The opinion of the court was delivered by: Cindrich, District Judge.
This is an action by the United States for civil penalties for
violations of the Clean Water Act, 33 U.S.C. § 1311, 1317 ("the
Act"). The case covers five western Pennsylvania steel plants
owned and operated by defendant Allegheny Ludlum Corporation
("ALC"), one of the few remaining steelmakers in the area. The
plants are grouped for compliance purposes as the Vandergrift
Facility, the Brackenridge Facility (consisting of the
Brackenridge and Natrona Plants), and the West Leechburg
Facility (consisting of the West Leechburg and Bagdad Plants).
See Joint Stipulation of Facts, Doc. No. 269. After a lengthy
period of litigation, including a trial before a jury, the court
finds that ALC has violated the Act in ways that justify a
The steelmaking process generates a considerable amount of
pollutants which must be monitored and controlled pursuant to
the Clean Water Act. The Act prohibits the discharge of any
pollutants into the navigable waters of the United States,
except as expressly authorized under the Act.
33 U.S.C. § 1311(a). The Act provides for the administration of the National
Pollution Discharge Elimination System ("NPDES") to regulate
pollution. The NPDES authorizes the U.S. Environmental
Protection Agency to issue permits regulating the release of
pollutants. Id. § 1342(a). States may participate in pollution
regulation under the Act. Id. § 1342(b); see generally PIRG
v. Hercules, Inc., 50 F.3d 1239, 1242 (3d Cir. 1995). Through
this system, the Commonwealth of Pennsylvania also regulates
pollution discharged by ALC.
ALC had been operating the Brackenridge and West Leechburg
plants when it purchased the Vandergrift facility in 1988. From
1988 until 1998, the Vandergrift plant discharged its wastewater
to the Kiski Valley sewage treatment plant, which itself
discharged into the Kiski River. ALC's West Leechburg plant
discharges directly into the Kiski River. The Brackenridge plant
discharges into the Allegheny River.
This case was filed in June 1995. The government's claims are
divided into three categories. The first is reported claims, or
claims that arise out of reports of monitoring that ALC is
obligated under the Act to prepare and submit to state and
federal environmental authorities. The second category is
interference claims, or claims that arise out of problems with
discharges that ALC sent to the Kiski Valley sewer plant, and
which interfered with the sewer plant's ability to comply with
its own environmental obligations. The third type is unreported
claims, or claims that arise out of the government's own
investigation of ALC's failure to comply with the Act.
After two amended complaints and a lengthy period of pretrial
preparation, the court decided cross-motions for summary
judgment. By decision dated September 28, 2000, the court denied
each party's summary judgment motion with respect to the
unreported and interference claims. Doc. No. 216 (reported at
United States v. Allegheny Ludlum Corporation, 118 F. Supp.2d 615
(W.D.Pa. 2000)). The court also rejected certain ALC
defenses to liability on reported claims and entered summary
judgment for 832 violations in favor of the United States. ALC
admitted liability to 119 violations. See Stipulation
Concerning Claims of Reported Violations, Doc. No. 215.
The court conducted a jury trial on liability from January 5
to February 2, 2001. During trial, the court granted the United
States['] motion for judgment as a matter of law on ALC[']s
affirmative defense of upset relating to the Vandergrift
Facility, involving 165 violations. The jury returned a verdict
in favor of ALC on all the interference and unreported claims.
The jury also returned a verdict for ALC on 6 of the 12 reported
claims relating to the Brackenridge and West Leechburg
Facilities, and in favor of the United States on the other 6
claims. ALC thus has been found liable for 1,122 days of
violations of the Act at its Vandergrift, Brackenridge and West
Leechburg plants during the period from July 1990 through
1997. Plaintiffs Exhibit P-1 and P-1A.*fn1
After the jury verdict on liability, the Court conducted a
non-jury penalty trial, from February 5 to 8, 2001. Testimony by
experts at this phase of the trial was submitted by written
proffer with live cross-examination.
The assessment of civil penalties for these violations as
sought by the United States is governed by 33 U.S.C. § 1319(d).
Section 1319(d) provides that the violator of a permit issued
pursuant to the Act shall be subject to a civil penalty not to
exceed $25,000 per day for each violation. This penalty
provision further states that in assessing the penalty, the
court shall consider the following factors:
the seriousness of the violation or violations, the
economic benefit (if any) resulting from the
violation, any history of such violations, any
good-faith efforts to comply with the applicable
requirements, the economic impact of the penalty on
the violator, and such other matters as justice may
It should be noted that, in addition to the 1,122 days of
violations for which defendant has been found liable in this
case, ALC settled an additional 990 days of violation with the
Pennsylvania Department of Environmental Protection ("PaDEP") in
consent decrees signed in 1992 and 1993. Plaintiffs Exhibit P-2
and P-3. As explained below, these violations may properly be
considered in the court's penalty calculations.
This decision constitutes the Court's findings of fact and
conclusions of law based on evidence from both the liability and
penalty trials. It is drawn largely from proposed decisions
submitted by the parties.
A. The Seriousness of the Violations
The United States Court of Appeals for the Third Circuit
approved a formula for assessing the seriousness of Clean Water
Act violations that accounted for the number of violations, the
amount that discharges exceeded permit limits, and the toxicity
of pollutants discharged. Public Interest Research Group of New
Jersey, Inc. v. Powell Duffryn Terminals, Inc., 913 F.2d 64, 79
(3d Cir. 1990) A sister court in this circuit applied similar
standards in examining the number, frequency, and degree of the
violations in a highly relevant case. United States v.
Municipal Auth. of Union Twp., 929 F. Supp. 800, 807 (M.D.Pa.
1996), aff'd on other grounds, 150 F.3d 259
(3d Cir. 1998) (each referred to as "Dean Dairy").
With regard to the number of violations, 386 violations over a
seven year period was considered a large number by the Third
Circuit in Powell Duffryn — a number reached, incidentally,
after the public interest plaintiffs waived review of whether
the district court undercounted violations by listing violations
of the monthly average limit for discharges as one offense
rather than thirty, 913 F.2d at 79 n. 29. For the sake of
comparison, the district court in Dean Dairy found that the
permittee committed a total of 2,360 violations over six years,
a number the court characterized as "very large." 929 F. Supp. at
807. ALC has been found liable for 1,122 days of violation over
the course of about six and a half years. This is a substantial
number and frequency of violations.
With regard to the magnitude of the violations and their
toxicity, these cases provide useful reference points. The vast
majority of the 2,360 days of violation in Dean Dairy were
violations of the discharge limits on conventional pollutants in
defendant Fairmont's discharge permit to the local treatment
plant. Dean Dairy, 929 F. Supp. at 803. These conventional
pollutants, known as total suspended solids ("TSS") and
biological oxygen demand ("BOD"),*fn2 were produced by the
daily cleaning of the equipment used to make sour cream, cottage
cheese, yogurt, and ice cream. Dean Dairy, 929 F. Supp. at
807-808. By contrast, many of ALC's violations involve toxic
pollutants, not conventional pollutants such as TSS and BOD.
Toxic pollutants generally pose a greater threat to human life.
Id. In Powell Duffryn, the district court found 10
violations of toxic pollutant limits to be serious, 913 F.2d at
79. Here, the court has found ALC liable for 893 days of
violations of toxic pollutant limits.
Furthermore, the district court and the Third Circuit found in
Powell Duffryn that the magnitude by which the defendant
exceeded its permit limits also made its violations serious.
Powell Duffryn, 913 F.2d at 79; Powell Duffryn, 720 F. Supp.
at 1161. In the current case, ALC exceeded its permit limits by
at least 1,000% for 180 days, as compared to 86 such days found
by the Court in Powell Duffryn, 720 F. Supp. at 1161. In
February 1993, ALC exceeded its monthly average chromium limit
by more than 4,000%. Plaintiffs Exhibit P-1A.
ALC's environmental conduct has reached other extremes. One
notorious ALC oil spill, on July 1, 1994, spread from West
Leechburg nearly 30 miles downstream to the Point at Pittsburgh.
The U.S. Coast Guard followed the oil sheen by helicopter from
the Point up the Allegheny, and traced it to the West Leechburg
facility on the Kiski River. Trial Transcript for 2/6/2001, Doc.
No. 320, at 10. PaDEP and the Coast Guard estimated that the oil
must have been flowing for nearly a day to have reached that far
downstream. Trial Transcript for 2/5/2001, Doc. No, 319, at 145.
When the Coast Guard arrived, ALC was unaware of the spill and
had failed to install containment booms or to report it. Even
though the spill was miles long, and ALC was told by the Coast
Guard about the spill, ALC eventually reported the spill as a
"small quantity of water containing oil" being discharged.
Plaintiffs Exhibit P-24.
Moreover, there is persuasive evidence that ALC's violations
likely caused harm to the river. We should first note that the
government has not shown actual harm from ALC's discharges. In
recognition of the difficulty of proving harm where the
violation is usually temporally distant from the penalty,
however, and the science is incomplete, a particularized showing
of actual harm is not necessary. "[B]ecause actual harm to the
environment is by nature difficult and sometimes impossible to
demonstrate, it need not be proven to establish that substantial
penalties are appropriate in a Clean Water Act case." Dean
Dairy, 929 F. Supp. at 807. A court may impose a significant
penalty if it finds there is a risk or potential risk of
environmental harm, even absent proof of actual deleterious
effect. United States v. Smithfield Foods, Inc., 972 F. Supp. 338,
344 (E.D.Va. 1997), aff'd in part, rev'd in part,
191 F.3d 516 (4th Cir. 1999), cert. denied, 531 U.S. 813, 121
S.Ct. 46, 148 L.Ed.2d 16 (2000);*fn3 Texaco, 800 F. Supp. at
24 (penalties permissible where potentially destructive
environmental impact). In Powell Duffryn, the Third Circuit
upheld the district court's finding that the defendant's
violations were serious, even absent a showing of actual harm
linked to the defendant's discharges.
The government called as its expert in aquatic toxicology Dr.
Jerome Diamond, who specializes in studies of fresh water rivers
and streams. He stated that the toxic metals in the violations
in this case are designated as priority pollutants, similar to
the pollutants given weight by the court in Powell Duffryn,
including chromium, copper, zinc and nickel. Diamond Proffer at
6. The record shows that the metals discharged by ALC can be
toxic in small concentrations of only parts per billion,
although ALC released toxic discharges of chromium on eight
occasions in concentrations of parts per million. Dr. Diamond
stated that ALC's closely spaced outfalls, the multiple and
recurring violations within a relatively short time frame, and
the synergistic effect of metals and pH violations, all combined
to pose multiple stresses, the cumulative effect of which were
more difficult for aquatic life to withstand.*fn4
B. History of the Violations And Good Faith Efforts to
Two statutory penalty factors, the defendant's "history of
violations" and its "good-faith efforts to comply,"
appropriately may be considered together because they combine
the problems the Act addresses with the defendant's reaction to
ALC's 1,122 days of Clean Water Act violations span the years
1990-1997. See Plaintiffs Exhibit P-1. Seven years is
comparable to the time spans of violations in other cases where
district courts have imposed significant civil penalties under
the Act. See, e.g., Powell Duffryn, 913 F.2d at 68 (six
years); Smithfield, 972 F. Supp. at 349 (six years); Dean
Dairy, 929 F. Supp. at 807 (six years).
In addition, ALC's history of violations extends back at least
to the 1980's. As found above, ALC settled almost a thousand
Clean Water Act violations with PaDEP in administrative actions.
The court considers pollution incidents reported by PaDEP
inspectors but not included in the allegations in this case, and
the violations resolved by PaDEP consent orders, to fall within
the broad range of information available for assessing ALC's
history of Clean Water Act violations. See Smithfield,
972 F. Supp. at 349; Dean Dairy, 929 F. Supp. at 807. If we are to
consider "any history of violations," as the Act requires, there
is no sound reason to exclude any ...