A recent decision of the Eight Circuit Court of Appeals provides a useful reminder about the importance of the Discharge Monitoring Reports (DMR). The message is simple: you are bound by what the report states, and disavowal in a civil penalty action is nearly impossible.
A DMR is filed by every person who holds an NPDES permit for the discharge of a pollutant from a point source. A discharge that conforms to the permit complies with the federal Clean Water Act (CWA). A discharge that does not conform to the permit violates the act and renders the permittee liable for civil penalties. As a condition of its permit, the permittee is responsible for submitting accurate and timely DMRs. The Eight Circuit’s opinion in United States v. STABL, Inc. explains why accurate DMRs are critical. Link.
STABL, Inc. fulfills a truly critical environmental and public health function. It is a rendering plant that processes dead cattle and other animals in a small town in Nebraska. STABL was required under the terms of its NPDES permit to meet CWA “pre-treatment” standards for certain pollutants resulting from its rendering process, including ammonia, grease and oil, total suspended solids and biochemical oxygen demand. Once it provided the necessary pre-treatment, STABL discharged its effluent to the municipal waste-water treatment works. The municipality controlled the valve that controlled the effluent flowing from the facility to the municipal system. The municipality also provided the required effluent testing used by STABL for preparation of the DMRs. Treatment at the facility was inadequate. In fact, when the facility was sold in 2010, the buyer secured a discount of a million dollars from the purchase price in recognition that a re-treatment system was needed. U.S. EPA and the State of Nebraska brought an enforcement action in 2011 against STABL for, among other things, failing to test for grease and oil and exceeding the limits in its pre-treatment permit.
At trial, STABL was reduced to disavowing the evidence contained within the DMRs it had submitted, which its plant manager had signed. Among its arguments was that the valve that controlled effluent for flow from its facility to the municipal treatment works was not properly calibrated and was, therefore, inaccurate. STABL also argued that the timing of the particular testing regime skewed the results unfavorably. The trial court rejected the company’s arguments regarding reliability and potential laboratory error and granted summary judgment to the governments. The company fared no better on appeal.
In rejecting the company’s arguments about the unreliability of its own DMRs, the Eighth Circuit relied in large part on the decisions of other federal courts. “To impeach its own DMRs, a party must, at the very least, offer evidence that corroborates its claim that the pollutant levels were over-reported and were actually within permit limits. . . . Evidence of unreliable testing methods alone is insufficient.” (Op. at p.12.) Thus, the company’s claim about the accuracy of the testing was “sheer speculation.”
The lesson of this decision is that a civil penalty enforcement action is the wrong time to question the accuracy of a DMR. Given the inherent complexity of testing for small quantities of numerous pollutants, errors can occur in sampling, storage and laboratory testing. The time, however, for questioning a test result – and providing an accurate result – is not in court.
The case is United States v. STABL, Inc., U. S. Court of Appeals for the Eighth Circuit, No. 14-2050 (August 27, 2015).
This article was authored by Blair M. Gardner, Jackson Kelly PLLC.