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By E. Todd Chayet
Thelen Reid Brown Raysman & Steiner LLP
In
1997, Albertson's, Inc. hired Sims Brothers Construction,
Inc. as general contractor for construction of a supermarket
in Baton Rouge, Louisiana. Sims subcontracted with Amtek
for demolition and site preparation work. After the work
began, an Amtek employee discovered two yellow canisters
in one of the buildings due to be demolished. Both canisters
were marked with labels bearing a skull and crossbones and
the word "poison." The canisters were stamped
"Property of Reddick Fumigants."
The
Amtek employee immediately notified Robert Case, president
of Amtek, and Mark Jerkins, Sims' superintendent for the
project. Case and Jerkins removed the canisters from the
building and set them out in the open on the project site.
They discussed having an environmental company remove them
from the site but took no further action.
Three
weeks later, the canisters still were on the site. An Amtek
employee took the canisters from the property without the
knowledge of either company and gave them to his cousin,
Edith Rome. She had the canisters brought to her home and
connected to her propane stove. The canisters leaked, making
Ms. Rome and her son ill. Ms. Rome later died from methyl
bromide poisoning. The canisters were found to contain pressurized
methyl bromide.
A
federal grand jury indicted Sims, Case, Jerkins and Amtek
for illegal storage of hazardous waste in violation of the
Resource Conservation and Recovery Act (RCRA), 42 USC §6928
(d) (2) (A). RCRA subjects any person who "knowingly
treats, stores, or disposes of any hazardous waste identified
or listed under this subtitle… without a permit…"
to fines of not more than $50,000 for each day of violation,
imprisonment not to exceed five years or both. After losing
motions to dismiss, the defendants pleaded guilty but reserved
their right to appeal.
On
appeal, the defendants argued that they were exempt from
permit requirements for storage of hazardous waste because,
as demolition contractors, they were "small quantity
generators" as defined in 40 CFR §260.10. Under
that section, generators who generate no more than 1,000
kilograms of hazardous waste a month may store the waste
on-site without a permit for 180 days so long as they comply
with safe storage conditions. Waste generated by those who
generate less than 100 kilograms a month is, with certain
conditions, not subject to regulation.
The
court rejected the argument, holding that the defendants
were not "generators" of hazardous waste at all.
The EPA defines a "generator" in 40 CFR §260.10
as "any person, by site, whose act or process produces
hazardous waste identified or listed, or whose act first
causes hazardous waste to become subject to regulation."
The defendants did not produce the hazardous waste in the
canisters or first cause it to be subject to regulation.
Rather, the abandoned canisters of methyl bromide already
were "waste" subject to regulation when Albertson's
bought the property. The defendants merely moved the canisters
from inside the buildings to outside. Because they were
not generators, the 5th U.S. Circuit Court of Appeals ruled
the defendants could not invoke the small generator exception
and treated them as storers. United States v. Sims Brothers
Construction, Inc., 277 F.3d 734 (5th Cir. 2001).
The
court noted that even if the defendants were considered
to be generators, they had failed to meet the federal requirements
to qualify for unpermitted storage of hazardous waste.
The
defendants also argued that RCRA was unconstitutional for
vagueness because it did not clearly define storage of gaseous
material. Under 42 USC §6903, for waste to be hazardous,
it must be "solid waste." For gaseous material
to be "solid waste," it must be "contained."
The statute defines "storage" as "the containment
of hazardous waste, either on a temporary basis or for a
period of years, in such a manner as not to constitute disposal
of such hazardous waste." The defendants argued that
the definitions gave them no fair warning that "merely
finding the cylinders on a jobsite or placing them on the
ground without further containment constitute[d] a felony."
They argued that they could not be found to have stored
hazardous waste because they did not put the canisters inside
an additional container.
The
court rejected these arguments. It expressed concern that
the statute did not specify how much time must elapse after
a person discovers he is in possession of hazardous waste
before criminal liability attaches for storage of hazardous
waste. However, the court held that under the facts here,
three weeks was enough time to find that the defendants
were "knowingly" storing hazardous waste. The
court noted that the defendants allowed the canisters to
remain in an open area for three weeks while doing nothing
about their removal or disposal. It noted the defendants
failed to notify the appropriate government agencies that
they had found potentially hazardous material or to contact
Redding Fumigants, whose name was stamped on the canisters
and which still was in business.
Each
of the defendants was sentenced to five years of probation.
In addition, Sims was fined $100,000 and assessed $400;
Amtek was assessed $400; Jerkins was assessed $100; and
Case was ordered to pay restitution of $14,628, a fine of
$10,000 and was assessed $100.
To
avoid similar problems, contractors that find potentially
hazardous wastes on a jobsite should promptly notify the
proper environmental agencies. Contractors also are well-advised
have a hazardous material management plan.
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For more information about the issues covered in this report, please contact E. Todd Chayet in our Los Angeles office at 213-576-8012 or at tchayet@thelen.com or contact your Thelen attorney. For more information about Thelen's Construction and Government Contracts Department, click here.
©2002 Thelen Reid Brown Raysman & Steiner LLP
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