ELR Citation: ELR 20522
No(s). s. 94-20461, 95-20227 (5th Cir. Jan 11, 1996)

The court holds that discharging "produced water," a byproduct of oil and gas extraction, without a permit violates the Federal Water Pollution Control Act (FWPCA). The court first holds that the plaintiff environmental group has standing to bring this FWPCA citizen suit against the owner and operator of a gas well and associated facilities, because the group's members proved that they suffered injury-in-fact and that the alleged injury is fairly traceable to the operator's discharge. Affidavits from the members regarding their use of the waterways in question satisfied the injury-in-fact requirements for standing. The group did not have to establish that the operator's produced water discharges were the particular cause of the alleged harm in order to satisfy the fairly traceable requirements, but only that the operator's discharge contributes to pollution impairing members' use of the waterways. The court holds that produced water is a pollutant under the act. Although produced water is not listed under the FWPCA's definition of pollutant and the U.S. Environmental Protection Agency (EPA) has not promulgated an effluent limitation or permit resulting discharge of produced water, courts have the authority to determine that a particular substance is a pollutant. The court notes that produced water from oil drilling waste treatment facility discharges is clearly subsumed by the phrases "chemical wastes" and "industrial wastes" in FWPCA §502(6). Moreover, if produced water reinjected into a state-approved well is a pollutant, it is hardly a stretch to say that produced water deposited directly into a waterway is also a pollutant. Further, EPA regulations recognize citizens' right to sue coastal oil well operators for discharging produced water without a permit. The court next holds that the district court did not abuse its discretion in finding that the operator's initial expert disclosures failed to comply with the expert disclosure provisions of its accelerated discovery order. The court also holds that the district court did not abuse its discretion in sanctioning the operator for violating the discovery order without first requiring the environmental group to file a motion to compel. The district court also did not abuse its discretion by striking the operator's experts and excluding their testimony to penalize the operator for failing to adhere to the discovery deadlines, because the expected testimony ultimately proved to be relatively unimportant. The court next upholds the district court's assessment of a $186,070 civil penalty against the operator for violating the FWPCA, which was based on the owner's economic benefit of noncompliance and was not improperly calculated. The court's approximation of economic benefit is reasonable under the facts of the case.

Addressing the environmental group's appeal, the court holds that the district court did not exceed its authority by amending, under Fed. R. Civ. P. 62(c), an order that enjoined the owner from discharging produced water from its oil and gas production operation without a permit. The district court's amending order had the effect of modifying the injunction under Rule 62(c), rather than completely dissolving it. Therefore, the district court had jurisdiction to amend the order. The amendment allows the operator to continue the unpermitted discharge so long as it complies with the terms of a final national pollution discharge elimination system general permit and compliance order.

Counsel for Plaintiff
Robert Wiygul
Sierra Club Legal Defense Fund
1631 Glenarm Pl., Ste. 300, Denver CO 80202
(303) 623-9466

Counsel for Defendant
David K. McGowan
125 S. Congress St., Ste. 1214, Jackson MS 39201
(601) 948-3411

Before REYNALDO, G. GARZA, KING, and HIGGINBOTHAM, Circuit Judges.