ELR Citation: ELR 20865
No(s). 92-7723 (2d Cir. May 14, 1993)

The court reverses a district court's dismissal of environmental groups' citizen suit under §505 of the Federal Water Pollution Control Act (FWPCA) as moot, because an FWPCA permittee that comes into compliance with its pretreatment permit after a §505 citizen suit is filed but before judgment is entered, may still be liable for civil penalties imposed for postcomplaint violations and violations that were ongoing at the time suit was filed, even though the plaintiff's request for injunctive relief is moot. A local sewer board brought enforcement actions against a tanning company for violations of the company's effluent discharge permit under the FWPCA between August 1989 and June 1991. Environmental groups gave the tanning company notice in June 1990 of their intent to bring an FWPCA citizen suit against the company and filed suit on August 14, 1990, requesting declaratory and injunctive relief, civil penalties, the right to monitor the company's compliance for a limited period, and attorney fees. The tanning company entered into a settlement agreement with the local sewer board on December 27, 1990, which imposed penalties on accelerated improvement in the company's internal pretreatment system. The company completed its improvement plan in March 1991.

The court holds that a defendant's ability to show, after suit is filed but before judgment is entered, that it has come into compliance with the effluent limits in its discharge permit will not render an FWPCA citizen suit for civil penalties moot. Civil penalties may still be imposed for postcomplaint violations and for violations that were ongoing at the time suit was filed. A rule requiring dismissal of a citizen suit in its entirety based on a defendant's postcomplaint compliance conflicts with FWPCA §309(d), which provides that any person who violates effluent limitations or permit conditions "shall [emphasis added] be subject to a civil penalty." Under such a rule, a penalty suit would always become moot and a defendant would escape all liability if it could show, at any time before judgment, that the allegedly wrongful behavior could not reasonably be expected to recur. Moreover, mooting an entire suit based on postcomplaint compliance would weaken the FWPCA's deterrent effect by diminishing the incentives for citizen plaintiffs to sue and by encouraging defendants to use dilatory tactics in litigation.

The court holds that the tanning company's settlement with the local sewer board is insufficient to warrant dismissing the environmental groups' entire suit on mootness grounds. It would be inconsistent with the goals of the FWPCA to preclude the environmental groups from pursuing their suit for civil penalties based on the local sewer board's enforcement actions against the tanning company, and neither the FWPCA nor prior case law from the Second Circuit requires a different result. The tanning company erroneously relies on the Second Circuit's decision in Atlantic States Legal Foundation, Inc. v. Eastman Kodak Co., 21 ELR 21047, in which the court affirmed a district court's dismissal of an entire FWPCA citizen suit where there was no realistic prospect that the violations alleged in the complaint would continue and the defendant had entered into a settlement with New York's Department of Environmental Conservation. The court holds that the Kodak decision is distinguishable from the present citizen suit. It is unclear whether the Kodak panel's statement that the citizen "action" might have to be dismissed implied dismissal of the entire citizen suit, because that issue was not squarely before the panel. In this case, the settlement did not cover all of the violations the environmental groups allege and the fines assessed by the local sewer board are small. More importantly, the settlement in Kodak was between a defendant and the New York state agency authorized to operate the FWPCA permit program, and the terms of the settlement covered the same violations alleged in the citizen suit. In this case, the local sewer board brought enforcement actions against the tanning company. The FWPCA accords the enforcement actions of local agencies less deference that it does to those of state and federal agencies. For example, the Act provides that only federal or state civil or administrative penalty actions can preclude citizen suits, and requires citizen plaintiffs to give notice to state and federal, but not local, agencies before filing suit.

[The district court's opinion is published at 23 ELR 20506.]

Counsel for Plaintiffs-Appellants
Charles M. Tebbutt
Lippes & Shonn
1260 Delaware Ave., Buffalo NY 14209
(716) 884-4800

Counsel for Defendant-Appellee
Philip H. Dixon
Whiteman, Osterman & Hanna
One Commerce Plaza, Albany NY 12260
(518) 487-7600

Feinberg, J. (before Cardamone and Pratt, JJ.):