the Presiding Officer to
establish a prima fade case against the respondent. Any motion for a default order shall
include a proposed default order and shall be served upon all parties. The alleged
defaulting party shall have twenty (20) days from service to reply to the motion. Default by
respondent constitutes, for purposes of the pending action only, an admission of all facts
alleged in the complaint and a waiver of respondent’s right to a hearing on such factual
allegations. 11 the complaint is for the assessment of a civil penalty, the penalty proposed
shall become due and payable by respondent without further proceedings sixty (60) days
after a final order issued upon default. If the complaint is for the revocation or suspension
of a permit, the conditions of revocation or suspension proposed in the complaint shall
become effective without further proceedings on the date designated by the Administrator
in his final order issued upon default. Default by the complainant shall result in the
dismissal of the case with prejudice.
(b) Procedures upon default. When Regional Administrator or Presiding Officer finds a
default has occurred, he shall issue a default order against the defaulting party. This order
shall constitute the initial decision, and shall be ified with the Regional Hearing Clerk.
(c) Contents of a default order. A default order shall include findings of fact showing the
grounds for the order, conclusions regarding all material issues of law or discretion, and
the penalty which is recommended to be assessed or the terms or conditions of permit
revocation or suspension, as appropriate.
(d) For good cause shown the Regional Administrator or the Presiding Officer, as
appropriate, may set aside a default order.
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IV. CML ADMINISTRATIVE PROCESS IV.E. Motions
40 CFR. Section 22.28 Motion to Reopen a Hearing.
(a) Filing and content. A motion to reopen a hearing to take further evidence must be
made no later than twenty (20) days alter service of the initial decision on the parties and
shall (1) state the specific grounds upon which relief is sought, (2) state bnefly the nature
and purpose of the evidence to be adduced, (3) show that such evidence is not cumulative,
and (4) show good cause why such evidence was not adduced at the hearing. The motion
shall be made to the Presiding Officer and filed with the Regional Heanng Clerk.
(b) Disposition of motion to reopen a hearing. Within ten (10) days following the service of
a motion to reopen a hearing, any other party to the proceeding may file with the Regional
Hearing Clerk and serve on all other parties an answer thereto. The Presiding Officer shall
announce his intent to grant or deny such motion as soon as practicable thereafter. The
conduct of any proceeding which may be required as a result of the granting of any motion
allowed in this section shall be governed by the provision of the applicable sections of
these rules. The filing of a motion to reopen a hearing shall automatically stay the running
of all time penods specified under these rules until such time as the motion is denied or the
reopened hearing is concluded.
40 CFR. Section 22.32 Motion to Reconsider a Final Order.
Motions to reconsider a final order shall be filed within ten (10) days alter service of the
final order. Every such motion must set forth the matters claimed to have been erroneously
decided and the nature of the alleged errors. Such motion shall not stay the effective date
of the final order unless specifically so ordered by the Administrator.
2. Case Law
Accelerated Decision
In re: IF&l ’vI Company. Inc. ,
Docket No. TSCA-III-057, Initial Decision (1985)
Background:
The president of the company responded to the complaint with a letter which the AU
accepted as an answer. In the letter, he did not deny any of the factual allegations and
EPA filed for a default judgment on the issue of liability which was granted.
Ruling:
Where the respondent in his answer admits violation of all counts in the complaint, a
motion for accelerated decision on the issue of liability may be properly granted.
IV—1 9 October 1997
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IV.E. Motions IV. CML ADMINISTRATIVE PROCESS
In re Erincraft, Inc .
Docket No. TSCA-V-C-92-90, Accelerated Decision and Order (1992)
Background:
Respondent filed an Answer to the Complaint admitting the factual violations, asking the
penalties sought be canceled, and requesting an informal conference. Complainant filed
a Motion for Accelerated Decision, but Respondent served no response.
Ruling:
By such inaction, Respondent is deemed to have waived any objection to the motion.
Standing alone, this is sufficient to establish liability and assess the penalty sought.
Motions for accelerated decision are comparable to motions for summary judgment; minor
factual issues do not necessarily bar a recovery. A disputed issue must involve a material
fact to preclude the granting of an accelerated decision. Since there exists no genuine
issue of any material fact concerning the alleged violations, Complainant is entitled to an
accelerated decision.
In re: Tillcimpok County Creamery Association .
Docket No. EPCRA-1094-03-O1-325
Background:
Complainant and Respondent, by motion, requested that the issues in the matter be
resolved by “accelerated decision.” Under the Consolidated Rules of Practice, an
accelerated decision may be granted “if no genuine issue of material fact exists and a
party is entitled to judgement as a matter of law.”
Ruling:
The Supreme Court has written that summary judgement is authorized by the Federal
Rules, “upon proper showings of the lack of a genuine, triable issue of matenal fact.” The
issue that defeats summary judgement must be one that requires further proceedings to
find facts. An issue of law is no barrier to a summary judgement. Applying these
principles to the present case, few “genuine issues of material fact” remain that would
prevent an accelerated decision.
Motion to Strike
In re: Spectrum Wire Corporation .
Docket No. EPCRA-I-91-1008, Order
Background:
EPA moved to strike the respondent’s defense that it did not manufacture a chemical and
was eligible for an article exemption.
October 1997 P 1—20
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IV. Clvi i. ADMINISTRATIVE PROCESS IV.E. Motions
Ruling:
The Judge denied the motion. The Judge stated: “Motions to strike are not viewed
favorably, and are infrequently granted. For the movant to succeed, the Court must be
convinced that there are no questions of fact, and that any questions of law are clear and
not in dispute.” A motion to strike will be denied “unless the legal insufficiency of the
defense is ‘clearly apparent’... If the sufficiency of the defense depends upon disputed
questions of law or fact, then a motion to strike will be denied.” Complainant’s motion was
denied because the insufficiency of the defense was not clearly apparent due to the
questions of fact and of law presented in the pleadings.
Motion to Amend
l itre: Irnitec. Inc ,
Docket No. TSCA-PMN-ff-89-0222,
Order Granting Motion to Amend Complaint
Background:
In this TSCA PMN case, Imitec asserted that EPA had misidentified the chemical at issue.
EPA then moved to amend the complaint to correct the error and Jmitec objected. The
basis for the objection was a seven month delay in filing for the amendment. EPA
responded that the delay had also been allowed because the case appeared ripe for
settlement. It had filed the motion to amend when linitec had broken off negotiations. The
AU found that Respondent did not show it had been prejudiced by the delay and allowed
the correcting amendment.
Ruling:
A motion to amend a complaint to change the name of the chemical substance at issue is
granted over the respondents objections that prosecution of the case was characterized by
undue delay.
Motion to Dismiss
Inre: Weed Heights Development Company: Mesaba Service and Supply Company. and
Martin Electric Company .
Docket No. TSCA-09-84-OO1O, Order Granting Motion to Dismiss (1984)
Background:
As a defense in this TSCA case, Weed Heights stated it did not own the six transformers
which were the basis of the case and filed a motion to dismiss. EPA did not respond to the
motion until after the time period had passed. in addition, EPA relied on an assumption of
ownership and presented no factual information. The ALl dismissed the case with
prejudice.
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IV.E. Motions IV. CML ADMINISTRATIVE PROCESS
Ruling:
A motion to dismiss should be granted upon showing of respondent by substantial
evidence, unrefuted by complainant, that a prima facie case has not been established.
Motion for Default
Kcrtzspn Brothers, Inc. v. US EPA ,
839 F. 2d 1396 (10th Cir. 1988)
Background:
Katzson Brothers failed to file an answer and EPA was granted a default judgment and a
civil penalty. Katzson appealed to the Administrator who upheld the initial decision.
Katzson then appealed the Administrator’s decision to the district court. The basis for the
appeal was that the proposed penalty was not fully presented in the record.
Ruling:
The court reviewed the record and remanded the case. The court order EPA to grant the
respondent a hearing concerning factors may mitigate the penalty. No penalty
justification had been included in the record on which the default judgment was based.
Motion to Intervene
Infe: Chemical Waste Management. Inc . ,
Docket No. 84-H-03, Order Granting Leave to Intervene (1984)
Background:
Chemical Waste arid EPA negotiated a CAFO whereupon Alabama filed a motion for
intervention by its Attorney General. The basis for its intervention was that its citizens
would be affected by the storage of PCBs in Alabama, that the consent agreement
contained errors of fact, and that the “goal” of the consent agreement (ocean incineration
of PCBs) was not in the State’s interest.
Ruling:
The State of Alabama is allowed to intervene in a proceeding and join in negotiating
settlement. The order is granted because: the State’s interest is in protecting its citizens;
the interests of the complainant and State are different; and the intervention will not unduly
delay the proceeding.
3. Special Considerations
Motions for Accelerated Decision should be made whenever the respondent admits the
violation or fails to provide any facts to dispute its liability. The motion will demonstrate for
October 1997 IV—22
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IV. CML ADMINISTRATiVE PROCESS IV.F. Informal Settlement
the AU that the respondent’s answer has not raised any issues refuting the allegations of
the complaint or the prima facie case.
IV.F. Informal Settlement
1. Statutory/Regulatory Requirements
40 CFR. Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.18 Informal Settlement: Consent Agreement and Order.
(a) Settlement policy. The Agency encourages settlement of a proceeding at any time if
the settlement is consistent with the provisions and objectives of the Act and applicable
regulations. The respondent may confer with complainant concerning settlement whether
or not the respondent requests a hearing. Settlement conferences shall not affect the
respondent’s obligation to file a timely answer under Section 22.16.
(b) Consent agreement. The parties shall forward a written consent agreement and a
proposed consent order to the Regional Administrator whenever settlement or compromise
is proposed. The consent agreement shall state that, for the purpose of this proceeding,
respondent (1) admits the jurisdictional allegations of the complaint; (2) admits the facts
stipulated in the consent agreement or neither admits or denies specific factual allegations
contained in the complaint; and (3) consents to the assessment of a stated civil penalty or
to the stated permit revocation or suspension, as the case may be. The consent agreement
shall include any and all terms of the agreement, and shall be signed by all parties or their
counsel or representatives.
(c) Consent order. No settlement or consent agreement shall dispose of any proceeding
under these rules of practice without a consent order from the Regional Administrator. In
preparing such an order, the Regional Administrator may require that the parties to the
settlement appear before him to answer inquiries relating to the consent agreement or
order.
40 CFR. Section 22.10 Appearances.
Any party may appear in person or by counsel or other representative. A partner may
appear on behalf of a partnership and an officer may appear on behalf of a corporation.
Persons who appear as counsel or other representative must conform to the standards of
conduct and ethics required of practitioners before the courts of the United States.
40 CFR. Section 22.08 Exparte Discussion of Proceeding.
At no time after the issuance of the complaint shall the Administrator, Regional
Administrator, Judicial Officer, Regional Judicial Officer, Presiding Officer, or any other
person who is likely to advise these officials in the decision on the case, discuss ex parte
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IV.F. Informal Settlement IV. CML ADMINISTRATIVE PROCESS
the merits of the proceeding with any interested person outside the Agency, with any
Agency staff member who performs a prosecutorial or investigative function in such
proceeding or a factually related proceeding, or with any representative of such person.
Any ex parte memorandum or other communication addressed to the Administrator,
Regional Administrator, Judicial Officer, Regional Judicial Officer, or the Presiding Officer
during the pendency of the proceeding and relating to the merits thereof, by or on behalf of
any party shall be regarded as argument made in the proceeding and shall be served
upon all other parties. The other parties shall be given an opportunity to reply to such
memorandum or communication.
2. Case Law
Supplemental Environmental Projects (SEPs)
In re: Spang & Company .
EPCRA Appeal Nos. 94-3 and 4, Docket Nos. EPCRA-III-Q37 & 048
Background:
In determining the penalty assessment, the Presiding Officer treated Spang’s projects as
supplemental environmental projects or SEPs, under Agency policy addressing the use
of SEPs in settling administrative enforcement cases.
Ruling:
SEPs embody a quid pro quo consisting of a legally enforceable commitment to perform
an environmentally beneficial project in the future, in exchange for the settlement of a case.
Here, there is no quid pro quo, as Spang’s projects have already been initiated or
completed and are being offered at a contested hearing in an effort to reduce a penalty.
As a matter of policy, future projects should not be considered in contested penalty
hearings. While not SEPs, these projects may be considered under the penalty policy’s
rubric of “other factors as justice may require.” Under this rubric, the evidence of
environmental good deeds must be clear and unequivocal. The circumstances must be
such that a reasonable person would easily agree that not giving some form of credit
would be a manifest injustice. The penalty assessment, was remanded for reconsideration
of the projects under “other factors as justice may require.”
Alternative Dispute Resolution
In re: Geron Furniture Inc. .
Docket No. EPCRA-09-94-0009 (1994)
Background:
The Respondent requested the appointment of a “settlement conference commissioner.”
The AU issued an Order initiating the Alternate Dispute Resolution process (ADR). The
October 1997 IV—24
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IV. CML ADMINISTRATIVE PROCESS IV.F. Informal Settlement
EPA then withdrew from the process and filed an objection to the appointment of a neutral
settlement commissioner.
Ruling:
• The AU issued an Order Concerning the Use of ADR in Enforcement Cases.
• ADR is consistent with EPA policies.
• AUJs as “case managers” may appoint commissioners as part of their powers granted
under the Consolidated Rules, which allows them “to require parties to attend
conferences for the settlement or simplification of the issues or the expedition of the
proceedings.” 40 CFR 22.04 (c)(8).
• Executive Order 12778, “Civil Justice Reform” recommends offering the services of
trained mediators in agency adjudications.
Prevailing Party
Inre: CF. Industries, Inc. .
Docket No. FIFRA-09-0465-C-5, Recommended Decision (1987)
Background:
Cfl and EPA negotiated a settlement in this case. Following the entry of the consent
agreement, CFI applied for attome s fees and expenses under the Equal Access to Justice
Act. The basis for CFTs motion was that EPA had reduced the proposed penalty from
$28,160 to $3,000. The judge denied the award, holding that to be eligible, CFI would have
had to have been a “prevailing party.”
Ruling:
The substantial reduction of a penalty reflected in a consent agreement did not suggest
weakness in the Agency s case because the settlement agreement when read in its entirety
shows a favorable settlement for the EPA on all charges of the complaint. Therefore,
Respondent’s claims for reimbursement pursuant to the EAJA were determined to be
unjustified.
IV—25 October 1997
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IV.F. Informal Settlement IV. CML ADMINISTRATIVE PROCESS
3. Special Considerations
It is the Case Development Officer’s responsibility to:
• serve as EPA’s co-representative with the Attorney at the settlement conference;
• monitor the respondent’s compliance with all terms of the consent agreement; and
• notify the Attorney of any violation of the terms of the agreement.
4. Process
a) Settlement Negotiation
Thoroughly review the case file prior to the conference.
At the conference, the Case Development Officer should:
• explain facts on which the complaint’s allegations are based;
• review all factors taken into consideration in determining the proposed penalty;
• describe other mitigating factors that the Agency may take into consideration (good
faith); and
• reaffirm that the violative activity has been discontinued.
At the conference, the Attorney or Case Development Officer should:
• explain the administrative process to Respondent; and
• review typical settlements in similar cases and provide copies of typical consent
agreements with Respondent.
• The settlement should contain a statement such as, “This agreement settles all claims
stemming from the facts in this case.”
b) Supplemental Environmental Projects
The parameters for settlement of an enforcement case are set forth in the enforcement
response or penalty policy for the particular statutory provision, and EPA’s Incentives for
Self-disclosure policy and Small Business policy (see 11-3?). One other factor that may be
taken into consideration in the mitigation of a penalty is the environmentally beneficial
project also known, as a Supplemental Environmental Project (SEP). EPA issued an Interim
Revised Supplemental Environmental Projects Policy in May 1995.
October 1997 IV—26
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IV. CML ADi iiNISmArIvE PROCESS IV.F. Informal Settlement
A supplemental environmental project is defined as an environmentally beneficial project
which a respondent agrees to undertake in settlement of an enforcement action, but which
the respondent is not otherwise legally required to perform. The project must meet five
legal guidelines. The project must:
1 Be consistent with all provisions of the statute;
2. Advance the environmental objectives of the statute and nexus,
3. Be managed and controlled by the respondent with oversight by EPA;
4. Have all the specific terms of the project set forth in the settlement
agreement; and
5. Not expand or embellish an EPA activity budgeted by Congress.
Examples of the categories of acceptable projects include: public health, pollution
prevention, pollution reduction, environmental restoration and protection, assessments and
audits, environmental compliance promotion, and emergency planning and preparedness.
The consent decree will set forth the specific actions to be performed by the respondent to
accomplish the project and the dates of completion of each action. In addition, the consent
agreement will also set forth stipulated penalties if the respondent fails to accomplish the
SEP satisfactorily.
c) Consent Agreement Oversight
All consent decrees require some degree of oversight to ensure compliance with the
specific terms of the agreement. Consent decrees which include the performance of a SEP
generally require long term EPA oversight by the case development officer. Once the
consent decree is filed, the case development officer should prepare a schedule of
activities required by the terms of the agreement. As each requirement is met, the date of
completion should be entered on the schedule and the documentation showing that the
activity has been completed should be retained in the case file. If a respondent fails to
accomplish an activity, the case development officer should contact the case attorney to
determine what steps should be taken to notify the respondent of its failure and possible
imposition of stipulated penalties.
The following ex
amples are provided at the end of this chapter.
Example P1-2
Interim Revised Supplemental Environmental Projects Policy . .
. 1VE-9
Example P1-3
Example Consent Agreement Schedule of Activities
IVE-27
IV—27 -- October 1997
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IV.G. Hearing Process IV. CML ADMINISThATIvE PROCESS
IV.G. Hearing Process
1. Statutory/Regulatory Requirements
40 CFR Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.21 Scheduling the Hearing.
(a) When an answer is filed, the Regional Hearing Clerk shall forward the complaint, the
answer, and any other documents filed thus far in the proceeding to the Chief
Administrative Law Judge who shall assign himself or another Administrative Law Judge as
Presiding Officer, unless otherwise provided in the Supplemental rules of practice. The
Presiding Officer shall then obtain the case file from the Chief Administrative Law Judge
and notify the parties of his assignment.
(b) Notice of hearing. If the respondent requests a hearing in his answer, or one is
ordered by the Presiding Officer under Section 22.15(c), the Presiding Officer shall serve
upon the parties a notice of hearing sethng forth a time and place for the hearing. The
Presiding Officer may issue the notice of hearing at any appropriate time, but no later than
twenty (20) days prior to the date set for the hearing.
(c) Postponement of hearing. No request for postponement of a hearing shall be granted
except upon motion and for good cause.
(d) Location of the hearing. The location of the hearing shall be determined in
accordance with the method for determining the location of the prehearing conference
under Section 22.19(d).
4ü CF’R Section 22.19 Prehearing Conference.
(a) Purpose of prehearing conference. Unless a conference appears unnecessary, the
Presiding Officer, at any time before the hearing begins, shall direct the parties and their
counsel or other representatives to appear at a conference before him to consider:
1) The settlement of the case;
2) The s]rnplification of issues and stipulation of facts not in dispute;
3) The necessity or desirability of amendments to pleadings;
4) The exchange of exhibits, documents, prepared testimony and admissions, or
stipulation of fact which will avoid unnecessary proof;
5) The limitation of the number of expert or other witnesses;
6) Setting a time and place for the hearing; and
October 1997 IV—28
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IV. CML ADMINISTRAThIE PROCESS IV.G. Hearing Process
7) Any other matters which may expedite the disposition of the proceeding.
(b) Exchange of witness lists and documents. Unless otherwise ordered by the Presiding
Officer, each party at the prehearing conference shall make available to all other parties
(1) the names of the expert and other witnesses he intends to call, together with a brief
narrative summary of their expected testimony, and (2) copies of all documents and
exhibits which each party intends to introduce into evidence. Documents and exhibits shall
be marked for identification as ordered by the Presiding Officer. Documents that have not
been exchanged and witnesses whose names have not been exchanged shall not be
introduced into evidence or allowed to testify without permission of the Presiding Officer.
The Presiding Officer shall allow the parties reasonable opportunity to review new
evidence.
(c) Record of the prehearing conference. No transcript of a prehearing conference
relating to settlement shall be made. With respect to other prehearing conferences, no
transcnpt of any prehearing conferences shall be made unless ordered by the Presiding
Officer upon motion of a party or sua sponte. The Presiding Officer shall prepare and file
for the record a written summary of the action taken at the conference. The summary shall
incorporate any written stipulations or agreements of the parties and all rulings and
appropriate orders containing directions to the parties.
(d) Location of prehearing conference. The preheciring conference shall be held in the
county where the respondent resides or conducts the business which the hearing
concerns, in the city in which the relevant Environmental Protection Agency Regional Office
is located, or in Washington, DC, unless (1) the Presiding Officer determines that there is
good cause to hold it at another location in a region or by telephone; or (2) the
Supplemental rules of practice provide otherwise.
(e) Unavailability of a prehearing conference. If a prehearing conference is unnecessary
or impracticable, the Presiding Officer, on motion or sua sponte, may direct the parties to
correspond with him to accomplish any of the objectives set forth in this section.
(0 Other discovery. (1) Except as provided by paragraph (b) of this section, further
discovery, under this section, shall be permitted only upon determination by the Presiding
Officer:
(i) That such discovery wifi not in any way unreasonably delay the proceeding;
(ii) That such information to be obtained is not otherwise obtainable; and
(iii) That such information has significant probative value.
(2) The Presiding Officer shall order depositions upon oral questions only upon a showing
of good cause and upon finding that:
IV—29 October 1997
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IV.G. Hearing Process IV. CML ADMINISTRATIVE PRocEss
(i) The information sought c not be obtained by alternative methods; or
(ii) There is a substantial reason to believe that relevant and probative evidence may
otherwise not be preserved for presentation by a witness at the hearing.
(3) Any party to the proceeding desiring an order of discovery shall make a motion
thereof. Such motion shall set forth:
(i) The circumstances warranting the taking of the discover;
(ii) The nature of the information expected to be discovered; and
(iii) The proposed time and place where it will be taken. If the Presiding Officer
determines that the motion should be granted, he shall issue an order for taking of such
discovery together with the conditions and terms thereof.
(4) When the information sought to be obtained is within control of one of the parties,
failure to comply with an order issued pursuant to this paragraph may lead to (i) the
inference that the information to be discovered would be adverse to the party from whom
the information was sought, or (ii) the issuance of a default order under Section 2 2.17(a).
40 CFR Section 22.22 Evidence
(a) General. The Presiding Officer shall admit all evidence which is not irrelevant,
immaterial, unduly repetitious, or otherwise unreliable or of little probative value, except
that evidence relating to the settlement which would be excluded in the federal courts
under Rule 408 of the Federal Rules of Evidence is not admissible. In the presentation,
admission, disposition, and use of evidence, the Presiding Officer shall preserve the
confidentiality of trade secrets and other commercial and financial information. The
confidential or trade secret status of any information shall not, however, preclude its
being introduced into evidence. The Presiding Officer may make such orders as may be
necessary to consider such evidence in camera, including the preparation of a
supplemental initial decision to address questions of law, fact, or discretion which arise out
of that portion of the evidence which is confidential or which includes trade secrets.
(b) Examination of witnesses. Witnesses shall be examined orally, under oath or
alfirmation, except as otherwise provided in these rules of practice or by the Presiding
Officer. Parties shall have the right to cross-examine a witness who appears at the hearing
provided that such cross-examination is not unduly repetitious.
(c) Verified statements. The Presiding Officer may admit an insert into the record as
evidence, in lieu of oral testimony, statements of fact or opinion prepared by a witness. The
admissibility of the evidence contained in the statement shall be subject to the same rules
as if the testimony were produced under oral examination. Before any such statement is
read or admitted into evidence, the witness shall deliver a copy of the statement to the
Presiding Officer, the reporter, and opposing counsel. The witness presenting the
October 1997 IV—30
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IV. CML ADMiNIS &T1vE PROCESS IV.G. Hearing Process
statement shall swear to or affirm the statement and shall be subject to appropriate oral
cross-examination upon the contents thereof.
(d) Admission of affidavits where the witness is unavailable. The Presiding Officer may
admit into evidence affidavits of witnesses who are unavailable. The term ‘unavailable”
shall have the meaning accorded to it by Rule 804(a) of the Federal Rules of Evidence.
(e) Exhibits. Where practicable, an original and one copy of each exhibit shall be filed
with the Presiding Officer for the record arid a copy shall be furnished to each party. A true
copy of any exhibit may be substituted for the original.
(f) Official notice. Official notice may be taken of any matter judicially noticed in the
Federal courts and of other facts within specialized knowledge and expenence of the
Agency. Opposing parties shall be given adequate opportunity to show that such facts are
erroneously noticed.
40 CFR Section 22.27 Initial Decision.
(a) Filing and contents. The Presiding Officer shall issue and file with the Regional
Hearing Clerk his initial decision as soon as practicable after the period for filing reply
briefs under Section 22.26 has expired. The Presiding Officer shall retain a copy of the
complaint in the duplicate file. The initial decision shall contain his findings of fact,
conclusions regarding all material issues of law or discretion, as well as reasons thereof, a
recommended civil penalty assessment, if appropriate, and a proposed final order. Upon
receipt of an initial decision, the Regional Hearing Clerk shall forward a copy to all parties,
and shall send the original, along with a record of the proceeding, to the Hearing Clerk.
The Hearing Clerk shall forward a copy of the initial decision to the Administrator.
(b) Amount of civil penalty. If the Presiding Officer determines that a violation has
occurred, the Presiding Officer shall determine a dollar amount of the recommended civil
penalty to be assessed in the initial decision in accordance with any criteria set forth in the
Act relating to the proper amount of a civil penalty, and must consider any civil penalty
guidelines issued under the Act. If the Presiding Officer decides to assess a penalty
different in amount from the penalty recommended to be assessed in the complaint, the
Presiding Officer shall set forth in the initial decision the specific reasons for the increase
or decrease. The Presiding Officer shall not raise a penalty from that recommended to be
assessed in the complaint if the respondent has defaulted.
(c) Effect of initial decision. The initial decision of the Presiding Officer shall become the
final order of the Administrator within forty-five (45) days after its service upon the parties
and without further proceedings unless (1) cm appeal to the Administrator is taken from it
by a party to the proceedings, or (2) the Administrator elects, sua sponte, to review the
initial decision.
IV—31 October 1997
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IV.G._Hearing Process IV. CML ADMINISTRATIVE PROCESS
40 CFR Section 22.25 Filing the Transcript.
The hearing shall be transcribed verbatim. Promptly following the taking of the last
evidence, the reporter shall transmit to the Regional Hearing Clerk the original and as may
copies of the transcript of testimony as are called for in the reporter’s contract with the
Agency, and also transmit to the Presiding Officer a copy of the transcript. A certificate of
service shall accompany each copy of the transcript. The Regional Hearing Clerk shall
notify all parties of the availability of the transcript and shall furnish the parties with a copy
of the transcript upon payment of the cost of reproduction, unless a party can show that the
cost is unduly burdensome. Any person not a party to the proceedings may receive a copy
of the transcript upon payment of the reproduction fee, except those parts of the transcript
order to be kept confidential by the Presiding Officer.
40 CF’R Section 22.26 Proposed Findings, Conclusions, and Order.
Within twenty (20) days alter the parties are notified of the availability of the transcript, or
within such longer time as may be fixed by the Presiding Officer, any party may submit for
consideration of the Presiding Officer, proposed findings of fact, conclusions of law, and a
proposed order, together with briefs in support thereof. The Presiding Officer shall set a
time by which reply briefs must be submitted. All submissions shall be in writing, shall be
served upon all parties, arid shall contain adequate references to the record and
authonties relied on.
40 CFR Section 22.35 Supplemental Rules of Practice Governing the Administrative
Assessment of Civil Penalties Under the Federal Insecticide, Fungicide, and Rodenticide
Act.
(a) Scope of these Supplemental rules. These Supplemental rules of practice shall
govern, in conjunction with the preceding Consolidated Rules of Practice (40 CFR Part 22),
all formal adjudications for the assessment of any civil penalty conducted under section
14(a) of the Federal Insecticide, Fungicide, and Rodenticide Act as amended (7 U.S.C.
126 1(a)). Where inconsistencies exist between these Supplemental rules and the
Consolidated rules (sections 22.01 through 22.32), these Supplemental rules shall apply.
(b) Venue. The prehearing conference and the hearing shall be held in the county,
parish, or incorporated city of the residence of the person charged, unless otherwise
agreed in writing by all parties.
(c) Evaluation of proposed civil penalty. In determining the dollar amount of the
recommended civil penalty assessed in the initial decision, the Presiding Officer shall
consider, in addition to the criteria listed in section 14(a)(3) of the Act, (1) respondent’s
histoiy of compliance with the Act or its predecessor statute and (2) any evidence of good
faith or lack thereof. The Presiding Officer must also consider the guidelines for the
Assessment of Civil Penalties published in the FEDERAL REGISTER (39 FR 27711), and any
amendments or supplements thereto.
October 1997 IV—32
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IV. CML ADMINISTRATIVE PROCESS IV.G. Hearing Process
40 CFR Section 22.33 Supplemental Rules of Practice Governing the Administrative
Assessment of Civil Penalties Under the Toxic Substances Control Act.
(a) Scope of these Supplemental rules. These Supplemental rules of practice shall
govern, in conjunction with the preceding consolidated niles of practice (40 CFR Part 22),
all formal adjudications for the assessment of any civil penalty conducted under section
16(a) of the Toxic Substances Control Act (15 U.S.C. 2615(a)). Where inconsistencies exist
between these Supplemental rules and the Consolidated rules (sections 22.01 through
22.32), these Supplemental rules shall apply.
(b) Subpoenas. (1) The attendance of witnesses or the production of documentary
evidence may be required by subpoena. The Presiding Officer may grant a request for a
subpoena upon a showing of (i) the grounds and necessity therefore, and (ii) the matenality
and relevancy of the evidence to be adduced. Requests for the production of documents
shall describe the evidence sought as specifically as practicable.
(2) Subpoenas shall be served in accordance with section 22.05(b)(1) of the Consolidated
Rules of Practice.
(3) Witnesses summoned before the Presiding Officer shall be paid the same fees and
mileage that are paid witnesses in the courts of the United States. Fees shall be paid by
the party at whose instance the witness appears. Where a witness appears pursuant to a
request initiated by the Presiding Officer, fees shall be paid by the agency.
2. Case Law
Right to Hearing
In re: Green Thumb Nursery. Inc .
FIFRA Appeal No. 95-4a, I.F.&R. Docket No. V.014-94
Background:
The Respondent contended that FIFRA Section 14(a)(3), requires an oral evidentiary
hearing before imposition of a penalty. A penalty was imposed on Respondent without
benefit of hearings.
Ruling:
Respondent failed to request a hearing in its answer. The government may only impose a
sanction on someone in accordance with due process, that requirement is fulfilled by
providing a citizen with a right to a hearing or with a meaningful opportunity for a hearing.
The Agency clearly afforded Green Thumb due process as a matter of fact, by advising
and informing the Respondent of when and how to request a heczririg. The Respondent did
not timely request a hearing and did not raise any genuine issue of matenal fact. Factual
disputes that are irrelevant or unnecessary will not be counted. Not only must a party
IV—33 October 1997
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IV.G. Hearing Process IV. CML ADMINISTRATIVE PROCESS
opposing summary judgement raise an issue of material fact, but that party must
demonstrate that the dispute is “genuine” by referencing probative evidence in the record.
The Presiding Officer’s election not to hold an oral evidentiary hearing was neither
erroneous or unreasonable.
Discovery
In re: Eastman Chemicals Division. Eastman Kodak Company .
Docket No. TSCA-88-H-07, Order Denying Motion to Compel Discovery (1989)
Background:
Eastman filed motions for discovery, in particular, to compel EPA’s witnesses to answer
interrogatories. EPA objected on the grounds that the Consolidated Rules required it to
provide “brief summaries” of testimony. The AU ruled in EPA’s favor, noting that “amplified
statements” would be provided at trial.
Ruling:
• Neither party shall be permitted under the guise of discovery to engage in delaying,
paper-producing, action-avoiding tactics.
• There is no constitutional right to discovery.
In re: E.1 du Pont de Nernours and Company, Inc. .
Docket No. F’IFRA-93-H-09
Background:
Complainant filed a motion for the production of documents and responses to
interrogatories relating to one of two counts.
Ruling:
The Complainant’s motion turns on whether the discovery requests at issue have
“significant probative value.” One source of guidance is the Federal Rules of Evidence,
which defines “relevant evidence” as “evidence having any tendency to make the
existence of any fact that is of consequence to the determination of the action more
probable or less probable than it would be without the evidence.” Therefore,
Complainant’s motion for discovery for certain interrogatories and document requests is
granted.
October1997 IV—34
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IV. CML ADMINIsm mjE PROCESS IV.G. Hearing Process
Inre Chautauqua Hcn dware Corporation .
Docket No. fl-EPCRA-90-0223, Order on Interlocutoiy Review, Appeal No. 91-1
Background:
The Region filed a motion to stay the deadline for compliance with a discovezy order and
requested review of the order. The order would have required the Agency to provide the
Respondent with:
• Internal documents discussing the purpose and legal basis for the EPCRA penalty
policy;
• All documents pertaining to the terms and rationales for the resolution of other EPCRA
civil administrative cases;
• A documents relating to the delisting of a chemical substance; and
• Information surrounding the selection of the Respondent for inspection.
Ruling:
The Chief Judicial Officer vacated the order on the basis that the documents:
• Did not have significant “probative value, 0 a tendency of a piece of information to prove
a fact that is of consequence in the case;
• Would be shielded from exposure by the evidenticrry privilege protecting the
deliberative processes of government agencies (predecisional and deliberative such
as penalty policy development); and
• Were otherwise obtainable (from the corporate records).
Exclusionary Rule
Wpnq Sun, et. p1. v. United States .
371 U.S. 471 (1963)
Background:
Petitioners were convicted in Federal District Court of fraudulent and knowing
transportation and concealment of illegally imported heroin. The Court of Appeals held
that the arrests of both petitioners without warrants were illegal because it was not based
on probable cause within the meaning of the Fourth Amendment, but affirmed their
convictions.
IV—35 October 1997
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IV.G. Hearing Process IV. CML ADM NISThA11VE PROCESS
Ruling:
There was neither reasonable grounds nor probable cause for one codefendant’s arrest.
Statements made by this codefendant at the time of his arrest and narcotics taken from a
third party as a result of his arrest are fruits of the unlawful search and excluded as
improperly admitted evidence. The conviction of the codefendant was set aside. The other
codefendant was granted a new trial on unexciuded evidence.
FIFRA Venue
In re: Stauffer Chemical Company .
I.F.&F?. Docket No. VI-23C, Initial Decision (1975)
Background:
Stauffer made three requests for a hearing, each time proposing another location. It then
filed a formal objection to the Houston site proposed by the AU.
Ruling:
Respondent was denied a motion to hold the hearing near its corporate headquarters or
place of incorporation. The hearing was held at the city where its local facility was situated
and where the violation occurred.
In re: Chemi-Trpl Chemical Company .
Docket No. I.F.&R.-V-QQJ-89, OrderDesignaingHearingLocatjon
Background:
Respondent’s work crews were alleged to have misused a pesticide while conducting
spraying activities in Michigan. Respondent requested that the hearing be held in Ohio
since its headquarters are there. EPA requested that the hearing be held in Michigan
since that was where the respondent conducted business.
Ruling:
Since the respondent does not maintain permanent facilities in Michigan, it does not have
a residence there. The language of Section 14(a)(3) makes it clear that the intent is to hold
the hearing in a place convenient to the respondent, in this case Ohio. This is not to say
that the ruling in Stauffer was erroneously decided. The Stauffer case is distinguishable
since Stauffer maintained facilities in and continued to do business in the cities where the
violation occurred.
October 1997 P /—36
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IV. CML ADMINISTRATIVE PROCESS IV.H. Appeals
3. Special Considerations
The Case Development Officer and Attorney are jointly responsible for ensuring that:
• all exhibits and witnesses are identified in a timely manner before the prehearing
exchange;
• the witnesses and exhibits are prepared for the hearing; and
• the Case Development Officer is prepared to testify regarding the size of the penalty.
4. Process
Discuss with the attorney the types and levels of expertise needed by witnesses testifying to
the facts and gravity of the violation which will support the proposed penalty.
Once witnesses are identified, explore possible examples of facts or gravity that may be
presented to buttress the Agency s case.
Ensure that all exhibits, original and appropriate number of copies, are available,
organized, and identified for the hearing.
IV.H. Appeals
1. Statutory/Regulatory Requirements
40 CFR Part 22—Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation or Suspension of Permits
Section 22.29 Appeal from or Review of Interlocutory Orders or Rulings.
(a) Request for interlocutory appeal. Except as provided in this section, appeals to the
Administrator shall obtain as a matter of right only from a default order, an accelerated
decision or decision to dismiss issued under section 22.20(b)(1), or an initial decision
rendered after an evidentiary hearing. Appeals from other orders or rulings shall lie only if
the Presiding Officer or Regional Administrator, as appropriate, upon motion of a party,
certifies such orders or rulings to the Administrator on appeal. Requests for such
certification shall be filed in writing within six (6) days of notice of the ruling or service of the
order, and shall state briefly the grounds to be relied upon on appeal.
(b) Avail ability of interlocutory appeal. The Presiding Officer may certify any ruling for
appeal to the Administrator when (1) the order or ruling involves an important question of
law or policy concerning which there is substantial grounds for difference of opinion, and
(2) either (i) an immediate appeal from the order or ruling will materially advance the
IV—37 October 1997
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IV.H. Appeals IV. CML ADMINISTRATIVE PROCESS
ultimate termination of the proceeding, or (ii) review after the final order is issued will be
inadequate or ineffective.
(c) Decision. If the Administrator determines that certification was improvidently granted,
or if he takes no action within thirty (30) days of the certification, the appeal is dismissed.
When the Presiding Officer declines to certify an order or ruling to the Administrator on
interlocutory appeal, it may be reviewed by the Administrator only upon appeal from the
initial decision, except when the Administrator determines, upon motion of a party and in
exceptional circumstances, that to delay review would be contrary to the public interest.
Such motion shall be made within six (6) days of service of an order of the Presiding Officer
refusing to certify a ruling for interlocutory appeal to the Administrator. Ordinarily, the
interlocutory appeal will be decided on the basis of the submissions made by the Presiding
Officer. The Administrator may, however, allow further briefs and oral argument.
(d) Stay of proceedings. The Presiding Officer may stay the proceedings pending a
decision by the Administrator upon an order or ruling certified by the Presiding Officer for
an interlocutory appeal. Proceedings will not be stayed except in extraordinary
circumstances. When the Presiding Officer grants a stay of more than thirty (30) days, such
stay must be separately approved by the Administrator.
40 CFR Section 22.30 Appeal From or Review of Initial Decision.
(a) Notice of appeal. (1) Any party may appeal any adverse ruling or order of the
Presiding Officer by filing a notice of appeal and an accompanying appellate brief with the
Hearing Clerk and upon all other parties and amicus curiae within twenty (20) days after
the initial decision is served upon the parties. The notice of appeal shall set forth
alternative findings of fact, alternative conclusions regarding issues of law or discretion,
and a proposed order together with relevant references to the record and the initial
decision. The appellant’s brief shall contain a statement of the issues presented for review,
a statement of the nature of the case and the facts relevant to the issues presented for
review, argument on the issues presented, and a short conclusion stating the precise relief
sought, together with appropriate references to the record.
(2) Within fifteen (15) days of the service of notices of appeal and briefs under paragraph
(a)(1) of this section, any other party or arnicus curiae may file and serve with the Hearing
Clerk a reply brief responding to argument raised by the appellant, together with
references to the relevant portions of the record, initial decision, or opposing brief. Further
briefs shall be filed only with the permission of the Administrator.
(b) Sua sponte review by the Administrator. Whenever the Administrator determines sua
sponte to review an initial decision, the Hearing Clerk shall serve notice of such intention
on the parties within forty-five (45) days after the initial decision is served upon the parties.
The notice shall include a statement of issues to be briefed by the parties and a time
schedule for the service and filing of briefs.
October 1997 IV—38
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IV. CML ADMINISTRATIVE PROCESS IV.H. Appeals
(c) Scope of appeal or review. The appeal of the initial decision shall be limited to those
issues raised by the parties during the course of the proceeding. lithe Administrator
determines that issues raised, but not appealed by the parties, should be argued, he shall
give counsel for the parties reasonable written notice of such determination to permit
preparation of adequate argument. Nothing herein shall prohibit the Administrator from
remanding the case to the Presiding Officer for further proceedings.
(d) Argument before the Administrator. The Administrator may, upon request of a party or
suc sponte, assign a time and place for oral argument after giving consideration to the
convenience of the parties.
40 CFR Section 22.31 Final Order on Appeal.
(a) Contents of the final order. When an appeal has been taken or the Administrator
issues a notice of intent to conduct review sua sponte, the Administrator shall issue a final
order as soon as practicable after the filing of all appellate briefs or oral argument,
whichever is later. The Administrator shall adopt, modify, or set aside the findings and
conclusions contained in the decision or order being reviewed, arid shall set forth in the
final order the reasons for his actions. The Administrator may, in his discretion, increase or
decrease the assessed penalty from the amount recommended to be assessed in the
decision or order being reviewed, except that if the order being reviewed is a default order,
the Administrator may not increase the amount of penalty.
(b) Payment of a civil penalty. The respondent shall pay the full amount of the civil
penalty assessed in the final order within sixty (60) days after receipt of the final order
unless otherwise agreed by the parties. Payment shall be made by forwarding to the
Regional Hearing Clerk a cashier’s check or certified check in the amount of the penalty
assessed in the final order, payable to the Treasurer, United States of America.
40 CFR Section 22.32 Motion to Reconsider a Final Order.
Motions to reconsider a final order shall be filed within ten (10) days after service of the
final order. Eveiy such motion must set forth the matters claimed to have been erroneously
decided and the nature of the alleged errors. Such motion shall not stay the effective date
of the final order unless specifically so ordered by the Administrator.
2. Case Law
Noble Automotive Chemical and Oil Company v US EPA .
Civil Action No. 82-1581, Order Denying Application for Declaratozy Judgment and
Injunction to Prevent the Administrative Law Judge from Issuing a Decision (1982)
Background:
After an Initial Decision was remanded against Noble Oil, Noble Oil filed a motion to
reopen based on the grounds that EPA’s PCB testing analysis was faulty and in the
alternative, that the penalty assessed was excessive. The court overruled holding that the
IV—39 October 1997
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IV.H. Appeals IV. CML ADMINISTRA11VE PROCESS
information Respondent wished to present could have been presented at the hearing as
could the financial information for mitigation of the penalty.
Ruling:
All available administrative remedies must be exhausted before the parties may resort to
judicial remedies unless the administrative procedure is inadequate to prevent injuiy or
when there is a clear and unambiguous statutory or constitutional violation.
In re: Me co Feed and Seed Company. Inc and lack Pierce dibla Pierce Waste Oil
Services .
TSCA Docket No. VII-84-T-312, Final Decision (1986)
Background:
Mexico Feed appealed first to the Administrator and then to the District Court. Both upheld
the Initial Decision after reviewing the record below.
Ruling:
On appeal, analysis of the sufficiency of the evidence is guided by the standard of whether
the issue has been resolved by a preponderance of the evidence. Questions of fact raising
issues of credibility among competing witnesses are to be determined, in the first instance,
by the Presiding Officer based upon his first-hand observation of the testimony. Absent
overwhelmingly compelling reasons to the contrary, deference is accorded to the Presiding
Officer’s determinations of credibility.
In re: Baker, Bean, and Feed Company .
FIFRA Docket No. VIfl-240C, Order Denying Motion to Suppress
Background:
Respondent filed a motion to suppress evidence stating that the search of its facility was
illegal. EPA objected on the grounds that ALJs are not empowered to nile on constitutional
issues. The ALT denied Respondent’s motion but clarified the authority of the ALT to rule on
such matters.
Ruling:
• Ruling on the constitutionality of congressional enactments is beyond the jurisdiction of
the Administrative Law Judge.
• Ruling on constitutional issues such as admissibility of evidence is within the scope of
the Administrative Law Judge’s authority.
October 1997 IV—40
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IV. CML ADMINISTRATIVE PROCESS IV.H. Appeals
In re Pueblo Chemical and Supply .
I.F.&F?. Docket No. VI-98C
Background.
Pueblo Chemical shipped a canceled pesticide in violation of a stop sale order in
unmarked drums. A complaint was issued for misbranding
Ru1ing
Pueblo asserted as a defense that under FIFRA section 9(c), it should have been given
notice that EPA intended to issue a complaint. The court dismissed the defense finding no
such advance notice was required. Pueblo also asserted that the case against it should be
dropped because the aerial applicator who received the drums was not prosecuted. The
ALT dismissed the defense as having no bearing on the facts of this case
IV—41 October 1997
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IV. CIVIL ADMINISTRATIVE
PROCESS EXAMPLES
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Example IV—1 COMPLAINT WITH CONFIDENTIAL INFORMATION DELETED .. lyE—I
Example IV—2 MAY 1995 INTERIM REVISED SUPPLEMENTAL ENVIRONMENTAL
PROJECTS POLICY .. . IvE—g
Example IV—3 CONSENT AGREEMENT — SECHEDULE OF ACTIVITIES IVE—27
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Example IV—1. Complaint with Confidential Information Deleted
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
IN THE MATTER OF
ESTRON CHEMICAL, INC
CALVERT CITY, KENTUCKY ) Docket No TSCA 88-H-08
)
Respondent
Notice of Treatment of Confidential Business Information
Portions of the attached Complaint required use of information which Respondent submitted to
the United States Environmental Protection Agency (EPA) as Confidential Business Information (CBI)
Information in the Complaint constituting or based on CBI has been deleted as indicated by the following
(CBI deleted) The onginal complaint containing CBI is filed with the Headquarters Heanng Clerk It will
itself be treated as confidential unless Respondent waives confidentiality thereto or EPA releases the
information in accordance with 40 C F R Part 2.
IVEI October 1997
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UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
Docket No TSCA-88-H-08
IN THE MATTER OF: ) COMPLAINT AND NOTICE OF
ESTRON CHEMICAL, INC ) OPPORTUNITY FOR HEARING
CALVERT CITY, KENTUCKY ) UNDER SECTION 16(a) OF
THE TOXIC SUBSTANCES
Respondent ) CONTROL ACT
COMPLAINT
This is a civil administrative action issued under the authonty of Section 16 (a) of the Toxic
Substances Control Act, 15 U S.C. 2601 et seq. (hereinafter “TSCA”) The Complainant is Connie A
Musgrove, Chief Executive Officer, Office of Compliance Monitoring, Office of Pesticides and Toxic
Substances, United States Environmental Protection Agency (hereinafter “EPA” or “the Agency”), who has
been duly delegated the authority to institute this action The Respondent is Estron Chemical, Inc., 1130
Route 46 West, Parsippany, New Jersey (hereinafter “Respondent”).
This Complaint serves as notice that Complainant has reason to believe that Respondent
manufactured a chemical substance in violation of section 5 of TSCA, 15 U S.C. Section 2604, and
Section 15 of TSCA, 15 U.S.C. Section 2614, as follows
October 1997 IVE—2
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COUNTS I THROUGH Xli
1 Respondent is included in the word Person” as defined in 40 CFR 720 3 (x) and as such is
subject to TSCA and the regulations promulgated thereunder
2. On or about September 11, 1987, an inspection of Respondent’s facility located in (CBI deleted),
was performed by an authorized employee of EPA pursuant to Section 11 of TSCA The purpose of the
inspection was to determine Respondent’s compliance with TSCA §5 requirements
3 As a result of the inspection Respondent provided EPA with copies of records covenng the
production of the new chemical substance (CBI deleted), hereinafter known as Chemical A Chemical A is
also known as (CBI deleted).
4 The production records that Respondent provided the Agency reveal that between (CBI deleted)
respondent produced Chemical A for commercial purposes on (CBI deleted) separate days Dunng this
period Respondent manufactured a total of (CBI deleted) of Chemical A
5. On the dates stated in paragraph 4, the chemical substance, Chemical A, did not appear on the
Chemical Substance Inventory maintained by the Administrator pursuant to 15 U S.C 2507.
6. Section 5 (a)(1) of TSCA, 15 U S C. 2604 (a)(1), provides that no person may manufacture a
chemical substance which does not appear on the TSCA Chemical Substance Inventory unless such
person submits a Premanufacture Notification to the Administrator of EPA at least 90 days before such
manufacture Respondent’s Premanufacture Notification to the Administrator for Chemical A was
received by the Agency for review on (CBI deleted) The review penod for Chemical A expired (CBI
deleted)
7 Section 15 (1)(B) of TSCA, 15 U S.C 2614 (1)(B), provides that it is unlawful for any person to fail
or refuse to comply with any requirement prescribed by Section 5
8 The conduct descnbed in Paragraph 4 above was in violation of Sections 5 (a)(1) and 15 (1)(B) of
TSCA, in that Respondent failed to notify the Administrator of the manufacture of the chemical substance,
Chemical A, at least 90 days before manufactunng chemical A
COUNT XIII
1-3 Paragraphs 1 through 3 of Count I are hereby incorporated by reference as if fully set forth in this
Count
4 40 CFR 720 102 was promulgated pursuant to Section 5 of TSCA. It requires that any person
who commences to manufacture a new chemical substance for a commercial purpose for which that
person previously submitted a Premanufacture Notification under Section 5 of TSCA must submit a notice
of commencement of manufacture to the Administrator of EPA on or no later than thirty days after
beginning manufacture of the new chemical substance for commercial purposes.
5 Respondent’s Premanufacture Notification to the Administrator (CBI deleted) for Chemical A was
received by the Agency on (CBI deleted). The review penod for Chemical A expired (CBI deleted)
6. The production records that Respondent provided the Agency reveal that on (CBI deleted),
Respondent began manufacture of Chemical A for commercial purposes On (CBI deleted), Chemical A
IVE—3 October 1997
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did not appear on the Chemical Substance Inventory maintained by the Administrator pursuant to 15
U.S C. 2607
7 Respondent did not submit a notice of commencement within 30 calendar days after beginning
the manufacture of the new chemical substance, Chemical A, for commercial purposes as required under
§40 CFR 720.102
8 Section 15(1) (C) of TSCA, 15 U S C. 2614(1) (C), provides that it is unlawful for any person to
fail or refuse to comply with any rule promulgated or order issued under Section 5 or 6. Section 15 (3) (B)
of TSCA, 15 U.S C 2614(3) (B) provides that itis unlawful for any person to fail or refuse to submit
reports, notices or other information as required by the Act
9 The conduct descnbed in Paragraph 7 was in violation of 40 C F R 720 102 and § 15(1) (C), and
I 5(3)(B) of TSCA, in that Respondent did not submit a notice of commencement to the Administrator
within 30 calendar days after beginning the commercial manufacture of the new chemical substance,
Chemical A, as required
October 1997 IVE—4
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PROPOSED CIVIL PENALTY
Section 16 of TSCA, 15 U.S C Section 2615, authonzes the assessment of a civil penalty of up to
$25,000 per day for each violation of TSCA Based upon the facts alleged in this Complaint, and upon the
nature, circumstances, extent and gravity of the violations alleged, as well as Respondent’s history of pnor
violations of TSCA, the degree of culpability, and such other matters as justice may require, the
Complainant proposes that Respondent be assessed the following civil penalty for the violations alleged in
this Complaint
COUNTS I THROUGH XII
Manufacture of a chemical substance which did not appear on the TSCA Chemical Substance Inventory
on twelve separate days . . . . . . . . $120,000
15 u.s C. 2604 (a) (1)
15 U.S.C 2614 (1)(B)
COUNT XIII
Failure to file a notice of commencement on or no later than 30 calendar days after beginning commercial
manufacture of a new chemical substance for which a Premanufacture Notification had been filed $15,000
15 U.S C. 2604 (a) (1)
15U.SC 2614 (1) (C)
15 U S C. 2614 (3) (B)
TOTAL PROPOSED PENALTY .. . $135,000
IVE—5 October 1997
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NOTICE OF OPPORTUNITY TO
REQUEST A HEARING
As provided in section 16 (a) (2) (A) of TSCA, and in accordance with 554 of Title 5, United States
Code, you have the nght to request a formal heanng to contest any matenal fact set forth in this Complaint
or to contest the appropriateness of the proposed penalty. To avoid being found in default and having the
above-cited penalty assessed without further proceedings, you must file a wntten answer within twenty
(20) days of your receipt of this Complaint Your Answer should (1) clearly and directly admit, deny, or
explain each of the factual allegations contained in this Complaint, (2) bnefly state all facts and
circumstances, if any, which constitute grounds for a defense, and (3) specifically request an
administrative heanng (if desired) The denial of any matenal fact or the raising of any affirmative defense
shall be construed as a request for heanng Failure to deny any of the factual allegations in this Complaint
will constitute an admission of the undenied allegations The answer should be sent to:
Headquarters Heanng Clerk (A-i 10)
United States Environmental
Protection Agency
401 M Street, SW, Room 3706
Washington, DC 20460
The heanng which will be held upon your request will be conducted in accordance with the
Administrative Procedure Act (5 U.S.C Section 551 et sea. ) and the “Consolidated Rules of Practice
Governing the Administrative Assessment of Civil Penalties and the Revocation or Suspension of Permits”
40 CFR Part 22 (45 FR 24360) A copy of the Consolidated Rules accompanies this Complaint
October 1997 IVE—6
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INFORMAL SETTLEMENT CONFERENCE
Whether or not you request a hearing, you may confer informally with EPA to discuss the facts of
this case, or amount of the proposed penalty, and the possibility of settlement An informal settlement
conference does not, however, affect your obligation to file a written Answer to the Complaint
EPA has the authonty to modify the amount of the proposed penalty, where appropriate, to reflect
any settlement reached with you in an informal conference The terms of such an agreement would be
embodied in a Consent Agreement and Final Order A Consent Agreement signed by EPA and yourself
would be binding as to all terms and conditions specified therein
Any requests for an informal conference, copies of all documents to be filed by Respondent, and
any other questions that you may have regarding this Complaint should be directed to
Mr Vincent Giordano
U S Environmental Protection Agency
Toxics Litigation Division (LE-134P)
Room 113 Northeast Mall
401 M Street, SW
Washington, DC 20460
(202) 475-8690
IVE—7 October 1997
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PAYMENT OF PENALTY
Instead of filing an Answer requesting a heanng or requesting an informal settlement conference,
you may choose to pay the proposed penalty Such payment should be made by sending to the
Headquarters Hearing Clerk’s address listed below a cashier’s or certified check in the amount of the
penalty assessed in this complaint Your check must be made payable to the United States of Amenca
and sent to
EPA-Washington
(Hearing Clerk)
P0 Box 360277M
Pittsburgh, PA 15251
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
Complainant
BY
Connie A Musgrove
Chief Executive Officer
Office of Compliance Monitoring (EN-342)
Date _______________
October 1997 IVE—8
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Example IV—2. May 1995 Interim Revised Supplemental
Environmental Projects Policy
Wsz%
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
/ WASHINGTON, D.C 20460
MAY -3 95
DWORCE
MEMORANDUM COI WICEASSUP NCE
SUBJECT: Issuance of late im Re S lemental Eflv nmental Projects Policy
FROM: StevenA.H
Assistant Administrator
TO: Regional Administrators
Attached is EPA’s Interim Revised Supplemental Environmental Projects (SEP)
Policy. SEPs are environmentally beneficial projects which a violator agrees to undertake in
seitlemtnt of an enforcement action, but which the violator is not otherwise legally required
U) perfo’m. This interim revisec P Qj icy vides’the Agency wi th additional flexibility to
craft settlements which may secure significant envir6nmentai or public,health pkolection.
The Agency encourages the use of SEPS. While penalties play an important role in
environmental protection by deterring violations and creating a level playing field, SEPs can
play an additional role in securing significant environmental or public health protection and
improvements. SEPs may be particularly appropriate to further the objectives in the statutes
EPA administers and to achieve other policy goals, including promoting pollution prevention
and environmental justice.
This revision provides numerous improvements to the current SEP Policy. The
revised Policy clearly defines a SEP. It establishes guidelines to ensure that SEPs are within
EPA’s legal authority. It defines seven categories of projects which may qualify as SEPs. it
provides step-by-step procedures for calculating the cost of a SEP and the percentage of that
cost, bas,d on an evaluation of five factors, which may be applied as a mitigating factor in
establishing an appropriate settlement penalty.
This Policy is effective May 8, 1995 and supersedes the February 12, 19 1 Policy
on the Use of Supplenientol Envirownenjal Projects in EPA Settlements. The Policy is to
be used in all enforcement actions filed after the effective date and to all pending cases in
which the government has not reached agreement in principle with the alleged violator on the
specific terms of a SEP.
£fl R.cyc d
ç p ’ — s ‘
IVE—9 October 1997
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-2-
We are issuing this Policy in an interim version because we may wish to revise it
based on public comments and our experience in using it. We are issuing it as an interim
policy, rather than as a draft, because we believe it is superior to the 1991 Policy and thus
should go into effect as soon as possible. We expect to publish this interim version of the
Policy in the Federal Register within the next 30 days.
Thank you for your comments on two previous internal drafts of this Policy. We
appreciate the support and efforts of the Department of Justice, our Office of General
Counsel, and the SEP workgroup in revising this Policy.
We expect to conduct training sessions on the new Policy in each Region during the
next few months. In addition, we expect to issue guidance on the proper drafting of
settlement agreements containing SEPs shortly. If you have any questions on the Policy, you
may contact David A. Hindin. Acting Branch Chief, Multimedia Enforcement Division, in
the Office of Regulatory Enforcement at 202-564-6004. Questions also may be directed to
Peter Moore, at 202-564-6014, or Gerard Kraus at 202-564-6047 in the Multimedia
Enforcement Division.
Attachment
cc: (w/auachment)
ssistant Administratr,rs
OECA Office Director,
ORE Division Directors
- Regional Counsels
Regional Enforcement Coordinators,
Dogiop.al Program Division Directors
Department of Justice, AAG, ENRD
Department of Justice, EES Chief and Deputy Chiefs
Department of Justice, EDS Chief and Deputy Chief
SEP Workgroup Members
October1997 lyE—b
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INTERIM REWSED
EPA SUPPLEMENTAL ENWRONMENTAL PROJECTS POLICY
EFFECTIVE MA Y 8, 1995
A. INTRODUCTION
1. Background
In settlements of environmental enforcement cases, the U.S. Environmental Protection
Agency (EPA) will require the alleged violators to achieve and maintain compliance with
Federal environmental laws and regulations and to pay a civil penalty. To further EPA’s
goals to protect and enhance public health and the environment, in certain instances
environmentally beneficial projects, or Supplemental Environmental Projects (SEPs), may be
included in the settlement. This Policy sets forth the types of projects that are permissible as
SEPs, the penalty mitigation appropriate for a particular SEP. and the terms and conditions
under which they may become part of a settlement. The primary purpose of this Policy is to
encourage and obtain environmental and public health protection and improvements that may
not otherwise nave occurred W UIIJUt the sé iement’ incentives provided by this Policy.
In settling enforcement actions, EPA requires alleged violators to promptly cease the
violations and, to the extent feasible, remediate any harm caused by the violations. EPA also
seeks substantial monetary penalties in order to deter noncompliance. Without penalties,
companies would have an incenine to delay compliance until they are caught and ordered to
comply. Penalties promote environmental compliance and help protect public health by
deterring future violations by the same violator and deterring violations by other members of
the regulated community. Penalties help ensure a national level playing field by ensuring
that violators do not obtain an unfair economic advantage over their competitors who made
“C necessary expenditures to comply on time. Penalties also encourage companies to adopt
pollution prevention and recycling techniques, so that they minimize their pollutant
discharges and reduce their potential liabilities.
Statutes administered by EPA generally contain penalty assessment criteria that a
court or adminisu ative law judge must consider in determining an appropriate penalty at triai
or a hearing. In the settlement context, EPA generally follows these criteria in exercising its
discretion to establish an appropriate settlement penalty. In establishing an appropriate
penalty, EPA considers such factors as the economic benefit associated with the violations,
the gravity or seriousness of the violations, and prior history of violations. Evidence of a
violator’s commitment and ability to perform a SEP is also a relevant factor for EPA to
consider in establishing an appropriate settlement penalty. All else being equal, the final
se tlement penalty will be lower for a violator who agrees to perform an acceptable SEP
compared to the violator who does not agree to perform a Sk P.
P IE—Il October 1997
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RevisedSEPPolicy *** May1995 Page2
The Agency encourages the use of SEP While penalties play an important role in
environmernai protection by deterring violations and creating a level playing field, SEPs can
play an additional role in securing significant environmental or public health protection and
improvements) SEPs may not be appropriate in settlement of all cases, but they are an
Important part of EPA’s enforcement program. SEPs may be particularly appropriate to
further the objectives in the statutes EPA administers and to achieve other policy goals,
including promoting pollution prevention and environmental justice.
2. Pollution Prevention and Environmental Justice
The Pollution Prevention Act of 1990 (42 U.S.C. § 13101 et seq., November 5,
1990) identifies an environmental management hierarchy in which pollution Rshould be
prevented or reduced whenever feasible; pollution that cannot be prevented should be
recycled in an environmentally safe manner whenever feasible; pollution that cannot be
prevented or recycled should be treated in an environmentally safe manner whenever
feasible; and disposaJ or other release into the environment should be employed only as a last
resort ...‘ (42 U.S.C. §13103). In short, preventing pollution before it is created is
preferable to trying to manage, treat or dispoac of it after it is created.
Selection and evaluation of proposed SEPs should be conducted in accordance with
this hierarchy of enviromnernal management, i.e., SEPS involving pollution pL’eVentiOfl
techmque are preferred over other types of reduction or control strategies, and this can be
refl eted in the degree of d j rn accorcied to a”defend... itfrespondent before ca1c lation
of the final monetary penalty.
Further, there is an acknowledged concern, expressed in Executive Order 12898 on
environmental justice, that certain segments of the nation’s population are disproportionately
burdened by pollutant exposure. Emphasizing SEPs in conm.waities where environmental
Justice issues are present helps ensure that persons who spend significant portions of their
time in areas, or depend on food and water sources located near, where the violations occur
would be protected. Because environmental justice is not a specific technique or process but
an overarching goal, it is not listed as a category of SEP; but EPA encourages SEPs in
commjnjties where environmental justice may be an issue.
3. Using this Pohçy
Iii cvaluating a proposed project to determine if it qualifies as a SEP and then
determining how much penalty mitigation is appropriate, Agency enforcement and
compliance pe!sonnel should use the following five-step process:
(1) Ensure that the project meets the basic definition of a SEP. (Section B)
(2) Ensure that all legal guidelines, including nexus, are satisfied. (Section C)
Depending on circumstances and cost, SEPs also may have a detment impact.
October 1997 IVE—12
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_______RevisedSEPPolicy *** May1995 *S* Page3
(3) Ensure that the project fits within one (or more) of the designated categories of SEPs.
(Section D)
(4) Calculate the net-present after-tax cost of the project and then determine the
appropriate amount of penalty mitigation. (Section E)
(5) Ensure that the project satisfies all of the implementation and other criteria.
(Sections F, 0, H and I)
4. Applicability
This Policy revises and hereby supersedes the-February 12, 1991 Policy on the Use of
SS’PPlefnentoj Environme,ual Pjvjecxs in EPA SeulemenLc. This Policy applies to settlements
of all civil judicial and administrative actions filed after the effective date of this Policy, and
to all pending cases rn-which the government has not reached agreement in principle with the
alleged Violator on the specific terms of a SEP.
This Policy applies to all civil judicial and administrative enforcement actions taken
under the authority of the environmental stawtes and regulations that EPA administers. It
also may be used by EPA and the Deparunent of Justice in reviewing préposed SEPs in
settlement of citizen suits. This Policy also applies to federal agencies that are liable for the
payment of civil penalties. This Policy does not apply to settlements of claims for stipulated
, naltie ’ for ,iolatioiLs of consenp ecrees or othet’settlement agh ement4tquire7 ..itS. 2
c _ I - - a • cc_. . — p • 1’ - • . a
This is a set leinem Policy and thus is not intended for use by EPA, d feadani
LespOndçnts, courts or administrative law judges at a hearing or in a trial. Fuxther,whether
\the Agency decides to axep a l,1c EP a part of a s eme i p iIjwithth EPA’s
dlscretio i. Even though a project appears to satisfy allof the provi.siona of this Filicy, EPA
may decide, for one or more reasons, that a SEP is not appropriate (e.g.;ihe cest of
reviewing a SEP proposal is excessive, the oversight ts of the SEP may be too high, or
the defendant/respondent may not have the ability or reliability to complete the proposed
SEP).
This Policy establishes a framework for EPA to use in exercising its enforcement
discretion in determining appropriate settlements. In some cases, application of this Policy
may not be appropriate, in whole or part. In such cases, the liflVrnon team may, with the
advance approval of Headquarters, use an alternative or modified approach.
- F J
B. DEFiNITION AND KEY CHARAC1tRJST CS OF A SEP
Supplemental environmental projects are defined as environmentally benefrial
projet s which a defendant/respondent agrees to undertake in s tIement of an -enforv’ ’nent
2 The Agency is evalu2ting whether SEPs should be used, and if so. how, in evaluating claims
for stipulated penalties.
lyE—I 3 October 1997
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RevisedSEPPolicy May19
aetion, but which the defendant/respondent is not otherwise legally required to perform.
The three bolded key parts of this definition are elaborated below.
‘Environmentally beneficial’ means a SEP must improve, protect, or reduce risks to
public health, or the environment t large. While in some cases a SEP may provide the
alleged violator with certain benefits, there must be no doubt that the project primarily
benefits the public health or the environment.
“In settlement of an enforcement action’ means: 1) EPA has the opportunity to help
shape the scope of the project before it is implemented; and 2) the project is not commenced
until after the Agency has identified a violation (e.g., issued a notice of violation,
administrative order, or complaint). 3
“Not otherwise legally required to perfonn means’ the SEP is not required by any
federal, state or local law or regulation. Further, SEPs cannot include actions whieb the
defendant/respondent may be required to perform: as injunctive relief in the instant case; as
part of a settlement or order in another legal action; or by state or local requirements. SEPs
may include activities which the defendant/respondent will become legally obligated to
undertake two or more years in the future. Such ‘accelerated compliance’ projects are not
allowable, however, if the regulation or statute provides a benefit (e.g., a higher emission
limit) to the defendant/respondent for early compliance.
• Jso, the performance uf* .SEP cduces’oeither &e cwmn,ency nor tin& .ss.
require ments of Federal environmental statutes md reguJatiotu.. Of course, -performance of a
SEP does not alter the defendant/respondent’s obligation to remedy a violation expeditiously
and return to compliance.
C. LEGAL GUIDELINES
EPA has broad discretion to settle cases , including the discretion to include SEPs as
an appropriate part of the settlement. The legal evaluation of whether a propised SEP is
within EPA’s authority and consistent with all statutory and Constitutional requirements may
be a complex task. Accordingly, this Policy uses five legal guidelines to ensure that our
Since the primary purpose of this Policy is to obtain environmental or public health benefits
that may not have occurred “but for’ the settlement, projects which have been started before the
Agency has identified a violation are not eligible as SEPs. Projects which have been committt4 to or
started before the identification of a violation may mitigate the penalty in other ways. Depending on
the specifies, if a company had initiated environmentally beneficial projects before the enforcement
process Commenced, the initial penalty calculation could be lower due to the absence of recalcitrance,
no history of other violations, good faith efforts, less severity of the violations, or a shorter duration
of the violations.
October 1997 IVE—14
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Revised SEP Policy
May1995 *3*
Pages
SEPs are within the Agency’s and a federal court’s authority, and do not run afoul of any
Constitutionaj or statutory requirements. 4
1. All projects must have adequate nexus. Nexus is the relationship between the
violation and the proposed project. This relationship exists only if the project
remediates or reduces the probable overall environmental or public health impacts or
risks to which the violation at issue contributes, or if the project is designed to reduce
the likelihood that similar violations will occur in the future. SEPs are likely to have
anadequate nexus if theprimay impactof the project isat the site wherethealleged
violation occurred or at a different site in the same ecosystem or within the immediate
geographjc area. Such SEPS may have sufficient nexus even if the SEP addresses a
different pollutant in a different medium. In limited cases, nexus may exist even
though a project will involve activities outside of the United States. 6
2.
environment I sta that are the basis of the enforcement action. Further, a project
cannot be inconsistent with any provision of the underlying statutes.
3. EPA or any other federal agency may not play any role in managing or controlling
funds that may be set aside or escrowed for performance of a SEP. Nor may EPA
retain authority to managc or administer the SEP. EPA may, of course, provide
oversight to ensure that a project is implemented pursuant to the provisions of the
settlement and have legal recourse if the SEP is not adequately erforined.
- - . .
4. The type and scope of each project are determined in the signed settlement
agreement. This means the ‘what, where and when’ of a project are determined by
the settlement agreement. Settlements in which the defendant/respondent agrees to
spend a certain sum of money on a project(s) to be determined later (after EPA or the
Department of Justice signs the settlement agreement) are generally not allowed.
5. A project may not be something that EPA itself is required by its statutes to do.
And a project may not provide EPA with additional resources to perform an activity
for which Congress has specifically appropriated In additicin, a SEP should
rtaPPeartobeanexpansionofanexjstingEpAP am ForexampIe,ifEPA
developed a brochure to help a segment of the regulated community comply with
envronmental requirements, a SEP may not directly, or indirectly, provide additional
resources to revise, cony or distribute the brochure.
These legal guidelines are based on federal law asit applies to EPA; States may have more or
less flexibility in the use of SEPs depending on their laws.
The immediate geographic area will generally be the area within a 50 mile radius of the site on
which the violations occurred.
6 All projects which would-include activities outside the U.S. must be approved in advance by
Headquarters and/or the Department of Justice. See section 1.
IVE—1 5
October 1997
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Revised SEP PoLicy ‘ 0
D. CATEGORffS OF SUPPLEMENTAL ENVJRONMENTAL PROJECTS
EPA has identified seven categories of projects which may qualify as SEPS. In order
for a proposed project to be accepted as a : , ii must satisfy the requirements of at least
one category plus all the other requirements established in this Policy.
1. Public health
A public health project provides diagnostic, preventative andlor remedial components
of human health care which is related to the actual or potential damage to human health
caused by the violation. This may include epidemiological data collection and analysis,
medical examinations of potentially affected persons, collection and analysis of blood/fluid/
tissue samples, medical treatment and rehabilitation therapy.
Public health SEPS are acceptable only where the primary benefit of the project is the
population that was harmed or put at risk by the violations.
2. Pollution Prevention
A pollution p-evention project is one which reduces the generation of pollution
through ‘source reduction,’ i.e., any practice which reduces t1 amount of any hazardous
substance, pollutant or contaminant entering any waste stream or otherwise being released
into the environment, prior to recycling, treatment or disposal. (After the pollutant or waste
S ca in has been generated, pollution preventon is no longer poss 9e and the waste must be
handled by appropriate recycling, treatmen:, containment, or dispo..al methods.)
Source reduction may include equipment or technology modifications, process or
procedure modifications, reformulation or redesign of products, substitution of raw materials,
a... improvements in housekeeping, maintenance, training, inventory control, or other
operaticn and maintenance procedures. Pcllution preventiOn also i:!udes any project which
protects natural resources through conservation or increased efficiency in the use of energy,
water or other materials. ‘In-process recycling,’ wherein waste materials produced during a
manufacturing process are returned directly to production as raw materials on Site, is
considered a pollution prevention project.
In all cases, for a project to meet the definition of pollution prevention, there must be
an overall decrease in the amount and/or toxicity of pollution released to the environment,
not merely a transfer of pollution among media. This decrease may be achieved directly or
through increased efficiency (conservation) in the use of energy, water or other mate- - ‘
This is consistent with the ! llutjpn Prevention Act of 1990 and the Administrator’s
‘Pollution Prevention Policy Statement: New Directions for Environmental Protection,’
dated June 15, 1993.
October 1997 IVE—16
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_______RevisedSEPpolicy May1995 *** Page7
3. . olluuon Reduction
If the pollutant or waste stream already has been generated or released, a pollution
reduction approach — which employs recycling, treatment, contaiiunent or disposal
techniques — may be app.-opriate. A pollution reduction project is one which results ma
decrease in the amount and/or toxicity of any hazardous substance, pollutant or contaminant
entering any waste stream or otherwise being released into the environment by an operating
business or facility by a means which does not qualify as pollution prevention.’ This may
include the installation of more effect.ve end-of-process control or treatment technology.
This also includes ‘out-of-process recycling,’ wherein industrial waste collected after the
manufacturing process and/or consumer waste materials are used as raw materials for
production off-site, reducing the need for treatment, disposal, or coasuinption of energy or
nsw resources.
4. nvimnment Restoration and Protection
An envronmental restoration and protection project is ne which goes beyond
repairing the damage caused by the violation to enhance the condition of the ecosystem or
immediate geographic area adversely affected. 7 These projects may be used to restore or
protect natural environments (such as ecosystems) and man-made environments, such as
facilities and iuildings. Also hThluded is any project’which the ecosystem from
ac .ai c potent aJ damage resulting from line violation or improves ndjtjon of
the ect ystem. Examples of such projects include: reductiqas in diicl á of pollutants
which are not the subject of the violation to an affected air basinor watershed; restoration of
a wetland along the same avian flyway in which the facility is located ; cr Purchase and
management of a watershed area by the defendant/respondent to protect a drinking water
supply wnere the violation, e.g., a reporting violation, did not directly damkge the watershed
but polentiajly could lead to damage due to unreported discharges. This Categoc also
includes projects which provide for the protection of endangered species (e.g., developing
conservation programs or protecting habitat critical to the well-being of a species endangered
by the violation).
With regards to man-made environments, such projects may involve the remediauon
of facilities and buildings, provided such activities are not otherwise legally required. This
includes the removal/mitigation of contaminated materials, such as soils, asbestos and leaded
paint, which are a continuing source of releases and/or threat to individuals.
5. Assessments and Audits
Assessments and audits, if they are not otherwise available as injunctive relief, are
potentiai SEPS under this category. There are four types of projects in this category:
a. pollution prevention assessments; b. site assessments; C. environmental management
system audits; and d. compliance audits.
EPA lacks authority to require repair, then repair itself may constitute a SEP.
lyE—I 7 October 1997
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RevisedSEPPolicy May1995 *** Page8
a. Pollution prevention assessments are systematic, internal reviews of specific
processes and operations designed to identify aI.u ovide information about opportunities to
reduce the use, production, and generation of toxic and hazardous materials and other
wastes. To be eligible for SEPs, such assessments must be conducted using a recognized
pollution prevention assessment or waste minimization procedure to reduce the likelihood of
future violations.
b. Site assessments are investigations of the condition of the environment at a site or
of the environment impacted by a site, and/or investigations of threats to human health or the
environment relating to a site. These include but are not limited to: investigations of levels
and/or sources of contamination in any environmental media at a site; investigations of
discharges or emissions of pollutants at a site, whether from active opetat one or through
passive transport mechanisms; ecological surveys relating to a site; natural resource damage
assessments; and risk assessments. To be eligible for SEPs, such assessments must be
conducted in accordance with recognized protocols, if available, applicable to the ty’e of
assessment to be undertaken.
c. An environmer.tal mana2ement system audit is an independent evaluation of a
party’s environmental policies, practices and controls. Such evaluation may encompass the
need for: (1) a formal corporate environmental compliance policy, and procedures for
implementation of that policy; (2) educational and training programs for employees; (3)
equipment purchase, operation and maintenance programs; (4) nvironmental c -- pliance
officer progr ms; (5) budgeting ‘i id planning sy . tems for environmental compliance; [ 5)
monitoring, record keeping and reporting systems; (7) in-plant and community emergency
plans; (8) internal communications and control systems; and (9) hazard identification, risk
assessment -
d. Ar environmental compliance audit is an independent evaluaLun of a
defendant/respondent’s compliance status with environmental requirements. Credit is only
given for the costs associated with conducting the audit. While the SEP should require all
violations discovered by the audit to be promptly corrected, no credit is given for remedying
the violation since persons are required to achieve and maintain compliance with
environmental requirements. In general, compliance audits are acceptable as SEPs only
when the defendant/respondent is a small business 8 9
- These two types of assessments and environmental management system audits are
allowable as SEPs without an implementation commitment by the defen4ant/respondent
-
8 For purposes of this Policy, a small business is owned by a person or another entity that
employs 100 or fewer individuals. Small businesses could be individuals, privately held corporations,
farmers, landowners, partnerships and others.
Since most large companies routinely conduct compliance audits, to mitigate penalties for such
audits would reward violators for performing an activity that most companies already do. In
contrast, these audits are not commonly done by small businesses, perhaps because such audits may
be too expensive.
October 1997 PIE—I 8
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Revised SEP Policy * * * May 1995 * * $ Page 9
Implementation is not required because drafting implementation requirements before the
results of the study are known is difficult. Further, for pollution prevention assessments and
environmental management systems audits, many of the implementation recommendations
from these studies may constitute activities that are in the defendantf respondent’s own
economic interest.
These assessments and audits are acceptable where the primary impact of the project
is at the same facility, at another facility owned by the violator, or at a different facility in
the same ecosystem or within the immediate geographic area (e.g., a publicly owned
ewater treatment works and its users). These assessments and audits are only acceptable
as SEPs when the defendant/respondent agrees to provide EPA with a copy.
6. Environmental Compliance Promotion
An environmental compliance promotion project provides training or technical support
to other members of the regulated community to: 1) identify, achieve and maintain
cxnnpliance with applica e statutory and regulatory requirements; 2) avoid committing a
violation with respect to such staxutcny and regulatory requirements; or 3) go beyond
omphance by reducing the generation, release or disposal of pollutants beyond legal
requirements. For these types of projects, the defendant/respondent may lack the experience,
knowledge or ability to implement the project itself, and, if so, the defendant/respondent -
should be required to contract with an appropriate expM to develop ai ipipI ment the
compliance prothotion project. Acceptable projects may Include, for çx mj,1e:producing or
sponsoring a seminar directly related to correcting widespread or prevalent violations within
hfndant/ respondent’s economic sector.
- Environmental compliance promotion SEPs are acceptable only where the primary
impact of the project is focused on the same regulatory program requirements which were
violated and where EPA has reason to believe that compliance in the sector would be
significantly advanced by the proposed project. For example, if the alleged violations
involved Clean Water Act pretreatment violations, the compliance promotion SEP must be
directed at ensuring compliance with pretreatment requirements.
7. Emergency Planning and Preparedness
An emergency planning and preparedness project provides assistance — such as
computers and software, communication systems, chemical emission detection and
inactivation equipment, HAZMAT equipment, or training - to a responsible stale or local
emergency response or planning entity. This is to enable these org*nizations to fulfill heir
obligations under the Emergency Planning and Community Right-to-Know Act (EPCRA) to
collect information to assess the dangers of hazardous chemicals present at facilities within
their jurisdiction, to develop emergency response plans, to train emergency response
personnel and to better respond to chemical spills.
EPCRA requires regulated sources to provide information on chemical production,
storage and use to State Emergency Response Commissions (SERCs), Local Emergency
IVE—19 October 1997
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Revised SEP Policy * * * May 1995 * * * Page 10
Planning Committees (LEPCs) and Local Fire Departments (LFDs). This enables states and
local communities to plan for and respond effectively to chemical accidents and inform
potentially affected citizens of the risks posed by chemicals present in their communities,
thereby enabling them to protect the environment or ecosystems which could be damaged by
an accident. Failure to comply with EPCRA impairs the ability of states and local
communities to meet their obligations and places emergency response personnel, the public
and the environment at risk from a chemical release.
Emergency planning and preparedness SEPs are acceptable where the primary impact
of the project is within the same emergency planning district or state affected by the
violations. Further, this type of SEP is allowable only when the SEP involves non-cash
assistance and there are violations of EPCRA or reporting violations under CERCLA § 103
alleged in the complaint.
8. Projects Which Are Not Acceptable as SEPs
Except for projects which meet the specific requirements of one of the categories
enumerated in § D. above, the following are examples of the types of projects that are not
allowable as SEPs:
a. General educational or public environmental awareness projects, e.g.,
sponsoring public seminars, conducting tours of environmental ctMltrols at a facility,
promoting recycling in a community;
b. Contribution to environmental reiearch at a college or university;
c. Conducting a project, which, though beneficial to a community, is unrelated to
environmental protection, e.g., making a contribution to charity, or donating
playground equipment;
d. Studies or assessments without a commitment to implement the results (except
as provided for in § D.5 above);
e. Projects which are being funded by low-interest federal loans, federal
contracts, or federal grants.
E. CALCULATION OF TL fl1NAL PENALTY
As a general rule, the costs to be incurred by a violator in performing a SEP may be
considered in determining an appropriate settlement amount. Calculating the fThal penalty in
a settlement which includes a SEP is a three-step process. First, the Agency’s penalty
policies are used as applicable to calculate all of the other parts of the settlement penalty
(including economic benefit and gravity components). Second, calculate the net-present
after-tax cost of the SEP. Third, evaluate the benefits of the SEP. based on specific factors,
October 1997 IVE—20
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Revised SEP Policy * * * May 1995 * * * Page 11
to determine what percentage of the net-present after-tax c i will be considered in
determining an appropriate final settlement penalty.
1. Penalty
Penalties are an important part of any settlement. A ubstantial penalty is generally
necessary for legal and policy reasons. Without penalties there would be no deterrence as
regulated entities would have little incentive to comply. Penalties are necessary as a matter
of fairness to those companies that make the necessary expenditures to comply on time:
violators should not be allowed to obtain an economic advantage over their competitors who
complied. Except in extraordinary circumstances, if a settlement includes a SEP. the penalty
should recover, at a minimum,the economic benefit of noncompliance plus 10 percent of the
gravity component, or 25 percent of the gravity component only, whichever is greater.
In cases involving government agencies or entities, such as municipalities, or non-
profit organizations, where the circumstances warrant, EPA may determIne, base4 on the
nature of the SEPs being proposed, that an appropriate settlement could contain a cash
penalty less than the economic benefit of non-compliance. The precise amount of the cash
penalty will be determined by the applicable penalty policy.
2.. alculaiion ofTh Cost of the SEP
Toens n that a proposed SEP is coasis ent with this POhcy,’Jbe net pr ent after-tax
.. c tcftb SEP, hereinafter called the SEP Cost, is ca1cnla 4.1i1 rderKi, jlitate
.aluatiod of the SEP Cost of a proposed SEP. the Agethy has dei elopëd *pputer model
Ca1IeIiPI(OJECF. To use PROJECT, the Agency needs reliable estimates ofth costs and
savings associated with a deftn nt/respondent’s performance of a SEP. Often the costs will
not be estimates but known amounts based on a defendant/respondent’s agreement to expend
a fixed or otherwise known dollar amount on a project.
There are three types of costs that may be associated with performance of a SEP
(which are entered into the PROJECT model): capital costs (e.g., equipment, buildings);
one-time nondepreciable costs (e.g.., removing contaminated materials, purchasing land,
developing a compliance promotion seminar); and annual operation costs or savings (e.g.,
labor, ‘themicals, water, power, raw materials). 10
In order to run the PROJECT model properly (i.e., to produce a reasonable estimau
of the net present after-tax cost of the project), the number of years that annual operation
costs or savings will be expended in performing the SEP must be specified. At a i inimum,
the defendant/respondent must be required to implement the project for the same ñmfmber of
10 PROJECT does nn eva1u2 the potential for market benefits which may rue with the
performance of a SEP (e.g., increased sales of a product, improved corporate public image, or
improved employee morale). Nor does it consider costs imposed on the government. such as the cost
to the Agency for oversight of the SEP, or the burden of a lengthy negotiation with a defendantl
respondent who does not propose a SEP until late in the ssttIem m process.
IVE—21 October 1997
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RevisedSEPPolicy * . * May1995 $*$ Page I2
years used in the PROJECT model calculation -enain costs or savings appear
speculative, they should not be entered into the PROJECT model. The PROJECT model is
the primary method to determine the SEP cost for purposes of negotiating settlements.”
EPA does not offer tax advice on whether a company may deduct SEP expenditures
from its income taxes. If a defendant/respondent states that it will not deduct the cost of a
SEP from its taxes and it is willing to commit to this in the settlement document, and provide
the Agency with certification upon completion of the SEP that it has not deducted the SEP
expend iwres, the PROJECT model calculation should be adjusted to calculate the SEP Cost
without reductions for taxes. This is a simple adjustment to the PROJECT model: just enter
a zero for variable 7, the marginal tax rate. If a business is not willing to m ke this
commitment, the marginal tax rate in variable 7 should not be set to zero; rather the default
settings (or a more precise estimate of the business’ marginal tax rates) should be used in
variable 7.
If the PROJECT model reveals that a project has a negative cost, this means that it
represents a positive cash flow to the defendant/respondent and asa profitable project thus,
generally, is not acceptable as a SEP. If a project generates a profit, a defendant/respondent
should, and probably will, based on its own economic interests, implement the project.
While EPA encourages companies to undertake environmentally beneficial projects that are
economically profitable, EPA does not believe violators should receive a bonus in the form
of penalty-n’itigauon to undertake such projectc as part of an enforcement action. EPA doeS
not oL r subsidies to complyingcompaniesto undertake proflLble environmc .Jly beneficial
projects and it would thus be inequitable and perverse to provide such subsidies oulyto
violators. In addition, the primary goal o SEPs is. to secure a favorable environmental or
publle health outcome which would not have occurred but for the enforcement case
settlement. To allow SEP penalty mitigation f&r profitable projects would thwart this
goa 1•I /
3. Penalty Mitigation
After the SEP Cost has been calculated, EPA should determine what percentage of
that cost may be applied as mitigation against the preliminary total calculated gravity
component before calculation of the final penalty. The SEP should be examined as to
whether and how effectively it achieves each of the following five factors listed below.
See PROJECT User’s Manual, January 1995. If the PROJECT model appe rs inappropriate to
a particular fact situation, EPA Headquarters should be consulted to identify an alternative approach.
For example, the December 1993 version of PROJECT does not readily calculate the co t of an
aceelerated compliance SEP. The cost of such a SEP is the additional cost associated With doing the
project early (ahead of the regulatory requirement) and it needs to be calculated in a slightly different
man . -
The penalty mitigation guidelines in subsection E.3 provide that the amount of mitigation
should not exceed the net cost of the project. To provide penalty mitigation for profitable projects
would be providing a credit in excess of net costs.
October 1997
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RevisedSEPPolicy May1995 Pagel3
• Benefits to the Public or Environment at Large . While all SEPs benefit public health
or the environment, SEPs which performwell on this factor will result in significant
and quantifiable reduction in discharges of pollutants to the environment and the
reduction in risk to the general public. SEPs also will perform well on this factor to
the extent they result in significant and, to the extent possible, measurable progress in
protecting and restoring ecosystems (including wetlands and endangered species
habitats).
• Thnovativeness . SEPs which perform well on this factor will further the development
and implementation of innovative processes, technologies, or methods which more
effectively: reduce the generation, release or disposal of pollutants; conserve natural
resources; restore and protect ecosystems; protect endangered species; or promote
compliance. This includes ‘technology forcing’ techniques which may establish new
regulatory ‘benchmarks.’
• Environmentai Iu tjç . SEPs which perform well on this factor will mitigate damage
or reduce risk to minority or low income populaions which may have been
disproportioflately exposed to pollution or are at environmental risk.
• Multimedia Impacts . SEPS which perform well on this factor will reduce emissions to
more than one medium.
• . PolIut on Prevention . SEPS which perform well on this factor will devel p and-
Jmplenpefltr ollution prevention techniq ies and practices.
- . “ f - - .
‘ j rhe t’e re r the perfonnance of the SEP under each of these factory, the higher the
percentage may be set. As a general guideline,- the final mitigatioti percentage
should not exceed 80 percent of the SEP Cost. For smail businesses, government agencies
orenthies, and non-proiit organizations, this percentage may be set as high as 100 percent.
For -ahy (Iefendantlrespondent, if one of the five factors is pollution prevention, the
percentage may be set as high as 100 percent. A lower mitigation percentage may be
appro ,r axe if the government must allocate significant resources to monitoring and reviewing
the impiementation of a project.
In administrative enforcement actions in which there is a statutory limit on
administrative penalties, the cath penalty obtained plus the amount of penalty mitigation
credit due to the SEPs shall not exceed the statutory administrative penalty limit.
F. PERFORMANCE BY A THIRD PARTY
SEPs are generally performed either by the defendantfrespondent itself (using its own
employees) and/or by contractors or consultants.’ 3 In the past in a few cases, a SEP has
‘ Of course, non-profit organi tions, such as universities and public interest groups, may
function as contractors or consultants.
IVE—23 October 1997
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RevisedSEPPolicy May1995 *** Page l4
been performed by someone else, commonly called a third party. Because of legal concerns
and the difficulty of ensuring that a third party implements the project as required (since by
definition a third party has no legal or contractual obligation to implement the project as
specified in the settlement document), performance of a SEP by a third party is not allowed.
G. OVERSIGHT AND DRAFFING ENFORCEABLE SEPS
The settlement agreement should accurately and completely describe the SEP. (See
rc ated legal guideline 4 in § C above.) It should describe the specific actions to be
performed by the defendant/respondent and provide for a reliable and objective means to
verify that the defendant/respondent has timely completed the project. This may require the
defendant/respondent to submit periodic reports to EPA. If an outside auditor is necessary to
conduct this oversight, the defendant/respondent should be made responsible for the cost of
any sdch activities. The defendant/respondent remains responsible for the quality and
timeliness of any actions performed or any reports prepared or submitted by the auditor. A
final report certified by an appropriate corporate official, acceptable to EPA and evidencing
completion of the SEP. should be required.
To the extent feasible, defendant/respondents should be required to quantify the
benefits associated with the project and provide EPA with a report setting forth how the
benefits were measured or estimated. The defendant/respondent sh 1 suld agree that whenever
itpublicizes a SEP or the results of the SEP. ii will state in a prominent manner that the
DIolect is being undertaken as part of the settlement of an enforcement action .
The drafting of a SEP will vary depending on whether the SEP is being performed as
pan of an administrative or judicial enforcement action. SEPs with long implementation
schedules (e.g., 18 month or longer), SEPS which require EPA review and comment on
interim milestone activities, and other complex SEPs may not be appropriate in those
administrative enforcement actions where EPA lacks injunctive relief authority or is subject
to a penalty ceiling. Specific guidance on the proper drafting of SEPs will be provided in a
separate guidance document.
H. FAILURE OF A SEP AND STIPULATED PENALTIES
If a SEP is not ccrnpleted satisfactorily, the defendant/respondent should be required,
pursuant to the terms of the settlement document, to pay stipulated penalties for its failure.
Stipulated penalty liability should be established for each of the scenarios set forth below as
appropriate to the individual case.
1. Except as provided in paragraph 2 immediately below, if the SEP is not
completed satisfactorily, a substantial stipulated penalty should be required.
Generally, a substantial stipulated penalty is between 50 and 100 percent of the
amount by which the settlement penalty was mitigated on account of the SEP.
October 1997 IVE—24
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RevisedSEPPolicy *** May1995 *S* PagelS
2. If the SEP is not completed satisfactorily, but the defendant/respondent:
a) made good faith and timely efforts to complete the project: ..nd b) certifies,
with supporting documentation, that at least 90 percent of the amount of
money which was required to be spent was expended on the SEP, no stipulated
penalty is necessary.
3. If the SEP is satisfactorily completed, but the defendant/respondent spent less
than 90 percent of the amount of money required to be spent for the project, a small
stipulated penalty should be required. Generally, a small stipulated penalty is
between 10 and 25 percent of the amount by which the settlement penalty was
mitigated on aceount of the SEP.
4. If the SEP is satisfactorily completed, and the defendant/respondent spent at
least 90 percent of the amount of money required to be spent for the project, no
stipulated penalty is necessary.
The detern inations of whether the SEP has been satisfactorily mpIeted i.e., pursuant to
the terms of the agreement) and whether the defendant/respondent has made a good faith,
timely effort to implement the SEP is in the sole discretion of EPA.
V. ‘CPA
flie aütháilty.of a governInent official to appro aSEPis bfflcial’s
ailth6r ’• io &tIe an enforcement ease and thus, subject to the e ii&p t nith’here, no
speclal approvals are required. The special approvals apply to t th ádniiñistrative and
judicial eziforciément actions as follows:’ 4 -
a. Regions in which a SEP is proposed for implementation shall be given the
àpportunityto review and comment on the proposed SEP.
b.
Policy, the SEP must be approved by the EPA Assistant Administrator for
Enforcement and Compliance Assurance.
c. In all cases in which a SEP would involve activities outside the United States,
the SEP must be approved in advance by the Assistant Administrator and, for
judicial cases only, the Assistant Attorney General for the Environment and
Natural Resources Division of the Department of Justice.
In judicial cases, the Department of Justice must approve the SEP.
IVE—25 October 1997
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RevisedSEPPolicy May1995 *** Page l6
d. In all cases in which a SEP includes an environmental compliance promotion
project, the SEP must be apprc, )y the Office of Regulatory Enforcement in
OECA. With time, this approval requirement may be delegated to Regional
officials.
2. Documentation and Conlidentiality
In each case in which a SEP is included as part of a settlement, an expl2n2tion of the
SEP with supporting materials (including the PROJECT model printout, where applicable)
must be included as part of the case file. The explanation of the SEP should demnistrax
that the five criteria set forth in Section A.3 above are met by the project and include a
description of the expected benefits associated with the SEP. The explanation must include a
description by the enforcement attorney of hownexus and the other legal guidelines are
satisfied. -.
Documentation and explanations of a particujar SEP may constitute confidential
settlement information that is exempt from disclosure under the Freedom of Information Act,
Is outside the scope of discovery, and is protected by various privileges, including the
attorney-client privilege and the attorney work-product privilege. While indwidual Agency
evaluations of proposed SEPs are confidential documents, this Policy is a public document
and may be released to anyone upon request.
This Policy is primarily for the use ‘J S. EPA eifo ersoinélin se#liFg
EPA serves the right to change this Policy at any time, i thowp ior nptice,
.ol o act at variance to this Policy. This Policy does ,w - :reate any r h *, didies , or
obkgótions, implied or oziwri se, in any rhi,d parties.
October 1997 IVE—26
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Example IV—3. Consent Agreement — Schedule of Activities
CONSENT AGREEMENT - SCHEDULE OF ACTMTIES
(Effective date November 3, 1987)
Provision in
Stipulated
Day / the Consent Activi%y Received P rialties
AIreement
—
60 Scope of Work (Audit) 1/4/88
LQ! 9 1 8 J ..
— —
Outline & Schedule for Employee 1/4/88 $100/day
— — — - - - - - - -___I! !!i9.AY ) — —
—
90 Plan/Schedule for test inputs Intenni 2/1/88
Report #1 ( udit1 2/1/88 $100/dav
120 Complete Training (USA) 3/2/88
$50/day
(March 2, 1988)
Letters sent to Customs 312/88 $50/day
Procedures developed for 3/2/88
- PMNs and their submissions
- Determining Status of proposed
imports
-Bonafide Intent Letters
180 Intenm Report #2 (Audit) 4/2/88
$100/day
(May 2, 1988)
Guidance Manual to EPA 4/2188
Develop & Implement Import Agreement 4/2188
wrth.
- Suppliers
---- —
210 Complete Test Inputs Complete Training (Sent in j)
[ May 3 l,i 988 J
270 Intenm Report #3 (Audit) 7/29/88
$100/day
(July 30, 1988)
Attorney’s Report re UK Establish 8/1/88
Procedures
290 Termination Date of Audit $500/day
--—-—— -- -——-—--——— -——-----—
325 Final Report to EPA 9/23/88
(September 23, 1988)
-------
Provision in
the Consent
Acireement
Activity
Pay $1,000,000 civil penalty
Summary of Past Employee
Schedule of Future Employee
Training Sessions
Schedule for EPA to perform
seminar for semi-conductor
lntenm Report #1
(one Reportable Event - 8(c))
L3ulday
up to
$50,000
* Day #lis July 1. 1987 which is the first day after the effective date (June 30, 1987) of the CAFO in this
matter
Days for these training sessions will be added to the compliance schedule at day 90.
Day
60
(August 30, 1987)
**90
(September 29, 1987)
Stipulated
Received Penalties
• 8/17/87 $100/day
8/19/87
8/19/87 : $100/day
8/10/87 : $50/day
9/1/87 $50/day
4/15/88
9/22/87 $250/day
upto
$50,000
¶ist of Trade Magazines for
Public Service Announcements
Published
Gui 11
(December 28, 1987) : :12/22/87)
lntenm Report #2 12/14/87 $250/day
(No Reportable Event) : up to
$5Q000
270 * lntenm Report #3 T3/ /88i250Th
(March 27, 1988)
360 :
(June 25, 1988)
420 :
(August24, 1988) :
—— —__ _ _ __ ______L. _..... ......
465
(October 8, 1988)
(one Reportable Event up to
per!efter -5,PMN $50,000
lntenm Rep& 7 8o7J
upto
$50,000
Termination of Survey
: upto
$15,000
Final Report
October 1997
IVE—28
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V. Other Actions
-------
V. OTHER ACTIONS
-------
V. OThER ACTIONS . v—i
VA SEIZURES . . .. V—I
I Statutory/Regulatory Requirements V—I
2 Case Law . . . . V—2
3 Special Considerations . . . . . . .. . .. V—2
4 Process .. . . . .. . .. V—2
V.B. STOP SALE, USE, OR REMOVAL ORDERS . . . . V—3
I Statutory/Regulatory Requirements . V—3
2. Case Law . ... V—3
3 Special Considerations . .. .. V—4
4 Process v—
V.C RECALL . . . .. .. .. V—5
1 Statutory/Regulatory Requirements .. .. V—5
2 Case Law . . V—6
3 Special Considerations . . V—6
4 Process .. . . . . . . . V—6
V D CIVIL JUDICIAL PROCEEDINGS . .. . . . V—7
I Statutory/Regulatory Requirements ... . . . . . .. V—7
2. Case Law . . . . . V—9
3 Special Considerations ... . . V—Il
4 Process . V—Il
V.E CRIMINAL. PROCEEDINGS . .. V—Il
I Statutory/Regulatory Requirements .... .... V—Il
2 Case Law V—12
3 Special Considerations .... V—l3
4. Process .. .. . . . . V—13
V F NOTICE OF WARNING/NOTICE OF NONCOMPLIANCE/NOTICE OF CONTEMPLATED PROCEEDINGS . V—l3
1. Statutory/Regulatory Requirements V—l3
2. Case Law . V—14
3. Special Considerations V—14
4. Process. . V—15
V.G. OTHERACTIONS MATRIX . . V—15
-------
V. OTHER ACTIONS
V.A. Seizures
1. Statutory/Regulatory Requirements
FIFRA Section 13:
(b) Seizure.—Any pesticide or device that is being transported, or having been transported,
remains unsold or in original unbroken packages, or that is sold or offered for sale in any
State, or that is imported from a foreign country, shall be liable to be proceeded against in
any district court in the district where it is found and seized for confiscation by a process in
rem for condernriat ion if—
(1) in the case of a pesticide—
(A) it is adulterated or misbranded;
(B) it is not registered pursuant to the provisions of section 3;
(C) its labeling fails to bear the information required by this Act;
CD) it is not colored or discolored and such coloring or discoloring is required under this
Act; or
CE) any of the claims made for it or any of the directions for its use differ in substance from
the representations made in connection with its registration;
(2) in the case of a device, it is misbranded; or
(3) in the case of a pesticide or device, when used in accordance with the requirements
imposed under this Act and as directed by the labeling, it nevertheless causes
unreasonable adverse effects on the environment.
In the case of a plant regulator, defoliant, or desiccant, used in accordance with the label
claims and recommendations, physical or physiological effects on plants or parts thereof
shall not be deemed to be injury, when such effects are the purpose for which the plant
regulator, defoliant, or desiccant was applied.
Cc) Disposition after condemnation.—If the pesticide of device is condemned it shall, after
entry of the decree, be disposed of by destruction or sale as the court may direct and the
proceeds, if sold, less the court costs, shall be paid into the Treasury of the United States,
but the pesticide or device shall not be sold contrary to the provisions of this Act or the laws
V—I October 1997
-------
V.A. Seizures V. Om AclioNs
of the jurisdiction in which it is sold. On payment of the costs of the condemnation
proceedings and the execution and delivery of a good and sufficient bond conditioned that
the pesticide or device shall not be sold or otherwise disposed of contrary to the provisions
of the Act or the laws of any jurisdiction in which sold, the court may direct that such
pesticide or device be delivered to the owner thereof. The proceedings of such
condemnation cases shall conform, as near as may be to the proceedings in admiralty,
except that either party may demand trial by jury of any issue of fact joined in any case,
and all such proceedings shall be at the suit of and in the name of the United States.
(d) Court costs, etc.—When a decree of condemnation is entered against the pesticide or
device, court costs and fees, storage, and other proper expenses shall be awarded against
the person, if any, intervening as claimant of the pesticide or device.
TSCA Section 17(b):
Seizure.--Any chemical substance or mixture which was manufactured, processed, or
distributed in commerce in violation of this Act or any rule promulgated or order issued
under this Act or any article containing such a substance or mixture shall be liable to be
proceeded against, by process of libel for the seizure and condemnation of such
substance, mixture, or article, in any district court of the United States within the jurisdiction
of which substance, mixture, or article is found. Such proceedings shall conform as nearly
as possible to proceedings in rem in admiralty.
2. Case Law
None.
3. Special Considerations
Seizure is a rarely used remedy and has several drawbacks:
• the time to complete the process is far longer than for issuance of a stop sale;
• the seizure extends only to the goods at the particular site of seizure; and
• if unclaimed, the goods become the property of the government and must be disposed
of at the t cpayers’ expense.
4. Process
1. Consult with Attorney to discuss:
• advisability of implementing seizure action; and
• potential for alternative actions.
October1997 V—2
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V.B. Stop Sale, Use, or Removal Orders V. OTHER Aciiopis
2. Prepare a draft complaint.
3 Assist Attorney in preparing referral package.
4. Monitor compliance with seizure and any reconditioning of the goods.
5. Maintain a record of Agency costs for possible reimbursement.
V.B. Stop Sate, Use, or Removal Orders
1. Statutoiy/Regulatory Requirements
FIFRA Section 13(a):
Stop sale, etc., orders.—Whenever any pesticide or device is found by the Administrator in any
State and there is reason to believe on the basis of inspection or tests that such pesticide or
device is in violation of any of the provisions of this Act, or that such pesticide or device has
been or is intended to be distributed or sold in violation of any such provision, or when the
registration of the pesticide has been canceled by a final order or has been suspended, the
Administrator may issue a written or printed “stop sale, use, or removal” order to any person
who owns, controls, or has custody of such pesticide or device, and after receipt of such order
no person shall sell, use, or remove the pesticide or device described in the order except in
accordance with the provisions of the order.
2. Case Law
Inre: Fleming and Company .
I.F. &R. Docket Nos. VII-92C and Vfl-135C, InitialDecjsjon (1977)
Background:
The President of Fleming testified that its violation of the Stop Sale Order was the result of
an unusual circumstance and not a deliberate or conscious effort to the violate the Order.
The judge found this was not a defense.
Ruling:
Shipment of “returned” goods to another customer constitutes removal from custody and
control, and sale in violation of the Stop Sale, Use, or Removal order
V—3 October 1997
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V.B. Stop Sale, Use, or Removal Orders V. OTHER ACTIONS
In re: Coharie Mill and Supply Company, Inc
I.F. & R. Docket No. -04-8545-C
Background:
An EPA inspector found 14 cans of a suspended EBD pesticide. A Stop Sale and Removal
Order was issued and Coharie buried the cans. Coharie argued it had not been told how
to dispose of the product.
Ruling:
Burial of a pesticide under stop sale was not justified notwithstanding that
• the order contained no reference to disposal;
• a state inspector told the distributor to get rid of the pesticide; and
• the cans were deteriorating.
The order’s key word is “removed.” The terms of the order were sufficient to place upon the
distributor the duty of inquiring of EPA the proper method of disposal of the pesticide.
3. Special Considerations
Stop sale, use, and removal orders may be issued any time a pesticide is in violation of the
Act. However, stop sale, use, and removal orders are generally reserved for situations
involving a potential hazard to health or the environment. A stop sale order:
• can be expeditiously issued on the basis of a “reason to believe” a hazard exists;
• extends to all of the pesticide material under the custody or control of the person; and
• keeps the responsibility for disposal of the material with the person receiving the order.
4. Process
1. Identify violation and develop evidence to support the existence of a violation.
2. Prepare a complete description of the material to be stop saled including batch codes.
3. Prepare and issue the stop sale.
4. Monitor compliance with the order.
5. Vacate the order upon disposal or reconditioning of the material.
October1997 V—4
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V. OThER ACTIONS V.C. Recall
V.C. Recall
1. Statutoiy/Regulatory Requirements
FIFRA Section 19(b):
Recalls.—(1) Jn general.—If the registration of a pesticide has been suspended or canceled
under section 6, and if the Administrator finds that recall of the pesticide is necessary to
protect health or the environment, the Administrator shall order a recall of the pesticide in
accordance with this subsection.
(2) Voluntary recall.—If, after determining under paragraph (1) that a recall is necessary,
the Administrator finds that voluntary recall by the registrant and others in the chain of
distribution may be as safe and effective as a mandatory recall, the Administrator shall
request the registrant of the pesticide to submit, within 60 days of the request, a plan for the
voluntary recall of the pesticide. If such a plan is requested and submitted, the
Administrator shall approve the plan and order the registrant to conduct the recall in
accordance with the plan unless the Administrator determines, after an informal hearing
that the plan is inadequate to protect health or the environment.
(3) Mandatory recall.—J.f, after determining under paragraph (1) that a recall is necessary,
the Administrator does not request the submission of a plan under paragraph (2) or finds
such a plan to be inadequate, the Administrator shall issue a regulation that prescribes a
plan for the recall of the pesticide. A regulation issued
under this paragraph may apply to any person who is or was a registrant, distributor, or seller
of the pesticide, or any successor in interest to such a person.
(4) Recall procedure.—A regulation issued under this subsection may require any person
that is subject to the regulation to—
(A) arrange to make available one or more storage facilities to receive and store the
pesticide to which the recall program applies, and inform the Administrator of the location
of each such facility;
(B) accept and store at such a facility those existing stocks of such pesticide that are
tendered by any other person who obtained the pesticide directly or indirectly from the
person that is subject to such regulation;
(C) on the request of a person making such a tender, provide for proper transportation of
the pesticide to a storage facility; and
(D) take such reasonable steps as the regulation may prescribe to inform persons who may
be holders of the pesticide of the terms of the recall regulation and how those persons may
tender the pesticide and arrange for transportation of the pesticide to a storage facility.
V—5 October 1997
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V.C. Recall V. OThER ACTIONS
(5) Contents of recall plan.—A recall plan established under this subsection shall include—
(A) the level in the distribution chain to which the recall is to extend, and a schedule for
recall; and
(B) the means to be used to verify the effectiveness of the recall.
(6) Requirements or procedures.—No requirement or procedure imposed in accordance
with paragraph (2) of subsection (a) may require the recall of einsting stocks of pesticides
except as provided by this subsection.
2. Case Law
None.
3. Special Considerations
The voluntary/mandatory statutory recall provision was added to FIFRA in 1988 and relates
only to pesticides suspended and canceled under section 6. Prior to 1988, the Agency
requested informal/formal recalls for pesticides that were suspended, canceled, or
ineffective, or presented a hazard. Though not supported by statute, this voluntary program
came about as a result of congressional hearings. Informal/formal recalls provide the most
expeditious means of removing pesticides from channels of trade and may continue to be
used for these purposes. Failure to comply with an informal/formal recall will result in the
issuance of a stop sale, use, or removal order to the consignees of the pesticide in question.
4. Process
1. Identify the violation and develop evidence to support the violation and the hazard
presented.
2. Prepare a complete description of the material to be recalled and the level in the
distribution chain to which the recipient will be requested to remove the product.
3. Prepare and issue the recall.
4. Monitor the quantifies from each location returned.
5. Monitor the disposition of all returned material.
October1997 V—6
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V. 0m AcTioNs V.D. Civil Judicial Proceedings
V.D. Civil Judicial Proceedings
1. Statutory/Regulatory Requirements
FIFRA Section 16(c):
(c) Jurisdiction of district courts —The distnct courts of the United States are vested with
jurisdiction specifically to enforce, and to prevent and restrain violations of this Act.
(d) Notice of judgments.—The admirustrator shall by publication in such manner as he may
prescribe, give notice of all judgments entered in actions instituted under the authority of
this Act.
TSCA Section 1 7a:
Specific enforcement.—(1) The district courts of the United States shall have jurisdiction over
civil actions to—
(A) restrain any violation of section 15,
(B) restrain any person from taking any action prohibited by section 5 or 6 or by a rule or
order under section 5 or 6,
(C) compel the taking of any action required by or under this Act, or
(D) direct any manufacturer or processor of a chemical substance or mixture manufactured
or processed in violation of section 5 or 6 or c i rule or order under section 5 or 6 and
distributed in commerce, (i) to give notice of such fact to distributors in commerce of such
substance or mixture and, to the extent reasonably ascertainable, to other persons in
possession of such substance or mixture or exposed to such substance or mixture, (ii) to give
public notice of such risk of injury, and (iii) to either replace or repurchase such substance or
mixture, whichever the person to which the requirement is directed elects.
(2) A civil action described in paragraph (1) may be brought—
(A) in the case of ci civil action described in subparagraph (A) of such paragraph, in the
United States district court for the judicial district wherein any act, omission, or transaction
constituting a violation of section 15 occurred or wherein the defendant is found or transacts
business, or
(B) in the case of any other civil action described in such paragraph, the United States
district court for the judicial district wherein the defendant is found or trarisacts business. In
any such civil action process may be served on a defendant in any judicial district in which a
defendant resides or may be found. Subpoenas requiring attendance of witnesses in any
such action may be served in any judicial district.
V—7 October 1997
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V.D. Clvii Judicial Proceedings V. OThER AcTioNs
TSCA Section 7:
(a) Actions authorized and required.—(1) The Administrator may commence a civil action in
an appropriate district court of the United States—
(A) for seizure of an imminently hazardous chemical substance or mixture or any article
containing such a substance or mixture,
(B) for relief (as authorized by subsection (b)) against any person who manufactures,
processes, distributes in commerce, or uses, or disposes of, an imminently hazardous
chemical substance or mixture or any article containing such a substance or mixture, or
(C) for both such seizure and relief.
A civil action may be commenced under this paragraph notwithstanding the existence of a
rule under section 4, 5, or 6 or an order under section 5, and notwithstanding the pendency of
any administrative or judicial proceeding under any provision of this Act.
(2) If the Administrator has not made a rule under section 6(a) immediately effective (as
authorized by subsection 6(d)(2)(A)(i)) with respect to an imminently hazardous chemical
substance or mixture, the Administrator shall commence in a district court of the United
States with respect to such substance or mixture or article containing such substance or
mixture a civil action described in subparagraph (A),(B), or (C) or paragraph (1).
(b) Relief authorized.—(1) The district court of the United States in which an action under
subsection (a) is brought shall have jurisdiction to grant such temporary or permanent
relief as may be necessary to protect health or the environment from the unreasonable risk
associated with the chemical substance, mixture, or article involved in such action.
(2) In the case of an action under subsection (a) brought against a person who
manufactures, processes, or distributes in commerce a chemical substance or mixture or an
article containing a chemical substance or mixture, the relief authorized by paragraph (1)
may include the issuance of a mandatory order requiring (A) in the case of purchasers of
such substance, mixture, or article known to the defendant, notification to such purchasers of
the risk associated with it; (B) public notice of such risk; (C) recall; (1)) the replacement or
repurchase of such substance, mixture, or article; or CE) any combination of the actions
described in the preceding clauses.
(3) In the case of an action under subsection (a) against a chemical substance, mixture,
or article, such substance, mixture, or article may be proceeded against by process of libel
for its seizure and condemnation. Proceedings in such an action shall conform as nearly
as possible to rem in admiralty.
(c) Venue and consolidation.—(l)(A) An action under subsection (a) against a person who
manufactures, processes or distributes a chemical substance or mixture or an article
October 1997 V—8
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V. OmEJ ACTIONS V.D. Civil Judicial Proceedings
containing a chemical substance or mixture may be brought in the United States District
Court for the District of Columbia or for any judicial district in which any of defendants is
found, resides, or transacts business; and process in such an action may be served on a
defendant in any other district in which such defendant resides or may be found. An action
under subsection (a) against a chemical substance, mixture, or article may be brought in
any United States district court within the junsdiction of which the substance, mixture, or
article is found.
(B) In determining the judicial district in which an action may be brought under
subsection (a) in instances in which such action may be brought in more than one judicial
district, the Administrator shall take into account the convenience of the parties.
(C) Subpoenas requiring attendance of witnesses in an action brought under subsection
(a) may be served in any judicial district.
(2) Whenever proceedings under subsection (a) involving identical chemical substances,
mixtures, or articles are pending in courts in two or more judicial districts, they shall be
consolidated for trial by order of any such court upon application reasonably made by any
party in interest, upon notice to all parties in interest.
(d) Action under section 6.—Where appropriate, concurrently with the filing of an action
under subsection (a) or as soon thereafter as may be practicable, the Administrator shall
initiate a proceeding for the promulgation of a rule under section 6(a).
(e) Representation. _Notwithstanding any other provision of law, in any action under
subsection (a), the Administrator may direct attorneys of the Environmental Protection
Agency to appear and represent the administrator in such an action.
(0 Definition .—For the purpose of subsection (a), the term “imminently hazardous chemical
substance or mixture” means a chemical substance or mixture which presents an imminent
and unreasonable risk of serious or widespread injury to health or the environment. Such a
risk to health or the environment shall be considered imminent if it is shown that the
manufacture, processing, distribution in commerce, use, or disposal of the chemical
substance or mixture, or that any combination of such activities is likely to result in such injury
to health or the environment before a final rule under section 6 can protect against such risk.
2. Case Law
United States of America v. Commonwealth Edison Co. .
620 F. Supp. 1404 (D.C.fl1 1985), Memorandum and Order Denying Motions
Background:
In this PCB case, EPA alleged an imminent hazard for PCB spills in a residential area.
Commonwealth Edison argued a section 7 case could not be brought because PCB use was
V—9 October 1997
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V.D. Civil Judicial Proceedings V. OThER ACTIONS
allowed under TSCA and EPA had not yet set PCB cleanup levels. The court did not find
Commonwealth Edison’s argument persuasive.
Ruling:
• EPA may bring To ac Substances Control Act action under section 7 against imminent
hazard notwithstanding the e dstence of a regulation governing the use of the substance.
• EPA may bring To ac Substances Control Act action under section 7 to require clean up
of an imminently hazardous chemical substance even when there is no regulation
governing the substance to be promulgated.
• EPA may commence a civil action under section 7 notwithstanding the existence or the
pendency of any administrative or judicial proceeding.
United States of America v. Texas Eastern Transmission Corporation dibla Texas Eastern
Gas Pipeline Company .
Civil Action No. H-88- 1917 (Entered 1989)
Background:
The consent agreement between EPA and Texas Eastern was entered by the District Court
for the Southern District of Texas.
Ruling:
Company consents to the assessment of a penalty, $15,000,000, in a civil judicial
proceeding pursuant to section 17 of TSCA.
United States of America v. Environmental International Electrical Services. Inc .
Civil Action No. 88-2084-S, Consent Decree (Entered 1988)
Background:
The court entered and retamed jurisdiction over the Consent Decree negotiated by EPA and
E.I.E.S.
Ruling:
Consent Decree sets the terms for clean up arid payment of stipulated penalties of a civil
administrative consent agreement and consent order.
October 1997 v—I 0
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V. Om ACTIONS V.E. Criminal Proceedings
3. Special Considerations
Civil judicial action should be taken when:
• other remedies to stop a violation, such as a Stop Sale Order, have not been effective;
• other remedies would be inadequate to stop or prevent the vioiation or risk posed to
health or the environment; or
• irreparable injury or loss will result if relief is not granted.
Civil administrative and civil judicial actions provide for different remedies, penalties
versus relief. Therefore in certain situations, parallel proceedings may be warranted.
4. Process
1. Consult with Attorney to determine if civil judicial action is appropriate
2. Develop evidence to support violation and/or nsk posed and any recalcitrance by
violator.
3. Identify the type(s) of relief and possible alternatives required and the basis for each
type of relief.
4. Assist Attorney in the development of the referral package
5. Prepare for trial.
6. Develop plan and schedule for monitoring the activities to be conducted in compliance
with the decree or order.
V.E. Criminal Proceedings
1. Statutory/Regulatory Requirements
FIFRA Section 14(b):
Criminal penalties.—( 1) In general.—
(A) Any registrant, applicant for a registration, or producer who knowingly violates any
provision of this Act shall be fined not more than $50,000 or imprisoned for not more than 1
year, or both.
V—Il October 1997
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V.E. Criminal Proceedings V. Om ACTIONS
(B) Any commercial applicator of a restricted use pesticide, or any other person not
described in subparagraph (A) who distributes or sells pesticides or devices, who
knowingly violates any provision of this Act shall be fined not more than $25,000 or
imprisoned for not more than 1 year, or both.
(2) Private applicator.—Any private applicator or other person not included in paragraph (1)
who knowingly violates any provision of this Act shall be guilty of a misdemeanor and shall
on conviction be fined not more than $1,000, or imprisoned not more than 30 days, or both.
(3) Disclosure of information.—Any person who, with intent to defraud, uses or reveals
information relative to formulas of products acquired under the authority of section 3, shall
be fined not more than $10,000, or imprisoned for not more than 3 years, or both.
(4) Acts of officers, agents, etc.—When construing and enforcing the provisions of this Act,
the act, omission, or failure of any officer, agent, or other person acting for or employed by
any person shall in every case be also deemed to be the act, omission, or failure of such
person as well as that of the person employed.
TSCA Section 16:
Penalties.—(b) Criminal.--Any person who knowingly or willfully violates any provision of
section 15 shall, in addition to or in lieu of any civil penalty which may be imposed under
subsection (a) of this section for such violation, be subject, upon conviction, to a fine of not
more than $25,00 for each day of violation, or to imprisonment for not more than one year, or
both.
2. Case Law
United States of America v. KordeL
397 U.S.1, 11(1970)
Background:
In this case, Kordel appealed his criminal conviction because it was based largely on
interrogatories he had answered in a civil proceeding. Kordel argued his 5th Amendment
rights had been violated. The court disagreed, noting he had not raised a 5th Amendment
challenge to the interrogatones.
Ruling:
The government’s use in criminal prosecution of evidence obtained through interrogatories
in a civil discovery proceeding did not violate the corporate officer’s fifth amendment
privilege against self-incrimination since the corporate officer had been notified of
contemplated proceedings and no claim of fifth amendment privilege had been made.
October 1997 V—12
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V. Om ACTIONS V.F. NOWINON/plOCp
3. Special Considerations
The Agency has recently instituted a policy concerning the review of cases for criminal
action. Cases that may indicate knowing or willful violations of the statute should be
referred to the appropriate office for review by criminal investigators. Criminal and civil
proceedings have different burdens of proof and degree of constitutional protections. Once
potential criminal activity is identified, the case is developed by the criminal staff. If parallel
civil and criminal proceedings are contemplated, separate staffs are used to develop the
cases.
4. Process
Criminal Review
It is EPA policy that civil Case Development Officers review cases for possible criminal
referral. These factors should be considered:
1. Knowing or willful behavior - not carelessness or negligent behavior which is the result
of not knowing or understanding the law;
2. Evidence to establish all elements of the statutory offense;
3. Severe impact on the Government’s ability to conduct its regulatory programs -
particularly for falsification of records;
4. Harm to humans or the environment; and
5. History of repeated noncompliance.
If you suspect criminal activity, the Office of Criminal Investigation should be consulted
immediately and the file given to the Special Agent for his review.
V.F. Notice Of Warning/Notice Of Noncompliance/Notice Of
Contemplated Proceedings
1. Statutory/Regulatory Requirements
FIFRA Section 9:
Inspection of Establishments, etc.—(c) Enforcement—(l) Certification of facts to Attorney
General.-.The examination of pesticides or devices shall be made in the Environmental
Protection Agency or elsewhere as the Administrator may designate for the purpose of
determining from such examinations whether they comply with the requirements of this Act.
If it shall appear from any such examination that they fail to comply with the requirements of
V—13 October1997
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V.F. NOWINON1NOCP V. OThER ACTIONS
this Act, the Administrator shall cause notice to be given to the person against whom
criminal or civil proceedings are contemplated. Any person so notified shall be given an
opportunity to present his views, either orally or in writing, with regard to such contemplated
proceedings, and if in the opinion of the Administrator it appears that the provisions of this
Act have been violated by such person, then the Administrator shall certify the facts to the
Attorney General, with cx copy of the results of the analysis or the examination of such
pesticide for the institution of a cnminal proceeding pursuant to section 14(b) or a civil
proceeding under section 14(a), when the Administrator determines that such action will be
sufficient to effectuate the purposes of this Act.
(2) Notice not required.-.-The notice of contemplated proceedings and opportunity to
present views set forth in this subsection are not prerequisites to the institution of any
proceeding by the Attorney General.
(3) Warning notices.—Nothing in this Act shall be construed as requiring the Administrator
to institute proceedings for prosecution of minor violations of this Act whenever he believes
that the public interest will be adequately served by a suitable written notice of warning.
FIFRA Section 14:
(a) Civil penalties.—(2) Private applicator.—Any private applicator or other person not
included in paragraph (1) who violates any provision of this Act subsequent to receiving a
written warning from the Administrator or following a citation for a prior violation, may be
assessed a civil penalty by the Administrator of not more than $1,000 for each offense:
2. Case Law
In re: Cantor Brothers .
LF.&R. Docket No. IJ-93C, Iriiiial Decision (1976)
Background:
Respondent argued he should have been issued a Notice of Warning before a complaint
was issued.
Ruling:
The Administrator has broad discretion in deciding whether a violation is minor and to be
disposed of by a warning notice or whether prosecution is warranted.
3. Special Considerations
Although EPCRA and TSCA do not provide for notices of noncompliance, TSCA penalty
policies do provide for notices of noncompliance as a matter of prosecutorial discretion.
While notices of warning/non-compliance are not considered in determining a penalty
October1997 V—14
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V. OTHER ACTIONS V.G. Other Actions Matrix
adjustment for past violations, they are used in determining an increase in the level of
action to be taken.
4. Process
1. Develop evidence to support violation
2. Issue notice.
V.G. Other Actions Matrix
Seizure Stop Sale, lnformaV Injunction Voluntary!
Use, and Formal Recall Mandatory
Removal Request Recall
Order
Authonty
FIFRA 13 and
TSCA17
FIFRA 13
None
FIFRA 16 and
TCSA7&17
FIFRA 19(b)
Evidence
Is/Was in
Violation
Reason to
Believe in
Violation
No Standard
Preponderance
“+“
Registration
Suspended
or Canceled
Expedience
U S Attorney
Distract Court
Judge
‘On the
Spot”
Program
Office
U.S Attorney
Distnct Court
Judge
Program
Office!
Regulation
Level
In Rem On Site
Custody or
Control
Channels of
Trade
Cease or
Conduct
Activities
Holders of
Pesticide in
Distnbutiori
Chain
Custody of
Matenals
U S
Government
Recipient of
Order
Recipient of
Request
Defendant
Recipient!
Subject of
Regulation
V15 October 1997
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VI. Enforcement Dlscretlo !
-------
VI. ENFORCEMENT
DISCRETION
-------
VI. ENFORCEMENT DISCRETION . Vt—I
VIA AGENCYPOLICY .. .. .. . V/—I
VI.B Processing a Wo Action 1 Assurance” Request VI—I
-------
VI. ENFORCEMENT DISCRETION
VI.A. Agency Policy
A “no action assurance” is a definitive assurance that EPA will not proceed with an
enforcement response for a specific individual violation of an environmental protection
statute, regulation or other legal requirement. EPA has long adhered to a policy against
giving these assurances unless they are in the context of cx formal enforcement
proceeding. There are only two exceptions to this policy. Upon concurrence by the
Assistant Administrator for Enforcement and Compliance Assurance, a no action
assurance may be given outside the context of a formal enforcement proceeding:
• Where expressly provided by applicable statute or regulation; or
• In extremely unusual cases in which a no action assurance is clearly necessary to
serve the public interest and which no other mechanism can address adequately.
See the Memorandum of Assistant Administrator for Enforcement and Compliance
Assurance March 3, 1995 for further explanation of this policy and procedures for handling
“no action assurance” requests.
Vl.B. Processing a “No Action Assurance” Request
A typical “no action assurance” request from companies, concerns the ability to use the
existing stocks of cx chemical substance which was manufactured in violation of TSCA. The
use of a chemical substance manufactured in violation of TSCA is prohibited. However, the
Agency may allow the use of existing stocks of illegally manufactured substance that meet
certain safety criteria on a limited case-by-case basis. Enforcement discretion is exercised
in this type of situation in order to avoid the unnecessary disposal of a substance that could
be legitimately marketed after a specific date. Without enforcement discretion, disposal
capacity would be needlessly diminished creating a detriment to the environment.
Any person requesting enforcement discretion, should be told that since the law prohibits the
use of any illegally manufactured substances, the granting of the right to use such stocks is
closely scrutinized on a case-by-case basis. The person should also be informed that
allowing the use of an illegally manufactured substance is a “no action assurance” which
may either be embodied in a setfiement agreement as part of an enforcement proceeding or
given outside the context of an enforcement proceeding only with the concurrence of the
Assistant Administrator.
VI—1 October 1997
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VI.B. Processing a “No Action Assurance” Request VI. ENFORCEMENT DISCREI1ON
Headquarters applies a TWO-TIER test in order to determine whether the exercise of such
enforcement discretion is warranted.
The first tier involves an expedited safety review. A request for an “Expedited Safety Review”
must be forwarded to the Office of Toxic Substances (OTS-New Chemical Branch). An
Expedited Safety Review is basically a brief preliminary determination by OTS of the health
and environmental risks of the chemical substance. This review does not take the place of
the “full-scale” in-depth 21 or 90 day PMN review process but both reviews may occur
concurrently. This request asks OTS to determine if, based on the result of the preliminary
review, EPA finds that the substance will not present an unreasonable risk of injury to: 1)
human health, or 2) the environment. If concerns are raised regarding potential adverse
health or environmental effects, Headquarters does not grant enforcement discretion to use
existing stocks. If the chemical successfully “clears” the safety determination by OTS, we
may move on to the next tier.
The second test requires that the company provide written details documenting any
IMMEDIATE AND TANGIBLE ECONOMIC HARM that will occur to the company (prior to the
expiration of the PIvIN review period) if it is not allowed to use the existing stocks of the
chemical substance. A company should explain, in detail, the following items:
• The steps the company took to minimize the violation once it was discovered, (i.e., efforts
to quarantine the chemical substance, amount in stock, how long to use the existing stock,
when manufacture ceased, efforts to notify customers, etc.);
• The requested use of the chemical substance and the precise economic loss which
occurs if it does not market the quarantined chemical substance (loss of jobs, danger of
plant closing, etc.);
• The nature and availability of substitutes for the chemical substance; and
• The specific need of the customers for the chemical substance.
A COMPANY CANNOT MEEr iTS BU1 DEN OF PROOF OF ECONOMIC HARM BY MERELY
STATING THAT iTS PROFITS WILL BE REDUCED OR THAT THE COMPANY WILL S1Jl-] H
A LOSS OF “PRESTIGE’ (REPUTATION) IN THE MARKErPLACE. Since the company has
violated the law, it should be compelled to bear the loss of any economic gain which it
received as a result of non-compliance.
If a company has successfully cleared the two tests, then enforcement discretion may be
granted. Once enforcement discretion has been granted, the company should be required to
submit reports (weekly, monthly) which detail the following information:
• the amount of the substance used during a pre-set reporting period;
• the customers to whom the chemical/product was shipped; and
October1997 VI—2
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VI. ENFORCEMENT DISCRETiON VI.B. Processing A “No Action Assurance” Request
• amount of substance remaining in stock
The company should also be informed that the granting of such discretion does not, in any
maimer, alter any enforcement actions which may arise concerning the substance.
Generally, once the enforcement discretion is granted, a company may begin to use the
existing stocks after it signs an agreement to provide evidence substantia-ting the violation.
The alternative, when the economic harm is remote in nature, is to deny enforcement
discretion at that time and instead finalize the use of existing stocks as one of the terms of
the Consent Agreement.
The following examples are provided at the end of the chapter.
Example VI—1. Processing Requests for Use of Enforcement Discretion — Memorandum
and Attachment: Memorandum Regarding “No Action
Assurances”
Example VI—2. Request for an Expedited Safety Review VIE—7
Example VI—3. “No Action Assurance” Pending Receipt of Violation Document... VIE—9
Example V1—4. “No Action Assurance” After Receipt of Violation
Documentation i r j 1
Example VI—5. Letter Denying “ No Action Assurance” VIE—13
October 1997
-------
VI. ENFORCEMENT
DISCRETION
EXAMPLES
-------
EXAMPLE VI—l. PROCESSING REQUESTS FOR USE OF ENFORCEMENT DISCRETION —
MEMORANDUM AND ATTACHMENT . .. ... . VIE—5
EXAMPLE VI—2. REQUEST FOR EXPEDITED SAFETY REVIEW . VIE—il
EXAMPLE VI—3 NO ACTION ASSURANCE” PENDING RECEIPT OF VIOLATION
DOCUMENT . VIE—i3
EXAMPLE VI— .4 NO ACTION ASSURANCE” AFTER RECEIPT OF VIOLATiON
DOCUMENTATION . . VIE—15
EXAMPLE VI—5 LETTER DENYING NO ACTION ASSURANCE” . VIE—17
-------
Example Vl—1. Processing Requests for Use of Enforcement
Discretion — Memorandum and Aftachment
Processing Requests for Use of
Enforcement Discretion
f UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
I WASHINGTON. D C 20460
p”c t
MAR 03 1995
çc:, CF
Mm4ORA NDUM EUFC C . NrAUD
CCM L .CZ S ; i .cE
SUBJECT: Processing Recu.e ts/for Use of Enforcement D screticn
FROM: Steven A. Me/ a jf
Ass szanz Ad..tinistratcr
TO: Assistar.t A stratcrs
Re.cicnal Administrators
General Counsel -
Inspector General
In lignz cf the reor anizaticn and consolidation of
Agency’s enforcement ar.d compliance assurance resources
activities at Headauarte s I believe that t is useful to
recirculate the attacned i emorar.du regarding “no action”
assurances as a reminder of both this poli v and the procedure
for handlir.c such requests. The Agency has long adhered to a
policy against gi.v r.g definitive assurances outside the cor.texz
of a formal enforcament proceedin that the government will ncz
proceed w:zr. an enforceoer.t response for a specific nd v dual
vLojat or. of an env1ron ental protection zatue, regulation, or
legal requirement. This policy, a necessary and crit callv
mporzant elecen: of the wlse exercise of tne Agency’s
enforcement discretion, and whicn has beer. a consistent fea:’ re
of the enfcrcement pro ram , was formalized n 1984 follow n
Agency—wide review and comment. ?lease note that OECA is
reviewing the ap 1icabi!jty of this policy to the CERC .
enforcement program, and w:ll issue additional guidance or. this
subJect.
A “no action” assurance includes, but s not l m ted to:
specific or general requests fcr the Agency zc exerc sa ts
enfcrcement d scre:ion n a particular manner or n a g:ven so:
of circumstances (i.e., that it will or wil not take an
enforcement actlcn); the development of po:cies or other
statements purporting to bind tne Agency and unich relate to or
wculd affect the Agency’s enforcement of the Feceral
env rcnmentai laws and regulations; and other similar requests
Courtney M. Pr ce, Assistant Administrator for Enforcement
and Compliance >!onitor ng, Policy Against “No Action” Ass rancas
(Ncv. 15, l98 ) (copy attached)
——fl .e S., C_—c a,—.:c:aa.
x. r* a .._a
VIE—I October 1997
-------
‘rocessing Requests for Use of
Enforcement Discretion (cont..)
2
for forbearance or action involving enforcement—related
activities. The procedure established by this Policy requires
that any such written or oral assurances have the advance written
concurrence of the Assistant Administrator for Enforcement and
Compliance Assurance.
The 1984 reaffirmation of this policy articulated well the
dangers of providing “no action” assurances. Such assurances
erode the credibility of the enforcement prcgram by creating real
or perceived inequities in the Agency’s treatment of the
regulated community. Given limited Agency resources, this
credibility is a vital incentive for the regulated community to
comply with existing requirements. In addition, a commither.t nr
to enforce a legal requirement may severely hamper later,
necessary enforcement efforts to protect public nealth and
envirorteent, regardless of wnether the action is against
recipient of the assurances or against others who cla
s:milarlv situated.
Moreover, these pr nc:ples are their most cc
contexz of rulemakings: good public policy coun
statements of enforcement discretion are not a1
particularly appropriate alternative to the pt’
commer.t rulemaking process. Where the Agertc’
is aDproprjate to alter or modify its appror
defined c:rcumszances, in my view we must
whether the objective is best achieved th 1
prccess (especially where the underlyir. ’e
established by rule under zne Administr
thrcugh piecemeal express cr.s of our::
We have recognized two general
act:on assurance may be appro r at
provided for by an applicable
circumstances where an assuranc e ,° the
the oublic interest and which r We
adequately. In light of the r
granting no action assurance. .Ltj 0
advance ccncurrence of the he
office. Over the years, t’PrO
reasonably consistent an . tj ).
enforcement d scret on, 4 Ofl
integrity of the Agency itioj 1
a mitigated enforcemer
There may be situa.
action assurances shoulc .
Underground Storage Tanks
For example, at many Supei
law. OECA is evaluating tt.
assurances under CERCLA and
guidance on the subject.
October 1997 VIE—2
-------
Processing Requests for Use of
Enforcement Discretion (cont.)
3
Lastly, an element of the 1984 Policy which I want to
highlight is that .t does not and should not preclude the Agency
from discussing fully and completely the merits of a particular
action, policy, or other request to exercise the Agency’s
enforcement discretion in a particular manner. I welcome a. free
and frank exchange of ideas on how best to respond to violations,
mindful of the Agency’s overarching goals, statutory directives,
and enforcement and compliance priorities. I do, however, want
to ensure that all such reguests are handled in a consistent and
coordinated manner.
Attachment
cc: CECA Office Directors
Regional Counsels
Regional Procram D reczcrs
VIE—3 October 1997
-------
Attachment — Memorandum Regarding “No Action Assurances ”
Policy Against “No Action” Assurance
S, ,
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 20460
‘••c
MJV 1 6 j
CF’C OF
. OPc: FlT £. 3
COS PI ’*.CL MO 4ilO I’ ,C
MEM0RAND JM
SUBJECT: Policy Against No ‘ction” Assure ces
FROM: Courtney M. Price
Assistant Ad r. stra:o: for Enforcement
and Compliance Monitoring
TO: Assi t nt Adnin strators
Regional Adx nistra tors
General Ccunsel
Insoector Gene: l
Th s memorandum reaff.rms EPA policy against giving
de nic:ve ass ,. :ances (written or oral) outside trie context of
a for a1 enforcement proceeding that EPA will not proceed
an enforoe’ ent response for a specific individual violatio- cf
an environmental protect.on statute, regulation, or ot.ner
le;al re u rement.
“ o action” promises may erode the credibility of EPA’s
enforcement program by creating real or perceived inequ ties
n the Agency’s treatment of the regulated com ur.itv. This
credibility is vital as a continuing incentive for regulated
parties to comply with environmental protection requirements.
in addition, any ccrnit.ment not to enforce a legal
requ:re er.t against a particular regulatec party may severer
ham er later enforcement efforts against that party, ho
claim gooc—faich reliance on that assurance, or agc nst ot . a:
art es whc claim to he slmilarly situated.
This policy against definitive no act on prcntses to
parties outside the Agency applies in all contexts, incluo:;
assurances requested:
0 both prior to and after a violation has been corn tted;
o on the basis tnat a State or 10031 governmeit is
resoonding to the violation;
VIE—5 October 1997
-------
Policy Against “No Action” Assurance (cont.)
2
on the basis tnat revisions to tne underlying legal
requirement are being considered;
° on the basis that the Agency has determined that the
party is not liable or has a valid defense;
on the bas:s tnat the violation already has been
corrected (or that a party has promised that t w:li
correct tne vioation); or -
on the basis :nat the violation is not of suffLc en:
priority to e:i: Agency action.
The Agency particularly must avoid no action pronises
relating either to v:oiations of judicial crders, for wh:cn a
cour: has independent enforcement author tv, or tc potent:a.
criminal violations, for whicn prosecutorial discreticn rests
with the United States Attorney Seneral.
As a ceneral rule, exceptions to tnis policy are arrantec
only
° where expressly provided by applicable statute or
regulation Ce.;., certain upset or bypass sit aticns)
o in extremely unusual cases in wnicn a no action
assurance is c ear1y neccessary to serve the puc:c
interest (e.g., to alcw action to avoid extrene risks
to public health cr safety, or to ootain ortant
information for research purooses) and whtch no o:ner
mecnanasm c n address adequately.
Cf course, any exceotions which CPA grants must be In an area
n nich CPA has d:scretion not to act under aooltcable law.
This oolici in nc way is intended to constraan the /
wrticn PA discusses anc coordinatos er.fcrcement plans w tn
state or local enforcement authorities consistent w th normal
working relationshios. To the extent tnat a statement c: E?A’
enforcement intent is necessary to help suPPort cr cor.clude en
effective state enforcement effort, EP.; can empicy language
sucn as the followinc:
EPA encourages State act on to resolve v olat onE of
the _____________ Act and supports the actions wn:cn ( State )
s ta ing to adcress the violations at s5ue. To tne extent
:- az :he State act:on does not satisfactorily reso.ve tne
-. :a..a::or.s, EP ma’.’ oursue its own enforcement act :r .”
October 1997 VIE—6
-------
Example Vl—2. Request for Expedited Safety Review
(OECA letterhead)
1 IEMORANDUM
SUBJECT Request for an Expedited Safety Review of a Chemical Substance
FROM. __________ Chief
_____________ Branch
TO: Lawrence E Cullen, Chief
New Chemicals Branch (TS-794)
On (date) a company which self-confessed a potential TSCA Section 5 violation, met with EPA to
discuss its illegal manufacture of a new chemical substance After the meeting, the company applied for a
Low Volume Exemption (LVE) for this chemical and it was assigned the number (identification) The issue
concerning whether the company will receive an LVE is presently under review.
For this chemical, please provide a statement regarding the results of the PMN safety review and
inventory status If there are any further questions regarding this matter, please contact (EPA staff name)
of my staff at (EPA staff telephone number)
VIE—7 October 1997
-------
Example Vl—3. “No Action Assurance” Pending Receipt of
Violation Document
(Placeon OECA letterhead)
(Name)
(Address)
Dear (Name),
Re (Client Name)
This is in response to our telephone conversation on (date), and your letter of (date), requesting
the granting of “No Action Assurance” for the continued commercial use of a chemical substance which
may have been manufactured in violation of the Toxic Substances Control Act (TSCA) In the
conversation and letter, you voluntanly disclosed that (client name) had imported a chemical substance
which was not listed on the TSCA §8(b) inventory. (Client name) used this chemical substance for
nonresearch and development purposes and Incorporated it into products used by several companies
This chemical is subject to a low volume exemption request identified as (identification)
As you are aware, EPA will initiate a proceeding for the assessment of a civil penalty against
(client name) for violations of TSCA involving the manufacture and use of chemicals prior to their inclusion
on the Inventory Upon review of this matter and the facts stated in your letter of (date) to (EPA staff
name), the facts of which we accept as accurate and upon which we are basing our decision, EPA has
determined that the national interest would not be served by the temporary discontinuation of (client name)
customers’ use of the product containing the chemical substance which is under review The basis for
this determination is that
1 The chemical substance has received an expedited risk assessment and was found not
to present an unreasonable risk of injury to human health and the environment, and
2 One of the users of the product containing the chemical substance, and its employees
may suffer an economic hardship due to a lack of the product containing the chemical
substance
Therefore from the date of this letter, (client name) and its customers, will be authorized to use the
existing stocks of the chemical substance, and of the product containing the chemical substance subject
to the low volume exemption notice Commencement of any additional manufacture (including
Importation) may not resume until the low volume exemption review penod has expired No civil penalty
will be assessed for the use of existing stocks of the chemical, and of the product containing the chemical
substance, provided that each of the following conditions are met
1 (Client name) initiates immediate steps to ensure its compliance with TSCA and certifies
that all of its future manufactunng of this chemical substance is in full compliance with the
provisions of the Toxic Substances Control Act;
2 Within 30 days, (client name) provides the Agency with all records pertaining to the
manufacture, processing, use, and export of the chemical substance in violation of TSCA,
as referenced in your letter of April 25, 1989, including batch, sales, purchase, and
inventory records,
3. Within 30 days, (client name) provides a narrative descnption of the steps required to
manufacture the chemical substance, the uses of the chemical substance, and the
structure and properties of the chemical substance
VIE—9 October 1997
-------
4. Within 30 days, (client name) provides a complete wntten descnption of the events which
led to its discovery of the violation and subsequent notification to the Environmental
Protection Agency (EPA),
5. (Client name) promptly provides any other documents or other information in the
company’s possession which the Agency seeks pursuant to Section 11 of TSCA in order
to prepare a CMI administrative case for the violations of Section 15 of TSCA by (client
name)
6. (Client name) does not contest the EPA’s junsdiction over the subject matter of the
complaint which will be issued for the violations of Section 15 of TSCA as described in the
first paragraph of this Ietter and
7 (Client name) certifies that the information which it shall supply to the Agency will be true,
accurate, and correct
Please sign in the space provided below if you agree and consent to the terms of this letter After
receiving the letter with your signature, I will consider granting the authonzation for the use of the subject
chemical Use of the chemical may begin in accordance with the conditions set forth above, only after I
have signed the letter granting the authorizations
Sincerely,
(Name)
Assistant Administrator
Date
SEEN AND AGREED TO.
Counsel
___________ Products Inc.
Date
October1997 VIE—b
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Example VI—4. “No Action Assurance” After Receipt of Violation
Documentation
(Name)
(Address)
Dear (Name):
This is in response to your written requests for a no action assurance regarding the release of the
self-imposed quarantined stocks of the (chemical name) polymer and of finished products produced from
that polymer Specifically, your request asked for Agency permission for your clients (city, country) to
distribute the quarantined stocks of (chemical name) for re-export to; to distribute the quarantined stocks
of (chemical name) for processing and use in the production of finished products that are used by the
importers’ customers as lubncants in the manufacture of reinforced fiberglass for automobiles, boats and
other structural fiberglass applications; to process and use (chemical name) in the production of finished
products, and to distribute finished products produced from (chemical name).
After consultation with my staff and the Office of Prevention, Pesticides, and Toxic Substances
(OPPTS) regarding legal and environmental issues, I have decided to grant your clients request for a no
action assurance This no action assurance applies to and covers any existing materials of the (chemical
name) products that your client& customers may have quarantined as well.
Please note that the Agency s application of a no action assurance to the proposed export and to
the proposed sale of existing stock of illegally unfinished and finished goods does not, in any manner,
affect any other enforcement issues which may anse in connection with the import, manufacture, use, or
distribution of this chemical product in violation of TSCA Nor does this action limit, in any way, your
client’ s responsibility for any harm that may arise from the exportation of this chemical product or from the
use of finished goods with this chemical product
If you have any questions, you may call Jesse Baskerville, the Director of the Toxics and Pesticides
Enforcement DMsion at (202) 564-4071.
Sincerely,
Steven A. Herman
Assistant Administrator
VIE—Il October 1997
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Example Vl—5. Letter Denying “No Action Assurance ”
(OECA letterhead)
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
(Company name)
Dear (Name)
Re
This is in response to your request of (date), concerning the granting of enforcement discretion for
the commercial use of a chemical substance which has been manufactured (imported) in violation of the
Toxic Substances Control Act (TSCA) On (date), a representative of (company name), (representative
name), voluntarily disclosed that (company name) had manufactured (imported) for commercial purposes
a chemical substance for which (company name) had not obtained a TSCA low-volume exemption.
As you are aware, EPA will initiate a proceeding for the assessment of a civil penalty against
(company name) for violations of TSCA invoMng the manufacture (importation) of this chemical prior to the
expiration of the pre-manufacture notice (PMN) review penod or the application for and receipt of a TSCA
low-volume exemption Upon review of this matter, it has been determined that your requested
authorization to use the existing stocks should be formalized as part of the settlement agreement between
EPA and (company name) in the TSCA Section 5 case to be issued by EPA. Until a settlement is reached,
no existing inventories of the illegally manufactured substance may be commercially used. EPA will
proceed with this matter as expeditiously as possible.
Thank you for your cooperation in this matter. If you have any questions, please contact (EPA staff
name). She may be reached at (EPA telephone number)
Sincerely yours,
Director
cc.
VIE—13 October 1997
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Alphabetical Index
-------
ALPHABETICAL INDEX
-------
Alphabetical Index
A
Ability to Pay, 111—22, 111—29, 111—30
Accelerated decision, IV—6, IV—15, IV—17, IV—19, IV—20, IV—22, IV—37
Adequacy, Quality, 111—33, 111—36, 111—37
Administrative Procedure Act (APA), 11—21
Agent in Charge, 11—14, 11—15
AU Responsibilities, 111—24
Alternative Dispute Resolution, IV—24
Appeals, 111—23, lV—2, lV—35, IV—37
Attitude of the Violator, 111—28
Authenticity, 111—33, 111—37
C
Case L.a ,, I—I, 1—2, 11—13, 11—17, 11—18, 11—23, 11—31, 11—35, 11—37, lI—.—44, lll—.——4, 111—9, 111—16,
111—24, 111—34, lV—.-4, lV—6 IV—11, IV—14, lV—19, lV—24, IV—33, IV—39, V—3, V—6, V—9,
V—12, V—14
Certified Statements, lI—44, lI—45
Civil Administrative Proceedings, 111—13
Civil Judicial Proceedings, Ill—I 3, V—7
conference, IV—26
Confidential Business Information, 11—21, lV—8
ConsensuallWarranted Inspection, Il—i
Consent Agreement Oversight, lV—27
Constitution/Statutory Requirements, Il—i
ConstitutionallStatutorylRegulatory Requirements, 111—13, 111—33
Cnminal proceedings, V—Il, V—13
Culpability, 111—17, 111—22
D
,
Data Sources, 11—35
Delegation of Authority to Exercise Power, 1—2
Discovery, IV—29, lV—34
Documentation, 11—15, 11—21, 11—31, 11—33
Documentation/process, 11—15, 11—19, 11—20,
Double Jeopardy, Ill—i 8, 111—19
11—27,
11—32
E
Economic Benefit, 111—30, 111—31
Elements Of Proof, Ill—i 3, 111—17, 111—19, 111—20
Emergency Situations, 11—10
Enforcement Discretion, Vl—1, Vl—2, Vl—3
Entry, lI—i, 11—2, 11—3, 11—10, Il—il, 11—12
Equal Access to Justice, Ill—i, llI—6, 111—7
Equity, 111—27, 111—32
-------
Evidence, Il—I, 11—5, 11—7’, 11—9, 11—10, 1 1—15, 1 1—17’, II———19, 11—21, 11—23, 11—24, II—26, 11—27’,
11—30, 11—31, 11—35, 11—36, 11—39, II—4 .4, II—45, Ill—i, 111—4, 111—5, 111—7’, III———8, 111—9, 111—13,
Ill—I?’, 111—19, 111—21, 111—26, 111—27’, 111—28, 111—29, 111—30, 111—32, 111—33, 111—3.4, 111—35, 111—37’,
IV—13, IV—16, IV—17, IV—18, IV—19, IV—22, IV—24, IV—29, IV—30, IV—32, IV—34, IV—36,
IV—40, V—4, V—6, V—11,V—12, V—15
Exclusionary Rule, IV—35
Exercise of Power, 1—3
Exit Requirements, 11—15, 11—19
F
Fairness, 111—27
Fair Notice, Ill—Il
FIFRA and TSCA Tracking System (FTTS), 11—42
Financial Data, 11—37
H
Harm/Circumstances, 111—31
Heanng, 111—22, IV—1, lV—2, IV—6, IV—14, IV—16, IV—17, IV—19, IV—22, lV—24, IV—28, IV—29,
IV—30, IV—32, IV—34, IV—36, IV—37, IV—40
Hearsay, 111—36
History of Pnor Violations, 111—28
I
Informal Settlement, IV—23
Informed Consent, lI—6, 11—7
Inspecting and Copying Records, 11—17
Inspection, 11—17
Inspection Authonty, Il—I
K
Knowledge, 111—9
M
Motion for Default, IV—1 1, IV—1 2, lV—1 4, IV—1 5, IV—22
Motion to Amend, IV—21
Motion to Dismiss, lV—21
Motion to Intervene, IV—17, IV—22
Motion to Strike, IV—7, lV—20
N
Notice Of Contemplated Proceedings, V—13, V—14
Notice Of Noncompliance, V—13
Notice Of Warning, V—I 3
0
Open Fields, 11—8
-------
P
Paperwork Reduction Act, 111—5
Penalties, 11—22, 11—32, 11—35, 11—37, lI—.4 4, Ill—i, Ill—B, IlI—9, 111—10, 111—18, 111—21, 111—22, 111—23,
111—26, 111—27, 111—28, 111—29, 111—31, 111—32, 111—33, I\/—1 , IV—3, i\/—5, l\/—8, I’V’—13, I\/—16,
tV—20, IV—23, IV—27, IV—32, IV—37, V—jo, V—Il, V—14
Photographs, 11—17
Plain View, 11—9
Preponderance of Evidence, lIl—4
Prima Facie Case, Ill—i, lll—4, lII—6, 111—7, 111—9, 111—12, 111—27, 111—30, 111—32, 111—37
Process, 11—10, 11—15, 11—21, 11—29, 11—39, Il—40, ll—41, Il—42, Il—43, ll—45, 111—7, 111—12, 111—13,
111—19, 111—32, 111—33, 111—37, IV—7, IV—9, lV—13, IV—15, lV—26, IV—28, IV—33, IV—37, V—I,
V—2, V—4, V—6, V—Il, V—13, V—15
R
Recall, V—5, V—6, V—B, V—15
Representative Sampling/Analytical Quality, 111—35
Right to Heanng, IV—33
Rules/Regulations, 1—3
S
Seizures, V—i
Selective Enforcement, 111—28, 111—29
Self Confession, 11—3 1
Settlement conference, IV—23, IV—24
Shadowlaw, 11—43
Special Considerations, 1—2, 1—4, 11—10, 11—14, 11—18, 11—20, 11—21, 11—27, 11—36, Il—44, IIl—7,
111—12, 111—19, 111—32, 111—36, lV—7, lV—13, IV—15, lV—22, lV—26, lV—37, V—2, V—4, V-B,
V—Il, V—13,V—14
Statutory Authority, I—I, 11—23
Statutory Requirements, Il—li, 11—16, 11—19, 11—20, 11—21, 11—31
Statutory/Regulatory Requirements, Ill—i, III—8, 111—21, IV—i, lV—5, IV—8, lV—13, IV—i6, IV—23,
IV—28, IV—37, V—i, V—il, V—3, V—5, V—7, V—I 3
Strict Liability, 111—9, Ill—li, Ill—I 3
Supoena Authority, 11—21, 11—27
Supplemental Environmental Projects, IV—24, IV—26, lV—27
T
Toxics Release Inventory System, 11—42
V
Venue, lV—32, IV—36
Voluntary Disclosure, 11—31, 11—32, 11—33,
11—34
w
Warranted/Warrantless Search, 11—2, 11—3, 11—9
-------
Case Index
-------
CASE INDEX
-------
case Index
3M Company v Carol M Browner
IV—4
A
A-2-Z Termite and Pest Control Corporation of Ocala
Adams v Federal Trade Commission
Agland Incorporated
Alden-Leeds, Inc
All Regions Chemical Labs, Inc v United States Environmental Protection Agency
lI—44
11—25
1k6
111—28
Aluminum Company of America (Alcoa) v. Dubois
Amvac Chemical Corporation
Aquanum Products, Inc
AvnI, Inc
11—13
111—18
111—27
11—7
B
Baker, Bean, and Feed Company
B J. Camey Industries, Inc.
Boliden Metech Inc v United States
Bradley Exterminating Company
Bunker Hill Co v EPA
IV—40
111—31
Il—4, 11—8
11—5
11—14, 11—17
C
Camara v. Municipal Court
Cantor Brothers, Inc
CED’s Inc v. EPA
11—10
111—36, V—14
Celotex Corporation
C.F Industries, Inc.
Chautauqua Hardware Corporation
Chemical Waste Management, Inc.
Chemi-Trol Chemical Company
Chevron U S.A v NRDC
Cohane Mill and Supply Company, Inc.
Colonial Processing, Inc
Coolidge v New Hampshire
Cooperative Grain and Supply Company
CWM Chemical Services, Inc, Chemical Waste Management Inc,
11—17
lII—4, 111—28
IV—25
IV—35
IV—22
IV—36
1—3
V—4
111—25, 111—29
11—9, 11—10
111—19
and Waste Management Inc
111—12
D
DIC Amencas, Inc.
Donovan v. Dewey
Dow Chemical Co v. United States
111—26
11—3
lI—8
E
Eastman Chemicals Division, Eastman Kodak Company
E.J du Pont de Nemours and Company, Inc ________
IV—34
IV—34
-------
Electnc Service Company _______________________________________
Empire Ace Insulation Manufactunng Corporation _______________________________________
Employers Insurance of Wausau and Group Eight Technology, Inc _________________________
Endicott Johnson v. Perkins
Equal Employment Opportunity Commission v. Children’s Hospital Medical Center
of Northern California _________________________________________________
Erincraft, Inc
Ensman Spraying Company, Inc and Gerald P Schreiner ________________________________
Evergreen Pest Control __________________________________________________________
Ka son Brothers, Inc. v. United States Environmental Protection Agency — 11—37, 111—29, IV—1 1, IV—22
L
Lazarus, Incorporated
Lee v. Federal Maritime Board ___________________________________________________
Leo Stangle I/b/a Gopher Choker ____________________________________________________
Lihue Plantation Co Ltd. _____________________________________________________________
Litton Industrial Automation Systems, Inc., New Britain Machines Division
11—36, 111—35, IV—14
111-4
111—26
11—26
11—26
IV—20
111—17
111—36
F
Falls v Town of Dyer, Indiana
Farmers Cooperative Elevator Company
Federal Trade Commission v. Texaco, Inc
Fleming and Company
Frankfort Power and Light
111—29
V—3
IV—14
G
George J. Huth, d/b/a Huth Oil Company and Joyce Nichols
Geron Furniture Inc
Green Thumb Nursery, Inc
II—6,
IV—33
H
Harmack Grain Company, Inc
Harold L. Thomsen, and Thomsen Senal Spraying, Inc
High Plains Cooperative, Inc
Hodag Chemical Corporation
Horton v California
111—5
11—9
I
Imitec, Inc.
1V21
J
JF&M Company, Inc
Johnson Pacific, Incorporated
IV—19
111—27
K
111—5, lV—5
11—24
111—7
11-6
11—13, 111—24
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M
Marshall, Secretary of Labor et al v Barlow, Inc _________________________________________ II—4
Matter of Edge Holding Company ___________________________________________________ 11—24
McCulloch v Maryland I_i
Medzam, Ltd. IV—12
Mendoza v INS 11—3
Mexico Feed and Seed Company, Inc and Jack Pierce dlbla Pierce Waste Oil Services _______ IV—40
Minnesota Mining & Manufacturing and SET Environmental, Inc ____________________________ 11—23
N
National Railroad Passenger Corporation (AMTRAK)
NeIIo Santacroce and Dominic Fanelli dlb/a Gilroy Associates
New Waterbury, LTD.
N Jonas&Co., Inc
Noble Automotive Chemical and Oil Company v US EPA
N.O.C., Inc T/A Noble Oil Company
111—24,
111—34
11—37,
11—14
Ill—3D
11—4
IV—39
111—17
0
Oklahoma Press Publishing v Walling
Oliver v. United States
11—25
11—8
P
Pacific Refining Company
Patnck J Neman
111—32
Pueblo Chemical and Supply
IV—1 1
IV—41
R
Reabe Spraying Service, Inc
Rek-Chem Manufactunng Corp.
Revere Products Corporation
Riverside Furniture Corporation
Robert Ross and Sons, Inc.
Rocketdyne Division, Rockwell International Corporation
Rollins Environmental Services (NJ), Inc v U S Environmental
lll—6
11—7
111—30
IlI—6,
111—35,
Ill—il
IV—12
Protection Agency
11—3 1
Ill—li
S
Sanico ________________________________ 11—17
Serrv Sullivan ________________________ 11—23
Shreveport Engraving Company v United States ________________________________________ 1—2
Spang and Company, Inc _________________ ___________ 1—2
Sponcidin International ____________________________________________________ 11—5, 11—35, IV—6
South Coast Chemical, Inc _________ Ill—il
Spectrum Wire Corporation ____________________________________________________ IV—20
Spang & Company ______________________ ________ IV—24
State of Maryland ________ lV—12
State of West Virginia Highways _____________________________________________________ 111—28
Stauffer Chemical Company _______________ _________ IV—36
-------
T
Thermal Reduction Company, Inc.
Tillamook County Creamery Association
IV—15
IV—20
U
U.S v. Biswell
11—2
U.S. v Feaster
United States Environmental Protection Agency v Alyeska Pipeline Service Company
11—27
11—23
United States of America v. Commonwealth Edison Co
United States of America v. Environmental International Electncal Services, Inc
United States of America v. Kordel
United States of America v. Morton Salt Company
United States of Amenca v Robbins
United States of Amenca v Texas Eastern Transmission Corporation d/b/a Texas Eastern
V—9
V—I o
V—12
11—24
111—18
Gas Pipeline Company
United States v. Stauffer Chemical Co
v—i 0
11—14
w
Water Services Inc. 11—18
Weed Heights Development Company, Mesaba Service and Supply Company, and Martin
Electnc Company IV—21
Wego Chemical & Mineral Corp ________________________________________________ lV—7
Willis Stores lV—6
Wong Sun, et al v United States ____________________________________________________ IV—35
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Handouts re:
“Self-Disclosure Policy”
Geraldine Gardner
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ATTACHIVUJIT A
SELF-DISCLOSURE OF POTENTIAL VIOLATIONS
/
ALTERNATIVE RESPONSES
Notice of Noncompliance (NON)
Notice of Violation (NOV)
Notice of Warning (NOW)
PROPOSING GRAVITY-BASED PENALTIES
(GBP) AS DISCUSSED IN THE
APPROPRIATE ERP
IF NOT ELIGIBLE
UNDER SELF-
DISCLOSURE
POLICY
ELIGIBLE’ for Consideration under the Self-Disclosure Policy
FOR A 100% REDUCTION
FOR A 75% REDUCTION
REFER TO
APPROPRIATE ERP 2
II
V
Issue a Complaint with
adjusted GBP
AND NO
SIGNIFICANT
ECONOMIC
BENEFIT
fi
“
luue a
NOTICE
OF
DETERMIN-
ATION
•1’
‘ ‘
C $ C
AND SIGNIFICANT
ECONOMIC
BENEFIT IS TO BE
RECAPTURED
I velop Complaint with lull GBP and
additional assesoment br significant
economic benefit, if appropriate
+
CACO with adiusted GBP
If Respondent Agrees If Respondent DOES NOT
to sign a CACO within Agree to sign to CACO
30 Days within 30 Days
issue a Complaint + CACO Proceed with appropriate
civil administrative process
Complete Self disclosure checklist as part of Agency juslification for documentation for final decision
2 Complete PENAlTY CAlCULATION siwu with self disclosure adlustment(s)(og, GBP adiusted by reducing proposed penalty for self disclosure)
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ATTACHMENT B
SELF-DISCLOSURE CASE REVIEW
Case Officer:
Attorney of Record:
Date:
FACILITY:
Represented by:
Date of Disclosure:
Type of Violation:
BACKGROUND:
REVIEW ANALYSIS: Case Development Analysis for possible application of the policy for
Incentive for Self-policing: Discovery, Disclosure, Correction and Prevention of Violations
(a.k.a. Self-Disclosure Policy)
CONCLUSIONS:
AUDIT POLICY CHECKLIST
SUPPORTING INFORMATION’: (SECTION G. APPLICABILITY)
1) This policy applies to the assessment of penalties for any violations under all statutes that EPA administers, and
supersedes any inconsistent provisions in media-specific penalty or enforcement policies and EPA’s 1986
Environmental Auditing Policy Statement.
2) To the extent that existing EPA enforcement policies are not inconsistent, they will continue to apply in
conjunction with this policy. However, a regulated entity that has received penalty mitigation for satisfying specific
conditions under this policy may not receive additional penalty mitigation for satisfying the same or similar
conditions under other policies for the same violation(s), nor will this policy apply to violations which have
received penalty mitigation under other policies.
3) This policy sets forth factors for consideration that will guide the Agency in the exercise of Its prosecutorial
discretion. It states the Agency’s views as to the proper allocation of its enforcement resources. The policy is not
final agency action, and is intended as guidance. It does not create any nghts, duties, obligations, or defenses,
implied or otherwise, m any third parties.
4) This policy should be used whenever applicable in settlement negotiations for both administrative and civil
judicial enforcement actions. It is not intended for use in pleading, at hearing or at trial. The policy may be
applied at EPA’s discretion to the settlement of administrative and judicial enforcement actions Instituted
prior to, but not yet resolved, as of the effective date of this policy.
=#=#=#=#=#=#=#=#=#=#=#=#=
1 Also include other supporting highlights or issues from the Audit Policy Preamble and Statement as applicable in the
case development. (Other available sources A > WarRoom\Policy Enf\Audit policy documents)
—1—
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CONDITIONS (Section D applicability)
1) SYSTEMATIC DISCOVERY: The violation(s) was/were discovered through (I one):
— a) an environmental audit (“Environmental audit” means a systematic documented, periodic and objective
review by regulated entities of f cility operations and practices related to meeting environmental requirements. An
“Environmental aixht report” means the analysis, conclusions, and recommendations resulting from an environmental
audit, but does not include data obtained in, or testimonial evidence concerning, the environmental audit.)
OR
— b) an objective, documented, systematic procedure or practice reflecting the regulated
entity’s due diligence in preventing, detecting, and correcting violations.
— Does regulated entity provide accurate and complete documentation to the Agency
as to how it exercises due diligence to prevent, detect and correct violations according
to the criteria for due diligence? (See below). (EPA may require as a condition of penalty
mitigation that a description of the regulated entity’s due diligence efforts be made publicly available.)
“Due Diligence” encompasses the regulated entity’s systematic efforts, appropriate to the size
and nature of its business, to prevent, detect and correct violations through all of the
following: ( f if true; X if not the case with this review, or? if unable to determine at this time)
— a) Compliance policies, standards and procedures that identify how employees and
agents are to meet the requirements of laws, regulations, permits and other sources of
authority for environmental requirements;
— b) Assignment of overall responsibility for overseeing compliance with policies,
standards, and procedures, and assignment of specific responsibility for assuring
compliance at each facility or operation;
— c) Mechanisms for systematically assuring that compliance policies, standards and
procedures are being carried out, including monitoring and auditing systems reasonably
designed to detect and correct violations, periodic evaluation of the overall
performance of the compliance management system, and a means for employees or
agents to report violations of environmental requirements without fear of retaliation;
— d) Efforts to communicate effectively the regulated entity’s standards and procedures to
all employees and other agents;
— e) Appropriate incentives to managers and employees to perform in accordance with
the compliance policies, standards and procedures, including consistent enforcement
through appropriate disciplinary mechanisms; and
— f) Procedures for the prompt and appropriate correction of any violations, and any
necessary modifications to the regulated entity’s program to prevent future violations.
—2—
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2) VOLUNTARY DISCOVERY: (I if true; X if not the case with this review, or? if unable to determine at
this time)
— The violation was identified voluntarily, and not through a legally mandated monitoring or
sampling requirement prescribed by statute, regulation, permit, judicial or administrative
order, or consent agreement.
For example, the policy does not apply to:
a) emissions violations detected through a continuous emissions momtor (or alternative monitor established
in a permit) where any such monitoring is required;
b) violations of National Pollutant Discharge Elimination System (NPDES) discharge lunits detected through
required sampling or monitoring; - —
- C) violations discovered through a compliance audit required to be performed by the terms of a consent order
or settlement agreement. —
3) PROMPT DISCLOSURE: (1 if true; X if not the case with this review, or? if unable to determine at this
time)
— The regulated entity fully discloses a specific violation within 10 days (or such shorter
period provided by law) after it has discovered that the violation has occurred, or may have
occurred, in writing to EPA;
4) DISCOVERY AND DISCLOSURE INDEPENDENT OF GOVERNMENT OR THIRD
PARTY PLAINTIFF:
The violation must also be identified and disclosed by the regulated entity prior to : W if true; X if
not the case with this review, or? if unable to determine at this time)
a) the commencement of a federal, state or local agency inspection or investigation, or the
issuance by such agency of an information request to the regulated entity;
b) notice of a citizen suit;
c) the filing of a complaint by a third party;
d) the reporting of the violation to EPA (or other government agency) by a “whistleblower”
employee, rather than by one authorized to speak on behalf of the regulated entity;
OR
e) imminent discovery of the violation by a regulatory agency;
NOTE: Where appropriate, EPA may require that to satisfy conditions 5 aixl 6, a regulated entity enter into a
publicly available written agreement, administrative consent order or judicial consent decree, particularly where
compliance or remedial measures are complex or a lengthy schedule for attaining aixi maintaining compliance or
remediating harm is required.
—3—
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5) CORRECTION AND REMEDIATION: (I if applicable, X if not the case m this review, or
if unable to determine at this lime)
The regulated entity corrects the violation within 60 days, certifies in writing that
violations have been corrected, and takes appropriate measures as determined by EPA to
remedy any environmental or human harm due to the violation. (PLEASE NOTE BELOW)
OR
— If more than 60 days will be needed to correct the violation(s), the regulated entity must
so notify EPA in writing before the 60-day period has passed.
6) PREVENT RECURRENCE: (1 if true; X if not the case with this review, or? if unable to determine at
this time)
____ The regulated entity agrees in writing to take steps to prevent a recurrence of the
violation, which may include improvements to its environmental auditing or due diligence
efforts;
7) NO REPEAT VIOLATIONS: (Can check NCDB and/or regional resources)
____ The specific violation (or closely related violation) has not occurred previously within
the past three years at the same facility,
OR
— is not part of a pattern of federal, state or local violations by the facility’s parent
organization (if any), which have occurred within the past five years.
For the purposes of this section, a violation is: (v’ if true; X if not the case with this review, or? if unable
to determine at this time)
a) any violation of federal, state or local environmental law identified in a judicial or
administrative order, consent agreement or order, complaint, or notice of violation,
conviction or plea agreement; or
b) any act or omission for which the regulated entity has previously received penalty
mitigation from EPA or a state or local agency.
8) OTHER VIOLATIONS EXCLUDED: (/ if true; X if not the case with this review, or? if unable to
determine at this time)
The violation is not one which
— (i) resulted in serious actual harm, or may have presented an imminent and substantial
endangerment to, human health or the environment, or
— (ii) violates the specific terms of any judicial or administrative order, or consent
agreement.
—4-.
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9) COOPERATION: (1 if true; X if not the case with this review, or? if unable to determine at this time)
— The regulated entity cooperates as requested by EPA and provides such information as is
necessary and requested by EPA to determine applicability of this policy.
Cooperation inclndes, at a minimum, providing all requested documents and access to employees
and assistance in investigating the violation, any noncompliance problems related to the disclosure,
aix! any environmental consequences related to the violations.
C. INCENTIVES FOR SELF-POLICING (Section C. applicability)
(1 if true; X if not the case with this review, or? if unable to determine at this time)
1) — NO GRAVITY-BASED PENALTIES:
Where the regulated entity establishes that it satisfies all of the conditions applicable to Section
D of the Self-disclosure Policy. EPA will not seek gravity-based penalties for violations of
federal environmental requirements.
2) — REDUCTION OF GRAVITY-BASED PENALTIES BY 75%:
EPA will reduce gravity-based penalties for violations of federal environmental requirements
by 75% because the regulated entity satisfied all of the conditions applicable to Section D(2)
through D(9) of the Self-disclosure Policy.
3) No Criminal Recommendations: (v” if true; X if not the case with this review, or? if unable to determine
at this time)
— a) EPA will not recommend to DOJ or other prosecuting authority that criminal charges
be brought against a regulated entity because the violation did not demonstrate or involve:
— 1) a prevalent management philosophy or practice that concealed or condoned
environmental violations;
OR
— ii) high-level corporate officials’ or managers’ conscious involvement in, or
willful blindness to, the violations.
NOTE: Whether or not EPA refers the regulated entity for criminal prosecution under this section, the Agency
reserves the right to recommend prosecution for the criminal acts of individual managers or employees under existing
policies guiding the exercise of enforcement discretion.
E. ECONOMIC BENEFIT: EPA will retain its full discretion to recover any economic benefit gained as a
result of noncompliance to preserve a “level playing field” in which violators do not gain a competitive advantage
over regulated entities that do comply. EPA may forgive the entire penalty for violations which meet conditions 1
through 9 in section D and, in the Agency’s opinion, do not merit any penalty due to the insignificant amount of any
economic benefit. (Provide summary of comments below.)
—5—
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ATTACHMENT C-Confidential
Sample Response Letter
Because every self-disclosure is a candidate for consideration under the Self-Disclosure
Policy, this is a sample letter that requests additional information Each case is different Be sure
to provide specific issues that need to be addressed
“... The United State Environmental Protection Agency (EPA) is in receipt of your
, dated (Date), in which you disclosed (potential) violations at (Facility
Location). EPA appreciates (Facility’s Name) willingness to self-police, and disclose, and
correct violations in a timely manner. Violation(s) of (Statute) may subject you to
enforcement action. Therefore, (Facility’s Name) should take action immediately to correct
any violations that have not been corrected.
As discussed in the Incentives for Self Policing: Discovery, Disclosure, Correction
and Prevention of Violations, 60 Fed. Reg. 66706, (Dec. 22, 1995) (“Self-Disclosure Policy”),
in the event EPA takes enforcement action, EPA will not seek gravity-based (i.e., non-
economic benefit) penalties from eligible facilities. Notwithstanding this letter, EPA
reserves the right to take any action pursuant to any applicable authority.
Enclosed is a copy of the Self-Disclosure Policy and a questionnaire, indicating the
information needed by the Agency. Please send your written response to: (Name, Title,
Division and Address of EPA Recipient).”
The questionnaire follows this page. Be sure to fill in the blanks before sending the document to
the company for response
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SELF-DISCLOSURE QUESTIONNAIRE
Provide the following information for each potential violation disclosed by at its
_______________ facility in the letter from dated_____________ Please correlate
each answer to the specific violation
Describe the violation and state the specific regulatory or statutory provision violated
2 Explain how the violation was discovered Please be as detailed as possible
3 State whether the violation of a federal, state, or local regulation was discovered by means
of a systematic, internal, environmental audit or through due diligence
If___________ believes that the violation was discovered through “due diligence,” as
defined in EPA’s Audit Policy, explain, in detail, how the company’s practices and
procedures leading to the discovery of the violation constitute such due diligence
If the violation was discovered by means of an environmental audit, provide the following
info rmation
A. State the date (s) on which the environmental audit or systematic procedure or
practice that identified the violation was being conducted
B State the frequency of environmental audits of the ________facility State the
date(s) on which the last environmental audit was conducted at the__________ facility
prior to ________ 1996
C State whether the ______________facility has a written policy or directive to
follow up on audit findings to correct identified problems and prevent their recurrence.
Provide Region with a copy of this written policy or directive.
D Describe the relationship between the __________facility and the person (s)
responsible for conducting environmental audits. Explain how____________
ensures the auditor’s tasks or inquiries are carried out in an objective and unobstructed
manner. Include in your answer a discussion of the manner in which personal, financial, or
other potential conflicts of interest are avoided between employees of the__________
facility and the individuals conducting an audit
E Provide a copy of written audit policies and procedures for the _______
facility The requested policies and procedures should indicate the scope of the audit, the
process for examining audit findings, the protocol for communicating audit results to
2
-------
management, auditor conflict of interest policy, auditor education and traimng
requirements, and follow-up measures
4 Was the violation identified through an activity which__________ was legally required to
perform, such as under a State or Federal statute, regulation or permit, or under the terms of a
judicial or administrative order or consent agreement 9 If so, identify the authonty under which
the activity w as required
5. Is the violation required to be reported under any Federal or State statute, regulation or
permit 9 If so, identify each such statute, regulation or permit
6 State the date on which the violation was discovered If believed additional analysis
or information was needed after the audit/systematic procedure or practice to determine whether a
violation existed, state the reasons for the additional analysis
7 If disclosure of the violation was not within ten (10) days of the date of discovery, or such
shorter period as may be provided by law, please explain, in detail, the reasons that the violation
was not disclosed within 10 days of discovery
8. Identify the name, title, and employer of each individual who discovered the violation
9 If the violation was discovered by an independent auditor, (that is, by a person not
employed by_______ ), provide the date and the manner in which________ was made aware of
the violation.
10 Explain in detail all measures taken to correct or remediate the violation Provide an
estimate of the length of time it took or will take to complete these measures If estimates
that more than 60 days will be needed to correct the violation, please explain filly and provide the
opinion of any technical or engineering expert relied upon to arrive at that estimate
11 Explain in detail all measures taken or to be taken to ensure that the violation disclosed
will not be repeated Include in your discussion any improvements made to_________
environmental auditing or due diligence efforts in an attempt to prevent recurrence of the
violation
12 Did the violation result in any serious actual harm to human health or the environment?
Provide a full explanation of how this conclusion was reached
13 Did the violation present or may it present, any form of endangerment to public health or
the environment 7 Provide a full explanation of how this conclusion was reached
14 Did the violation violate the specific terms of a judicial or administrative order or consent
agreement 7 If so, please identify the order or agreement
3
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Attachment D - Sample Confidential
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
—
) Docket No. TSCA-96-H-12
) COMPLAINT AND NOTICE OF
In the Matter of ) OPPORTUNITY FOR HEARING
) UNDER SECTION 16(a) OF
Zeneca, Inc. ) THE TOXIC SUBSTANCES
Wilmington, DE ) CONTROL ACT
)
Respondent. )
)
— )
COMPLAINT
This is a civil administrative action issued under the authority of Section 16(a) of the
Toxic Substances Control Act, 15 U.S.C. § 2601 et g. (hereinafter “TSCA”). The
Complainant is Jesse Baskerville, Director, Toxics & Pesticides Enforcement Division, Office
of Regulatory Enforcement, Office of Enforcement and Compliance Assurance, United States
Environmental Protection Agency (EPA), who has been duly delegated the authority to
institute this action. The Respondent is Zeneca Inc., 1800 Concord Pike, Wilmington, DE
19850-5438.
This Complaint serves as notice that Complainant has reason to believe that Respondent
has violated the reporting requirements of Section 8(a) of TSCA, 15 U.S.C. Section 2607(a),
the Inventory Update Reporting Regulations promulgated thereunder at 40 C.F.R. Part 710,
Subpart B, and the regulations promulgated thereunder at 40 C.F.R. Part 712, thereby
violating Section 15 of TSCA, 15 U.S.C. Section 2614, as follows:
COUNT I
1. Respondent is a corporation which owns or controls a facility located in Wilmington,
Delaware.
2. Respondent is a “person” as defined in 40 C.F.R. § 7 10.2(s).
3. 40 C.F.R. Part 710 Subpart B was promulgated under authority of TSCA Section 8(a).
4. 40 C.F.R. § 7 10.28(b) and 7 10.28(c) requires any person who manufactured or
imported for commercial purposes 10,000 pounds or more of a chemical substance
which is in the Master Inventory File at the beginning of a reporting period, at any
single site owned and/or controlled by that person, at any time during the person’s
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2
latest complete corporate fiscal year before August 25, 1990, or before August 25 at
four-year intervals thereafter, to report for the Partial Updating of the Inventory Data
Base unless the chemical is specifically excluded by 40 C.F.R. § 710.26 or 40 C.F.R.
§ 710.29.
5. 40 C.F.R. § 7 10.33(b) sets forth that persons subject to recurring reporting must so
report between August 25, 1990 and December 23, 1990, extended to February 21,
1991, 55 Federal Register (FR) 39586 (September 27, 1990). Subsequent recurring
reporting periods are from August 25 to December 23 at 4-year intervals thereafter(59
FR 30651, June 14, 1994). Any person described in § 710.28(b) must report during
the appropriate reporting period for each chemical substance described in § 710.25 that
the person manufactured during the applicable corporate fiscal year described in §
7 10.28(b).
6. On or about September 28, 1995, Respondent submitted a Partial Updating of TSCA
Inventory Data Base Production and Site Report (hereinafter “Form U”) number
61139630 identifying eight chemical substances that were imported for commercial
purposes in excess of 10,000 pounds at their Wilmington, Delaware facility.
7. The following eight chemicals reported on Form U number 61139630 are listed in the
Master Inventory File and are not excluded from reporting requirements as described
in 40 C.F.R. § 710.26.
CAS # Chemicals Reported
1. 84-65-1 Anthraquinone
2. 121-57-3 Sulphanalic Acid
3. 366-18-7 2,2’-Bipyridyl
4. 12 1-69-7 N,N-Dimethylaniline
5. 91-66-7 N,N-Diethylaniline
6. 103-69-5 N-Ethylaniline
7. 1843-03-4 3-Methyl-6-t-Butylphenol/Crotonaldehyde,
3/1 Condensate
8. 108-88-3 Toluene
8. Respondent’s failure to submit a Form U for the eight chemical substances listed in
paragraph 7 by the regulatory deadline of December 23, 1994, constitutes violations of
40 C.F.R. § 710.33(b), a Rule promulgated under TSCA Section 8(a), and thereby
constitutes violations of Section 15(3)(B) of TSCA.
COUNT U
9. Respondent is a corporation which owns or controls a facility located in Wilmington,
Delaware.
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3
10. Respondent is a “person” as defined in 40 C.F.R. § 7 10.2(s).
11. On or about October 5, 1995, Respondent provided EPA with evidence which revealed
that Respondent had imported the chemical substance, Thiophenol (CAS # 108-98-5),
at the Zeneca Inc. facility located in Wilmington, Delaware from December 1992 to
December 1993.
12. Section 8(a)(1) of TSCA authorizes the Administrator of EPA to promulgate rules
requiring maintenance of records and submission of reports as the Administrator may
reasonably require. The Administrator promulgated such a rule, the “Manufacturer’s
Report - Preliminary Assessment Information” (PAIR form), at 40 C.F.R. Part 712.
This rule enables EPA to collect the only reliable source of information on the workers
associated with and potentially exposed to the chemical listed.
13. The PAIR regulations at 40 C.F.R. §712.30(a)(2), state that the information in each
Preliminary Assessment Information Manufacturer’s Report (PAIR form) must cover
the person’s latest complete corporate fiscal year as of the effective date of the rule
amendment adding a chemical substance to the list of chemicals for which a PAIR form
is required.
14. The effective date for the PAIR amendment adding Thiophenol to the list of chemicals
for which a PAIR form was required was January 26, 1994. The Respondent was
required to provide a completed PAIR form within 60 days of the effective date for
each plant site r? anufacturing or importing this chemical substance.
15. Pursuant to 40 C.F.R. Part 712.30(d), Respondent was required to submit a PAIR
Report for Thiophenol by March 28, 1994.
16. Respondent signed a PAIR form for Thiophenol on or about September 28, 1995.
Respondent’s PAIR form, Control Number 80828073, revealed that a quantitative
amount of Thiophenol was imported from the period December 1992 through
December 1993.
17. Section 15(3)(B) of TSCA, 15 U.S.C. 2614(3)(B) provides that it is unlawful for any
person to fail to or refuse to submit-reports as required by TSCA, or a rule thereunder.
18. Respondent’s failure to submit a PAIR form for Thiophenol as required by 40 C.F.R.
Part 7 12.30(d) is a violation of TSCA Sections 8(a) and 15, 15 U.S.C. 2607(a) and
2614.
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4
PROPOSED CIVIL PENALTY
Section 16 of TSCA, 15 U.S.C. Section 2615, authorizes the assessment of a civil
penalty of up to $25,000 per day for each violation of TSCA. Based upon the facts alleged in
this Complaint, and upon the nature, circumstances, extent and gravity of the violations
alleged, as well as Respondent’s history of prior violations of TSCA, the degree of culpability
and such other matters as justice may require, the Complainant proposes that Respondent be
assessed the following civil penalty for the violations alleged in this Complaint:
COUNT I
Failure to submit a Partial Updating of TSCA Inventory Data Production and Site Report for
eight chemical substances
by the regulatory deadline $ 136,000 -
(Level 1, Significant, Per Chemical, Per Site)
15 U.S.C. § 2614(3)(B)
15 U.S.C. § 2607(a)
COUNT II
Failure to submit a Preliminary Assessment
Information Manufacturer’s Report for
Thiophenol, as required $ 34,189
15 U.S.C. 2614(3)(B)
40 C.F.R. Part 712, Subpart B
TOTAL PROPOSED CIVIL PENALTY $ 170,189
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5
NOTICE OF OPPORTUNITY TO
REQUEST A HEARING
As provided in Section 16(a)(2)(A) of TSCA 15 U.S.C. § 2615(a)(2)(A), you have the
right to request a formal hearing to contest any material fact set forth in this Complaint or to
contest the appropriateness of the proposed penalty. Any hearing requested will be conducted
in accordance with the Administrative Procedures Act, 5 U.S.C. Section 551 et and the
Consolidated Rules of Practice Governing the Administrative Assessment of Civil Penalties
and the Revocation or Suspension of Permits , 40 C.F.R. Part 22 ( “Consolidated Rules of
Practice”) . A copy of the Consolidated Rules of Practice accompanies this Complaint.
To avoid being found in default which constitutes an admission of all facts alleged in the
Complaint and a waiver of the right to a hearing and having the above penalty assessed without
further proceedings you must file a written Answer within twenty (20) days of receiving this
Complaint . Pursuant to the Consolidated Rules of Practice, your Answer must clearly and directly
admit, deny, and/or explain each of the factual allegations contained in this Complaint with regard to
which you have any knowledge. If you have no knowledge of a particular fact and so state, the
allegation is considered denied. Failure to deny any of the allegations in this Complaint will
constitute an admission of the undenied allegation.
The Answer shall also state the circumstances and arguments, if any, which are alleged to
constitute the grounds of defense, and shall specifically request an administrative hearing if
desired. If you deny any material fact or raise any affirmative defense, you will be considered
to have requested a hearing.
The Answer must be filed with:
Headquarters Hearing Clerk (1900)
United States Environmental Protection Agency
401 M Street, S.W., Room M3708
Washington, DC 20460
Please send a copy of the Answer and all other documents which you file in this action to the
following attorney assigned to represent EPA in this matter:
Carl Eichenwald, Attorney
U.S. Environmental Protection Agency (2245A)
401 M Street, S.W
Washington, D.C. 20460 Telephone: (202) 564-4036
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6
INFORMAL SETTLEMENT CONFERENCE
Whether or not you request a hearing, you may confer informally with EPA to discuss
the facts of this case, or amount of the proposed penalty, and the possibility of settlement. An
informal settlement conference does not, however, affect your obligation to file a written
Answer to the Complaint.
EPA has the authority, where appropriate, to modify the amount of the proposed
penalty to reflect any settlement reached with you in an informal conference. The terms of
such an agreement would be embodied in a Consent Agreement and Consent Order
(“CACO”). A CACO signed by EPA and you would be binding as to all terms and conditions
specified therein upon signature by the Environmental Appeals Board.
Please be advised that the Consolidated Rules of Practice prohibit any ex parte
(unilateral) discussion of the merits of any action with the Administrator, Environmental
Appeals Board Judge, Administrative Law Judge, or any person likely to advise these officials
in the decision of the case, after the Complaint is issued.
PAYMENT OF PENALTY
Instead of filing an Answer requesting a hearing or requesting an informal settlement
conference, you may choose to pay the proposed penalty. Such payment should be made by
sending a cashier’s or certified check payable to the Treasurer of the United States of America
in the amount of the penalty assessed in this Complaint. The check should be mailed to:
EPA-Washington
(Hearing Clerk Docket No. TSCA 96-H-12)
P.O. Lock Box 360277M
Pittsburgh, PA 15251
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
TSCA 96-H-12
In Re: Zeneca, Inc.
Complainant
BY: ___________________
Jesse Baskerville, Director
Toxics & Pesticides Enforcement Division
Office of Regulatory Enforcement
DATE:
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7
CERTIFICATE OF SERVICE
I hereby certify that the original of the foregoing Complaint and Notice of Opportunity for
Hearing, Docket No. TSCA 96-H-12, has been filed with the Headquarters Hearing Clerk and that
copies were sent, certified mail, return receipt requested to:
Mr. A. Keith Willard, Chairman
Zeneca Inc.
1800 Concord Pike
Wilmington, DE 19850
Date Barbara R. McGarry (2245-A)
Toxics and Pesticides Enforcement Division
Office of Regulatory Enforcement
U.S. Environmental Protection Agency
401 M Street, S.W.
Washington, D.C. 20460
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Attachment E-Sample Confidential UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
)
In the Matter of
)
Zeneca, mc,
)
Wilmington, Delaware
)
RESPONDENT
)
)
Docket No TSCA-96-H-
CONSENT AGREEMENT
Complainant, the United States Environmental Protection Agency (“EPA”), and
Respondent, Zeneca, Inc of Wilmington, Delaware (“Respondent”) the parties herein, having
consented to entry of this Consent Agreement and Consent Order before the taking of any
testimony and without any adjudication of any issue of fact or law, consent to the terms of this
Consent Agreement and the attached Consent Order
I PRELIMINARY STATEMENT
A. EPA initiated this proceeding for the assessment of a civil penalty of one hundred
seventy thousand, one hundred eighty nine dollars ($170,189) pursuant to Section 16(a) of the
Toxic Substances Control Act, 15 U S C. § 2601 (“TSCA” or “the Act”) and regulations
promulgated thereunder, found at 40 C F.R Subchapter R by issuing an administrative Complaint
and Notice of Opportunity for Hearing Under Section 16(a) of the Toxic Substances Control Act
(“Complaint”)
B The Complaint alleges that EPA had reason to believe that Respondent failed to comply
at its Wilmington, Delaware facility in a timely manner by the regulatory deadline of December
23, 1994, with the Partial Updating of the TSCA Inventory Data Base Rule (“JUR”) requirements
for eight chemical substances’ in violation of 40 C F R §710 33(b), promulgated under the
1 Respondent also submitted an LUR Report for Thiophenol, CAS RN 108-98-5 Ho ever, that failure to
timely submit was not charged in the complaint Thiophenol was subject to PAIR reporting by March 28, 1994 Both
the PAIR and IUR reporting requirements exist under the authority of TSCA §8(a) 40 CFR 710 35(a) hnuts the burden
on information submitters by not requinng an [ hR report for a chemical subject to certain other reporting under TSCA
§ 8(a) Consistent with the intent of the [ hR. EPA determined not to charge for both reporting violations
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2
authority of Section 8(a) of TSCA, 40 U S C §2607(a) and violation of Section 15(3)(B) of
TSCA., 40 U S.C §2614(3)(B) These chemicals are identified as follows
Chemicals Reported
CAS # Chemical Name
1 84-65-1 Anthraquinone
2 121-57-3 Sulphanalic Acid
3. 366-18-7 2, 2’ - Bipyridyl
4 121-69-7 N, N - Dimethylaniline
5 91-66-7 N, N - Diethylaniline
6. 103-69-5 N - Ethylaniline
7 1843-03-4 3 - methyl - 6 - t - Butylphenol/crotonaledhyde, 3/1 condensate
8. 108-88-3 Toluene
C. The Càmplaint further alleges that EPA had reason to believe that Respondent failed to
comply by the regulatory deadline of March 28, 1994, with the Preliminary Assessment
Information Rule (“PAIR”) requirements for Thiophenol, CASRN 108-98-5, in violation of 40
C.F R. §712.30(d), promulgated under the authority of Section 8(a) of TSCA, 40 U S C
§2607(a) and violation of Section 15(3)(B) of TSCA, 40 U.S C. §2614(3)(B)
D. Respondent stipulates that EPA has jurisdiction over the subject matter alleged in the
Complaint. Respondent waives any defenses it might have as to venue
E. Respondent hereby waives its right to a judicial or administrative hearing on any issue
of law or fact set forth in the Complaint
F. Respondent neither admits nor denies the factual allegations contained in the
Complaint, set forth in Part II of this Consent Agreement and the Consent Order
G. Respondent certifies that it has met all conditions in Sections D(2) through D(9)
contained in the Incentives for Self-Policing Discovery. Disclosure. Correction and Prevention of
Violations , 60 Fed. Reg. 66706 (Dec 22,1995).
H Respondent consents to the Terms of Settlement as set forth in Part V of this Consent
Agreement and the Order
II. EPA FINDINGS OF FACT
A. Respondent is a corporation which owns or controls a facility located in Wilmington,
Delaware
B On or about September 28, 1995 Respondent submitted a Partial Updating of TSCA
Inventory Data Base Production and Site Report (hereinafter “Form U”) identifying eight
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3
chemical substances that were imported, and thus, manufactured for commercial purposes in
excess of 10,000 pounds at its Wilmington, Delaware facility
C. The chemical substances reported on the Form U are listed in the Master Inventory File
and are not excluded from reporting requirements as described in 40 C F R § 710 26
D The effective date for the PAIR amendment adding Thiophenol to the list of chemicals
for which a PAIR form was required was January 26, 1994
E On or about September 28, 1995 Respondent submitted a PAIR form, Control Number
80828073 indicating that respondent had imported reportable quantities of Thiophenol between
December 1992 and December 1993
III EPA CONCLUSIONS OF LAW
A Respondent is a “person” as defined in 40 C F R § 710 2(s)
B Section 15(3)(B) of TSCA, 15 U S C 2614(3)(B) provides that it is unlawful for any
person to fall to or refuse to submit reports as required by TSCA, or a rule thereunder
C. 40 C F R. Part 710 Subpart B was promulgated under authonty of TSCA Section 8(a)
D 40 C F R § 710 28(b) and 710 28(c) requires any person who manufactured or
imported for commercial purposes 10,000 pounds or more of a chemical substance which is in the
Master Inventory File at the beginning of a reporting period, at any single site owned and/or
controlled by that person, at any time during the person’s latest complete corporate fiscal year
before August 25, 1990, or before August 25 at four-year intervals thereafter, to report for the
Partial Updating of the Inventory Data Base unless the chemical is specifically excluded by 40
CFR. §71026or40C.FR. §710 29
E 40 C F R § 710.33(b) sets forth that persons subject to recurring reporting must so
report between August 25, 1990 and December 23, 1990, extended to February 21, 1991, 55
Federal Register (FR) 39586 (September 27, 1990) Subsequent recurring reporting periods are
from August 25 to December 23 at 4-year intervals thereafter 59 FR 30651 (June 14, 1994)
Any person described in § 710 28(b) must report during the appropriate reporting period for each
chemical substance described in § 710 25 that the person manufactured during the applicable
corporate fiscal year described in § 710 28(b)
F Respondent’s failure to submit a Form U for the eight chemical substances listed in
Section II B above by the regulatory deadline of December 23, 1994, constitutes violations of 40
C F R § 710 33(b), a Rule promulgat’ed under Section 8(a) of TSCA, 15 U S C § 2607(a), and
of Section 15 of TSCA, 15 U S C § 2614 for which a penalty may be assessed pursuant to
Section 16(a) of TSCA, 15 U S C § 2615(a)
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4
G 40 C F R. Part 712 Subpart B was promulgated under authonty of TSCA Section 8(a)
H 40 C F R §712 30(a)(2), requires that the information in each Preliminary Assessment
Information Manufacturer’s Report must cover the person’s latest complete corporate fiscal year
as of the effective date of the rule amendment adding a chemical substance to the list of chemicals
for which a PAIR form is required
I The Respondent was required to provide a completed PAIR form within 60 days of the
effective date for each plant site manufacturing or importing this chemical substance
J Pursuant to 40 C F R Part 712 30(d), Respondent was required to submit a PAIR
Report for Thiophenol by March 28, 1994
K Respondent’s failure to submit a PAIR Report for Thiophenol listed in Section II E
above by the regulatory deadline of March 28, 1994, constitutes violations of 40 C F R §
710 30(d), a Rule promulgated under Section 8(a) of TSCA, 15 U S C § 2607(a), and of Section
15 of TSCA, 15 U S C § 2614 for which a penalty may be assessed pursuant to Section 16(a) of
TSCA, 15USC § 2615(a)
IV CIVIL PENALTY
The proposed penalty in this matter was calculated by applying the Recordkeeping and
Reporting Rules TSCA Sections 8, 12 and 13 Enforcement Response Policy (TSCA ERP) to the
facts of this case. The TSCA ERP was developed in accordance with the Guidelines for the
Assessment of Civil Penalties under Section 16 of the Toxic Substances Control Act which set out
a general penalty system for TSCA violations. This penalty policy captures the mandatory
evaluation factors of Section 16 of TSCA, including the nature, circumstances, extent and gravity
of the violations alleged, as well as Respondent’s history of prior violations of TSCA, the degree
of culpability an6such other matters as justice may require.
Penalties are determined under the TSCA ERP by first calculating a penalty based on the
gravity of the violation and then adjusting for certain factors, such as voluntary disclosure The
gravity is determined by the nature, extent, and circumstances surrounding the violation Once
the levels of extent and circumstances are identified, the TSCA ERP provides a matrix for
calculating the amount of the gravity-based penalty
In accordance with the TSCA ERP, the nature of the inventory update rule violations is
that of “hazard assessment” The circumstance level for the particular violation is Level I
Finally, the extent level of the particular violation is significant The initial gravity-based proposed
penalty in this action represented the point of intersection on the penalty matrix for a circumstance
level I and an extent level significant, $17,000, multiplied by the number of violations, 8, for a
proposed penalty of $136,000
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5
Also in accordance with the TSCA ERP, the nature of the preliminary assessment
information update rule violations is that of “hazard assessment” The circumstance level for the
particular violation is Level 1 Finally, the extent level of the particular violation is significant
The initial gravity-based proposed penalty in this action is represented the point of intersection on
the penalty matrix for a circumstance level 1 and an extent level significant, $17,000, plus, to
account for every day being a separate violation, the amount of violation, $17,000 is multiplied by
the number of days in violation, 547, and divided by the number of days in a year, 360, equaling
$25,830 55, which would add to a proposed penalty of $42,830 55 PAIR violations are capped
at a one year maximum, making the proposed penalty $34,189 Accordingly, the total proposed
penalty in this matter was $170,189
Because the Respondent’s has voluntary disclosed to EPA of the violations alleged in the
Complaint, the Agency has applied the Incentives for Self-Policing Discovery. Disclosure.
Correction and Prevention of Violations , 60 Fed. Reg 66706 (Dec.22, 1995) (“Self-Disclosure
Policy”) 2 The Self-Disclosure Policy has several important goals, including encouraging greater
compliance with the laws and regulations which protect human health and the environment and
reducing transaction costs associated with violations of the laws EPA is charged with
administering In the appropriate circumstances, reductions in gravity based penalties up to 100%
are available under the Self-Disclosure Policy
Based, in part, upon Respondent’s certification, EPA has determined that Respondent has
satisfied all conditions in Sections D(2) through D(9) of the Self-Disclosure Policy and thus
qualified for a 75 percent penalty reduction of the initial gravity based penalty of $170,189
Therefore, the penalty agreed upon by the parties for settlement purposes is $42,547 25
V TERMS OF SETTLEMENT
A This Consent Agreement and Consent Order shall be a complete settlement of all
administrative claims and civil causes of action between the parties alleged in and arising from the
Complaint
B: With respect to the chemical substances identified in the Complaint, Respondent
certifies that it is in compliance with Inventory Update Rule reporting and the Preliminary
Assessment Information Rule requirements of Section 8(a) of TSCA
C Respondent certifies that, to the best of the knowledge of its TSCA Compliance
Specialists, it has not identified any other information requiring reporting for the 1994 LUR
reporting period or any PAIR reporting period
2 Respondent’s disclosure to EPA occurred on October 5, 1995 After Respondent’s disclosure, the Agency
issued Incentives for Self-Policing Discovery, Disclosure, Correction and Prevention of Violations Final Policy
Statement , 60 Fed Reg 66708 (December 22, 1995)
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6
D Respondent agrees to the payment of a civil penalty in the sum of forty two thousand
five hundred forty seven dollars and twenty five cents ($42,547.25) Respondent shall pay the
civil penalty by forwarding a cashier’s or certified check, within thirty (30) calendar days of receipt
of the Consent Order, payable to the order of the “Treasurer of the United States of America” in
the amount of $42,547.25 to
U S Environmental Protection Agency
Hearing Clerk
P0 Lock Box 360277M
Pittsburgh, PA 15251
The check shall bear the case docket number TSCA-96-H-
E. To ensure a record f compliance with Part V of this Consent Agreement, Respondent
shall forward a copy of the check to EPA, in care of
Tony R Ellis, Case Development Officer
U S Environmental Protection Agency
Toxics and Pesticides Enforcement Division (2245A)
401 M Street, S W
Washington, DC 20460
F If Respondent fails to remit the civil penalty as agreed to herein, EPA is entitled to
assess interest and penalties on debts owed to the United States and a charge to cover the cost of
processing and handling a delinquent claim. Interest, at the statutory judgment rate provided for
in 28 U S.C § 1961, will therefore begin to accrue on the civil penalty if it is not paid within thirty
(30) calendar days of the date of execution of the Consent Order.
G Pursuant to Section of 16(a)(4) of TSCA, 15 U S.C § 2615(a)(4), failure by
Respondent to pay any civil penalty under this Consent Agreement in a timely manner pursuant
to Part V D and E may result in the forwarding of this action to the United States Department of
Justice for collection of the amount due, plus stipulated penalties, interest, and a charge to cover
the cost of processing and handling a delinquent claim This provision does not limit the EPA
from using any or all other remedies available at law and in equity to enforce this Consent
Agreement
VI. OTHER MATTERS
A Nothing in this Consent Agreement and Consent Order shall relieve Respondent of the
duty to comply with all applicable provisions of TSCA and other environmental statutes..
B “EPA” shall mean the United States Environmental Protection Agency and any
successor departments or agencies of the United States
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7
C Any change in ownership or corporate status of the Respondent including, but not
limited to, any transfer of assets or real or personal property, shall in no way alter Respondent’s
responsibilities under this Consent Agreement
D The provisions of this Consent Agreement and Order shall apply to and be binding on
the Parties, their officers, directors, successors, and assigns upon execution of the Consent Order
by the Environmental Appeals Board or its dtlegatee
E Respondent’s obligations under this Consent Agreement shall end when Respondent has
performed all of the terms of the Consent Agreement, including payment of civil penalties and
stipulated penalties, as appropriate, in accordance with the Consent Order in this matter
F The penalty specified in Paragraph D of Part V , above, shall represent civil penalties
assessed by EPA Respondent shall not treat this civil penalty as a deduction for purposes of
Federal taxes
G. The Consent Order shall have the same force and effect as a final order as defined in 40
C F R § 22 03, and as used in “Guidelines for Assessment of Civil Penalties Under Section 16 of
the Toxic Substances Control Act”, 45 Fed Reg 59770 (September 10, 1980)
H All of the terms and conditions of this Consent Agreement together comprise one
agreement, and each of the terms and conditions is in consideration of all of the other terms and
conditions In the event that this Consent Agreement, or one or more of its terms and conditions,
is held invalid, or is not executed by all of the signatory parties in identical form, or is not
approved in such identical form by the Environmental Appeals Board or its delegatee, then the
entire Consent Agreement shall be null and void
I The undersigned representatives of each party to this Consent Agreement certiFy that
each is duly authorized by the party whom he or she represents to enter into the terms and bind
that party to it
WE AGREE TO THIS.
For Respondent: For Complainant:
Zeneca, Inc Jesse Baskerville, Director
Toxics and Pesticides Enforcement Division
Office of Regulatory Enforcement
Date__________ Date __________
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UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C.
)
In the Matter of
)
)
Zeneca, Inc.
)
Wilmington, Delaware,
)
RESPONDENT
)
)
Docket No TSCA-96-H-
CONSENT ORDER
Pursuant to Section 16(a)(2) of the Toxic Substances Control Act (“TSCA”, 15 U S C §
2601 et q), 15 U S C § 2615(a)(2), it is hereby ORDERED THAT
1 Respondent shall comply with all of the terms of the Consent Agreement, incorporated
herein by reference, and with the requirements set forth in TSCA and regulations thereunder;
2. Respondent is assessed a civil penalty in the sum of Forty Two Thousand Five
Hundred Forty Seven Dollars and Twenty Five Cents ($42,547.25),
3 Respondent shall, within thirty (30) calendar days of receipt of this Order, forward a
certified or cashier s check, payable to the order of the “Treasurer of the United States of
America”, in the amount of$ 42,547.25 to
U S. Environmental Protection Agency
Heanng Clerk
P0 Box 360277M
Pittsburgh, PA 15251
The check shall bear the case docket number “TSCA-96-H-
IT IS SO ORDERED
Environmental Appeals Board
Date
by
Environmental Appeals Judge
U S Environmental Protection Agency
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Attachment F - Sample Confidential
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
)
)
In the Matter of
)
FINAL DETERMINATION,
Minolta Corporation,
)
NOTICE OF VIOLATION
Ramsey, New Jersey
)
)
Pursuant to the Final Policy Statement, Incentives for Self-Policing Discovery. Disclosure.
Correction and Prevention of Violations , 60 Fed Reg 66706 (December 22, 1995) (“Self-Disclosure
Policy”), the U S Environmental Protection Agency ( “EPA” or “Agency”) hereby issues this Final
Determination on violations disclosed to EPA by Minolta Corporation (“Minolta”) located at 101
Williams Drive, Ramsey, New Jersey, 07746
I. SELF-DISCLOSURE POLICY
EPA issued the Self-Disclosure Policy to encourage regulated entitles to conduct voluntaxy
compliance evaluations and to disclose and promptly correct violations As an incentive for companies
to undertake self-policing, self-disclosure, and self-correction of violations, EPA may substantially
reduce or eliminate gravity-based civil penalties, however, EPA retains its discretion to recover any
economic benefit gamed as a result of noncompliance Where the disclosing party establishes that it
satisfies all the conditions listed below, as set forth in the Self-Disclosure Policy, EPA will not seek
gravity-based penalties for violations of the federal environmental requirements
(1) Discovery of the violation(s) through an environmental audit or due diligence,
(2) Voluntary disclosure;
(3) Prompt disclosure;
(4) Discovery and disclosure independent of government or third-party plaintiff,
(5) Correction and remediation;
(6) Prevent recurrence,
(7) r4à repeat violations,
(8) Other violations excluded, and
(9) Cooperation.
II. FINDINGS OF FACT
In a letter written to EPA on or about December 8, 1995, a representative of Mmolta admitted
violations of TSCA § 13 and CFR § 12 121(a) Minolta’s failure to certif ’ at the port of entry that the
chemical shipment is subject to TSCA and complies with all applicable rules or orders constitutes
failure to comply with 19 CFR Part 12, which is a violation of 13 and l5(3)(B) of TSCA
Disclosure 1: On or about October 26, 1995, Minolta imported various toner and starter products to
Los Angeles, California, without prepared TSCA certifications to the director at the
portofentry as required by 19 CFR § 12 121(a)
Disclosure 2: On or about October 16, 1995, Minolta utiported various products (photo conductors,
imaging cartridges, memory boards) to L 9 s Angeles, California, without prepared
TSCA certifications to the director at the port of entry as required by 19 CFR §
12 121(a)
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Disclosure 3: On or about October 31, 1995, ‘Minolta imported a shipment of imaging cartridges to
New York, New York, without prepared TSCA certifications to the director at the port
of entry as required by 19 CFR § 12 12 1(a)
Disclosure 4: On or about October 29, 1995, Minolta imported various products to Los Angeles,
California, without prepared TSCA certifications to the director at the port of entry as
required by 19 CFR § 12 121(a)
Disclosure 5: On or about October 12, 1995, Minolta imported vanous spare parts for copiers to
New York, New York, without prepared TSCA certifications to the director at the port
ofentry as required by 19CFR 12.121(a)
III. Final Determination
Pursuant to the Self-Disclosure Policy, and based on information provided by Minolta on
December 8, 1995, February 20, 1996, and April 15, 1996, EPA makes the following final
determination concerning each of the disclosures identified above
I Minolta meets the conditions of the Self-Disclosure Policy for eliminating the total gravity-based
penalties of $30,000 00 for these violations otherwise assessed under TSCA § 16
2 Minolta failed to submit TSCA certifications for the imported shipments, but the chemicals were
otherwise in compliance with other TSCA provisions
3 EPA will not seek gravity-based penalties for these violations
4 Minolta gained an insigmficant amount of any economic benefit as a result of these disclosed
violations
In making the final determinations above, EPA believes Minolta is capable of achieving a
higher standard of self-policing and greater compliance with laws and regulations that protect human
health and the environment Consistent with the purposes of the Self-Disclosure Policy, EPA expects
Minolta to continue with their company-wide internal policies and procedures necessary to prevent
recurrence of violations of environmental requirements.
Under Authonty of the
U S Environmental Protection Agency
Date _______________________________
By _______________________
Jesse Baskerville, Director
Toxics and Pesticides
Enforcement Division
Office of Regulatory Enforcement
2
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REGISTERED MAIL
RETURN RECEIPT REQUESTED
SUBJECT In the Matter of
Final Determination Notice of Violation
Dear
Enclosed please find a NOTICE OF DETERMINATION concerning violations of the Toxic
Substances Control Act (TSCA), 15 U S C §2601 et seq
The U S Environmental Protection Agency (EPA) is in receipt of your letter, dated
, in which you disclosed violations by your facility at <101 Williams Dnve,
Ramsey, New Jersey> EPA appreciates willingness to self-police, disclose,
and correct violations in a timely manner Violations under may subject you to
enforcement action. However, based on documentation provided to the EPA on , your facility appears to have taken immediate actions to correct
these violations by submitting the proper certifications
Based on the Final Statement Policy, Incentives for Self-Policing Discovery. Disclosure.
Correction and Prevention of Violations , 60 Fed. Reg 66706 (December 22, 1995) (“Self-Disclosure
Policy”), EPA will not seek any gravity-based penalties (nor economic benefit) since has discovered, disclosed, and corrected the violations in accordance with the Self-
Disclosure Policy Should you have any questions regarding this letter, please contact the attorney of
record, of my staff, ax <202/564-4032>
Sincerely,
3
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Attachment C - Sample Confidential
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
BEFORE THE ADMINISTRATOR
In the Matter of
SUNBEAM-OSTER COMPANY, INC.
Docket No. EPCRA-94-H-02
Respondent.
CONSENT AGREEMENT
Complainant, United States Environmental Protection Agency (EPA#), and Respondent, the
Sunbeam Corporation (Sunbeams or 1 Respondent”), the Parties herein, having consented to the
entry of this Consent Agreement and the attached Consent Order before the taking of any testimony
and without any adjudication of any issues of law or fact herein, agree to comply with the terms of
this Consent Agreement and the attached Consent Order.
I. PRELIMINARY STATEMENT
A. In December 1993, Respondent Sunbeam voluntarily disclosed to EPA that it failed to
timely submit for its Hattiesburg, Mississippi; Coushatta, Louisiana; Shubata, Mississippi; Bay
Springs, Mississippi; Neosho, Missouri [ 2 facilities]; McMinnville, Tennessee; and Waynesboro,
Mississippi facilities toxic chemical release forms (“Form R”) for calendar years 1990 through 1992,
as required by Section 313 of the Emergency Planning and Community Right-To-Know Act
( EPCRA1, 42 U.S.C. § 11023, and by regulations duly promulgated and codified at 40 C.F.R. Part
372, for the thirty-four incidents specified in EPA’s Complaint in this matter, incorporated herein by
reference.
B. Based upon the voluntary disclosures as described in Section l.A above, EPA issued an
administrative Complaint and Notice of Opportunity for Hearing (“Complaint”), EPCRA 94-H-02,
dated September 30, 1994, in which the Agency alleged thirty-four violations of EPCRA.
C. Respondent, for purposes of this proceeding: (1) admits that the EPA has jurisdiction over
the subject matter alleged in the Complaint; (2) neither admits nor denies the findings of fact and
conclusions of law stated and/or alleged in the Complaint and in this Consent Agreement and the
attached Consent Order; and (3) consents to this Consent Agreement and the attached Consent
Order.
D. Upon discovering and voluntarily disclosing the alleged violations set forth in the
Complaint, Respondent cooperated fully with EPA in resolving the matters covered by this Consent
Agreement, and took all steps reasonably expected to address the alleged violations, including a
review of its EPCRA compliance program for its Hattiesburg, Missouri; Coushatta, Louisiana;
Shubata, Mississippi; Bay Springs, Mississippi; Neosho, Missouri (2 facilities]; McMinnville,
Tennessee; and Waynesboro, Mississippi facilities. Accordingly, EPA agrees to mitigate the civil
penalty assessments, proposed in the Complaint as described in Section IV below.
E. The terms of this Consent Agreement and the attached Consent Order constitute a full
settlement of this proceeding with respect to all civil and administrative claims and causes of action
alleged in and arising from the Complaint. Each party shall bear its own costs.
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F. Respondent waives its right to request a judicial or administrative hearrng on any issue of
law or fact to the extent set forth in the Complaint, including but not limited to its rights under
EPCRA § 325(b)(1)(B).
G. Respondent certifies that to the best of its knowledge and belief, it is in full compliance
with EPCRA Section 313, 42 U.S.C. § 11023 with respect to the violations alleged in the Complaint.
II. EPA FINDINGS OF FACT
Paragraphs 1 through 294 of the Complaint are incorporated herein by reference as EPA’s
Findings of Fact in this matter.
III. EPA CONCLUSIONS OF LAW
EPA has concluded that the Findings of Fact described in Section II above constitute thirty-
four violations of EPCRA Section 313, 42 U.S.C. § 11023. Specifically, EPA concludes that
Respondent’s facilities violated EPCRA § 313 and regulations codified at 40 C.F.R. Part 372, which
require covered owners or operators to submit Form Rs for certain listed toxic chemicals.
IV. CIVIL PENALTY
Pursuant to EPA’s EPCRA Section 313 Enforcement Response Policy (August 10, 1992), EPA
proposed in the Complaint an Initial Proposed Penalty of $794,319. Consistent with the provisions
of the EPCRA § 313 ERP, Complainant made the following downward adjustments to the Initial
Proposed Penalty:
Counts I through Xl
* 25% reduction for self-disclosure of the violation before it was detected by
EPA; and
* 25% reduction for timely self-disclosure and for taking all steps reasonably
expected;
Counts XII through XXXIV
* 25% reduction for self-disclosure of the violation before it was detected by
EPA.
Therefore, EPA’s Adjusted Proposed Penalty was $536,850.
Subsequent to Respondent’s voluntary disclosure to EPA of the violations alleged in the
Complaint, EPA issued the Voluntary Environmental Self-Policing and Self-Disclosure Interim Policy
Statement , 60 Fed. Reg. 16875 (April 3, 1995) (“Self-Disclosure Policy”). 1 The Self-Disclosure
Policy has several important goals, including encouraging greater compliance with the laws and
regulations which protect human health and the environment and reducing transaction costs
associated with violations of the laws EPA is charged with administering. Under the appropriate
circumstances, reductions in gravity-based penalties up to 100% are available under the Self-
Disclosure Policy.
‘That policy was superseded by EPA’s Incentives for Self-Policing Discovery, Disclosure, Correction and
Prevention of Violations Final Policy Statement , 60 Fed Reg 66708 (December 22, 1995) Nevertheless, because
Respondent provided all necessary information regarding application of the policy to EPA before the superseding
policy was issued, EPA has determined that the Self-Disclosure Policy is appropriate to apply here
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The Self-Disclosure Policy permits the retroactive application ot the Policy to disclosures
which occurred before the Policy took effect. EPA has determined that it is an appropriate exercise
of its discretion to do so in this matter. EPA has further determined that Respondent has satisfied all
seven Conditions in the Self-Disclosure Policy, and thus qualifies for a 100% penalty reduction from
the Adjusted Proposed Penalty of $536,850.
Pursuant to the Self-Disclosure Policy, EPA retains itS full discretion to recover any economic
benefit gained as a result of noncompliance. Based on information provided by Respondent and
verified by EPA using the BEN computer model, EPA has determined that $1,000.00 per violation is
a representative amQunt of economic benefit of noncompliance in this matter..
Therefore, the penalty agreed upon by the parties for settlement purposes is $34,000.
V. TERMS OF SETTLEMENT
A. Respondent agrees to pay a civil penalty in the amount of $34,000 within 30 days of
the execution of the Consent Order by the Environmental Appeals Board. The specific requirements
of each of these terms of settlement are outlined below.
B. Penalty Payment -
1. For payment of the civil penalties assessed in Counts I through XXXIV of the
Complaint for EPCRA violations, Respondent shall, within 30 days of execution of the Consent
Order, forward a cashier’s or certified check in the amount of $34,000 and payable to the order of
the “Treasurer of the United States of America,” to the following address:
United States Environmental Protection Agency
Hearing Clerk
P.O. Box 360277M
Pittsburgh, PA 15251
The check should indicate that it is for “Sunbeam-Oster EPCRA Enforcement Action (EPCRA 94-H-
02).”
2. To ensure a record of compliance with Paragraph V.B.1, Respondent shall
forward a copy ot.the check to EPA, in care of the following person:
Carl J. Eichenwald, Attorney
U.S. EPA
Office of Regulatory Enforcement (2245-A)
401 M Street, S. W.
Washington, DC 20460
3. If Respondent fails to pay the penalty in a timely manner as described in
Paragraph V.B.1, this action may be the forwarded to the United States Department of Justice for
collection of the amount due. In addition, if a payment is not received on or before its due date,
interest will be assessed at the annual rate established by the Secretary of the Treasury, pursuant to
31 U.S.C. § 3717, on the overdue amount from the due date through the date of payment.
Respondent also agrees to pay a stipulated penalty of $1,000 per day in addition to interest
as allowed by law, unless EPA in writing excuses or mitigates the stipulated penalty. EPA will
excuse or mitigate the stipulated penalty if EPA determines after an appropriate showing by
Respondent that the failure to comply occurred despite the exercise of good faith and due diligence
by the Respondent.
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This section does not limit the EPA from using any or all other remedies available at law or
in equity to enforce this Consent Agreement.
VI OTHER MATTERS
A. Nothing in this Consent Agreement and the attached Consent Order shall relieve
Respondent of the duty to comply with all applicable provisions of EPCRA or other environmental
statutes.
B. “EPA’ shall mean the U.S. Environmental Protection Agency and any successor
departments or agencies of the United States.
C. Any change in ownership or corporate status of the Respondent including, but not
limited to, any transfer of assets or real or personal property, shall in no way alter Respondent’s
responsibilities to pay any penalty under this Consent Agreement.
D. The provisions of this Consent Agreement and Order shall apply to and be binding on
the Parties, successors, and assigns upon execution of the Consent Order by the Environmental
Appeals Board or its delegatee.
E. Respondent’s obligations under this Consent Agreement shall end when it has fully
performed all of the terms of the Consent Agreement, including payment of civil penalties and
stipulated penalties, as appropriate, in accordance with the Consent Agreement in this matter.
F. All of the terms and conditions of this Consent Agreement together compromise one
agreement, and each of the terms and conditions is in consideration of all of the other terms and
conditions. In the event that this Consent Agreement (or one or more of its terms and conditions) is
held invalid, or is not executed by all of the signatory parties in identical form, or is not approved in
such identical form by the EPAs Environmental Appeals Board or its designated representative, then
the entire Consent Agreement shall be null and void.
C. The undersigned representatives of each party to this Consent Agreement certify that
each is duly authorized by the party whom he or she represents to enter into the terms and bind that
party to it.
FOR RESPONDENT:
DAVID R. SARGENT, . Date
Vice President and Associate General Counsel
Sunbeam Corporation
FOR COMPLAINANT:
JESSE BASKERVILLE, Director Date
Toxics and Pesticides Enforcement Division
U.S. Environmental Protection Agency
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Attachment H
5/5/97
NEW INSTRUCTIONS FOR ENTERING AUDIT POLICY DATA -
Docket Users: -
Please find attached new instructions on how to enter Audit Policy data in Docket The new Docket
changes allow users to indicate whether the Audit Policy was applied through the use of a Y/N flag
Please follow the attached instructions when entenng Audi Policy data in Docket. If you have any
questions, Dlease feel free to call me at 202-564-5089, or Merle Miller (EPA/OECA) at 202-564-4114
INSTRUCTIONS FOR ENTERING AUDIT POLICY DATA
IN THE ENFOP( FMFNT DOCKET DATARASE
I) ADMINISTRA
ENFORCE (C
TIVE NON-CASE MATT
LOSED OUT)
ER RESULTING IN A NOTICE OF INTENT NOT TO
.
FIELD
VALUE
TYPE CASE
CASE CATEGORY
AUDPOL
‘A’ (by default)
LAW/SECTION
1 Law and Section Violated
-2. Law and Section Violated
3.Etc. —
VIOLATION DET
ECTED
Date of the Disclosure
CLOSED
RESULT CODE
PENALTY ASSESSED
RELIEF SOUGHT -
- -
Date of Notice of Intent Not to Enforce
SA (Source Agrees)
‘0’
EITHER: -
AUDI 100% Gravity Mitigation Through Audit
OR
AUD2 100% Gravity Mitigation Through
Compliance Mangement System
CASE SUMMARY
Any additional pertinent information
II) ADMINISTRATIVE CASE OPENED INITIALLY OR CONVERTED FROM AN ADMINISTRATIVE
NON-CASE MATTER:
FIELD
VALUE
TYPE CASE
Enter Section Authonzing the Action (remove AUDPOL if
converted from non-case matter)
LAW/SECTION
1. Law and Section Violated
2. Law = AUDPOL, Section = AUDPOL
REMAINING EVENTS FIELDS
NORMALLY ENTERED FOR AN
ADMINISTRATIVE CASE
Date:
. ,hI -+.
1
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PROPOSED PENALTY
Combined amount of economic benefit and gravity
components - -
PENALTY ASSESSED
Penalty Assessed
RELIEF SOUGHT
AUDi 100% Gravity Mitigation Through Audit
OR
AUD2 100% Gravity Mitigation Through Compliance
- Mangement System
OR-
AUD3 75% Gravity Mitigation
OR - -
AUD4 0% Gravity Mitigation
CASE SUMMA Y -
- —
- - - -
- - - -
‘
-
If RELIEF SOUGHT Equals AUD3,
explain circumstances of non-systematic discovery and
indicate economic benefit and gravity portions
If RELIEF SOUGHT Equals AUD4,
indicate which conditions of Audit Policy were not met
Provide any additional pertinent information (e.g , unusual
Audit Polióy issue, application of another enforcement
policy, SEP)
III) CIVIL JUDICIAL CASE OPENED INITIALLY OR CONVERTED FROM ADMINISTRATIVE CASE
OR ADMINISTRATIVE NON-CASE MATTER
IVii ii lflh( iAi CASE:
— .—- —
FIELD -
-
VALUE -
TYPE CASE -
CIV -- -
LAW/SECTION
1. Law and Section Violated
2. Law = AUDPOL; Section = AUDPOL
CASE SUMMARY
If RELIEF SOUGHT Equals AUD3,
explain circumstances of non-systematic
discovery and indicate economic benefit and
gravity portions
If RELIEF SOUGHT Equals AUD4,
indicate which conditions of Audit Policy were
not met
Provide any additional pertinent information
(e.g., unusual Audit Policy issue, application of
another enforcement policy, SEP)
VIOLATION DETECTED
Date of Disclosure
REMAINING EVENTS FIELDS NORMALLY
ENTERED FOR A CIVIL JUDICIAL CASE
PROPOSED PENALTY
Combined amount economic benefit and gravity
components
2
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LD
VALUE
Penalty Assessed
AUDi 100% Gravity Mitigation Through Audit
OR
AUD2 100% Gravity Mitigation Through
Comphance Mangement System
OR
AUD3 75% Gravity Mitigation
.
M E
R
OR
AUO4 0% Gravity Mitigation
Enter the Docket Case Number of the new civil
judic Ial case
- —
Date the mattet Converts to S civil judicial case
Co (Comb 1ed with another case)
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