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Environmental Crimes
Case Bulletin
U.S. Environmental Protection Agency
Office of Criminal Enforcement, Forensics and Training
This bulletin summarizes publicized investigative activity and
adjudicated cases conducted by OCEFT Criminal Investigation
Division special agents, forensic specialists, and legal support staff.
May 2015
In This Edition:
Mann Distribution, LLC Region 1
Brian Davis Region 2
Det Stavegerske Dampskibsselskab, Daniel Paul Dancu, Bo Gao, Xiaobing
Chen, Xin Zhong Region 4
Duke Energy Corporation Region 4
Hardrock Excavating LLC Region 5
Helena Chemical Corporation Region 5
Kevin Branch, Danielle Roussel Region 6
Race Addington Region 6
&EPA
United States
Environmental Protection
Agency
EPA Pub. 310-N-15-005
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Defendant Summary
Region
Defendants
Case Type/Status
Region 1
Mann Distribution, LLC
CAA/Failure to develop and implement a risk man-
agement plan
Region 2
Brian Davis
RCRA/lllegal treatment, storage, disposal of hazard-
ous waste
Region 4
Pet Stavegerske Damp-
skibsselskab, Daniel Paul Dancu,
Bo Gao, Xiaobing Chen, Xin Zhong
Act to Prevent Pollution from Ships (APPS)/ Conspira-
cy, obstruction of justice, witness tampering
Region 4
Duke Energy Corporation
CWA/Unlawful failure to maintain equipment, unlaw-
ful discharge of coal ash into river
Region 5
Hard rock Excavating LLC
CWA/lllegal dumping of fracking waste
Region 5
Helena Chemical Corporation
FIFRA/Unlawful disposal of restricted pesticide
Region 6
Kevin Branch, Danielle Roussel
SDWA/Falsification of information on water testing
logs
Region 6
Race Addington
Title 18/Knowingly presenting a falsely created blow-
out preventer (BOP) test chart
Page 2
EPA Bulletin-May 2015
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Sentencings
Rhode Island Chemical Company Sentenced for Failing to Develop and Implement a Risk Management Plan
-- On May 6, 2015, MANN DISTRIBUTION, LLC, of Warwick, Rhode Island, also known as Mann Chemical, LLC,
pleaded guilty in federal district court for the District of Rhode Island to violating the Clean Air Act by failing
to develop and implement a Risk Management Plan to minimize the chance of release of hydrofluoric acid
from its Warwick facility, and to protect workers, the community, and emergency and first responders in the
event of a chemical release or fire.
The company was fined $200,000 and ordered to serve a term of three years' probation for failing to
adhere to EPA regulations which require a Risk Management Plan be developed, including a "worst case"
response plan. Mann Chemical is also required to issue a public apology.
EPA regulations require facilities storing more than 1,000 Ibs. of hydrofluoric acid to develop and
implement a Risk Management Plan. An EPA inspection in June 2009 determined that Mann Chemical failed
to develop and implement a Risk Management Plan while storing 92 drums of hydrofluoric acid in a
concentration of 70%. The inventory indicated that each drum weighed 500 pounds, for a total of 46,000
pounds of hydrofluoric acid.
According to a Center for Disease Control and Prevention website, hydrogen fluoride is a chemical
compound that contains fluorine. It can exist as a colorless gas or as a fuming liquid, or it can be dissolved in
water. When hydrogen fluoride is dissolved in water, it may be called hydrofluoric acid. Hydrofluoric acid is
used mainly for industrial purposes, and may cause skin burns, tissue damage and/or respiratory concerns.
The case was investigated by EPA's Criminal Investigation Division with the assistance of the REFP Unit
of the Office of Environmental Stewardship with EPA's Region 1 office. It was prosecuted by Assistant U.S.
Attorney Terrence P. Donnelly and Special Assistant United States Attorney Peter Kenyon of EPA.
Back to Defendant Summary
Mann Distribution Facility in Warwich, Rhode Island.
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EPA Bulletin-May 2015
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Sentencings
Former Water Works Employees in Louisiana Sentenced for Falsifying Information on Water Testing Logs --
On May 12, 2015, KEVIN BRANCH, of LaPlace, Louisiana, and DANIELLE ROUSSEL, of Paulina, Louisiana,
I former employees of the St. John the Baptist Parish
Water Works, pleaded guilty in federal district court for
falsifying information on the water testing logs they were
required to maintain and for falsely swearing to cover up
their failure to properly collect and record water samples
from testing sites where a brain-eating amoeba was
| found in the water system.
Both were sentenced to one year in prison, with
ithat sentence suspended, and six months of probation.
Branch was ordered to perform 80 hours of community
service. Roussel was ordered to perform 40 hours of
community service. Each was ordered to pay a $400 fine.
Branch and Roussel were required to collect
water samples from at least two locations, the Lions
Water Treatment Plant in Reserve and an additional site
in Mt. Airy, to ensure that the water contained the appropriate amount of residual chlorine to disinfect the
water and prevent growth of the amoeba, known as Naegleria fowleri. Branch and Roussel were required by
law to record their findings on a daily log to be filed with the Department of Health and Hospitals.
However, a Louisiana State Police investigation found that the two did not collect all the samples to
which they had attested. It was found that data from Global Positioning Systems (GPS) permanently attached
to the parish vehicles assigned to Branch and Roussel showed that they were nowhere near the testing sites
on numerous days where the employees alleged to have tested water samples.
The case was investigated by EPA's Criminal Investigation Division, the Louisiana State Police, the
Louisiana Department of Health and Hospitals, and the St. John the Baptist Parish Government.
Drinking water fountains covered up as a result of the de-
fendants falsifying water testing logs.
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Brain-eating amoeba found in the water system.
Page 4
EPA Bulletin-May 2015
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Sentencings
The coal ash discharged into the Dan River from this
broken 48-inch storm water pipe.
Duke Subsidiaries Plead Guilty and Are Sentenced to Pay $102 Million for CWA Crimes - On May 14, 2015,
three subsidiaries of North Carolina-based Duke Energy Corporation, the largest utility in the United States,
pleaded guilty in federal district court to nine criminal violations of the Clean Water Act at several of its North
Carolina facilities and agreed to pay a $68 million criminal fine and spend $34 million on environmental
H projects and land conservation to
^p benefit rivers and wetlands in North
' Carolina and Virginia. Four of the
.charges are the direct result of the
I massive coal ash spill from the Dan
. River steam station into the Dan River
I near Eden, North Carolina, in February
2014. The remaining violations were
I discovered as the scope of the
I investigation broadened based on
] allegations of historical violations at
the companies' other facilities.
Under the plea agreement, both Duke
Energy Carolinas and Duke Energy
Progress, must certify that they have
reserved sufficient assets to meet legal
obligations with respect to its coal ash impoundments within North Carolina, obligations estimated to be
approximately $3.4 billion.
On Feb. 20, 2015, the three U.S. Attorney's Offices in North Carolina filed separate criminal bills of
information in their respective federal courts, alleging violations of the Clean Water Act at the following Duke
facilities: the Dan River steam station (Rockingham County), the Cape Fear steam electric plant (Chatham
County), the Asheville steam electric generating plant (Buncombe County), the H.F. Lee steam electric plant
(Wayne County) and the Riverbend
steam station (Gaston County). The
alleged violations included unlawfully
failing to maintain equipment at the Dan
River and Cape Fear facilities and
unlawfully discharging coal ash and/or
coal ash wastewater from impoundments
at the Dan River, Asheville, Lee and
Riverbend facilities.
As part of their plea agreements,
Duke Energy Business Services LLC, Duke
Energy Carolinas LLC and Duke Energy
Progress Inc. will pay a $68 million
criminal fine and a total $24 million The grey coal ash mixing in with the Dan River just downstream of the spill.
PageS
EPA Bulletin-May 2015
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Sentencings
community service payment to the National Fish and Wildlife Foundation for the benefit of the riparian
environment and ecosystems of North Carolina and Virginia. The companies will also provide $10 million to
an authorized wetlands mitigation bank for the purchase of wetlands or riparian lands to offset the long-term
environmental impacts of its coal ash basins. In addition, they will pay restitution to the federal, state and
local governments that responded to the Dan River spill and be placed on a period of supervised probation
for five years.
Duke's subsidiaries operating 18
facilities in five states, including 14 in
North Carolina, will also be required to
develop and implement nationwide and
statewide environmental compliance
programs to be monitored by an
independent court appointed monitor
and be regularly and independently
audited. Results of these audits will be
made available to the public to ensure
compliance with environmental laws and
programs. The companies' compliance
will be overseen by a court-appointed
monitor who will report findings to the
court and the U.S. Probation Office as
The primary coal ash basin at the Dan River Steam Station with all the
wastewater drained out as a result of the pipe collapse.
well as ensuring public access to the
information.
Approximately 108 million tons of coal ash are currently held in coal ash basins owned and operated
by the defendants in North Carolina. Duke Energy Corporation subsidiaries also operate facilities with coal
ash basins in South Carolina, approximately 5.99 million tons of coal ash, Kentucky, approximately 1.5 million
tons of coal ash, Indiana, approximately 35.6 million tons of coal ash and Ohio, approximately 5.9 million tons
of coal ash. The companies must also meet the obligations imposed under federal and state law to excavate
and close coal ash impoundments at the Asheville, Dan River, Riverbend and Sutton facilities.
Additionally, at the insistence of the United States, the holding company Duke Energy Corporation has
guaranteed the payment of the monetary penalties and the performance of the nationwide and statewide
environmental compliance plans.
The case was investigated by EPA's Criminal Investigation Division, the Office of Inspector General of
EPA, Criminal Investigations of the IRS and North Carolina State Bureau of Investigation with assistance from
the Federal Bureau of Investigation and the Department of Defense Criminal Investigative Service.
Back to Defendant Summary
PageS
EPA Bulletin-May 2015
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Sentencings
Oklahoma Chemical Corporation Fined $225.000 for Environmental Crime - On May 4, 2015, HELENA
CHEMICAL CORPORATION was sentenced in federal district court for the Northern District of Oklahoma for
unlawfully disposing the restricted pesticide, Medal II AT, at its Welch, Oklahoma, facility in Craig County.
According to the plea agreement, for at least a six-month period beginning in May 2013, Helena
Chemical Corporation disposed of unused Medal II AT by discharging the pesticide onto the ground and
allowing it to run onto an adjacent property and into the Little Cabin Creek. Medal II AT contains the
restricted use chemicals Altrazine and S-Metolachor which are two of the main active ingredients. If exposed
to Altrazine, a person may experience difficulty breathing, weakness, irritation of the eyes, and suffer from
liver damage; and a person exposed to S-Metolachor may experience eye, skin and respiratory irritation,
dizziness, and nausea.
Under the settlement, Helena Chemical will pay $150,000 in criminal fines and $75,000 toward
performing community service to fund environmental projects, initiatives, emergency responses, and/or
education dedicated to the preservation and restoration of the environment and waters.
The case was investigated by EPA's Criminal Investigation Division and the Oklahoma Department of
Agriculture. It was prosecuted by Assistant United States Attorney Joel-lyn A. McCormick.
Back to Defendant Summary
Pesticide flowing off of Helena Chemical Corporation's property.
Page?
EPA Bulletin-May 2015
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Sentencings
Texas Man Sentenced for False Statements in Relation to Blowout Preventer Testing on Oil Platform in Gulf
of Mexico - On May 20, 2015, RACE ADDINGTON, of Houston, Texas, was sentenced in federal district court
for the Eastern District of Louisiana to one year probation and 40 hours of community service for making
false statements to agencies or departments of the United States in relation to the veracity of blowout
preventer testing on an offshore oil and gas platform located at Ship Shoal 225 on a federal mineral lease in
the Gulf of Mexico.
According to court documents, on or about November 27, 2012, production and well workover
operations were being conducted on the platform and the blowout preventer system had to be tested. A
blowout preventer system is designed to ensure well control and prevent potential release of oil and gas and
possible loss of well control. The blowout preventer pressure chart that recorded the testing of the blowout
preventer testing done on November 27, only recorded 6 of the 7 required components as being tested and
was not signed nor dated by any representative on the platform.
On or about November 28, 2012, Addington, as the well site supervisor for the platform saw the
results of the blowout preventer testing and had workers create a false blowout preventer test. The next day
when Bureau of Safety and Environmental Enforcement (BSEE) inspectors conducted a routine inspection of
the platform, Addington presented the fabricated blowout preventer pressure test chart to the BSEE
inspectors with the expectation that it would be a passing test and the inspectors would not find the platform
to be in non-compliance for failing to properly test the blowout preventer system.
On December 6, 2012, during an investigation of the veracity of the blowout preventer test by the
Department of Interior's Investigation and Review Unit, Addington lied and told investigators the false chart
he provided inspectors was a test of the chart recorder and that the inspectors mistakenly retrieved the
wrong pressure chart from the files when in truth and in fact he knew that he had the blowout preventer
pressure test chart fabricated and personally presented the chart to inspectors as the actual test record for
the platform's blowout preventer system.
The case was investigated by EPA's Criminal Investigation Division, the Department of Interior-Office
of Inspector General (Energy Investigations Unit) and the Investigations and Review Unit, Bureau of Safety
and Environmental Enforcement. It was prosecuted by Assistant United States Attorney Emily K. Greenfield
of the United States Attorney's Office's National Security Unit.
Back to Defendant Summary
PageS EPA BulletinMay 2015
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Plea Agreements
Ohio Company Pleads Guilty to Dumping Fracking Waste - On May 28, 2015, HARDROCK EXCAVATING LLC,
a Youngstown, Ohio-based company, pleaded guilty in federal district court for the Northern District of Ohio
to violating the Clean Water Act by dumping fracking waste into a tributary of the Mahoning River. The
company's owner, Benedict W. Lupo, was previously sentenced to 28 months in prison for ordering the
illegal discharges, which took place more
jthan 30 times between Nov. 1, 2012 and
;Jan. 31, 2013, according to court
I documents.
The community payment will be
! split between two agencies ~ $12,500 each
to the Friends of the Mahoning River and
Midwest Environmental Enforcement
! Association.
Hardrock Excavating LLC was
j owned by Lupo and was located in
Youngstown. The company provided
i services to the oil and gas industry in Ohio
and Pennsylvania, including the storage of
brine and oil-based drilling mud used in
hydrofracturing, or fracking. There were
approximately 58 mobile storage tanks at
the facility and each holds approximately 20,000 gallons.
Lupo, directed employees to empty some of the waste liquid stored at the facility into a nearby
wastewater drain on or about Nov. 1, 2012. Lupo directed the employees to conduct this activity only after
no one else was at the facility and only after dark.
The employees, at Lupo's direction, emptied some of the waste liquid at the facility into the nearby
stormwater drain using a hose on numerous occasions over the next several months. The drain flowed into a
tributary of the Mahoning River and ultimately into the Mahoning River. The last time an employee emptied
some of the waste liquid into the drain was on or about Jan. 31, 2013.
The waste liquid that night included brine and drill cuttings. A sample of the discharge taken that
night was black in color and a subsequent analysis showed the presence of several hazardous pollutants,
including benzene and toluene.
The case was investigated by EPA's Criminal Investigation Division, the Ohio EPA, Ohio Department of
Natural Resources, the Ohio Bureau of Criminal Investigation, the Youngstown Department of Public Works
and the Youngstown Fire Department. It is being prosecuted by Special Assistant U.S. Attorney Brad Beeson.
The storm sewer outfall in which Lupo directed an employee to discharge
waste liquid. The outfall ultimately flows into the Mahoning River.
Back to Defendant Summary
Page9
EPA Bulletin-May 2015
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Plea Agreements
New York Man Pleads Guilty to Illegally Treating. Storing, and Disposing of Hazardous Waste -- On May 12,
2015, BRIAN DAVIS, of Owego, New York, pled guilty in
federal district court for the Northern District of New|
York to one felony count of treating, storing, and
disposing of hazardous waste without a permit, in I
violation of the Resource Conservation and Recovery |
Act.
In June 2013, Davis, the owner of Large Car LLC, a
company in Owego that installs and removes old
industrial plating equipment for re-use or recycling,
agreed to remove various hazardous chemicals, including
arsenic, chromium, lead, and selenium, from a bankrupt
waste generator facility in New Hampshire. Davis did not
have a permit or environmental license to remove these
chemicals, but he nevertheless transported them to the
Large Car LLC facility in Owego, where he treated,
stored, and disposed of them over the course of nearly a
year. Specifically, Davis stored the hazardous waste
without labeling it, properly isolating incompatible
materials, or protecting it from the elements. Davis also
treated and disposed of much of this waste by igniting |
and evaporating it, mixing it with other materials, and
shipping it offsite without manifesting it. He faces up to
five years in prison, a fine of up to $15 million, and will
be responsible to pay any charges associated with the
cleanup and removal of the remaining hazardous waste
material. He is scheduled to be sentenced on September |
25.
The case was investigated by EPA's Criminal
Investigation Division and the New York State
Department of Environmental Conservation. It is being
prosecuted by Assistant United States Attorney Michael
F. Perry.
Back to Defendant Summary
Plating wastes illegally stored at the Large Car LLC facility.
The top picture shows EPA scientists sampling the waste.
Page 10
EPA Bulletin-May 2015
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Indictments/Information!
Norwegian Shipping Company and Engineering Officers Charged with Environmental Crimes and
Obstruction of Justice -- On May 13, 2015, DET STAVANGERSKE DAMPSKIBSSELSKAB AS (DSD Shipping) and
four employees were charged in federal district court for the Southern District of Alabama with violating the
Act to Prevent Pollution from Ships (APPS), conspiracy, obstruction of justice and witness tampering. DSD
Shipping is a Norwegian-based shipping company that operates the oil tanker M/T Stavanger Blossom, a
vessel engaged in the international transportation of crude oil. Also indicted were four engineering officers
employed by DSD Shipping to work aboard the vessel, DANIEL PAUL DANCU, of Romania, BO GAO, of China,
XIAOBING CHEN, of China, and XIN ZHONG, of China.
According to the indictment, in 2014, DSD Shipping and its employees conspired to bypass pollution
prevention equipment aboard the M/T Stavanger Blossom and to conceal the direct discharge of waste oil
and oil-contaminated waste water from the vessel into the sea. The operation of marine vessels, like the M/
T Stavanger Blossom, generates large quantities of waste oil and oil-contaminated waste
water. International and U.S. law requires that these vessels use pollution prevention equipment to preclude
the discharge of these materials. Should any overboard discharges occur, they must be documented in an oil
record book, a log that is regularly inspected by the U.S. Coast Guard. Despite these requirements, DSD
Shipping and its employees used a bypass pipe to circumvent pollution prevention equipment and discharge
waste oil and oil-contaminated waste water directly into the sea. DSD Shipping and its employees also filled
plastic bags with waste oil from a sludge tank aboard the vessel and then discarded the oil-filled plastic bags
overboard into the sea.
The indictment further alleges that prior to an inspection by the U.S. Coast Guard, Chen ordered
crewmembers to remove the bypass pipe, install a new pipe and repaint the piping to hide the illegal
discharges. Chen and Zhong then ordered crewmembers to lie to the U.S. Coast Guard and instructed them
to say that no plastic bags containing waste oil were discarded overboard, that all plastic bags remained
aboard the vessel and to provide the incorrect quantity of bags generated from the cleaning of the sludge
tank. To further hide the illegal discharges of waste oil and oil-contaminated waste water, DSD Shipping and
its employees maintained a fictitious oil record book that failed to record the disposal, transfer, or overboard
discharge of oil from the vessel. The oil record book also contained false entries stating that pollution
prevention equipment had been used when it had not.
DSD Shipping and the engineering officers were charged with violating the APPS for failing to record
overboard discharges in the vessel's oil record book and garbage record book and with obstruction of justice
and witness tampering for presenting false documents and deceiving the Coast Guard during an
inspection. If convicted, DSD Shipping could be fined up to $500,000 per count, in addition to other possible
penalties. Dancu, Gao, Chen and Zhong face a maximum penalty of 20 years in prison for the obstruction of
justice charges. An indictment is merely a formal charge that a defendant has committed a violation of
criminal laws and every defendant is presumed innocent until and unless proven guilty.
The case was investigated by EPA's Criminal Investigation Division, the Sector Mobile of the U.S. Coast
Guard, and Investigative Services of the U.S. Coast Guard. It is being prosecuted by Assistant U.S. Attorney
Mike D. Anderson, with the U.S. Attorney's Office for the Southern District of Alabama, and ECS Trial Attorney
Shane N. Waller.
Back to Defendant Summary
Page 11 EPA Bulletin-May 2015
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