While the United States Environmental Protection Agency (EPA) is taking a compliance-first approach, it does not negate environmental enforcement. In some cases, these enforcement actions include substantial monetary penalties and prison time.
Settlement Includes $100 Million to Address Leaks
The United States Department of Justice (DOJ) announced a proposed settlement with The Kroger Company, resolving alleged Clean Air Act violations at grocery stores nationwide.
“Under the proposed consent decree, Kroger will spend an estimated $100 million over the next three years to reduce coolant leaks from refrigerators and other equipment and improve company-wide compliance with rules protecting the Earth’s ozone layer. The company will also pay a $2.5 million civil penalty.”
The DOJ’s release states that the settlement resolves Kroger’s failure to promptly repair refrigerant equipment leaks of the refrigerant R-22, an ozone-depleting hydrochlorofluorocarbon (HCFC), between 2014 and 2023. Kroger also failed to keep adequate refrigeration service records.
If finalized, Kroger will retrofit or replace 600 large commercial refrigeration units.
Coolant leaks from commercial refrigeration units are often the focus of environmental enforcement (Photo by Dominik on Unsplash).
Seven-Figure Fine and Prison Time
According to the DOJ, “The owner of a company that produced and sold renewable fuel and fuel credits was sentenced today to serve 18 months in prison followed by two years of supervised release, and to pay $2,857,029 in restitution and a $150,000 fine, for his role in a scheme that generated over $7 million in fraudulent EPA renewable fuel credits and sought over $6 million in fraudulent tax credits connected to the purported production of biodiesel.”
The DOJ states that the biofuel company claimed to turn various feedstocks into biodiesel. However, based on the numbers they provided to the Internal Revenue Service (IRS) and the EPA, Christopher Burdett (owner) and Royce Gilham (General Manager) “vastly overstated their production volume to generate more credits.”
Burdett previously pleaded guilty to conspiring to commit wire fraud and to file false claims and was sentenced to 37 months in prison.
TSCA Violations
The EPA has filed an administrative complaint against Wego Chemical Group of Great Neck, N.Y., and related companies, for violations of the Toxic Substances Control Act (TSCA).
According to the EPA’s Release, “The complaint stems from Wego’s years-long failure to properly report its import and domestic distribution of chemical substances. Since at least 2016, Wego has imported hundreds of millions of pounds of hundreds of toxic chemicals, mostly from China, without meeting basic federal reporting requirements.”
The company initially failed to submit its required 2020 Quadrennial Chemical Data Reporting (CDR) submission. When Wego submitted CDR data, it omitted required information on how any of the chemicals will be used, information that EPA needs to evaluate public health risks. The complaint also alleges that at least one chemical Wego imported could not lawfully have been imported at all.
The complaint alleges that Wego:
- Failed to timely submit CDR data for hundreds of chemicals across two reporting cycles;
- Never reported required use information for those chemicals in either submission;
- Failed to submit a Pre-Manufacture Notification (PMN) before importing a new chemical substance;
- Failed to file a required TSCA compliance certification at the time it unlawfully imported that new chemical;
- Failed to submit significant new use notices as required;
- Failed to notify the EPA of the export to Canada of two chemicals that were subject to significant new use rules;
- Filed a Notice of Commencement claiming it had begun importing a chemical when, in fact, it had not; and
- Filed a false certification stating it had not imported a chemical under a TSCA Risk Evaluation during the previous five years, when, in fact, it had.
$10 Million PFAS Settlement
Yet another per- and polyfluoroalkyl substances (PFAS) settlement involving Aqueous Film Forming Foam (AFFF). This settlement involving Tyco/Johnson Controls is not the company’s first. In 2021, they agreed to pay $17.5 million to resolve lawsuits in Peshtigo, Wisconsin.
The recently announced settlement, again in Wisconsin, was filed by the Wisconsin Attorney General, Josh Kaul. The suit alleged that the company “violated state law when it failed to notify regulators about a PFAS discharge and did not investigate or remediate the contamination around the Fire Technology Center in Marinette (AP).”
According to AP, “Under the terms of the settlement announced Thursday, Wisconsin will put the $10 million from Tyco into a trust fund earmarked for PFAS cleanup. Tyco also agreed to continue to provide for replacement wells to provide clean drinking water to affected residents, conduct required monitoring and reporting, and implement further measures for the long-term remediation of the area.”
Tyco has a webpage dedicated to PFAS where they state, “Since 2017, Tyco has been working tirelessly to respond to the presence of PFAS that migrated from historic operations at our Fire Technology Center (FTC) property. We have spent over 100 million dollars on the effort, an indication of both the scale and complexity of the project. It’s to be expected, therefore, that from time to time, misleading or incorrect information enters into the public discussion about our work. We have added this section to our website to address such misunderstandings.”
For more information on PFAS, see our PFAS Resource Page.
If you need assistance with an environmental issue, including litigation support, contact Jeffrey Bolin, M.S., CHMM at 248-932-0228, Ext. 125.
Alan Hahn drafted this blog. Alan has an undergraduate degree in Environmental Studies and completed a graduate program in Environmental Management. He has worked in environmental management for more than 45 years. He has written hundreds of blogs and articles. His published work includes Michigan Lawyers Weekly, Detroiter, Michigan Forward, GreenStone Partners, Manure Manager Magazine, Progressive Dairy, and HazMat Magazine.
Jeffrey Bolin, M.S., reviewed this blog. Jeff is a partner and senior scientist at Dragun Corporation. He is a published author, a frequent speaker, and an expert witness. His expertise in environmental due diligence, PFAS, vapor intrusion, and site assessments has led to projects in the US, Canada, and overseas. See Jeff’s Bio.
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