ELR Citation: ELR 21052
No(s). F 87-95 (N.D. Ind. Mar 13, 1992)

The court imposes a civil penalty of $ 450,000 against a manufacturer for discharging excessive amounts of pollutants in violation of its national pollutant discharge elimination system (NPDES) permit under Federal Water Pollution Control Act (FWPCA) §309(d). Defendant manufacturer, previously found liable of violating its NPDES permit, manufactures automotive jacks using cleaning and finishing processes that produce waste streams of oil and grease, chromium, zinc, and suspended solids, for which it was issued an NPDES permit placing conditions on the discharge of the wastes into a nearby ditch. In fixing the penalty, the court determines that during the subject period of this suit, there were 413 violations for exceeding the daily maximum limitation and 53 violations for exceeding the monthly average limitation contained in the manufacturer's NPDES permit. However, the court holds that the 53 violations of monthly average limitations will be considered a violation for each of the days of that month, making the total number of NPDES permit violations by the defendant 1,977 for a statutory maximum penalty of up to $25,830,000.

The court next turns to the mitigating factors that Congress provided in FWPCA §309 for calculating civil penalties. As to the seriousness of the defendant's violations, the court finds that there has been minimal environmental damage as a result of the violations, which represents a significant mitigating factor. As to any economic benefit to the defendant as a result of noncompliance with its NPDES permit, the court finds that defendant's choice of pollution controls was based on its consultants' recommendations, and the cost of alternative controls was based on its consultants' recommendations, and the cost of alternative controls was not excessively more than the controls installed. Thus, defendant's rejection of an ultrafiltration system did not amount to an economic windfall in defendant's favor, nor was there any purposeful behavior by defendant to avoid the costs of complying with its NPDES permit. However, the four-year delay in installing the wastewater system, in the face of significant permit exceedances provided an economic benefit to defendant, for which benefit the court fixes a penalty of $85,000. The court next finds that because the defendant has been in violation of its permit since effluent charges were first regulated in 1975, the court will not mitigate the maximum penalty based on the history of defendant's violations. The court next finds that no evidence indicates that the defendant purposefully engaged in any kind of strategy to avoid installing a competent system, and defendant acted in good faith. Defendant implemented interim improvements while the installation of the wastewater treatment system and the cessation of the metal plating process was initially delayed. Although defendant should have been more expeditious in its approach to resolving the problems, the court considers the defendant's good-faith efforts a mitigating factor. Finally, the court holds that because no evidence was offered to indicate that a large civil penalty would have an adverse effect on the operations of the defendant, the economic impact of a large civil penalty will not be a mitigating factor. Based on the mitigating factors, the defendant is entitled to a substantial reduction from the maximum possible penalty.

Counsel for Plaintiff
Peter G. Mallers II
Beers, Mallers, Backs & Salin
1100 Fort Wayne National Bank Bldg., Fort Wayne IN 46802
(219) 426-9706

Richard J. Kilsheimer
Kaplan, Kilsheimer & Foley
685 Third Ave., New York NY 10017
(212) 687-1980

Counsel for Defendant
Milford M. Miller
Miller, Carson & Boxberger
1400 One Summit Sq., Fort Wayne IN 46802
(219) 423-9411