Petition for Writ of Certiorari — Simkins Industries, Inc. v. Sierra Club

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preme Court, US, |

EILED

CCT 20 1988

YOSEPH E SPANIOL! :

CLERK —_

IN THE

Supreme Court of the United States

OCTOBER TERM, 1988

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LESPOUIUe!l

PETITION FOR WRIT OF CERTIORARI

FOR THE FOURTH CIRCUIT

DAVID F.. ALBRIGH

TO THE

UNITED STATES COURT OF APPEALS

HARLEY THOMAS HOWELL *

SEMMES, BOWEN & SEMMES

250 W. Pratt Street

Baltimore, MD

(301) 5389-5040

*x ¢

21201

Counsel of Record Counsel for Petitione?

WILSON - EPES PRINTING Ci IN 789-0096 - WASHIN

20001

QUESTIONS PRESENTED

1. Does $505 of the Clean Water Act abridge the

Article III standing requirement of “redressability” by

authorizing private citizens to seek a judicial award of

penalties to the United States Treasury?

2. In reviewing a summary judgment rendered in

direct conflict with Gwaltney of Smithfield v. Chesapeake

Bay Foundation, Ine., 484 U.S. 108 S.Ct. 376

(1987), did the Court of Appeals err by finding a con-

tinuing violation of the Clean Water Act never charged

by complaint or motion and negated by the unchallenged

findings of fact?

[Note: Petitioner reserves the right to argue Question 3

in the event certiorari is granted on both the above ques-

tions, but does not include Question 3 among the reasons

for the grant of certiorari. |

3. Did the court below err in holding that the failure

to file discharge-monitoring reports, without more, con-

stitutes the violation of “an effluent standard or limita-

tion”—the jurisdictional requisite of a citizen suit under

$ 505(a) of the Clean Water Act?

(i)

ce mmm cmc cea accesses

PARTIES TO THE PROCEEDINGS

Petitioner and defendant-appellant below, Simkins In-

dustries, Inc., has no parent companies, subsidiaries, or

affiliates to list pursuant to Rule 28.1. Respondent and

plaintiff-appellee below is the Sierra Club.

TABLE OF CONTENTS

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PARTIES TO THE PROCEEDINGS ............................

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PERTINENT STATUTORY PROVISION .....................

STATEMENT UNDER RULE 238.4 (b)

pe ee 4 ba he gy yi at ee): aa Er.

A. District Court Proceedings ..................................

B. Court of Appeals Proceedings

REASONS FOR GRANTING THE WRIT

I. Section 505 of the Clean Water Act Abridges the

Article III Requirement of “Redressability” By

Authorizing Private Citizens to Seek a Judicial

Award of Penalties to the United States

SRE he Gr

II. In Its Review of a Summary Judgment Rendered

in Direct Conflict With this Court’s Decision in

Gwaltney, the Court of Appeals Erred by Find-

ing a Continuing Violation of the Act Never

Charged by Complaint or Motion and Negated

by the Unchallenged Findings of Fact

CONCLUSION .

(iii)

TABLE OF CONTENTS—Continued

APPENDICES:

Appendix A:

Appendix B:

Appendix C:

Appendix D:

Appendix E:

bes

Appendix

Apperdix G:

Opinion of the Court of Appeals,

May 31, 1988

Opinion of the District Court, June

Be Ee ve ees

Opinion of the District Court, July

31, 1986

Opinion of the District Court,

March 16, 1987

Judgment of Court of Appeals,

WN Gs WOE ieee

Order of Court of Appeals Denying

Petition for Rehearing, July 27,

42a

ae)

Noa

68a

69a

Tla

TABLE OF AUTHORITIES

Cases Page

Allen v. Wright, 468 U.S. 737 (1984) ............. 10, 14

Amadeo v. Zant, 108 S.Ct. 1771 (1988)... 24, 28

Anderson v. Bessemer City, 470 U.S. 564 (1985)... 25

Ashcroft v. Mattis, 431 U.S. 171 (1977) ................ 19

Atlantic States Legal Foundation v. Tyson Foods,

Inc., 682 F.Supp. 1186 (N.D. Ala. 1988) ............. 25

Bender v. Williamsport Area School Dist., 475

tee: GE CIGOE) oc eee 16, 22

Chesapeake Bay Foundation v. Bethlehem Steel

Corp., 608 F. Supp. 440 (D. Md. 1985)... 13

Chesapeake Bay Foundation v. Gwaltney of

Smithfield, Ltd., 791 F.2d 304 (4th Cir. 1986),

vacated 484 U.S . , 108 S.Ct. 376 (1987)... 8,17

Chesapeake Bay Found., Inc. v. Gwaltney of

Smithfield, Ltd., 844 F.2d 170 (4th Cir. 1988) ..

27-28

Deakins v. Monaghan, 108 S.Ct. 523 (1988) _......... 16

Diamond v. Charles, 476 U.S. 54 (1986) 18, 19

Duke Power Co. v. Carolina Envir'l Study Group,

ine., 408 U3. G GSTS)... 3 Se 11

Environmental Protection Agency v. California,

426 US. 200 (1906) ..he ee 9

Fountain v. Filson, 336 U.S. 681 (1949) 23

Friends of the Earth v. Eastman Kodak Co., 656

F. Supp. 513 (W.D.N.Y. 1987) ................... Ee 14

Gladstone Realtors v. Village of Bellwood, 441

U.S. OF (lS)... eee 15

Gonzales v. Gorsuch, 688 F.2d 1263 (9th Cir.

DIE B sbiccssncsincumiecs tel necke cha ee sett Pet 14

Gwaltney of Smithfield v. Chesapeake Bay Foun-

dation, Inc., 484 U.S. ——, 108 S.Ct. 376

CREEP occ nee 9, 12, 15, 19-25, 27

Hamker v. Diamond Shamrock Chemical Co.. 756

¥.20 302 (0th Cis, 1968) 27

Icicle Seafoods, Inc. v. Worthington, 475 U.S. 709

| EOD a cininsstnmtssesovesneaoudag see ne 25-26

John Deere Co. v. American Nat. Bank, 809 F.2d

Rie (00m Cot, 20 eee Zo

Leeke v. Timmerman, 424 U.S. 83 (1981) ............. 19

Linda R.S. v. Richard D., 410 U.S. 614 (1973)...

16, 18

TABLE OF AUTHORITIES—Continued

McBi de v. Merre ll Dow & Pharmaceut cals, inc.,

800 F.2d 1208 (D.C. Cir. 1986) 2

Meese v. Keene, 107 S.Ct. 1862 (1987) 10

Menzel v. County Util. Corp., 712 F.2d 91 (4th

Cir. 1983) 9

Middlesex County Sewerage Auth. v. National

Sea Clammers Ass’n, 453 U.S. 1 (1981) 11,12

Pullman-Standard v. Swint, 456 U.S. 273 (1982). 26, 28

Roadway Express, Inc. v. Piper, 447 U.S. 752

(1980) 2

Safir v. Dole, 718 F.2d 475 (D.C. Cir. 1983) 19

Sierra Club v. Chevron U.S.A., Inc., 834 F.2d

1517 (9th Cir. 1987) 12-1

Sierra Club v. Morton, 405 U.S. 717 (1972) 1]

Sierra Club v. Shell Oil Co., 817 F.2d 1169 (5th

Cir. 1987) 9

Sierra Club v. Union Oil ¢ ‘o. of Californ la, 8538

F.2d 667 (9th Cir. 1988) 20, 27, 28

Simon v. Easton Kentucky Welfare Rights Ora..,

126 U.S. 26 (1976) ¥6 11,18

St id nt P thlie Inte rest Re search Group, Ine. Vv.

AT & T Bell Laboratories, 617 F. Supp. 1190

(D.N.J. 1985) 17-18

Student Public Interest Research Group of New

Jersey, Inc. v. A.T. & T. Bell Laboratories, 6423

F. Supp. (D. N.J. 1986), modified and re-

manded, 842 F.2d 1436 (3rd. Cir. 1988) 17

Sure-Tan, Inc. v. N.L.R.B., 467 U.S. 883 (1984) 18-19

Toussie v. United States, 397 U.S. 112 (1970) 2

Tull v. United States, 107 S.Ct. 1831 (1987) 23

Vall Y For ge Christian Colle ge vu. Americans

United For Separation of Church and State.

154 U.S. 464 (1982)

Warth v. Selden, 422 U.S. 490 (1975) 11,18

White v. New Hampshire Dept. of Empl. Sec..

155 U.S. 445 (1982) 19

Williams City of St. I 785 F.2d 114 (&th

Cir. 1986)

vii

TABLE OF AUTHORITIES—Continued

Constitutional and Statutory Materials Page

Article III, Constitution of the United States 5-6, 7-8,

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2403 (a)

1318

1319 (a)

1342

1362 (11)

1365.

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1365 (a) (

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1365 (b) (1) (A) : 1

1365 (b) (1) (B) 18

1365 (c) (3)

1365 (f) (6) ...

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6972 (a) (2)

9659 (c) .........

yislative Materials

1 A LEGISLATIVE HISTORY OF THE WATER POLLU-

TION

in 1972 U.S. CopE Conc. & AD. NEWS 3668 12

CONTROL

ACT

AMENDMENTS OF 1972

Supreme Court Rule 28.4(b) __.. 3

Federal Rules of Civil Procedure:

Rule 11

Rule 52 (a)

Vill

TABLE OF AUTHORITIES—Continued

Other Authorities Page

Austin, The Rise of Citizen-Suit Enforcement in

Environmental Law: Reconciling Private and

Public Attorneys General, 81 NORTHWESTERN

U.L. REv. 220 (1987)

Boyer & Meidinger, Privatizing Regulatery En-

forcement: A Preliminar y Assessment of Citi-

zens Suits Under Federal Environme ntal Laws,

34 BUFFALO L. REV. 833 (1985) ; eee +

Brief for the United States as Amicus Curiae in

Gwaltney of Smithfield v. Che sapeakss Ba

Found, Inc., No. 473 (Oct. Term. 1986) 15-16

Fodil, Citizen Suits Against Polluters: Picking

Up the Pace, 9 Harv. Envtut. L. Rev. 23

(1985) :

Lewis, Environmentalists’ Authority To Sue In-

dustry For Civil Penalties, 16 ENvTL. L. REP.

10101 (1986)

Mckinney, Statute of Limitations for Citizen

Suits Under the Clean Water Act, 72 CORNELL

L. REV. 195 (1986) 12

Schwartz v. Hackett, Citizens Suits Against Pri-

vate Industry Under the Clean Water Act. 17

NAT. RESOURCES LAW. 327 (1984) 9, 11, 12, 1

Thompson, Citizen Suits and Civil Penalties Under

the Clean Water Act, 85 MicH. L. REv. 1656

(1987) on , Ei, ie be

IN THE

Sigtreme Court of the United States

OCTOBER TERM, 1988

—

No.

SIMKINS INDUSTRIES, INC.,

Petitioner

SIERRA CLUB,

= Respondent

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

Petitioner, Simkins Industries, Inc., respectfully prays

that a writ of certiorari issue to review the judgment

and opinion of the United States Court of Appeals for

the Fourth Circuit, entered in the above-entitled proceed-

ing on May 31, 1988.

OPINIONS BELOW

The opinion of the United States Court of Appeals for

the Fourth Circuit is reported at 847 F.2d 1109 and is

reprinted in the appendix hereto (“App.”) at la.

The opinion of the United States District Court for

the District of Maryland (Murray, J.), entering sum-

mary judgment against the Petitioner on issues of lia-

bility, is reported at 617 F.Supp. 1120 and is reprinted

at App. la. The opinion of the District Court, assessing

a $977,000 civil penalty agairst Petitioner, is reported

at 17 Envt’l. L. Rptr. 20346 and is reprinted at App.

42a. The unreported opinion of the District Court deny-

ing subsequent motions is reprinted at App. 58a.

JURISDICTION

Respondent Sierra Club brought suit in the District

Court alleging jurisdiction under Section 505(a) of the

Clean Water Act, 33 U.S.C. § 13865(a). Petitioner filed

a motion for judgment on the pleadings based on lack of

subject-matter jurisdiction, which was denied by the

District Court on June 18, 1985. App. 41a. The District

Court then entered partial summary judgment against

Petitioner and on July 31, 1986, assessed $977,000 in

civil penalties against Petitioner. App. 57a.

Petitioner appealed. The Court of Appeals affirmed on

May 31, 1988. App. 17a, 68a. A timely-filed petition for

rehearing was denied on July 27, 1988. App. 69a.

The jurisdiction of this Court to review the judgment of

the Fourth Circuit is invoked under 28 U.S.C. § 1254(1).

PERTINENT STATUTORY PROVISION

Section 505 of the Clean Water Act, 33 U.S.C. § 1365,

provides in pertinent part:

$1365. Citizen sutts:

(a) Authorization; jurisdiction

Except as provided in subsection (b) of this sec-

tion, any citizen may commence a civil action on his

own behalf—

(1) against any person * * * who is alleged to be

in violation of (A) an effluent standard or limita-

tion under this chapter or (B) an order issued by

the Administrator or a State with respect to such

a standard or limitation, or

(2) against the Administrator where there is al-

leged a failure of the Administrator to perform any

act or duty under this chapter which is not discre-

tionary with the Administrator.

The district courts shall have jurisdiction, without

regard to the amount in controversy or the citizen-

ship of the parties, to enforce such an effluent stand-

ard or limitation, or such an order, or to order the

Administrator to perform such act or duty, as the

case may be, and to apply any appropriate civil pen-

alties under section 1319(d) of this title.

(g) Citizen

For the purposes of this section, the term “citi-

zen” means a person or persons having an interest

which is or may be adversely affected.

STATEMENT UNDER RULE 28.4(b)

Because the proceeding draws into question the con-

stitutionality of Section 505(a) of the Clean Water Act,

33 U.S.C. § 1365(a), an Act of Congress affecting the

public interest, and neither the United States nor any

agency, officer, or employee thereof is a party, it is noted

that 28 U.S.C. § 2403(a) may be applicable.

While this case was pending on appeal, the United

States sought to intervene but its application was denied

by the Fourth Circuit. App. 2a-3a n.1. No court of the

United States as defined by 28 U.S.C. § 451 has, pursu-

ant to 28 U.S.C. § 2403(a), certified to the Attorney

General the fact that the constitutionality of such Act

of Congress has been drawn in question.

STATEMENT OF THE CASE

Petitioner, Simkins Industries, Inc. (‘‘Simkins’’), oper-

ates a paper mill in Catonsville, Maryland, manufactur-

ing paperboard from recycled waste paper. App. 46a.

The Maryland State Department of Health and Mental

Hygiene issued Simkins a permit under the Clean Water

Act, 33 U.S.C. $ 1342, authorizing it to discharge specific

effluents into the adjacent Patapsco River. The permit

required Simkins to monitor three outfalls at its plant

at monthly intervals. The monitoring results were to be

summarized quarterly in a Discharge-Monitoring Report

(“DMR”) submitted to the Department no later than 28

days following the end of each calendar quarter. Ct.

App. Joint Appendix (“J.A.”) at 21.

On August 31, 1984, Sierra Club mailed Simkins a

letter (App. 76a) pursuant to 33 U.S.C. § 1365(b) (1)

(A), requiring 60 days prior notice as a precondition to

filing a citizen suit under § 1365(a)(1). The letter

stated that Sierra Club had reason to “believe” that Sim-

kins “has violated and continues to violate” its permit

by failing to file any DMRs from August 1, 1981, to

March 31, 1984. App. 76a-78a.

Simkins’ prompt responses to the letter were summar-

ized in findings of fact by the District Court (App. 46a-

53a). On August 29, 1984, two days before Sierra Club

mailed notice, Simkins directed its officials to comply with

its permit monitoring and requirements. On September 4,

1984, Simkins retained outside chemists to perform the

required monitoring and to file the quarterly DMRs in

compliance with its permit. App. 50a-5la. The District

Court also found that, after conducting monthly tests on

September 30, 1984, and filing DMRs on October 1, 1984,

Simkins has continued ever since to file the quarterly

DMRs required by its permit (App. 51a).

A. District Court Proceedings

On October 31, 1984, after 60 days had expired, Sierra

Club filed a citizen suit against Simkins in the District

Court. Its complaint invoked jurisdiction under § 505(a)

of the Clean Water Act, 33 U.S.C. § 1865(a). App.

Tla. Sierra Club identified itself as a California-based

conservation organization with members residing near

the Patapseco River whose recreational interests were

“adversely affected” by Simkins’ permit violations (App.

73a). The complaint alleged: “Defendant has violated

the waste water discharge limits contained in its NPDES

permit, as set forth in a letter to the Defendant dated

August 31, 1984, attached hereto as Exhibit A and in-

corporated by reference herein.” App. 74a (italics added).

In contrast to the August letter, the complaint did not

allege that Simkins was continuing to violate its permit

or that Simkins had failed to comply since receipt of the

notice.

By way of relief, the complaint requested an order to

declare Simkins ‘“‘to have violated” the Clean Water Act,

enjoin Simkins from “further violation” of its permit,

and direct it to pay civil penalties of $10,000 per day of

violation. App. 74a-75a. In addition, Sierra Club sought

attorney’s fees, expenses, and costs (App. 75a).

Simkins moved for judgment on the pleadings. Its

motion challenged the Article III standing of Sierra Club

to bring a citizens suit for penalties and objected to the

failure of the complaint to state a violation of an “efflu-

ent standard or limitation” in the Simkins permit, as

§ 505 requires (J.A. 33). Supported by DMRs filed by

Simkins, the motion contended that Simkins was in pres-

ent compliance with its permit and could not be sued

under § 505 for wholly past violations (J.A. 33, 34).

Sierra Club moved for partial summary judgment on

the sole ground that it was undisputed that Simkins “has

violated” its permit by failing to file DMRs in the past

(J.A. 68, 84). During argument on the motions (J.A.

85), Sierra Club proffered the affidavit of its member,

John Railey, attesting to his “interest in monitoring the

discharge of effluents into the Patapsco River.” J.A. 112.

On June 18, 1985, the District Court rejected Simkins’

contentions and granted summary judgment for Sierra

Club as to liability. App. 40a-41a. In an opinion by Judge

Murray,’ the Court held that Sierra Club acquired Ar-

1 During a conference in chambers, Judge Murray disclosed to

counsel his former membership in the Sierra Club and offered to

recuse himself and transfer the case to another judge if any

litigant was concerned (J.A. 333, 338, 341). These disclosures

ticle III standing demonstrating “that the interest of

[its] members may be adversely affected by defendant’s

noncompliance with its permit requirements.” App. 38a.

Second, the Court ruled that Sierra Club “may maintain

an action against defendant for past violations even if

defendant now complies with the terms of its NPDES

permit.” App. 39a. It held “that civil penalties may be

recovered in citizen suits for past violations” and treated

Simkins’ present compliance as “irrelevant to plaintiff’s

cause of action.” App. 39a. Finally, Simkins’ admitted

failure to file DMR’s was held to constitute a violation

within the purview of § 505. App. 41a.”

Having decided Simkins’ liability for its past violations

of the DMR provision of its permit, the District Court

held a bench trial limited to the amount of civil penalties

to be assessed. App. 42a. In its written submission,

Sierra Club urged the Court to impose $320,000 in penal-

ties and to direct Simkins to pay the penalties to a State

clean water fund for use in cleaning up the Chesapeake

Bay (J.A. 373). On July 31, 1986, Judge Murray con-

cluded that the failure to file 11 DMRs covered 977 days

and thus justified a maximum penalty of $9,770,000.

App. 55a. However, the Court found that such violations

were “not so egregious as to warrant the full assessment

of $10,000 per day” but that a penalty of $977,000 would

‘‘serve as a sufficient deterrent” (App. 55a).

Counsel fees and other litigation expenses were

awarded to Sierra Club. App. 56a. No injunctive relief

were not placed “on the record”, as required by 28 U.S.C. § 455(e).

As soon as it became aware of these facts, Simkins moved for

recusal but Judge Murray’s denial of the motion (App. 59a-63a) was

sustained on appeal (App. 14a-17a). Those rulings are not chal-

lenged in this Petition.

2 In a later opinion, the Court explained that “the fact that no

pollution existed is not relevant to the court’s decision to assess

penalties for failure to comply with Maryland’s reporting require-

App. 66a n.8.

ments.’

‘

was considered or granted. Despite the formal prayer

in its complaint for an injunction (App. 75a), Sierra

Club did not request injunctive relief in its final sub-

missions and took no appeal from the Court’s failure to

issue an injunction.*

B. Court of Appeals Proceedings

Simkins did appeal to the Fourth Circuit, which af-

firmed the judgment for penalties. The primary thrust

of the appeal was a renewed, two-pronged challenge to

the Article III standing of Sierra Club to maintain a

citizen suit for civil penalties payable to the United

States. First, Simkins argued that proof of the “injury”

component of standing* was not satisfied by the Railey

affidavit. Second, Simkins contended that the “redress-

ability’ component of standing cannot be abridged by

Congress itself and that § 505 offends Article III insofar

as it permits a citizen to seek and obtain judgment for

penalties without any personal stake in their recovery.

In an opinion by Chief Judge Winter, the Fourth

Circuit disagreed with both contentions. It found the

Railey affidavit sufficient to establish injury stemming

from Simkins’ past violations. App. 6a-7a. On the Ar-

ticle III “redressability” question, the Fourth Circuit

advanced the thesis that the deterrent effect of penalties

3 Unlike Simkins, Sierra Club filed no post-judgment motion. It

did not seek reconsideration of the Court’s failure to grant injunc-

tive relief.

4 This Court has adopted a three-part test of Article ITI standing:

“TA]t an irreducible minimum, Art. III requires the party who

invokes the court’s authority to ‘show that he personally has suf-

fered some actual or threatened injury as a result of the putatively

illegal conduct of the defendant,’ and that the injury ‘fairly can

be traced to the challenged action’ and ‘is likely to be redressed

by a favorable decision.’” Valley Forge Christian College v.

Americans United For Separation of Church and State, 454 U.S.

464, 472 (1982) (citations omitted).

is sufficient of itself to confer standing upon citizens to

sue for their recovery, even if such penalties are con-

cededly payable only to the United States Treasury. App.

8a.

In addition, the Fourth Circuit was obliged to reconcile

the judgment for penalties, based on Simpkins’ past

violations of its permit, with the collapse of its own

precedent on which that judgment was predicated. Chesa-

peake Bay Foundation v. Gwaltney of Smithfield, Ltd.,

791 F.2d 304 (4th Cir. 1986) (opinion per Winter, C.J.),

vacated 484 U.S. , 108 8.Ct. 376 (1987). The pres-

ent case was argued prior to this Court’s decision in

Gwaltney, but the Fourth Circuit refused to remand the

case for further findings of fact. The Fourth Circuit

held “as a matter of law” that Sierra Club had alleged

“in good faith” and had also proved a continuing viola-

tion within the meaning of Gwaltney. App. 8a-9a.

As a pleading matter, the Fourth Circuit focused ex-

clusively on the pre-suit 60-day notice letter in support

of its conclusion that “Sierra Club alleged in good faith

a continuing violation of the Clean Water Act.” App.

9a. It did not address Simkins’ argument that the letter

described a state of affairs that had existed on August

31, 1984, but did not purport to cover events happening

when suit was filed 60 days thereafter. The jurisdic-

tional allegation of the complaint filed October 31, 1984,

merely asserted that Simkins “has violated” its permit

(App. 74a). The allegations of the complaint were not

mentioned in the opinion below.

As a matter of proof, the Fourth Circuit questioned

the accuracy of the pre-suit DMRs filed by Simkins. App.

10a. It did not acknowledge the District Court’s finding

that Simkins, after filing pre-suit DMRs on October 1,

1984, has remained in compliance by continuing to file

all DMRs required by its permit. App. 5la. “More sig-

nificantly”, according to the opinion below (App. 10a),

Simkins also viclated its permit when it failed to main-

tain records of monthly monitoring activities prior te

September 30, 1984—although no such “record reten-

tion” violation was charged in the 60-day notice or the

complaint and was admittedly not considered by the Dis-

trict Court. App. 10a n.7. The Fourth Circuit did rec-

ognize that Simkins’ violations “occurred solely before

Sierra Club filed suit,” (App. lla), but it held that such

“violations continued past the date Sierra Club filed its

complaint” and thus supported § 505 jurisdiction under

Gwaltney. App. 1la.°

5 Finally, the Fourth Circuit concluded that the reporting con-

dition of a permit constitutes “an effiuent standard or limitation”,

alleged violation of which is a §505 jurisdictional prerequisite.

App. 12a. It relied upon dicta (but not the holding) in Menzel v.

County Util. Corp., 712 F.2d 91 (4th Cir. 1983) and the text of

83 U.S.C. § 1365(f)(6), which specifies the types of effluent limi-

tations deemed to be “under this Act” for citizen suits but does

not alter the meaning of “effiuent limitation” set forth in § 1362(11).

Schwartz & Hackett, Citizen Suits Against Private Industry Under

the Clean Water Act, 17 NAT. RESOURCES LAW. 327, 336 (1984).

The Fourth Circuit rejected contentions that § 1365(f)(6) does

not encompass all permit conditions, but refers to the effluent

“standards or limitations as translated into the conditions of an

NPDES permit.” E.P.A. v. California, 426 U.S. 200, 225 (1976)

(court’s emphasis). See Sierra Club v. Shell Oil Co., 817 F.2d 1169,

1173 (5th Cir. 1987). Under the construction urged below, a citizen

suit may enforce “an effluent standard or limitation” in a permit,

but would not encroach upon federal enforcement under 33 U.S.C.

§ 1319(a) of reporting and other permit conditions implementing

§ 1318-—-a provision nowhere mentioned in the citizen suit statute.

With its singular focus upon paperwork violations, the decision

below is strangely at odds with the requirement that a citizen

must allege “a reasonable likelihood that a past polluter will con-

tinue to pollute in the future.” Gwaltney of Smithfield v. Chesa-

peake Bay Foundation, Inc., 484 U.S. ——, 108 S.Ct. 376, 381

(1987). By its uniaue construction, the Fourth Circuit has argu-

ably expanded citizen suit jurisdiction beyond the reach of § 595.

Because no other court has adopted that construction, we reserve

further argument for briefing in the event that the writ of certi-

orari is granted on the other questions presented.

REASONS FOR GRANTING THE WRIT

I. Section 505 of the Clean Water Act Abridges the Article

III Requirement of “Redressability” By Authorizing

Private Citizens to Seek a Judicial Award of Penalties

to the United States Treasury.

The Clean Water Act contains a novel feature dis-

tinguishing it from every other statute previously en-

acted by Congress. In providing for citizen suits, $ 505(a)

of the Act authorizes a private citizen suing “on his

own behalf” to invoke federal jurisdiction to impose civil

penalties payable exclusively to the United States Treas-

ury. 33 U.S.C. §$1365(a). Invoking that provision,

Sierra Club sought and obtained judgment for $977,000

in penalties but lacks any stake in their recovery. The

United States, whose stake is uncontestable, was not a

party to the suit. Nevertheless, in upholding the penalty

judgment, the Fourth Circuit perceived in Article IIT

of the Constitution no impediment to the standing of a

private citizen to seek judicial relief beneficial only to

the Treasury. App. 8a.

However, Article III “is every bit as important in its

circumscription of the judicial power of the United States

as in its granting of that power * * *,” Valley Forge

Christian College v. Americans United, 454 U.S. 464,

476 (1982), Bets cases recognize that a mere showing

of personal injury is not sufficient to establish st: nding;

we have eae required that the injury be ‘fairly traceable

to the defendant’s allegedly unlawful conduct and likely

to be redressed by the requested relief.” Meese v. Keene,

107 S.Ct. 1862, 1869 (1987), quoting from Allen v.

Viright, 468 U.S. 737, 751 (1984).

The function of “the ‘redress nel component is to

focus on the requested relief.” Allen v. . Wright, 468 U.S

737, 753n.19 (1984). Wlien the Nona sted relief consists

of penalties payable to the Treasury, for general expend-

itures unrelated to the environment, the focus reveals an

inescapable question of fundamental constitutional mag-

nitude. A citizen who sues on his own behalf for penal-

ties, which he is not entitled to share, cannot demonstrate

“that he personally would benefit in a tangible way from

the court’s intervention.” Warth v. Selden, 422 U.S. 490,

508 (1975). Standing requires “a substantial likelihood

that the judicial relief requested will prevent or redress

the claimed injury to satisfy the “case or controversy’

requirement of Art. III.” Duke Power Co. v. Carolina

Envir’l Study Group, Inc., 438 U.S. 59, 79 (1978). “The

necessity that the plaintiff who seeks to invoke power

stand to profit in some personal interest remains an Art.

III requirement.” Simon v. Easton Kentucky Welfare

Rights Org., 426 U.S. 26, 39 (1976).

This case presents the “redressability’” question which

inquires whether Congress exceeded the constraints of

Article III when it allowed citizens to sue on their own

behalf for penalties payable to the Treasury.° When the

Clean Water Act was enacted, Congress plainly intended

to expand citizen standing to the ful! extent permitted

by Article III. It defined a “citizen” broadly “as a per-

son or persons having an interest which is or may be

adverselv affected.” 33 U.S.C. §1365(g). It is clear

“that this phrase was intended by Congress to allow suits

by all persons possessing standing under this Court’s de-

cision in Sierra Club v. Morton, 405 U.S. 727 (1972).”

Middlesex County Sewerage Auth. v. National Sea Clam-

mers Ass’n, 453 U.S. 1, 16 (1981).

Section 505 was thus adapted to Morton (but not later

decisions) and was patterned upon a citizen suit provi-

6 Legal commentators agree that this question remains unre-

solved. See, e.g., Thompson, Citizen Suits and Civil Penalties

Under the Clean Water Act, 85 MICH. L. REV. 1656, 1678 (1987) ;

Boyer & Meidinger, Privatizing Regulatory Enforcement: A Pre-

liminary Assessment of Citizen Suits Under Federal Environmental

Laws, 34 BUFFALO L. REV. 833, 938-39 (1985); Schwartz & Hackett,

Citizen Suits Aaainst Private Industry Under the Clean Water

Act, 17 NAT. RESOURCES LAW 327, 332-35 (1984).

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the Clean Air Act, 42 U.S.C. § 7604(a), which

for injunctive relief only. Middlesex County, 453

t i8 n.27. Congress took a drastic step beyond thos«

when it authorized penalties to be assessed in

) while denying citizens any right in their re-

lisposition. The legislative history does not ex-

nificant aberration,’ except that Congress did

hat any penalties imposed would be deposited as

neous receipts and not recovered by the complain-

Indeed, Congress considered and specifically re-

he option of allowing citizens to collect a share of

nalties.” Citizens were not authorized to recover

es elther. Middlesex County, 453 U.S. at 14.

effect of $505 is to deputize “private attorneys

’ able to invoke federal jurisdiction to impos

( hut eckine anv personal stake in their assess

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The citizen plaintiff’s role is to assert permit

ns and to request that a fine be imposed; the

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"= "= * “The [citizen plaintiffs in a Clean

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1972, at 221-21 (197

Water Act suit] are suing as private attorneys gen-

eral and they seek the enforcement of federal law.

Although the statute provides that a citizen sues ‘on

his own behalf’, ani pe nalties recovered from such

an action are paid into the United States Treasury.

Unlike in a qui tam action, where a volunteer plain-

tiff can recover part of the penalty, in this action a

plaintiff recovers nothing. Any benefit from the law-

suit, whether injunctive or monetary, inures to the

public or the United States. The citizen suit provi-

sion was designed to supplement administrative en-

forcement, not to provide a private remedy. * * *”

Sierra Club v. Chevron U.S.A., Inc., 834 F.2d 1517, 1522

(Ith Cir. 1987) (italics added), quoting from Chesapeake

Bay Found. v. Bethlehem Steel Corp., 608 F.Supp. 440,

449 (D.Md. 1985).

Given the recent and well-documented “explosion” of

citizen penalty suits under § 505,‘° the important but un-

resolved question of Article III “redressability” should be

addressed by this Court. The lack of a controlling deci-

sion engenders a serious paradox in the administration of

justice. Precisely because Congress denied citizens a per-

sonal stake in the penalties assessed in § 505 suits, the

prospect of huge awards earmarked for the Treasury

serves as a powerful incentive for private parties to di-

vert claimed penalties to uses unauthorized by Congress.

Citizen suits typically begin with demands for maximum

penalties at the outset, but end in settlements requiring

the defendant to donate sums to an environmental project

designated by the citizen-plaintiff, in preference to having

the funds disappear into the Treasury. Consent decrees

on such terms are approved routinely by federal courts.

lo See. e.g., Thomr son, Citizen Suits and Civil Penalties Under

the Clean Wate? Act, 85 Micu. L. Rev. 1656, 1658-59 LOS7

McKinney, Statute of Limitations for Citizen Suits Under the Clean

Water Act, 72 CORNELL L. REV. 195 (1986): Fodil. Citizen S

igainst Polluters: Picking Up the Pace, 9 Harv. ENVTL. L. RE\

See, e.g., Friends of the Earth v. Eastman Kodak Co.,

696 F.Supp. 518, 515 (W.D.N.Y. 1987) ($49,000 paid

to private foundation in lieu of penalties to the Treas-

ury). Surveys of consent decrees indicate that citizen

suits under § 505 generate more funds for a handful of

national environmental groups that is collected by the

Treasury on behalf of the taxpaying public2! Although

Congress recently acted to curtail such abuses,’* the over-

arching question remains whether Congress strayed be-

federal judiciary in forcing payments to the Treasury.

By purporting to confer jurisdiction upon federal

courts to impose penalties in citizen suits to which the

United States is not a party, Congress has posed that

very question. It is undeniable that the ‘“redressability”

component of standing is an Article III limitation upon

the jurisdiction of federal courts importantly related to

the doctrine of separation of powers. Allen v. Wright,

468 U.S. 737, 752 (1984); Valley Forge, supra, 454 U.S.

at 473-74. Congress may not by statute, including § 505,

Gonzales v. Gorsuch, 688 F.2d 1263, 1267-68 (9th Cir.

1982), authorize a form of judicial relief which does not

prevent or redress the citizen’s claimed injury:

1 This private gain phenomenon is explored in Austin, The

Rise of Citizen-Suit Enforcement in Environmental Law: Recon-

ciling Private and Public Attorneys General, 81 Nortuw. U.L. REv.

220, 240 (1987); Lewis, Environmentalists’. Authority To Sue In-

dustry For Civil Penalties, 16 ENVTL. L. REP. 10101, 10102 (1986);

Boyer & Meidinger, Privatizing Regulatory Enforcemevt: A Pre-

liminary Assessment of Citizen Suits Under Federal Environmental

Laws, 34 BUFFALO L. REV. 833, 932-93 (1985); Schwartz & Hackett,

Citizen Suits Against Private Industry Under the Clean Water

Act, 17 NAT. RESOURCES LAW. 327, 359-60 (1984).

‘The Clean Water Act was amended in 1987 to provide that

consent decrees to which the U..ited States is not a party will not

become final until 45 days after the Attorney General and the Ad-

ministrator have received copies of the decree. Water Quality Act

of 1987, Pub. L. No. 100-4, § 504, 1987 U.S. Cope ConG. & ADMIN.

NEWS 7, 75, codified as 33 U.S.C. § 1365(c¢) (23).

* * * Congress may, by legislation, expand standing

to the full extent permitted to Art. III, thus per-

mitting litigation by one “who otherwise would be

barred by prudential standing rules.” In no event,

however, may Congress abrogate the Art. III

minima. A plaintiff must always have suffered “a

distinct and palpable injury to himself,” that is likely

to be redressed if the requested relief is granted.

Gladstone Realtors v. Village of Bellwood, 441 U.S. 91,

100 (1979) (citations omitted).

The Article III “redressability” question is no less im-

portant because it is capable of evading review. Because

consent decrees avoid a judicial assessment of penalties,

citizen suits are rarely litigated to final judgment. In

fact, during the entire 16-year history of the Clean Water

Act, only twice has a penalty judgment in a § 505 suit

been subjected to appellate review. Both cases were de-

cided by the Fourth Circuit in panel opinions by Chief

Judge Winter. Apart from the present case, the other

Fourth Circuit decision was vacated last term in Guwalt-

ney of Smithfield v. Chesapeake Bay Found., Inc., 484

US. , 108 8.Ct. 376 (1987) (“Gwaltney”)

This Court concluded in Gwaltney “that citizens, unlike

the Administrator, may seek civil penalties only in a suit

brought to enjein or otherwise abate an ongoing viola-

tion.” 108 S.Ct. at 382. The present case raises the ques-

tion which Gwaltney did not reach. Once a past violation

has been abated and injunctive relief is no longer appro-

priate, does a citizen have Article III standing to procure

the assessment of penalties payable to the United States

Treasury?

In Gwaltney, in sharp contrast to the present case, no

standing question was raised in the Fourth Circuit or in

the petition for certiorari. Although this Court did not

discuss the “redressability” component of standing, the

Solicitor General did identify the Article III problem en-

gendered by citizen suits for penalties:

ieee

* * * A citizen plaintiff who alleges that he is ad-

versely affected by a company’s ongoing violation of

its discharge permit and requests an injunction re-

quiring compliance can satisfactorily demonstrate,

at least at the pleading stage, both personal injury

and redressability. However, a citizen who brings

suit to obtain a judicial assessment of civil penalties

for nonrecurring past violations would fail to meet

Article III’s requirements; the mere assessment of

civil penalties, which are payable only to the Treas-

ury, would not redress in a meaningful sense the

citizen’s alleged injuries. Cf. Linda R.S. v. Richard

D., 410 US. 614 (1973). ** *

Brief for the United States as Amicus Curiae in Guwalt-

ney, No. 86-473 (Oct. Term, 1986) at 21 n.34 (italics

added).

We concur with the Solicitor General, hastening to add

that Article III standing is not restricted to the pleading

stage but must exist throughout the litigation including

appeal. Bender v. Williamsport Area School Dist., 475

U.S. 534, 541 (1986) ; see id. at 551 (dissenting opinion).

When injunctive relief is abandoned or becomes moot

during litigation, a dependent elaim for penalties to the

Treasury cannot satisfy the ‘“redressability’ component

of citizen standing. Cf., Deakins v. Monaghan, 108 S. Ct.

923, 529 (1988).

The decision below did not consider the essential nexus

between injunctive relief and penalties. It advanced a

deterrence rational for upholding the judgment for pen-

alties in the complete absence of injunctive relief:

|T |he judicial relief of civil penalties, even if

payable only to the United States Department of the

Treasury, is causally connected to a citizen-plain-

tiffs injury. Such penalties can be an important

deterrence against future violations. Members of

Sierra Club must show actual or threatened injury

traceable to the wrong and a particularized interest

in deterring violations of the Act, but once they have

done so, the imposition of civil penalties is causally

connected to the injury. See Student Public Interest

Research Group, Inc., v. AT & T Bell Laboratories,

617 F.Supp. 1190, 1200-01 (D.N.J. 1985) (money

damages [sic] awarded in Clean Water Act citizen

suit made payable to U.S. Treasury did redress

plaintiff’s injury in the form of general deterrence).

App. 8a (fn. omitted).

The deterrence theory embraced by the Fourth Circuit,

without further elaboration '* owes no allegiance to the

decisions of this Court. The nisi prius opinion cited be-

low, Student Public Interest Research Group, Inc. v. A.T.

& T. Bell Laboratories, 617 F.Supp. 1190 (D.N.J. 1985), was

never tested by appellate review.” Its deterrence ration-

ale is incompatible with Article III precedents for mani-

18 In its footnote, the Fourth Circuit found it “interesting to note

that Simkins commenced compliance with its reporting obligations

under the Clean Water Act Shortly after Sierra Club notified

Simkins in a letter dated August 31, 1984, * * * of its belief that

Simkins was failing to comply with permit requirements.” App. 8a

n.d (italics added).

By that comment the Fourth Circuit contradicted an express

finding of the District Court: “On August 29, 1984, the acting

plant manager, Jim Grant, instructed Robert Frey, controller, to

see that all applicable state and federal monitoring requirements

were complied with.” App. 50a. That finding was not challenged

on appeal.

'*The deterrent effect of civil penalties was also stressed in

Chesapeake Bay Found., Inc. v. Gwaltney of Smithfield, Ltd., 791

F.2d 304, 309-10 (4th Cir. 1986) (Winter, C.J.), vacated 108 S.Ct.

876 (1987), in an unpersuasive attempt to justify citizen suits for

wholly past violations.

'* After summary judgment was granted to the citizen-plaintiff

on issues of liability, the parties settled the suit for $75,000, only

preserving a dispute over attorney’s fees for further litigation.

Student Public Interest Research Group of New Jersey, Inc. v.

A.T. & T. Bell Laboratories, 643 F.Supp. 961, 962 (D.N.J. 1986),

modified and remanded, 842 F.2d 1436 (3rd Cir. 1988).

fold reasons. First, deterrence rests upon the premise

that penalties will force compliance if permittees “know

they can be sued for past violations even if they cease

discharges or come into compliance with their permits

before they are sued.” Jd. at 1200. That premise was

surely discredited by Gwaltney. Second, the notion “that

Congress intended deterrence as a purpose of sanctions”

(id. at 1201), simply begs the Article III question.

Third, even if “the deterrent effect of civil penalties is

not a remote possibility” because “the general public will

benefit” (id. at 1202), that generalized benefit hardly es-

tablishes a substantial likelihood that the citizen seeking

a penalty assessment “personally would benefit in a tangi-

ble way from the court’s intervention.” Warth v. Selden,

422 U.S. 490, 508 (1975).

At bottom, the deterrence theory proves too much. Vir-

tually every major standing question presupposes some

claim to judicial relief which, if granted, would “dis-

courage” a forbidden practice by others. See, e.g., Simon

». Eastern Kentucky Welfare Rights Org., 426 U.S. 28,

42 (1976). If deterrence alone were to satisfy the “re-

dressability” component of standing, then Congress might

as readily authorize citizens to initiate or intervene in

criminal prosecutions against environmental violators."

Of course, it is settled that “a private citizen lacks a

judicially cognizable interest in the prosecution or non-

prosecution of another.” Linda R.S. v. Richard D., 410

U.S. 614, 619 (1974) (prosecution of father would not

guarantee his child support payments). See also, Dia-

mond v. Charles, 476 U.S. 54, 64 (1986) (physician

lacks standing to exact compliance with anti-abortion

law): Sure-Tan, Inc. v. N.L.R.B., 467 U.S. 883, 897

16 Congress has attempted to do just that. Under § 505(b) (1 )(B)

of the Clean Water Act, a citizen may “intervene as matter of

right” in any federal civil or criminal” prosecution of a violator.

98 U.S.C. § 1365(b)(1)(B). See also Deepwater Ports Act, § 16(b)

(1)(B), 33 U.S.C. § 1515(b) (1) (B).

(1984) (employers “have no judicially cognizable inter-

est in procuring enforcement of the immigration laws’

against aliens in their employ); Leeke v. Timmermen,

454 U.S. 83 (1981) (assault victim lacks standing to

compel arrest of assailants).

It is possible that citizens and environmental groups

might derive satisfaction if violators are stung with large

penalties, but that “is not the sort of benefit from which

Article III standing is constructed * * *.” Safir v. Dole,

718 F.2d 475, 480 (D.C. Cir. 1983) (per Scalia, J.). Ab-

sent a personal stake in the penalty assessment,'' the

“emotional satisfaction from a ruling” that an adver-

sary’s past acts were “wrongful” is not a redressable

interest. Ashcroft v. Mattis, 481 U.S. 171, 172-73 (1977).

The urgent need for definitive guidance on the con-

tours of Article III redressability, as applied to § 505’s

authorization of civil penalties in citizen suits, is under-

scored by recent amendment of other environment meas-

ures designed to confer like penalty authority upon pri-

vate citizens.'* In spelling out conditions under which

citizens may sue for penalties, the Gwaltney decision

serves to fuel speculation that the “redressability” com-

ponent of Article III standing is merely a prudential con-

cern and does not apply when Congress allows citizens to

stand in the shoes of the Treasury. The decision below

reinforces that speculation and deserves review by this

Court.

17 The ability of a citizen to recover attorney fees and costs in a

suit resulting in successful abatement before verdict, Gwaltney,

108 S.Ct. at 386 n.6, does not enhance his stake in an award of

penalties. See Diamond v. Charles, 476 U.S. 54, 70 (1986); White v.

New Hampshire Dept. of Empl. Sec., 455 U.S. 445, 452 (1982).

18 Tdentical penalty authority was added to citizen suit provisions

of the Resource Conservation and Recovery Act of 1984, 42 U.S.C.

$ 6972(a)(2), and the Comprehensive Environmental Response,

Compensation, and Liability Act of 1986, 42 U.S.C. § 9659(c).

II. In Its Review of a Summary Judgment Rendered in

Direct Conflict With this Court’s Decision in Gwaliney,

the Court of Appeals Erred by Finding a Continuing

Violation of the Act Never Charged by Complaint or

Motion and Negated by the Unchallenged Findings of

Fact.

This Court’s holding in Gwaltney discredited the

Fourth’s Circuit’s theory allowing citizen suits under

§ 505 for wholly past violations of the Clean Water Act.

The judgment of the District Court rested entirely upon

that repudiated theory, but the Fourth Circuit upheld it

anyway.

The Fourth Circuit enswered the Gwaltney decision

by ignoring the complaint and the findings of fact in

order to revive its own pre-Gwaltney theory of the law.

In so doing, it disagreed in principle with the Ninth

Circuit decision in Sierra Club v. Union Oil Co. of Cali-

fornia, 853 F.2d 667, 671 (9th Cir. 1988), that findings

of fact by the District Court on the issue of ongoing vio-

lations are necessary to support a judgment for penalties.

In its strained attempt to circumvent Gwaltney and

contrive a “continuing violation” where none existed, the

Fourth Circuit could only cite pre-suit paperwork errors

as the jurisdictional basis for $977,000 in penalties. It

was obliged to rely on forced rationales while refusing to

recognize Simkins’ immediate, diligent efforts to bring

itself into full compliance with its permit as soon as it

received 60-day notice. Simkins has remained in com-

pliance ever since. The Fourth Circuit simply ignores

basic law that “the purpose of notice to the alleged vio-

lator is to give it an opportunity to bring itself into com-

plete compliance with the Act and thus likewise render

unnecessary a citizen suit.” Gwaltney, 108 S.Ct. at 382-

85. The notice achieved the exact purpose of Congress,

but the Fourth Circuit disregarded that purpose. Its

cramped reading of Gwaltney strips Simkins of the bene-

fit of timely compliance.

In upholding a judgment rendered in direct conflict

with Gwaltney, the Fourth Cireuit saw fit to (1) over-

look the defective jurisdictional allegations of the com-

plaint; (2) uphold summary judgment on a ground never

presented to the District Court; (3) substitute its appel-

late views of the record for the unchallenged findings of

fact; (4) assess guilt for a violation never charged, and

(5) refuse to remand the case for findings of fact re-

sponsive to the supervening decision in Gwaltney. In

each instance, the Fourth Circuit defied the precedents

of this Court and created a substantial conflict with deci-

sions from other circuits. The decision below was a ver-

itable explosion of errors, profoundly implicating sub-

ject-matter jurisdiction and procedural due process, which

invites intervention by this Court.

1. Defective jurisdictional allegations. The decision

below trivializes the holding in Gwaltney that § 505 con-

fers jurisdiction only when the citizen-plaintiffs make “a

good faith allegation” of continuing or intermittent vio-

lation. Jd. 108 S.Ct. at 385. The “good faith allegation”

must be tested by Rule 11, Federal Rules of Civil Pro-

cedure, which requires the complaint to be based on a

good faith belief that the allegations are “well grounded

in fact.” Id. This Court remanded for a decision

“whether respondents’ complaint contained a good-faith

allegation of ongoing violation by petitioner.” Jd. 108

S.Ct. at 386 (italics added).

The Sierra Club complaint, filed October 31, 1984, did

not purport to satisfy this jurisdictional requirement. It

merely alleged that Simkins “thas violated” its permit in

the particular specified in a letter dated August 31, 1984,

which was incorporated by reference (App. 74a). The

complaint did not allege that the past violations were on-

going.’®

However, in its opinion below, the ourth Circuit no-

where mentioned the allegations of the complaint. It re-

lied exclusively upon the recitals in the August letter as

having “alleged in good faith a continuing violation of

the Clean Water Act.” (App. 9a). It refused even to

acknowledge the indisputable facts that the August letter

(a) described a situation that had existed 60 days prior

to filing the complaint and (b) did not constitute a plead-

ing subject to the good faith requirement of Rule 11.

The decision below nullifies the Gwaltney pleading cri-

terion. It also contradicts this Court’s long-standing in-

sistenee that jurisdiction must be distinctly alleged and

may not be inferred argumentatively from the pleadings.

See, e.g., Bender v. Williamsport Area School Dist., 475

U.S. 534, 547 (1986).

2. Summary judqment. The decision below, recog-

nizing that a citizen-plaintiff must prove a continuing

violation, found it “beyond dispute that Sierra Club

proved a continuing violation” within the meaning of

Gwaltney. App. 9a. However, that issue was not sub-

mitted to or adjudicated by the District Court. Simkins

was never given a chance to dispute that issue.

Having alleged that Simkins’ violations consisted of its

past failures to file DMRs, Sierra Club moved for sum-

mary judgment on the sole ground that Simkins “has

violated the Clean Water Act” in that respect (J.A. 68).

Sierra Club argued that “{wle are asking this Court to

impose penalties for past violations” (J.A. 89) and that

Simkins’ present compliance “has no bearing whatsoever

on the issue of lability” (J.A. 92). The District Court

19 In contrast, the complaint in Gwaltney alleged that defendant

“has violated * * * [and] will continue to violate its NPDES per-

mit.” Gwaltney, 108 S.Ct. at 380.

agreed. It granted summary judgment on the ground

that Simkins “has failed to file DMRs in the past” and

present compliance “is irrelevant to plaintiff’s cause of

action.” App. 39a, 40a.

Gwaltney destroyed the legal basis for the summary

judgment. Instead of vacating the judgment, however,

the Fourth Circuit upheld it on a different ground neither

raised by the motion for summary judgment nor consid-

ered by the District Court. The appellate decision that a

continuing violation was shown “beyond dispute” in-

jected on appeal “a new issue as to which the opposite

party had no opportunity to present a defense before the

trial court.” Fountain v. Filson, 336 U.S. 681, 683

(1949). Indeed, if Simkins had been charged with a

continuing violation, it could have developed the record

to resist summary judgment on that charge and would

have exercised its Seventh Amendment right to a jury

decision of that issue. Tull v. United States, 107 S.Ct.

1831, 1839 (1987).

The decision below contradicts the Fountain holding

that it is erroneous to deprive a party opposing summary

judgment of an opportunity to dispute the facts material

to an issue not presented to the trial court. Fountain,

336 U.S. at 683. In addition, summary judgment may

not be granted or affirmed on a ground raised for the

first time on appeal. Recent decisions of other circuits

so hold.’ The decision below stands in direct conflict

with those holdings.

3. Appellate factfinding. This case seriously questions

the authority of an appellate court, subject to Rule 52(a)

of the Federal Rules of Civil Procedure, to find a con-

tinuing violation where none was charged or found in

the District Court. Faced with a judgment hopelessly at

20 See, e.g., John Deeve Co. v. American National Bank, 809 F.2d

1190, 1192 (5th Cir. 1987); McBride v. Merrell Dow & Pharmaceu-

ticals, Inc., 800 F.2d 1298, 1212 (D.C. Cir. 1986): Williams v. City

of St. Louis, 783 F.2d 114, 116 (8th Cir. 1986).

odds with Gwaltney as a matter of law, the Fourth Cir-

cuit disregarded the trial judge’s finding of continuing

compliance and weighed the evidence de novo in order to

conclude that pre-suit violations continued beyond filing

of the complaint. App. 10a-lla. Despite this Court’s re-

peated admonitions, the Fourth Circuit chose “to ignore

the dictates of Rule 52(a) and engage in impermissible

appellate factfinding.” Amadeo v. Zant, 108 S.Ct. 1771,

1780 (1988).

Simkins was adjudged liable for wholly past violations

consisting of failing to file DMRs until it was notified of

the violations. As Gwaltney teaches, “‘the purpose of notice

to alleged violator is to give it an opportunity to bring

itself into complete compliance with the Act and thus

likewise render unnecessary a citizen suit.” Jd. 108 S.Ct.,

at 382-83. During the 60-day period prior to suit, Sim-

kins did everything possible to achieve compliance. Its

efforts were recognized in the detailed findings of fact

adopted by the District Court after a bench trial on the

issue of penalties. App. 46a-53a. Based on the evidence,

the District Court found explicitly that ‘“|c]ommencing

with the report due in October, 1984, and continuing

through the present |July 31, 1986], Simkins has filed

quarterly discharge monitoring reports as required by

its permit.” App. 5la.

The Fourth Circuit completely disregarded these find-

ings. While conceding it “is true that Simkins’ failure

to sample occurred solely before Sierra Club filed suit”

(App. lla), the Fourth Circuit impugned the compliance

finding in two respects. First, it observed that the pre-

suit DMRs filed on October 1, 1984, which reported sam-

plings for September, “did not include sampling data for

the months of July and August of 1984, and therefore

did not include accurate quarterly averages.” (App. 10a).

However, in submitting proposed findings to the District

Court, Sierra Club did not suggest any deficiency in the

October DMR or request a finding on the point.

Second, the Fourth Circuit observed: “Simkins did not

file a complete DMR until January 15, 1985, almost three

months after Sierra Club filed its suit on October 31,

1984.” App. 10a. Surely, this is a non-sequitur. Under

its permit, Simkins was required to file DMRs on a

quarterly basis, e.g., (October 1 to December 31, 1984),

but those DMRs were not due until January 28, 1985

(J.A. 21). By filing the DMRs on January 15, Simkins

was in total compliance for the entire quarter, including

the date suit was filed.

Furthermore, any charge of continuing noncompliance

was negated by the findings of uninterrupted post-notice

compliance. It is significant that the District Court re-

tained jurisdiction of this case for more than two years,

without any suggestion of recurring violations of the per-

mit. Even if suit was properly brought initially, the

demonstrated compliance initiated prior to suit and con-

tinuing thereafter raises an unresolved mootness question.

Gwaltney, 108 S.Ct. at 386; Atlantic States Legal Foun-

dation v. Tyson Foods, Inc., 682 F.Supp. 1186, 1190

(N.D. Ala. 1988).

What is most disturbing is the Fourth Circuit’s draw-

ing of unwarranted inferences from the record, with no

mention of the findings of the District Court. Once again,

the question “is not whether the Fourth Circuit’s inter-

pretation of the facts was clearly erroneous, but whether

the District Court’s finding was clearly erroneous.” An-

derson v. Bessemer City, 470 U.S. 564, 577 (1985). The

Fourth Circuit identified no infirmity in the findings of

fact; it ignored them entirely. This was not a viable

option:

* * * If the Court of Appeals believed that the Dis-

trict Court had failed to make findings of fact es-

sential to a proper resolution of the legal question,

it should have remanded to the District Court to

make those findings. If it was of the view that the

findings of the District Court were “clearly erron-

eous” within the meaning of Rule 52(a), it could

have set them aside on that basis. If it believed that

the District Court’s factual findings were unassail-

able, but that the proper rule of law was misapplied

to those findings, it could have reversed the District

Court’s judgment. But it should not simply have

made factual findings on its own. * * *

Icicle Seafoods, Inc. v. Worthington, 475 U.S. 709, 714

(1986).

The scope of Rule 52(a) is a basie concern to all fed-

eral litigants. If the continuing violation of a permit is

thought to raise an “ultimate fact”, then the decision

below should be reversed summarily on authority of

Pullman-Standard v. Swint, 456 U.S. 273, 286-87 (1982).

If it is regarded as a mixed question of law and fact, then

this Court should grant the writ to resolve the substan-

tial conflict of decisions of this Court and among the

circuits—a conflict which was carefully identified but not

addressed in the Swint case. Id. 456 U.S. at 289-90n.19.

When massive penalties hinge upon little more than ap-

pellate factfinding, the proper construction of Rule 52(a)

seems all the more imperative.

4. Uncharged violation. The Fourth Circuit was evi-

dently unconvinced by its own analysis of the sole viola-

tion charged in the 60-day notice and the complaint and

adjudicated by the District Court—the wholly past fail-

ures to file DMRs required by the permit. Incredibly, the

Court seized upon a separate provision in the permit and

concluded that “Simkins failed to maintain records of

monthly sampling it was obligated to perform prior to

September 30, 1984, as required by * * * the record re-

tention provision of its permit.” App. 10a.

Because Simkins was never charged with a “records

retention” violation at any time before the Fourth Cir-

cuit concocted it, without record support, Simkins stands

penalized for unalleged misconduct for which no notice

or opportunity to defend was ever provided." It is a

shocking abdication of due process to sustain a $977,000

penalty judgment on an appellate finding of a violation

not alleged or adjudicated below. No punitive sanction

may be imposed in these circumstances. Roadway Ex-

press, Inc. v. Piper, 447 U.S. 752, 767 (1980). Moreover,

while upholding Article III standing upon an affidavit

averring injury traceable to reporting violations, the

Fourth Circuit did not explain how Sierra Club acquired

standing to enforce a “record retention” provision with-

out alleging its violation.

5. Refusal to remand. Finally, the decision below

creates an unnecessary conflict in principle with a later

decision of the Ninth Cireuit. In Sierra Club v. Union

Oil Co. of California, 853 F.2d 667, 671 (9th Cir. 1988),

following its analysis of the Gwaltney decision, a panel

of the Ninth Circuit noted record evidence of ongoing

violations but declined to draw any conclusion because

the district court had not made any factual findings on

that issue. In Gwaltney itself, a different Fourth Cir-

cuit panel remanded that case “to the district court for

further findings as to whether, on the merits, plaintiffs

proved at trial an ongoing violation.” Chesapeake Bay

Found. Inc. v. Gwaltney of Smithfield, Ltd., 844 F.2d 170,

171 (4th Cir. 1988). In remanding in Gwaltney, the

Fourth Cireuit observed: “While the district court did

make subsidiary findings pertinent to this issue, it did

not make a direct finding as to whether citizen-plaintiffs

proved the existence of intermittent or sporadic violations

21 Because the “missing records” would merely document wholiy

past violations, a citizen suit predicated on such violations would

bear no relation to current abatement, the sole justification for

citizen suits cited in Gwaltney, 108 S.Ct. at 382-83. Moreover, the

“continuing residual effects” of a permit violation do not transform

it into a continuing violation. Hemker v. Diamond Shamrock Chemi-

cal Co., 756 F.2d 392, 397 (5th Cir. 1985). In other contexts, the

failure to file reports or maintain records does not constitute a

continuing violation. See, e.g., Toussie v. United States, 397 U.S.

112, 115 (1970).

constituting an ongoing violation.” Jd., 844 F.2d at 172

(citation omitted; italics added).

The Fourth Circuit all but disowned its Gwaltney dis-

position when it perceived no need at all to remand this

case to the District Court for further findings. App. 8a.

It conceded: “The district court did not consider whether

Simkins’ failure to maintain records and whether Sim-

kins’ failure to file complete DMRs until after Sierra

Club filed suit constituted continuing violations of the

Act.” App. 10a n.7 (italics added). While noting that

the District Court had authorized suit for past violations

of the permit reporting requirements, App. 8a, the Fourth

Circuit perversely disregarded the direct finding of con-

tinuing compliance with those requirements before and

after suit was filed.

The Union Oi! decision underlines the self-contradictory

and misguided attempt below to indulge in appellate fact-

finding, especially on a sparse record left undeveloped be-

cause of misplaced pre-Giwaltney reliance upon the past

violation theory. Union Oil is faithful to the long line of

precedents of this Court: “When an appellate court dis-

cerns that a district court has failed to make a finding

because of an erroneous view of the law, the usual rule

is that there should be a remand for further proceedings

to permit the trial court to make the missing findings.”

Pullman-Standard v. Swint, 456 U.S. 278, 291 (1982),

and authorities cited therein. See also Amadeo v. Zant,

108 S.Ct. 1771, 1780 (1988).

The decision below, with its capricious refusal to re-

mand for findings, stands in naked defiance of the rule. _

Given the “punitive nature of the relief” imposed below,

Tull v. United States, 107 S.Ct. 1831, 1838 (1987), the

Fourth Circuit compounded its unjustifiable disregard of

the actual findings by its refusal to permit the District

Court to make the “missing”’ findings.

CONCLUSION

For each of the foregoing reasons, this Court should

grant the writ and reverse the decision below.

Respectfully submitted,

DAVID F.. ALBRIGHT

HARLEY THOMAS HOWELL *

SEMMES, BOWEN & SEMMES

250 W. Pratt Street

Baltimore, MD 21201

(301) 5389-5040

* Counsel of Record ” Counsel for Petitioner

October 19, 1988

APPENDICES

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 87-1600

SIERRA CLUB,

Plaintiff-Appellee

versus

SIMKINS INDUSTRIES, INC.,

Defendant-A ppellant

Appeal from the United States District Court

for the District of Maryland

Herbert F. Murray, District Judge—(CA-84-4018-HM)

Argued November 4, 1987 Decided: May 31, 1988

BEFORE WINTER, Chief Judge, ERVIN, Circuit

Judge, and BUTZNER, Senior Circuit Judge.

David F. Albright; H. Thomas Howell (Semmes,

Bowen & Semmes on brief) for Appellant; John F. King

WINTER, Chief Judge

Simkins Industries, Inc., (Simkins) appeals from a

judgment entered against 1 in a citizen suit brought by

Sierra Club pursuant to ¢ 505 of the Clean Water Act,

29 1.S.C. $1365. The district court held that Simkins

was — under the Clean Water Act for failing to

comply with the terms and conditions of Simkins’ Na-

tional "p ollutant Discharge Elimination System (NPDES)

permit by failing to file qu arterly reports from August 1,

1981, to March 31. 1984, Sierra Club Vv. Simkins Indus-

tries, Inc., 617 F. Supp. 1120 (D. Md. 1989) (granting

partial summary judgment on liability), and assessed

civil penalties ‘n the amount of $977,000 ($1,000 per

day of viol: tion). Simkins argues on appeal that Clean

Water Act citizen suits may not be properly founded on

such reporting \ violations and that citizen-plaintiff Sierra

Club has not established a continuing violation within

the meaning of Gwaltney of Smithfield, Ltd. v. Chesa-

peake Bay Foundation, Inc., .g. ——, 108 8. Ct.

276. 98 L. Ed. 2d 206 (Dec. 1, 1987). We disagree. We

also perceive no merit in Simkins’ challenges to Sierra

Club’s standing; the district court’s calculation of civil

penalties ; and the district court’s denial of Simkins’

belated motion for recusal. We therefore affirm the dis-

trict court’s judgment on liability and civil pe malties.

1 Decision in this ap] eal was stayed pr nding the Supreme Court’s

decision in Gwaltney (citizen-plaintiff suits pursuant to $505 of

the Clean Water Act may not be based upon wholly past violations )

and again stayed by mouuon of the parties p nding ongoing settle-

nt negotiations. Because we now have the benefit of the Supreme

Court’s guidance in Gwaltney and because the parties have re] orted

their inability to reach a S¢ ttlement, we proceed to decision.

After oral argument, the United States moved for limited inter-

vention to insure that any civil penalties assess d in this action be

——

The Clean Water Act (Act), 33 U.S.C. §§ 1251 et 8e9-

(1982 and West Supp. 1988), originated in the Federal

Water Pollution Control Act Amendments of 1972, 86

Stat. 816, “to restore and maintain the chemical, physi-

eal, and biological integrity of the Nation’s waters.” 33

U.S.C. § 1261 (a). Section 301! a) of the Act, 33 US.C.

§$1311(a), yenerally prohibits the discharge of pollutants

into navigable waters unless the point source has ob-

tained a permit from the Environmental Protection

Agency (EPA). Under a procedure established by Con-

gress in § 402 of the Clean Water Act, 33 U.S.C. § 1342,

the EPA Administrator may delegate to a state the au-

thority to administer the NPDES program with respect

to point sources in that state, and the source state may

set more stringent minimum effluent levels supplanting

federal standards. A violation of an NPDES permit,

whether issued by state or federal officials, is a violation

of the Act exposing the permit holder to liability under

8505 of the Act. See Environmental Protection Agency

vy. California e& rel. State Water Resources Control

Board, 426 U.5. 200, 205 (1976) ; 33 US.C. § 1342(k).

The State of Maryland is authorized by the EPA to

administer the NPDES program for point sources in the

State of Maryland. In_ particular, Maryland issues

NPDES permits and is empowered to attach certain

terms and conditions to these permits, including sampling

and reporting requirements. Section 308 of the Clean

Water Act, 33 U.S.C. § 1318, provides that recipients of

such permits may be required to establish and maintain

records, install monitoring equipment, and perform sam-

pling, § 1318(a) (4) (A). It also authorizes the EPA

Administrator or his or her authorized representatives a

made payable to the United States Treasury. On April 22, 1988,

we denied the government's motion without prejudice to another

application if future circumstances demonstrate that it is necessary

for the government to seek protection of its interests.

right of entry to an effluent source location or to premises

where required records or monitoring equipment are

kept, $ 1318(a)(4)(B). A citizen suit must allege viola-

tion of “an effluent standard or limitation,” 33 U.S.C.

§ 1365(a) (1), defined, inter alia, to mean “a permit or

condition thereof issued under section 1342... .,” § 1365

(f) (6).

In 1981, the Office of Environmental Programs of the

Maryland Department of Health and Mental Hygiene is-

sued Simkins a permit pursuant to 33 U.S.C. § 1342 for

its paper mill in Catonsville, Maryland, on the bank of

the Patapsco River. Simkins’ paper mill manufacturers

cardboard, and in the course of operation Simkins dis-

charges treated waste from its plant into the Patapsco

Liver. See 617 F. Supp. at 1123. The NPDES permit

allowing Simkins to discharge this waste was conditioned

upon maximum daily and quarterly averages in levels of

oil and grease. The permit also required Simkins to moni-

tor at locations near its plant the levels and volume of

flow of oil and grease, as well as other effluents such as

copper, total organic carbon, and total phenol. The per-

mit required Simkins to sample on a monthly basis and

to summarize and file accurate results with the Office of

Environmental Programs in quarterly Discharge Moni-

toring Reports (DMRs). See 40 C.F.R. §§ 122.41(/) (4)

(i) ; 122.22(b), (d).

It is undisputed that Simkins failed to sample and to

file the quarterly DMRs for a period of over two years.

The district court heard testimony that the plant man-

ager’s supervisor did not regard sampling as a “prior-

ity.”

The Sierra Club filed its citizen suit on October 31,

1984. It sought declaratory relief, injunctive relief, and

civil penalties of $10,000 per day of violation, alleging

that Simkins’ failure to report constituted a separate vio-

lation for each day it occurred. The district court

granted Sierra Club’s motion for partial summary judg-

ment, and subsequently fixed civil penalties.’

IT.

Simkins challenges Sierra Club’s Article III standing

to sue as a private attorney general seeking enforcement

of the Clean Water Act under the Act’s citizen suit pro-

visions, 33 U.S.C. § 1365. In its complaint, Sierra Club

alleged that health, recreation, aesthetic, and environ-

mental interests of its members were and were going to

be adversely affected by Simkins’ failure to comply with

the terms and conditions of its NPDES permits. Sierra

Club submitted the affidavit of member John Railey at-

testing to his interest, as one regularly using and enjoy-

ing the Patapsco River and surrounding land, in preserv-

ing the environmental integrity of the river. Simkins

2 The district court deferred decision on liability, awaiting our

decision in Gwaltney as to whether civil penalties under Section

309(d) of the Act, 33 U.S.C. §1319(d), can be assessed per day

of violation. See Chesapeake Bay Foundation, Inc. v. Gwaltney of

Smithfield, Ltd., 791 F.2d 304, 314-15 (4 Cir. 1986) (civil penalties

may be assessed on a daily basis), vacated on other grounds, ——

U.S. ——, 108 S. Ct. 376 (1987); § 1319(d) (“shall be subject to a

civil penalty not to exceed $10,000 per day of such violation”). The

district court then concluded that Simkins’ failure to comply with

its NPDES permit exposed Simkins to a maximum penalty of

$9,770,000, $10,000 for each day of violation, and exercised its

discretion in assessing a penalty of $1,000 for each day of viola-

tion.

3 Simkins’ suggestion that Mr. Railey’s affidavit was too vague to

support summary judgment is not well-founded. The affidavit was

sufficiently specific to allege Article III injury in stating:

My interest, use or enjoyment of the Patapsco River and

surrounding area includes preserving the health, safety and

welfare of the river basin, preserving marine life and water

integrity within the river, and eliminating odorous and un-

sightly illegal pollution. I regularly hike along the river. My

activities and interests with respect to the Patapsco River have

been adversely affected physically, aesthetically and emotionally

argues that Sierra Club has not shown injury under

Article III fairly traceable to Simkins’ failure to sample

and file DMRs, and that Sierra Club’s citizen suit is

violative of the Article III requirement that a plaintiff’s

injury be redressed by the requested ~elief. We disagree

with both contentions.

Sierra Club maintains that its members have been in-

jured by Simkins’ reporting violations because they are

unable to know the full extent of pollution in the river

near Simkins’ paper mill. Mr. Railey’s articulated inter-

ests include aesthetic and environmental interest which

can constitute injury in fact. Sierra Club v. Morton, 405

U.S. 727, 734-35 (1972). Of course, Congress’ provision

for citizens suits does not, in itself, establish Article III

standing; Sierra Club must establish that one or more

of its members use the Patapsco River and would be ad-

versely affected by its pollution. See Sierra Club v. SCM

Corp., 747 F.2d 99, 107 (2d Cir. 1984) (to establish

standing under § 505 of the Act, Sierra Club required

to demonstrate actual injury within the meaning of

Morton).

John Railey’s affidavit adequately establishes injury

and the threat of future injury,‘ stemming from both

by Simkin’s [sic] Industries’ failure to comply with its NPDES

permit and resulting illegal pollution.

Finally, I have an interest in monitoring the discharge of

effluents into the Patapsco River.

A. 112. Simkins presents no reason to doubt the truth of Mr.

Railey’s affidavit. The district court was not presented with such a

challenge, and thus did not have occasion to review any evidence

underlying Mr. Railey’s affidavit. Under these circumstances. we

accept as true statements made in the affidavit. See Chesapeake

Bay Foundation v. American Recovery Co., 769 F.2d 207, 209 n.1

(4 Cir. 1985) (ner curiam

'See Valley Forge Christian College v. Americans United For

Separation of Church & State, Ine., 454 U.S. 464, 472 (1982

Simkins’ failure to report concerning harmful effluents

for which its permit contained maximum discharge levels

and Simkins’ failure to report concerning the levels of

other effluents for which it was not subject to discharge

limitations. As a result of these violations, information

on any harmful level of pollutants in the area of Simkins’

plant during this time period is forever lost to environ-

mental planners and policymakers and those who might

undertake to remedy the effects of any pollution. More-

over, Simkins’ failure to report on levels of harmful ef-

fluents subject to maximum discharge limitations threat-

ens Mr. Railey’s prospective interest in protecting the

environmental integrity of the Patapsco River and cur-

tailing any ongoing unlawful discharges into its waters.

The actual injury stemming from reporting and sam-

pling violations, coupled with the threatened injury

stemming from failure to report on maximum levels of

harmful effluents, establishes injury traceable to Simkins’

actions.

Simkins also contends that the Clean Water Act’s pro-

vision for civil penalties unconstitutionally provides a

remedy which does not address the Sierra Club’s injury,

maintaining that Sierra Club has failed to establish “the

causal connection between the alleged injury and the ju-

dicial relief requested.” Allen v. Wright, 468 U.S. 737,

753 n.19 (1984).

It is true, as the Supreme Court has observed, that

Congress’ provision for citizen suits in § 1365

necessarily includes . . . plaintiffs seeking to enforce

these statutes as private attorneys general, whose

injuries are “noneconomic” and probably noncom-

pensable . .

(threatened rather than actual injury can meet minimum Article

[II standing requirements).

Middlesex County Sewerage Authority v. National Sea

Ciammers Association, 453 U.S. 1, 17 (1981). However.

judicial relief of civil penalties, even if payable only

e United States Department of the Treasury, is

causally connected to a citizen-plaintiff’s injury. Such

penalties can be an important deterrence against futur

violations.” Members of Sierra Club must show actual

or threatened injury traceable to the wrong and a par-

‘ularized interest in deterring violations of th Act

but once they have done so, the imposition of civil penal-

ties is causally connected to the injury. See Student

Public Interest Research Group, Inc. v. AT & T Labora-

tories, 617 F. Supp. 1190, 1200-01 D.N.J. 1985

money damages awarded in Clean Water Act citizen

ut made payable to U.S. Treasury did redress plain-

injury in the form of general deterrence

ITT.

Before the Supreme Court’s decision in Gwaltney. the

court held that the Clean Water Act authorized

en suits for imposition of civil penalties for past

violations. 617 F. Supp. at 1126-27, 1121-32. In a sup-

plemental memorandum filed after the

(tf CISION

;

record, we think that onlv o1

I ~

Supreme Court’

contends that Gwaltner

reversal of the district court’s decision. On

in Gwaltney, Simkins

ne conclusion is possible, a

‘ a

matter of law, as to whether §$ 1365/a) encompasses

this citizen suit, and accordingly neither reversal is in-

dicated nor is there need to remand the case to the dis-

court for further findings. Upon due consideration

T! trict court was of course not obligated to fin

- ( Ss lawsult had a specific, immediate deterrent ef

rder to find that Article III standing ed. |

( veresting to note that Simkins commenced « mp!

/ { re] Cir obligatior nder the Clea Water A

Sierra Club notified Simkir In a letter dated A l

184 int te U.S.A 1365(b)(1)(A f its |

t Simk failing to comply with permit require

of the parties’ supplemental memoranda on Gwaltney’s

application to this appeal, we conclude that Sierra Club

1as alleged in good faith and proved a continuing viola-

tion within the meaning of Gwaltney.

In Gwaltney, the Supreme Court held that citizen-suits

could not be based upon wholly past violations, but dis-

tinguished wholly past violations from allegations of in-

termittent or sporadic violations. On remand from the

Supreme Court, we have ruled that while the Supreme

Court held that good faith allegations were sufficient to

meet threshold jurisdictional challengers, the Supreme

Court also stated that in order to prevail, a citizen-

plaintiff must prove a continuing violation. See Chesa-

peake Bay Foundation, Inc. v. Gwaltney of Smithfield,

Ltd.. ——- F.2d ——, No. 85-1873 (4th Cir. April 13,

1988).

At the outset of this lawsuit, Sierra Club alleged in

good faith a continuing violation of the Clean Water

Act. In a letter dated August 31, 1984, and incorporated

by reference in paragraph 14 of plaintiff’s complaint,

Sierra Club alleged continuing reporting violations of the

Clean Water Act. See 33 U.S.C. §$ 1318, 1365(a) (1)

(A), 1365/f) (6).°

It is also beyond dispute that Sierra Club proved a

continuing violation of an effluent standard or limitation

under 33 U.S.C. § 1865(a)(1)(A). Simkins was re-

quired to ample on a monthly basis and maintain records

of its sampling activities. The DMR Simkins filed in the

6In the August 31, 1984, letter, the so-called sixty-day letter

U.S.C. § 1365(b), the Sierra Club placed Simkins on notice

hat it believed Simkins “has violated and continues to viol:

the terms of the permit, and proceeded to list reporting violations

that had occurred to date. Sierra Club of course did not list report-

ng violation that had not vet occurred and therefore were not

“un to it. It was sufficient to allege a continuous series of re-

porting violations coupled with an allegation that Simkins was

yntinuing to violate its permit’s terms and conditions

10a

1984 did not include sampling data for the months

of July and August of 1984, and therefore could not in-

clude accurate quarterly averages. Simkins did not file

a complete DMR until January 15, 1985, almost three

after Sierra Club filed its suit on October 31,

nonth is

1984.

More significantly, Simkins was required, as a general

condition of its permit, to retain records of its sampling:

Re cords Re té ntion

All records and information resulting from the

monitoring activities required by this permit, in-

cluding all records of analyses performed, calibra-

tion and maintenance of instrumentation, and orig-

inal vanes from continuous monitoring instru-

ment ion shall be ma ntained for a minimum of

ae (3) years. This period shall be automatically

xtended during the course of litigation, or when

requested by DHMH [Department of Health and

Mental Hygiene].

NPDES Permit No. MD0058033. general condition II]

A)(7) (emphasis addedi. On and after October 31.

1984, the day the Sierra Club filed its citizen suit, Sim-

kins failed to maintain records of monthly sampling it

was obligated to perform prior to September 30, 1984,

as required by 33 U.S.C. $ 1318 and the record retention

provision of its permit.’

fhe district court did not consider whether Simkins fa

maintain records and whether Simkins failure to file complete DMRs

intil after Sierra Club filed suit constituted continuing violations of

the Act. It calculated civil penalties based on reporting violations

up until March 31, 1984. Sierra Club has not requested remand for

extension of the time period the district court employed for dete)

mining civil penalties, and we see no reason, in light of the dis-

trict court’s decision to assess substantially less than the maximum

possible civil penalties, to revise the district court’s cal lations.

lla

It is true that Simkins’ failure to sample occurred

solely before Sierra Club filed suit, but Simkins’ moni-

toring obligations were not designed to be a mere aca-

demic exercise. Simkins was bound by the reporting and

records retention requirements of the NPDES permit

that are central to adequate administration and enforce-

ment of limits on substantive discharges under the Clean

Waiter Act. Unless a permit holder monitors as required

by the permit, it will be difficult if not impossible for

state and federal officials charged with enforcement of

the Clean Water Act to know whether or not the permit

holder is discharging effluents in excess of the permit’s

maximum levels. Congress has provided that these rec-

ords be made generally available, with some exceptions,

to the Administrator, the public, and to Congressional

committees. See 33 U.S.C. § 1318.5 Simkins cannot suc-

cessfully defend against its failure to file complete DMRs

or retain records by noting that the underlying data was

never collected in the first instance. In this context,

where the permit expressly establishes a continuing ob-

ligation to retain records and file complete DMRs, to al-

low such a defense to jurisdiction would effectively pro-

vide a permit holder with the opportunity to escape

liability under § 1365(a) by failing at the outset to sam-

ple and to ereate and retain the necessary monitoring

records on possibly harmful and unlawful effluent dis-

charge levels.

Because we conclude that Simkins’ violations con-

tinued past the date Sierra Club filed its complaint, we

do not reach the issue of whether they were intermittent

or episodic violations which did not cease to be con-

tinuous within the meaning of Gwaltney.

8 Required reports such as DMRs may be used as admissions in

court to establish a defendant’s liability. See Chesapeake Bay

Foundation v. Bethlehem Steel Corp., 608 F. Supp. 440, 451 (D.

Md. 1985)

12a

IV.

In the district court, Sierra Club successfully main-

tuined that Simkins’ undisputed failure to file quarterly

DMRs for over thirty consecutive months violated the

Act, 33 U.S.C. $$ 1318, 1365. Simkins challenges this

holding, arguing that the phrase ‘an effluent standard

or limitation” of § 1365(a) should be construed to exclude

citizen suits that do not allege discharge of pollutants

in violation of permit limitations. We disagree.

Section 1365 defines an “effluent standard or limita-

tion” to include “2 permit or condition thereof issued

under section 1342 of this title.” § 1365(f) (6). As we

said in Menzel v. County Utilities Corporation, 712 F.2d

91 (4 Cir. 1983):

a discharger that fails to file [DMRs], or fails to

file accurate reports, would be in violation of its

NPDES permit and would be subject to citizens’ suit

under 33 U.S.C. § 1365.

Id. at 94: see also Pymatuning Water Shed Citizens for

Hygienic Environment v. Eaton, 506 F. Supp. 902 (W.D.

Pa. 1980) (awarding injunctive relief in citizens suit

not alleging dischargers in violation of permit levels),

aff'd, 644 F.2d 995 (3d Cir. 1981). Simkins’ reporting

requirements are expressly made conditions of its per-

mit. and therefore violations of these conditions, by op-

eration of $1365(f) (6), are violations of an effluent

standard or limitation of § 1865(a).°

9 Simkins’ efforts to distinguish substantive discharge limitations

from reporting requirements therefore fails in light of the plain

language of $1365(f)(6). Its argument is also unpersuasive be-

cause, as above, the reporting requirements of the Act and Simkins’

NPDES permit are essential elements of the Clean Water Act’s

enforcement procedures. Sampling data is useful, independent of

ascertaining compliance with maximum discharge limitations, to

enable goverment officials and others to monitor potentially harmful

trends and adjust their future course of action accordingly. See

99 T.S.C. $1818(a)(4)(B) (Administrator shall have access to

records at reasonable times); § 1318(b) (records shail be made

13a

Simkins contends that the Sierra Club should be

estopped from seeking civil penalties in excess of the

approximate cost of an environmental survey, $130,000,

which counsel for Sierra Club mentioned at trial. We dis-

agree. Sierra Club requested $10,000 per day of viola-

tion in its complaint, and we have held that such daily

penalties can be imposed. See Gwaltney, 791 F.2d at

913-15. Sierra Club’s complaint, not the informal com-

ments of its counsel at trial, constitute the formal re-

quest for damages. More importantly, the district court

has wide discretion in determining civil penalties which

cannot be limited by trial counsel’s oral arguments.

Simkins further argues that Sierra Club should be

judicially estopped from money damages greater than its

purported trial request for only $130,000 in damages

because the Sierra Club used this request to prevail in

a dispute over the admission of certain expert testimony

on the actual level of pollutants in the Patapsco River

near Simkins’ paper mill. It is not clear that Sierra

Club’s mention of lower money damages than the eivil

penalties requested in the complaint or awarded by the

district courts is accurately characterized as a formal

request to limit the magnitude of civil penalties.” It is

available upon request to the public with limited exceptions) ;

§ 1318(d) (records shall be made available upon request to com-

mittees of Congress). For example, Simkins’ permit required it to

collect information on the levels of copper at certain monitoring

locations despite the absence of a maximum quarterly, monthly,

or daily average on copper in the NPDES permit. At the trial on

damages, plaintiff presented evidence of unsafe levels of copper

in the river near Simkins’ plant.

10 We are not convinced that Sierra Club counsel sought to limit

his client’s request for civil penalties by arguing to the district

court as follows:

{Your Honor has! the power, we submit, to assess penalties in

the amount of $130,000. We are not asking that. We are only

asking that you provide monies ... for... the survey .-- to

determine what the impact of this industry’s functioning on

l4a

clear that the district court did not rule on admissibility

of the expert testimony on the basis of Sierra Club’s

mention of a hypothetical number. The district court

properly concluded, in the exercise of its broad discretion

as to the admission of evidence, that testimony concern-

ing the actual level of pollutants was relevant to its

determination of what penalty should be imposed. Its

ruling was not dependent upon the amount Sierra Club

mentioned during oral argument as a possible assess-

ment." See Simkins, 617 F. Supp. at 1131 (current com-

pliance with Act may be considered in assessing amount

of penalties).

VI.

The district judge, Judge Murray, had joined the

Sierra Club in 1969, but he resigned in 1971 upon his

appointment to the bench, maintaining no further con-

that river site has been during the period of time they have

not reported.

A. 155-54. By way of summation of its admissibility argument,

Sierra Club argued that it would be “entirely reasonable for the

Sierra Club to ask that the industry at least pay that amount...”

A. 154 (emphasis added). Sierra Club’s use of the number $130,000

appears to be not an effort to buy admissibility of its testimony by

lowering its money damages request, but rather a hypothetical

number used in its argument that the testimony was relevant to

the district court's civil penalties determination.

11 Additionally, Simkins contends that the district court im-

properly included the first 93 days of the period of noncompliance,

arguing that at worst it was in noncompliance with its quarterly |

reporting requirements beginning October 28, 1981. Simkins’ obli-

gations under the NPDES permit extended beyond filing of quar-

terly reports to the actions necessary to make filing of the DMRs

possible, including installation and regular use of sampling equip-

ment and the maintenance of records recording the results of moni-

toring. The district court found that from the date the NPDES |

permit was effective, July 27, 1981, Simkins failed from the time |

the permit was made effective to comply with the permit’s specified |

conditions. Thus the district court did not abuse its broad discretion

in finding that the period of noncompliance commenced July 27,

1981.

15a

tact with the organization. Judge Murray’s prior asso-

ciation with plaintiff’s organization thus ended thirteen

years before this case commenced. Judge Murray was

commendably forthright in informing the litigants in

pretrial conference of his prior membership in the

Sierra Club. His ensuing offer to recuse himself from

the case was not accepted by Simkins’ counsel. Simkins

now contends that the district court erred in denying its

post-trial motion for recusal, arguing that a reasonable

person, knowing reasonably ascertainable facts, would

harbor doubts about Judge Murray’s impartiality, see

United States v. Carmichael, 726 F.2d 158, 160 (4th Cir.

1984), and that the district court erred in failing to

make its offer of recusal on the record. We conclude

that the district court’s impartiality may not be fairly

questioned in this case and that the court did not err in

failing to make its offer of recusal on the record.

We agree with the district court’s holding that such

prior association does not, in itself, form a reasonable

basis for questioning a judge’s impartiality. See Maier

v. Orr, 758 F.2d 1578, 1581 (Fed. Cir. 1985) (trial

judge’s former association with Air Force does not rea-

sonably raise appearance of partiality) ; Brody v. Presi-

dent & Fellows of Harvard College, 664 F.2d 10, 11 (1

Cir. 1981) (trial judge’s graduation from defendant uni-

versity does not in itself constitute reasonable basis for

recusal motion), cert. denied, 455 U.S. 1027 (1982). As

the Brody court persuasively reasoned, litigants are en-

titled to a judge free of personal bias, but not to a judge

without any personal history before appointment to the

bench.

Simkins seeks to distinguish Maier and Brody on the

basis that, unlike the Air Force or a university, the

Sierra Club has been “judicially noticed out” as a single-

issue advocacy group. The Judicial Conference of the

16a

United States has suggested that judicial officers resign

from organizations such as the Sierra Club, the Anti-

Defamation League of B’nai B’rith, and the National

Association for Advancement of Colored People, as

groups which “regularly engage in adversary proceed-

ings” in federal court.’? However, it does not follow that

federal judges who are former members of one of these

groups may not preside in disputes in which the group

is a party. To the contrary, one can infer that resigna-

tion is deemed appropriate in order generally to allow

former members to preside in federal court proceedings

involving these expansive organizations. We have no dif-

ficulty concluding that-a brief association with the Sierra

Club terminated over a decade before adversary proceed-

ings commenced does not form a basis for reasonably

questioning a district judge’s impartiality.

Simkins sought recusal through new counsel after an

adverse judgment had been entered. arguing that Sim-

kins should not be bound by its former counsel’s waiver

of Judge Murray’s offer of recusal. Simkins presented

evidence that its counsel had told it before the pretrial

conference that the judge may have been associated with

the Sierra Club and that, were this to be the case, counsel

would seek the district judge’s recusal. Simkins contends

that when it heard no more from its former counsel on

this matter, it reasonably relied upon counsel’s silence

as an indication that the judge was not a former mem-

ber. It argues that its former counsel’s alleged error was

compounded by the district court’s failure to make its

offer of recusal on the record.

This line of argument is without merit for two rea-

sons. First, Simkins argument is that it reasonably

relied on its former counsel’s failure to communicate the

'. See Judicial Conference of the United States, Advisory Comm.

on Judicial Activities, Ady. Op. 40 (Jan. 10, 1975).

17a

fact of the district judge’s prior affiliation with plaintiff

as an indication that the judge was not a former mem-

ber. However, Simkins wishes not to be bound by its

reliance on its former counsel’s tactical decision not to

accept the judge’s offer to recuse himself. Ordinarily

civil litigants are bound by their lawyers’ tactical deci-

sions, and we see no reason to depart from this rule in

this case. Especially is this so because Simkins’ motion

for recusal was made after entry of adverse judgment,

so that the equities do not militate in favor of Simkins.

Secondly, Simkins’ assumption that the district judge

was required to offer to recuse himself on the record is

ineorrect. Subsection 455(e) does provide that acceptance

of a litigant’s waiver of a § 455(a) offer of recusal must

be preceded by a “full disclosure on the record of the

basis for disqualification.” However, $ 455(a) by its

terms is applicable only when a judge’s impartiality

‘might reasonably be questioned.” As we have said, we

do not think the district judge’s impartiality may be rea-

sonably questioned on the basis of the trial judge’s brief

membership in the Sierra Club over a decade before this

case was tried. His disclosure of his prior affiliation

with plaintiff was therefore not required under § 455(a).

It follows that the on-the-record requirement for accept-

ance of waivers under § 455(e) is not applicable.

Affirmed.

APPENDIX B

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

Civil No. HM84-4019

SIERRA CLUB

SIMKINS INDUSTRIES, INC.

Civil No. HM&4-4919

SIERRA CLUB

NEUVA ENGINEERING, INC.

Civil No. HM84-4020

SIERRA CLUB

KEYSTONE AUTOMOTIVE PLATING Co.

MEMORANDUM AND ORDER

iff Sierra Club has filed three citizens’ su

sults pur-

suant to $ 505 of the Clean Water Act. 33 U.S.C. § 1365,

against defendants

Simkins Industries,

(hereinafter Simkins) :

Ine., Civil No. HMS84-4019

Ine., Civil No.

HMS84-4018 Neuva Enginee:

(hereinafter Neuva): and

Keystone Automotive Plating Co., Civil No HM84-4020

(hereinafter Keystone).

rs acti aha yroac

nree actions cnarges

eeanex

ifig’,

The complaint in each of the

the defendant with violating “the

eo’ ° '™ s

19a

terms and provisions of its National Pollutant Discharge

Elimination System (NPDES) permit” in violation of

the Clean Water Act, 33 U.S.C. § 1251, et seg. Specifi-

cally, plaintiff alleges that the defendants’ discharge of

treated wastes into the Patapsco River pursuant to

NPDES permits violates the waste water discharge lim-

its contained in such permits and thus violates § 301 (a)

of the Clean Water Act, 33 U.S.C. § 131l(a). As relief

for the alleged violations, plaintiff seeks a declaratory

judgment that defendants have violated the Clean Water

Act, 33 U.S.C. §§$ 1311 and 1342; an injunction prohibit-

ing defendants from further violating their NPDES per-

mits; a mandatory injunction requiring defendants to

provide to plaintiff a copy of all future reports submitted

by defendants to the state or federal government regard-

ing defendants’ NPDES permits; an assessment of civil

penalties of $10,000 per day for each violation against

each defendant; and an award of costs, including attor-

ney, witness and consultant fees. Various motions are

presently pending before the courts; namely:

(1) Defendant Simkins’ Motion for Entry of Judg-

ment on the Pleadings;

(2) Defendant Neuva’s Motion to Dismiss and/or

Motion for Judgment on the Pleadings;

(3) Defendant Keystone’s Motion to Dismiss;

(4) Plaintiff’s Motions for Partial Summary Judg-

ment as to each defendant;

(5) Plaintiff's Motion for Leave to File Amended

Complaint; and

(6) Defendant Neuva’s Motion for Continuance.

The court held a hearing on these motions on May 3,

1985, and has reviewed the memoranda submitted and

is now prepared to rule.

Backg rou nd

Plaintiff Sierra has brought these actions against de-

fendants Simkins, Neuva and Keystone pursuant to the

citizen suit provision of the Clean Water Act, 33 U.S.C.

1365. That provision provides:

(a) Except as provided in subsection (b) of this

section, any citizen may commence a civil action on

is own behalf—

(1) against any person (including (i) the

United States, and (ii) any other governmental

instrumentality or agency to the extent permit-

ted by the eleventh amendment to the Constitu-

tion) who is alleged to be in violation of (A)

an effluent standard or limitation under this

chapter or (B) an order issued by the Adminis-

trator or a State with respect to such a stand-

ard or limitation, or

(2) against the Administrator where there

is alleged a failure of the Administrator to per-

form any act or duty under this chapter which

is not discretionary with the Administrator.

The district court shall have jurisdiction, without

regard to the amount in controversy or the citizen-

ship of the parties, to enforce such an effluent stand-

ard or limitation, or such an order, or to order the

Administrator to perform such act or duty, as the

case may be and to apply any appropriate civil

penalties under section 1319(d) of this title.

This court, per Judge Young, has recently discussed the

statutory scheme of the Federal Water Pollution Control

Act ‘hereinafter the Clean Water Act or the Act), 33

U.S.C. $ 1251 et seqg., in Chesapeake Bay Foundation, et

al, U. Betile hie m Steel Corporation, Civil No. Y 84-1620,

pp. 4-6 (D. Md. May 6, 1985), and will not repeat it

herein. Relevant portions of the Act having bearing on

the issues at bar will be discussed where appropriate.

21a

As required by § 505(b) (1) (A) of the Act, 33 U.S.C.

$ 1865 (b) (1) (A), plaintiff gave notice on Aug. 31, 1984,

of the alleged violations and of its intent to file suit,

to the Administrator of the United States Environmental

Protection Agency; to the Regional Administrator, Re-

gion 8, United States Environmental Protection Agency;

to the Assistant Secretary of Environmental Programs,

Department of Health and Mental Hygiene; to the Direc-

tor of Water Management Administration, Office of En-

vironmental Programs; and to the defendants herein.

After the lapse of 60 days from plaintiff’s giving of

notice and after neither the Environmental Protection

Agency (hereinafter EPA) nor the state commenced

prosecution to redress the alleged violations, plaintiff

brought the instant actions.

Plaintiff Sierra Club is a national, non-profit corpora-

tion with its principal place of business in San Francisco,

California and with members in the Chesapeake Bay

area. It is a public interest organization dedicated to

protecting and conserving natural resources. Defendant

Keystone, a corporation organized under the laws of the

State of California, operates a business consisting of re-

pairing damaged automobile bumpers. Defendant Sim-

kins, a corporation organized under the laws of the State

of Connecticut, operates a papermill which manufactures

cardboard. Defendant Neuva, a corporation organized

under the laws of the State of Maryland, operates a busi-

ness consisting of the engineering, manufacturing and

sale of electronic systems, components and equipment.

Each of the defendants discharges treated wastes from

its operations into the Patapseo River pursuant to

NPDES permits issued by the Maryland Department of

Health and Mental Hygiene, Office of the Environmental

Programs, and authorized by the Administrator of the

KPA under § 402(a)(b) of the Act, 33 U.S.C. § 1342

(a)-(b).

The instant actions against defendants charge that

defendants have violated the waste water discharge lim-

&).)

“aca

its of their NPDES permits in violation of § 301(a) of

the Act, 33 U.S.C. § 1311(a). Plaintiff also charges the

defendants with failure to report in violation of the act.

Each defendant has moved to dismiss the actions on vari-

us grounds. Plaintiff has moved for partial summary

judgment as to liability. The court will now examine

}

. ak :

each ot these motions.

l. Nig rod Clih v. Ke yustone A uton oriae Plating

}

Presently pending before the court in the above-

captioned case are plaintiff’s Motion for Leave to File

Amended Complaint, Defendant’s Motion to Dismiss. and

Plaintiff's Motion for Partial Summary Judgment. A

discussion of each motion follows.

A. Plaintiff's Motion for Leave to File Amended Com-

pla rit

Plaintiff files the instant motion requesting the court

to grant it leave to file an amended complaint. In sup-

port of the motion, plaintiff contends that since it filed

its original complaint charging defendant Keystone with

violations of the Clean Water Act between April 1, 1976

and September 20, 1983, it has discovered additional vio-

lations of the Act by defendant occurring between Octo-

ber 1, 1983 and June 30, 1984. The amended complaint,

in essence, only differs from the original complaint in

that it alleges additional violations of the Act. Plaintiff

thus requests that all of the alleged violations be tried

rether in the interest of judicial economy. Defendant

Keystone has not filed opposition to the motion.

‘ule 15 of the Federal Rules of Civil Procedure per-

party to amend his pleading by leave of the court

and requires the court to grant such leave to amend

vhen justice so requires. The court believes that justice

judicial economy, in the instant case. mandate per-

mitting plainiiff to amend its complaint in light of the

imilarity of the issues and parties. There is no reason

’ |

23a

to subject identical parties to separate trials regarding

the same alleged permit violations. Plaintiff’s Motion for

Leave to File Amended Complaint is therefore Granted.

B. Defendant’s Motion to Dismiss

Defendant Keystone initially filed its Motion to Dis-

miss on January 16, 1985. However, in response to plain-

tiff’s Motion for Leave to File Amended Complaint filed

on February 4, 1985, defendant Keystone filed a second

Motion to Dismiss on February 27, 1985. Defendant

Keystone seeks dismissal of the complaint pursuant to

Rule 12(b) of the Federal Rules of Civil Procedure.

Rule 12(b) permits dismissal for failure to state a claim

upon which relief can be granted. Dismissal is not

proper, however, unless it appears beyond doubt that

plaintiff can prove no set of facts in support of its claim

which would entitle it to relief. See Jenkins v. McKeithen,

395 U.S. 411, 422 (1969) - Conley v. Gibson, 355 U.S. 41,

45-46 (1957). The court will now turn to examine de-

fendant Keystone’s grounds for dismissal in light of

these principles.

1. Statute of Limitations

In support of its Motion to Dismiss, defendant asserts

that the one-year statute of limitations provision set

forth in $ 5-107 of the Courts and Judicial Proceedings

Article of the Maryland Annotated Code applies in the

instant case and bars 403 of Sierra’s 453 claims that

defendant violated its permit between April 1, 1976 and

June 30, 1984. Keystone claims that 403 of the alleged

permit violations are time-barred because they occurred

more than one year prior to the filing of the suit by

plaintiff. Keystone asserts also that 50 of the alleged

violations occurred within the year prior to the filing of

the suit and, therefore, are not barred by the statute of

limitations; however, only 8 of the 50 concern allegedly

illegal discharges for which relief may be sought. See

24a

Memorandum in Support of Motion to Dismiss, pp. 6,

9-10. Alternatively, Keystone argues that if the court

finds the one-year statute is inapplicable, then Mary-

land’s three-year statute of limitation applicable gen-

erally to civil actions would govern plaintiff’s claim. /d.

at 11.

In opposition to defendant’s Motion to Dismiss, Sierra

argues that 28 U.S. § 2462, the statutory period appli-

cable in government actions to recover civil penalties,

applies to the citizen suit provision of the Clean Water

Act. Plaintiff argues that because it is seeking the same

relief as would the government, specifically, civil penal-

ties for past violations and future compliance, the same

statute of limitations should apply to plaintiff’s action

as would apply to an action by the government. Because

the interest of the government and plaintiff citizen are

identical, plaintiff contends that the five-vear statute of

limitations, as set forth in 28 U.S.C. § 2462, is applicable

and not the state statute of limitations as urged by de-

fendants. Plaintiff's Memorandum in Opposition to De-

fendant’s Motion to Dismiss, pp. 3-5.

The issue before the court is whether, in the absence

of a limitations provision in a federal statute, a federal

court should apply the analogous state statute of limita-

tions or a federal statute of limitations to a citizen suit

instituted under § 505 of the Clean Water Act. This

court recently has decided this precise issue.

On April 30, 1985, Judge Young of this court, in

Chesapeake Bay Foundation v. Bethlehem Steel Corpora-

tion, Civil No. Y84-1620 (D. Md. May 6, 1985), held

that 28 U.S.C. $ 2462 applies to citizen suits for civil

penalties as well as government actions for penalties

under the Clean Water Act.' The court noted that where

128 U.S.C. § 2462 provides:

Except as otherwise provided by Act of Congress, an action.

suit or proceeding for the enforcement of any civil fine, penalty

25a

a federal statute fails to provide a limitations period,

federal courts generaily apply the period of limitations

most appropriate under state iaw; however, where appli-

cation of a state statute would frustrate a federal policy

underlying the cause of action under consideration, the

general rule concerning application of an appropriate

state statute of limitations should not apply. Chesapeake

at 15-16, 17 (citing Johnson v. Railway Express Agency,

421 U.S. 454, 462, 465 (1925)). The court reasoned

that application of a state statute of limitations would

frustrate several policies of the Clean Water Act because

such application would produce non-uniform citizen suit

enforcement from state to state and would also produce

non-uniform enforcement as between citizens and the

government. Chesapeake, at 18-22. The court then ruled

that even though 28 U.S.C. § 2462 was designed to apply

to suits brought by the government, the five-year limita-

tions period set forth in the statute is equally applicable

in a citizen suit for civil penalties under the Clean Water

Act. The court reasoned:

The plaintiffs are suing as private attorneys general,

and they seek the enforcement of federal law. Al-

though the statute provides that a citizen sues “on

his own behalf,” any penalties recovered from such

an action are paid into the United States Treas-

ury.... [I]n this action a plaintiff recovers noth-

ing. Any benefit from the lawsuit, whether injunc-

tive or monetary, inures to the public or to the

United States. The citizen suit provision was de-

signed to supplement administrative enforcement,

not to provide a private remedy. Under these cir-

cumstances it seems most appropriate that the same

or forfeiture, pecuniary or otherwise. shall not be entertained

unless commenced within five (5) years from the date when

the claim first accrued if, within the same period, the offender

or the property is found within the United States in order

that proper service may be made thereon.

= | J

26a

statute of limitations applies to a citizen action as

to a federal administrative action. Chesapeake at

24-25. Accord Friends of the Earth, et al. v. Facet

Enterprises, Inc., Civil No. 84-857T (W.D. N.Y.

ec. 28, 1984). Compare Chesapeake and Friends

of the Earth, supra, (applying five-year federal stat-

ute of limitations found in 28 U.S.C. § 2462) with

Student Public Interest Research Group of New

Jersey, et. al. v. Tenneco Polymers, 602 F. Supp.

1394, 1398-99 (D. N.J. 1985) (refusing to apply

both state statute of limitations and federal statute

of limitations).

The court agrees that the five-year federal statute of

limitations in 28 U.S.C. $ 2462 applies to this instant

citizen suit for civil penalties and relies upon the ra-

tionale articulated by Judge Young of this court in

Cheaspeake.*

2. Section 505(b)

In further support of its Motion to Dismiss, Keystone

asserts that $ 505(b) of the Clean Water Act also bars

plaintiff’s suit because the state has commenced and is

diligently prosecuting administrative proceedings against

Keystone based upon the alleged violations of Keystone’s

NPDES permit. Defendant Keystone’s Memorandum in

Support of Motion to Dismiss, pp. 11-18, 15. In response,

plaintiff argues that §505(b) of the Clean Water Act

does not bar the present suit because the state’s admin-

istrative proceeding was commenced after plaintiff filed

its complaint. Plaintiff filed suit on October 31, 1984

and the State of Maryland issued its “Notice of Viola-

tion” on December 13, 1984. Moreover, plaintiff asserts

that even if the state’s action preceded plaintiff’s suit,

plaintiff's suit still would not be barred because the

* The court instructs plaintiff to file a memorandum by August 1,

1985 indicating which claims, if any, are time-barred by the five-

year statute of limitations.

tia cel

27a

state’s administrative hearing is not tantamount to a

“diligent prosecution” in a court within the meaning of

$ 505(b). Id. at 6-8.

Section 505(b) of the Clean Water Act, 33 U.S.C.

$ 1365(b), provides that no citizen suit can be main-

tained “if the Administrator or State has commenced

and is diligently prosecuting a civil or criminal action

in a court of the United States, or a State to require

compliance with the standard limitation, or order, but

in any such action in a court of the United States any

citizen may intervene as a matter of right.” Prelimi-

narily, the court notes that it finds the state’s adminis-

trative proceeding was instituted after plaintiff com-

menced its action. Significantly, plaintiff filed its com-

plaint on October 31, 1984 and the state filed its Notice

of Violation on December 31, 1984. Defendant argues

that the state’s administrative proceeding was instituted

two months prior to plaintiff’s filing of its Amended

Complaint on February 4, 1984. The court finds this

argument unpersuasive. The dispositive date is that on

which the original complaint was filed, not the date on

which the plaintiff sought amendment of the complaint.

Plaintiff’s suit was instituted prior to the state’s institu-

tion of administrative proceedings aganst defendant Key-

stone and, therefore, is not barred by §505(b) of the

Clean Water Act.

Secondly, the court also notes that it does not find the

state’s administrative proceeding equivalent to a diligent

prosecution in a court for purposes of § 505(b) of the

Clean Water Act. The court recognizes that under cer-

tain circumstances an administrative proceeding may be

considered the equivalent of court action and thus bar

citizen suits, see Baughman v. Bradford Coal Co., 592

F.2d 215 (3d Cir.), cert. denied, 441 U.S. 961 (1979);

however, in order to be accorded court status, a state

agency must possess the full remedial powers inherent

to traditional judicial courts. In the instant case, plain-

28a

tiff seeks a declaratory judgment, injunctive relief, civil

penalties and costs. Keystone notes that the state in an

administrative proceeding has the power to revoke a dis-

charge permit, impose civil penalties, issue orders requir-

ing corrective action within a specified time and execute

a consent order. However, Keystone also notes that the

state agency may only seek injunctive relief from a court.

Defendant Keystone’s Memorandum in Support of Motion

to Dismiss, p. 14. The state agency, therefore, does not

possess the full remedial powers available to a court but

must seek the injunctive relief plaintiff requests in a

court. The state court proceeding possibly may be in-

adequate to fully protect the plaintiff herein and there-

fore would not be so diligent as to preempt the citizen

suit. The court thus believes that it would not be appro-

priate to denominate the state agency as a court within

$505(b) and, accordingly, will not bar plaintiff’s suit.

Cf. Student Public Interest Research Group of New Jer-

sey, Inc. v. Monsanto Company, 600 F. Supp. 1479, 1482

(D. N.J. 1985). See also Student Public Interest Re-

search Group of New Jersey v. Fritzsche, Dodge & Ol-

cott, 759 F.2d 1131 (3d Cir. 1985): Brewer v. City of

Bristol, 577 F. Supp. 519 (E.D. Tenn. 1983).

3. Civil Penalties

Keystone asserts that $505 of the Act entitles Sierra

as a citizen plaintiff to prospective relief only for con-

tinuing violations of the Act and not civil penalties for

alleged permit violations occurring prior to the filing of

the suit. Defendant Keystone’s Memorandum in Support

of Motion to Dismiss, pp. 15-19, 27. Plaintiff, in turn,

contends that the language of the Act, the legislative

history of the Act, and court constructions of the Act

Support the proposition that citizens may recover civil

penalties for past permit violations. Plaintiff’s Response

to Motion to Dismiss, pp. 8-14. Moreover, plaintiff con-

tends that it has sufficiently alleged continuing violations

to warrant injunctive relief.

29a

Whether civil penalties for past violations may be

awarded in a citizen’s suit under the Clean Water Act

has not been addressed by this court. However, a num-

ber of other federal courts have addressed the issue and

have determined that courts. in fact, may assess civil

penalties for violations of the Act alleged to have oc-

curred prior to the filing of the case. See Illinois v. Out-

board Marine, Inc., 680 F.2d 473, 480-81 (7th Cir.

1982); Student Public Interest Research Group of New

Jersey v. Monsanto, 600 F. Supp. 1474, 1476-77 (D. NJ.

1985); Sierra Club v. Aluminum Company of America,

585 F. Supp. 842, 853-54 (N.D. N.Y. 1984); Friends of

the Earth v. Facet Enterprises, Civil No. 84-357T (W.D.

N.Y. 1984). These courts have rejected defendants argu-

ment that plaintiff’s recovery should be limited to pros-

pective relief and have conclusively held that § 1365(a)

of the Clean Water Act authorizes citizen suits for im-

position of civil penalties for past violations. The court

agrees with the ruling of these cases and adopts their

reasoning in full. The court also notes that it finds the

cases cited by defendant in support of its position in-

apposite because such cases involved the recovery of dam-

ages and not the recovery of civil penalties.

For the foregoing reasons, the court finds that defend-

ant has failed to show beyond doubt that plaintiff can

prove no set of facts in support of its claim which would

entitle it to relief. Defendant Keystone’s Motion to Dis-

miss is therefore Denied.

C. Plaintiff's Motion for Partial Summary Judgment

Plaintiff seeks summary judgment on the issue of

liability contending that defendant has not complied with

its NPDES permit. In support of its motion, plaintiff

contends that defendant has violated a condition of its

NPDES permit and, thus has violated the Act, specifi-

eally, $$ 301 and 402 of the Act, 33 U.S.C. §§ 1311, 1342;

that plaintiff has standing to bring the instant action;

30a

the defendant has admitted in its DMRs? its ‘violations

of its NPDES permit for which liability may attach; and

that plaintiff is entitled to judgment as a matter of law

because no genuine issue as to any material fact about

liability exists in light of Keystone’s admissions.

In opposition to plaintiff’s motion for partial summary

judgment, defendant Keystone argues that the majority

of Sierra’s claims are barred by the applicable statute

of limitations: that Sierra’s instant proceedings are

barred by § 505(b) of the Clean Water Act because the

State of Maryland has commenced and is diligently

prosecuting Keystone for alleged violations of its permit;

and that Sierra is not entitled to the imposition of civil]

penalties for past permit violations, Moreover, defend-

ant argues that further proceedings by Sierra are barred

by the defendant’s entry into a consent decree with the

State whereby the defendant agreed to remit to the state

a penalty in the amount of $10,000 for alleged violations

of Keystone’s NPDES permit. Defendant further argues

that Sierra’s claims of permit violations amount to al-

legations of improper recording or technical violations

and not substantive Violations by defendant of its

NPDES permit. Finally, defendant argues that Sierra

has not demonstrated that it has standing to prosecute

its claims against Keystone,

Summary judgment is appropriate only if the plead-

ings “show that there is no genuine issue as to any ma-

terial fact and that the moving party is entitled to a

judgment as a matter of law.” The court believes that

Keystone’s pleadings do not raise material factual dis-

putes and that the law weighs in favor of plaintiff Sierra

Club. Both the factual] and legal bases for the court’s

findings are set forth infra,

The essential facts in the instant case are uncon-

troverted. The Maryland Water Resources Administra-

3 Discharge Monitoring Reports.

3la

tion issued NPDES permit number MD0025046 to de-

fendant in accordance with § 402 of the Act on January

29, 1976. The permit authorizes defendant to discharge

limited amounts of the treated waste from its operations

into the Patapsco River in accordance with the provisions

of the permit. The permit also requires defendant to file

periodic Discharge Monitoring Reports (DMRs) indicat-

ing the contents and quality of its wastewater discharge.

Both Keystone’s current NPDES permit and DMRs have

been authenticated. The DMRs indicate that Keystone

has committed excessive discharges and has failed to

report in various instances. Having found no genuine

issue as to a material fact, the court will now examine

the law bearing on the issue at bar.

As this court stated in Chesapeake, “Tslection 308 of

the Act, 33 U.S.C. § 1318, provides that the Administra-

tor of the EPA shall require all NPDES permit holders

to monitor their discharges. Permit holders must main-

tain records of the results of this monitoring and report

the results to the relevant state or federal] agency in

DMR. 40 C.F.R. 122.41(1) (4) (i). Permit holders must

certify the accuracy of information contained in their

DMRs, 40 C.F.R. 122.22. The DMRs must contain a

complete and accurute record of pollutant monitoring by

the permit holders. 40 C.F.R. ss 122.22(d), 122.41(1)

(4) (1).” Chesapeake Bay Foundation v. Bethlehem Stee!

Corp., Civ. No. Y84-1620, p. 29 (D. Md. May 6, 1985).

Courts generally have held that reports or records which

-e required to be kept by law, may be used to establish

a defendant’s liability. Chesapeake, Supra, at 30; Stu-

dent Public Interest Research Group of New Jersey v.

Tenneco Polymers, 602 F. Supp. 1394, 1400 (D. NJ.

1985) ; Student Public Interest Research Group of New

Jersey v. Fritzsche, Dodge & Olcott, 579 F. Supp. 1528,

1538 (D. N.J. 1984): Student Public Interest Research

Group v. Monsanto Co., 600 F. Supp. 1479, 1485 (D. N.J.

1985). Defendant’s DMRs in the instant case indicate

that defendant has violated its NPDES permit by ex-

32a

ceeding its permit limitations and by failing to report.

“|T Jo violate a NPDES permit is to violate the Act.”

Chesapeake, supra, at 29 (citing Environmental Protec-

tion Agency v. State Water Resources Control Board,

426 U.S. 200, 205 (1976); Natural Resources Defense

Council, Inc. v. Costle, 586 F.2d 1369, 1374-77 (D.C. Cir.

1977) ). “Summary Judgment is appropriate on the is-

sue of liability for violations of the Act.” Student Pub-

lic Interest Research Group v. Monsanto Co., 600 F.

Supp. at 1485. The court thus finds that partial sum-

mary judgment as to liability is appropriate as a matter

of law.

The court finds defendant’s opposition to the motion

unconvincing and insufficient to raise genuine issues of

material fact. As to defendant’s arguments that sum-

mary Judgment is inappropriate because of the state’s

diligent prosecution against defendant for the alleged

permit violations and because the alleged permit viola-

tions amount only to technical and not substantive viola-

tions of defendant’s NPDES permit, the court finds

Student Public Interest Research Group of New Jersey

v. Fritzsche, Dodge & Olcott, 579 F. Supp. 1528 (D. N.J.

1984), worthy of mention. In Fritzsche, the court re-

jected such claims by defendant finding that defendant’s

claim of diligent prosecution by an agency was relevant

only to defendant’s Motion to Dismiss and that defend-

ant’s argument regarding “technical” permit violations

was relevant only to the issue of damages. Jd. at 1538.

The court believes the same reasoning applies in this

case. The court also believes that the state proceeding

and defendant’s entry into a settlement with the state is

irrelevant to the case at bar. As discussed supra, the

instant citizen suit is not barred by the state proceeding

and any state investigation, resolution, or negotiation

does not affect plaintiff's right to prosecute permit viola-

tions. Moreover, the court believes that defendant’s char-

acterization of its permit violations as technical and not

Substantive is unmeritorious. Defendant’s DMRs indi-

39a

cate that it has violated its NPDES permit. Enforce-

ment of NPDES permits is based on strict liability. Stu-

dent Public Interest Research Group of New Jersey v.

Tenneco Polymers, 602 F. Supp. 1394, 1400 (D. NJ.

1985). The Act thus places a heavy emphasis on ac-

curacy. See Chesapeake, supra, at 33. Good faith and

improper recording, therefore, are not good defenses.

As to defendant’s arguments concerning the applicable

statute of limitations and the imposition of civil penal-

ties, the court finds that its earlier discussion is equally

applicable in the summary judgment context. Such argu-

ments, therefore, are insufficient to withstand plaintiff’s

Motion for Partial Summary Judgment.

Finally, as to defendant’s claim that plaintiff has not

adequately demonstrated that it has standing to prosecute

its claims, the court finds such argument equally un-

meritorious. In paragraph seven of plaintiff’s complaint,

plaintiff alleges that “[m]embers of the Sierra Club re-

side in Maryland, in the vicinity of the Patapsco River,

and recreate in, on or near, and otherwise use and enjoy,

the Patapsco River and the water system of which it is

a part. The quality of the Nation’s waters and the wa-

ters of the State of Maryland directly affects the health,

recreational, aesthetic and environmental interests of

Sierra Club’s members. The interests of Sierra Club’s

members have been, are being and will be adversely af-

fected by the failure of defendant, Keystone Automotive

Plating Company, to comply with its NPDES permit re-

quirements.” Plaintiff has also submitted numerous af-

fidavits from various individual members of the Sierra

Club who indicate that their interest and activities with

respect to the Patapsco River has been adversely affected

physically, aesthetically and emotionally by defendant’s

failure to comply with its NPDES permit and resulting

pollution.

The court is satisfied that plaintiff has sufficiently

demonstrated that it has standing to bring this suit.

QA.

o4a

Allegations of harm to one’s aesthetic or recreational

interest are sufficient to establish standing to sue. Sierra

Club v. Morton, 405 U.S. 727. 734 (1972). In the ease

at bar, plaintiff has alleged that Sierra Club members’

aesthetic and/or recreational interests and use of the

Patapsco River will be harmed by continued pollution of

the river. Other courts have also found that plaintiffs on

equal footing with the plaintiff herein have standing to

sue. See Student Public Interest Research Group v. Mon-

santo Co., 600 F. Supp. 1479, 1484 (D. N.J. 1985):

Sierra Club v. Aluminum Company of America, 585 F.

Supp. 848, 844-853 (N.D. N.Y. 1984): Friends of the

Earth v. Facet Enterprises, Civil No. 84-357T, p. 4

(W.D. N.Y. 1984). Having found that plaintiff was

satisfied the Sierra Club v. Morton standing require-

ments, the court finds that plaintiff is a proper party in

the instant action.

For the foregoing reasons, the court has determined to

grant plaintiff’s Motion for Partial Summary Judgment

as to liability. A hearing will be scheduled at a later

date to determine the appropriate remedies under the

Act.

I]. Sierra Club v. Neuva Engineering

Various motions are pending before the court in the

above-captioned matter. The outstanding motions, a dis-

cussion of which follows, are Defendant’s Motion to Dis-

miss and or Motion for Judgment on the Pleadings,

Plaintiff’s Motion for Partial Summary Judgment, and

Defendant’s Motion for Continuance.

A. Defendant’s Motion to Dismiss and or Motion for

Judgment on the Pleadings

Defendant files the instant motion seeking relief pur-

suant to Rule 12+b) of the Federal Rules of Civil Proce-

dure or, alternatively, Rule 12(c). In Support of its mo-

tion, defendant claims that plaintiff improperly seeks

declaratory and injunctive relief and civil penalties for

35a

past violations of defendant’s NPDES permit which is

not authorized by § 505 of the Act; that plaintiff does

not have standing to bring the instant action; that de-

fendant has ceased all operations at the plant which is

the subject of plaintiff's complaint and no longer dis-

charges any wastes into the Patapsco River; that the

State of Maryland has informed Neuva’s counsel that it

intends to initiate an action against Neuva regarding

the alleged permit violations by Neuva; that plaintiff’s

claim is barred by the analogous one-year state statute

of limitations; and that plaintiff’s allegations of fact are

insufficient at law to support plaintiff’s action under

$505 of the Act. Plaintiff opposes defendant’s motion.

Plaintiff argues that defendant’s Motion to Dismiss

should be denied because the permit violations are not

barred by the applicable five-year statute of limitations;

because the State of Maryland has not commenced and

is not diligently prosecuting Neuva for violations of

Neuva’s permit and, thus, plaintiff’s citizen suit is not

preempted; because the citizen suit provision of the Clean

Water Act provides for the imposition of civil penalties

for past permit violations; and because plaintiff has suf-

ficiently demonstrated that it has standing.

The court has addressed each of the arguments ad-

vanced supra and will not repeat its discussion again.

(See, supra pp. 6-11, 16-17). Summarily, however, the

court finds that the five-year statute of limitations set

forth in 28 U.S.C. § 2462 is the applicable statute of

limitations in a citizen suit for civil penalties under the

Clean Water Act. The court also finds that plaintiff’s

citizen suit is not barred by § 505(b) of the Act because

the state’s action or lack thereof does not amount to a

diligent prosecution in a court within the meaning of

. 505(b). Moreover, the court finds that plaintiff has

sufficiently alleged, with supporting affidavits, that it has

standing to bring the present action. Finally, the court

finds that the Act permits citizens to seek civil penalties

36a

for past permit violations. The fact that Neuva no longer

operates the plant in question and no longer discharges

refuse into the Patapsco River has no effect on plaintiff’s

right to prosecute the alleged permit violations. Defend-

ant’s actions may indicate that it does not intend to com-

mit future permit violations, but such actions do not

null and void plaintiff’s cause of action.

B. Plaintiff’s Motion for Partial Summary Judgment

* $e

Plaintiff files the instant motion pursuant to Rule 56

of the Federal Rules of Civil Procedure. Plaintiff claims

that summary judgment as to liability is appropriate be-

cause defendant has violated its permit and, thus, has

violated the Act; because plaintiff has standing to bring

this action; because defendant has admitted its violations

of the Act; and because no material facts are in dispute

and it is entitled to judgment on the issue of liability as

a matter of law. Defendant opposes the motion contend-

ing that the pleading and answers to Requests for Ad-

mission demonstrate that there exists genuine disputes as

to material facts alleged by the plaintiff; that defendant

has filed its response to plaintiff’s Requests for Admis-

sion of Genuiness of Documents in a timely manner, and

has not admitted the alleged permit violations; and that

the arguments advanced in defendant’s Motion to Dismiss

present genuine disputes as to material facts.

Preliminarily, for the reasons articulated supra in the

court’s denial of defendant’s Motion To Dismiss, the court

believes that the arguments advanced in defendant’s Mo-

tion to Dismiss and adopted in opposition to plaintiff's

motion do not raise genuine disputes as to material facts.

The court believes, however, that defendant’s response to

plaintiff's Requests for Admission of genuineness of Doc-

uments may raise an issue of fact, but not a material

issue. Significantly, Paul Thompson, Regional Chief of

the Enforcement Program of the Waste Management Ad-

ministration of the Department of Health & Mental

37a

Hygiene of the State of Maryland (the state agency in

charge of NPDES permits and DMRs), has authenticated

copies of defendant’s DMRs and NPDES permit filed

with the court. The DMRs indicate violations of defend-

ant’s NPDES permit. Defendant simply has not admit-

ted the authenticity of its NPDES permit or DMRs but

has offered no evidence contradicting its DMRs authenti-

cated by Mr. Thompson. In the absence of contradictory

evidence, the court cannot find a genuine issue as to any

material fact and finds that summary judgment as to

liability is appropriate as a matter of law because of

the violations evidenced by the authenticated DMRs.

C. Defendant’s Motion for Continuance

Sierra Club v. Neuva Engineering is scheduled for trial

on July 15, 1985. Defendant requests the court to con-

tinue the trial date because defense counsel Rothwell will

be out of the country and, therefore, unavailable to try

the case. Plaintiff opposes the motion contending that

plaintiff will be prejudiced by a continuation of the trial

date and that defendant will not be prejudiced by a de-

nial of the request because defendant is already repre-

sented by defense counsel Reed.

The court has considered the argument advanced and

has reviewed the court’s calendar and has determined to

grant defendant’s request. The court has rescheduled the

trial to begin on Monday September 16, 1985 at 10:00

a.m.

ilI. Sierra Club v. Simkins Industries

Presently pending before the court in the above-

captioned are defendant’s Motion for Entry of Judgment

on the Pleadings and Plaintiff’s Motion for Partial Sum-

mary Judgment. A discussion of each motion follows.

EEE

38a

A. Defendant’s Motion for Entry of Judgment on the

Pleadings

Defendant Simkins moves the court to enter judgment

on the pleadings in favor of the defendants. In support

of its motion, defendant asserts that:

“(a) Plaintiff lacks standing to bring a private action

as plaintiff has not alleged that any member of plaintiff

suffered an injury in fact stemming from defendant’s

alleged failure to file past monitoring reports;

(b} The complaint fails to state a claim as it does not

allege either a violation of an effluent standard or limita-

tion or a violation of the terms and conditions of the

Simkins permit;

(ce) Plaintiff's private action before this court has been

foreclosed by defendant’s prompt satisfaction of the al-

leged violations set forth in plaintiff’s sixty-day letter;

and

(d) The relief sought by plaintiff is inappropriate as

the request for injunctive relief has been mooted by the

absence of a continuing violation, and under such cir-

cumstances, courts may not impose civil penalties.”

In opposition to defendant’s motion, plaintiff argues

that Sierra Club has standing to bring this action; that

the permit at issue contains an enforceable reporting re-

quirement; that defendant’s actions to rectify the alleged

violations do not bar plaintiff’s claim; and that plaintiff

may request the court to impose civil penalties for past

failures to report. Plaintiff thus asks the court to deny

defendant’s motion.

As discussed supra page 16, the court again finds that

plaintiff has standing to bring the instant action. Both

the complaint and the affidavits of individual Sierra Club

members are sufficient to show that the interest of Sierra

Club members may be adversely affected by defendant’s

noncompliance with its permit requirements. Such a

39a

showing satisfies the Sierra Club v. Morton, 405 U.S. 727

(1972) test and is a sufficient claim on which a cause of

action may be maintained.

Secondarily, the court believes that plaintiff may main-

tain an action against defendant for past violations even

if defendant now complies with the terms of its NPDES

permit. Defendant’s permit requires defendant to file

DMRs on a quarterly basis. Defendant’s Reply Memoran-

dum in Response to Plaintiff’s Memorandum in Opposi-

tion to Defendant’s for Entry of Judgment, p. 7. Plain-

tiff charges and defendant admits, that defendant has

failed to file DMRs in past. Defendant’s failure to file

DMRs thus violated its permit requiring such reporting.

A violation of a permit requirement is a violation of the

Act. Courts generally have held that civil penalties may

be recovered in citizen suits for past violations. //linois v.

Outboard Marine, 680 F.2d 473 (7th Cir. 1982); Sierra

Club v. The Aluminum Company of America, 585 F.

Supp. 84 853-54 (N.D. N.Y. 1984). That defendant is

now complying with NPDES permit is irrelevant to

plaintiff's cause of action. Such compliance, however,

may be considered in assessing the amount of penalties.

For a fuller discussion of civil penalties, see supra pp.

11-12.

Defendant urges that the court should read Hamker

v. Diamond Shamrock Chemical Company, 756 F.2d 392

(5th Cir. 1985) to state for the proposition that the

‘ourt lacks jurisdiction to entertain a citizens complaint

under the Clean Water Act where no allegation of a

present violation of an effluent standard is made. The

court believes such a reading of Hamker is too broad.

This broad reading of Hamker ostensibly would preclude

the court from considering an action in which the polluter

stops polluting the day, the hour, or the minute before

the suit is filed. The court believes that Ham/cer is more

narrowly limited to stand for the proposition that a court

lacks jurisdiction to impose penalties for a single past

violation ended long before the filing of the suit.

40a

In the instant action, defendant is not a one-time vio-

lator of the Act but a multiple violator of its NPDES

permit. In such a case, imposition of civil penalties is

appropriate even if defendant is now in compliance with

its permit.

Accordingly, for the foregoing reasons, plaintiff has

sufficiently stated a claim upon which relief can be

granted. Defendant’s Motion for Entry of Judgment on

the Pleadings is therefore denied.

B. Plaintiff's Motion for Partial Summary Judgment

As plaintiff alleged in its Motion for partial Summary

Judgment against defendants Keystone and Neuva, plain-

tiff again argues that partial summary judgment against

Simkins is appropriate because defendant has violated its

permit condition and, thus, has violated the Act; that

plaintiff has standing to bring this action; that defend-

ant’s admissions demonstrate its violations of the Act;

and that it is entitled to judgment as a matter of law

because no material facts are in dispute. Defendant

Simkins opposes plaintiff's motion and contends, as it did

in its Motion for Entry of Judgment on the Pleadings,

that factual issues are raised by the court’s consideration

of whether plaintiff has standing; whether plaintiff can

maintain an action where the alleged violation consists

of a past failure to file state monitoring reports; whether

defendant’s prompt action to redress the alleged griev-

ances precludes a private suit; and whether plaintiff’s

claim is barred by the Maryland one-year statute of lim-

itations.

The court has addressed each of these arguments in

this memorandum and will not repeat its analysis again.

For the reasons set forth supra, the court finds that de-

fendant’s arguments do not create any material factual

disputes.

Significantly, cefendant has admitted that it failed to file

DMRs as required by its permit prior to receiving plain-

4la

tiff’s 60 day letter. Liability attaches for violation of a

permit condition whether such violation consists of an

excessive discharge or a failure to report. Again, a viola-

tion of a permit is a violation of the Act. Summary

Judgment as to liability is therefore appropriate.

Accordingly, it is this 18th day of June 1985 by the

United States District Court for the District of Mary-

land,

ORDERED:

(1) that defendant Simkins’ Motion for Entry of

Judgment on the Pleadings be, and the same hereby is,

Denied;

(2) that defendant Neuva’s Motion to Dismiss and /or

Motion for Judgment on the Pleadings be, and the same

hereby is, Denied;

(3; that defendant Keystone’s Motion to Dismiss be,

and the same hereby is, Denied;

(4) that plaintiff's Motions for Partial Summary

Judgment to each defendant be, and tne same hereby are,

Granted:

(5) that plaintiff’s Motion for Leave to File Amended

Complaint be, and the same hereby is, Granted;

(6) that defendant Neuva’s Motion for Continuan¢e

be, and the same hereby is, Granted; and

(7) that the Clerk of the Court provide to all parties

in these actions copies of this memorandum and order.

s’ Herbert F. Murray

United States District Judge

42a

APPENDIX C

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

Civil No. HM84-4018

THE SIERRA CLUB

SIMKINS INDUSTRIES, INC.

MEMORANDUM

Plaintiff Sierra Club has filed the instant citizen suit

against defendant Simkins Industries, Ine. ‘Simkins:

pursuant to § 505 of the Clean Water Act ‘the Act), 33

U.S.C. $ 1365. The complaint alleges that defendant has

violated the terms and provisicns of its National Pol-

lutant Discharge Elimination System (NPDES) permit

number MD0058033. Specifically, the complaint alleges

that defendant hus violated the Clean Water Act by

failing to comply with its NPDES permit; that is, by

failing to file quarterly discharge monitoring reports

(DMRs) with the State of Maryland between August 1,

1981 and March 31, 1984. By Memorandum and Order

dated June 18, 1985, the court gran:ed plaintiff’s motion

for partial summary judgment on the issue of liability

finding that defendant Simkins has violated the Act by

failing to comply with the terms of its NPDES permit.

At issue before the court, therefore, is the appropriate

civil penalty to be assessed against Simkins for its viola-

tions. Plaintiff argues that Simkins is subject to a maxi-

mum penalty of $9,770,000. Conversely, defendant argues

43a

that the court should assess a penalty against it in the

range of $10,000 to $20,000.

Both parties have submitted post-trial Proposed Find-

ings of Fact and Conclusions of Law. Defendant also hus

filed a motion for reconsideration. Having reviewed the

record in this case, the court is now prepared to rule.

I. SIMKINS’ MOTION FOR RECONSIDERATION

Defendant Simkins moves the court to reconsider its

June 18, 1985 order granting plaintiff’s motion for par-

tial summary judgment and denying defendant’s motion

for entry of judgment on the pleadings. In support of

its motion, Simkins argue that the pendency of state

criminal proceedings against it requires the court to dis-

miss plaintiff’s suit pursuant to 33 U.S.C. § 1365(b) (1)

(B). Simkins also contends that upon receipt of plain-

tiff’s notice of intent to sue, Deputy Attorney General

Barrett informed counsel for plaintiff that the Maryland

Attorney General’s office would be proceeding with a

criminal investigation of Simkins. Simkins thus argues

that in light of the state criminal proceedings, this pri-

vate suit is barred and must be dismissed.

Plaintiff Sierra Club opposes defendant’s motion for

reconsideration. Plaintiff argues that its citizen suit is

not barred because the State has not commenced an ac-

tion against Simkins in a court. Plaintiff also argues

that a citizen suit is barred only if the State initiates a

court action within the statutory sixty-day notice period.

Plaintiff thus argues that defendant’s motion for recon-

sideration should be denied because the State did not

initiate a court action within the sixty-day period.

Section 505(b) of the Clean Water Act, 33 U.S.C.

$ 1365(b), provides that no citizen suit can be main-

tained “prior to sixty days after the plaintiff has given

notice of the alleged violation . .. or if the Administra-

tor or State has commenced and is diligently prosecuting

44a

a civil or criminal action in a court of the United States,

or a State to require compliance with the standard, limi-

tation, or order . . .” 33 U.S. § 1365(b) (1). Prelimi-

narily, the court finds that the instant citizen suit is

proper and should not be dismissed because it was filed

after the sixty-day notice period and because the State’s

criminal investigation is not tantamount to a “diligent

prosecution” in a court within the meaning of § 505(b).

The court believes that the state of affairs at the time

plaintiff filed this action is dispositive. Significantly plain-

tiff initiated this citizen suit on October 31, 1984, sixty-

one days after giving notice of its intent to sue. Simkins

argues that the State informed counsel for plaintiff with-

in the sixty-day period that it would be proceeding with

a criminal investigation of Simkins: nevertheless, Sierra

Club improperly filed this suit. The court is not per-

suaded. At the time plaintiff filed this suit, the State had

not commenced a court action within the meaning of

s 505(b); to be sure, a state investigation is quite dis-

tinct from a court action which is being diligently prose-

cuted. In order for this case to be barred, the State must

have filed a court action within the sixty-day period and

then diligently have prosecuted the case. See Brewer v.

City of Bristol, 577 F. Supp. 519 (E.D. Tenn. 1983)

(“Timing of pollution abatement efforts is often of criti-

cal importance; [rlequiring that the state action be

commenced within the 60-day notice period is a strong

method of insuring prompt response.”) The court be-

lieves that to hold otherwise would permit “state agencies

and polluters {tol ignore the time requirements of Sec-

tion 1365(b) by “diligently” prosecuting late actions and

thus bar any further citizen participation.” Brewer, 577

F. Supp. at 528.

The court notes that counsel for defendant states, by

affidavit, that he met with Deputy Attorney General Jane

Barrett on July 10, 1985 and was informed that “| Ms.

Barrett’s] investigation had progressed to the point that

45a

she was intending to seek a criminal indictment of

Simkins Industries.” Affidavit of Jack Meyerson, p. 1

(emphasis added). Moreover, Maryland Assistant Attor-

ney General Michael Powell states, by affidavit dated

July 1985, that “between August 1984 and the present,

the Hazardous Waste Strike Force has proceeded with

the Simkins matter and it is anticipated that an indict-

ment will be presented to a state grand jury in late

August or early September of 1985.” Affidavit of Michael

Powell, p. 2. Obviously, any state action was commenced

after plaintiff filed this ease on October 31, 1984. Hav-

ing found that the State had not commenced a court or

an administrative action within the meaning of § 505(b)

of the Clean Water Act prior to the commencement of

this action, defendant’s motion for reconsideration will

be denied.

II. CIVIL PENALTIES

Having denied defendant's motion for reconsideration,

the court’s June 18, 1986 order granting plaintiff’s mo

tion for partial summary judgment on the issue of lia-

bility is hereby reaffirmed. Again, the court finds that

defendant’s violation of its NPDES permit conditions is

a violation of the Clean Water Act for which defendant

may be held liable. Sierra Club v. Simkins Industries,

Inc. et al., Civil No. HM 84-4018 (D. Md. June 18,

1985). The court now must decide the amount of civil

penalties for which defendant Simkins is liable. Before

analyzing the law applicable to this issue, the court will

first examine the facts giving rise to the instant action.

A. Findings of Fact

Plaintiff Sierra Club and defendant Simkins have filed

Proposed Findings of Fact and Conclusions of Law in

this case. The court has determined to adopt in part

plaintiff's and defendant’s Proposed Findings of Fact,

having found that they adequately and fairly represent

the facts in this case. The court’s factual findings thus

46a

are set forth below incorporating the parties’ submis-

S10ns.

A). BACKGROUND

1. Plaintiff, Sierra Club, is a non-profit national con-

servationist organization with many members in the

Chesapeake Bay area, dedicated to protecting natural re-

sources, including water.

2. Members of the Sierra Club reside in Maryland, in

the vicinity of the Patapsco River, and recreate in, on

or near, and otherwise use and enjoy the Patapsco River

and the water system of which it is a part. The quality

of the nation’s waters and the waters of the State of

Maryland directly affects the health, recreational. aes-

thetic, environmental interests of Sierra C'lub’s members.

The interests of the members of the Sierra Club have

been, are being and will be adversely affected by the

failure of Defendant, Simkins Industries, Inc. to comply

With its NPDES permit requirements.

3. Simkins Industries, Ine. operates a paper mill

on River Road, Catonsville, Maryland 21228. ( Discharge

permit; Frey testimony).

!. The facility was formerly a textile plant. (Frey

testimony).

». The plant in Catonsville is one of 15 plants owned

by Simkins Industries, Ine. which are mostly located

over the Eastern seaboard. (Plaintiff's Exhibit. 11—De-

fendant’s 1984 Annual Report).

6. The Simkins plant manufactures pajperboard from

waste paper, the bulk of which is collected in the local

area. (Frey testimony).

¢. The Defendant processes 160 tons off waste paper

per day. (Frey testimony).

8. The Defendant produces 3600 tons of paper prod-

ucts a month. ( Frey testimony).

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48a

2. TOC [total organic carbons]

3. Total phenol

ce. Out fall 003—The ph shall not be less than 6.0 nor

greater than 9.0 and shall be monitored by grab once a

month. There should be no discharge of floating solids

or persistent foam in other than trace amounts. ( Defend-

ant’s Exhibit 6.)

15. The permit requires Simkins to monitor 3 outflows

from its power house and paper producing plant on a

monthly basis and to report the results of this monitor-

-ing to the Maryland Department of Health and Mental

Hygiene, Enforcement Division on a quarterly basis. ( De-

fendant’s Exhibit 6). Thus commencing August 1, 1981

through March 31, 1984 Simkins should have filed 11

Discharge Monitoring Reports.

16. Simkins has failed to file quarterly discharge

monitoring reports with the State of Maryland between

August 1, 1981 and March 31, 1984, the time period for

which relief is sought in the complaint. In fact, however,

Simkins did not file a DMR with the state until October

1, 1984. (Stipulation of counsel).

Ci. RECALCITRANCE

17. On February 8, 1983, a state employee filed a

report of observations concerning Simkins Industries,

Inc. He remarked: “Contacted Mr. Gamber, new plant

manager, and reviewed discharge permit requirements,

particularly quarterly monitoring reports. Mr. Gamber

stated that out fall 002 receives non-contact cooling wa-

ter from several sources. .. .” (Plaintiff's Exhibit 18).

18. On February 9, 1983, A.D. Gamber, plant engi-

neer for Simkins Industries, Inc. wrote Paul Thompson,

Acting Regional Chief Enforcement Program, Waste

Management Administration, State of Maryland and

stated: “As reviewed with Mr. Miller we will obtain

49a

monthly outfall samples and have them tested as a “ive

for the quarterly discharge reports.” | (Plaintift s Exhib:

19. On May 25, 1983, a state employee, Don Mille:

filled out a report of observations concerning Simkins

Industries, Inc. He stated: “I contacted Mr. Gambe)

plant engineer, for routine inspection. Mr. Gamber stated

that he had been contacted by Mike Broumberg concern-

ing past due DMR’s. Mr. Gamber stated that he was at

fault for not sampling and submitting DMR’s. He fur-

ther indicated that he would start sampling per permit

requirements. Mr. Gamber stated that they had had an

oil spill recently and consequently had made some changes

at the fuel oil storage tanks.” (Plaintiff’s Exhibit 17).

<0. On July 12, 1983, a state employee, Don Miller.

sive out a report of observations concerning Simkins

Industries, Inc. He stated: “Contacted Mr. Gamber.

ae manager. Mr. Gamber stated that he had not im-

piemented a sampling program per DP requirements.

He stated that his supervisors did not consider the sam-

pling a priority and requested a meeting with his super-

visor.” (Plaintiff’s Exhibit 19).

<1. On September 8, 1983, a state employee, Arthur

O'Connell and Mike Griffen filed a report of observations

concerning Simkins Industries, Inc. and asserted. among

other things: “However, Mr. Gamber told us that no

arrangements have been undertaken to sample the out

fails as required in the discharge permit.” (Plaintiff’s

Exhibit 23).

—

22. On July 27, 1983, Paul Thompson, state inspector,

issued a site complaint to Simkins Industries. Inc. and

asserted: “That the reports and records required by dis-

charge permit No. 80-DB-1779 have not been submitted

» the administration. The existence of the above-

mentioned violation may subject you to prosecution and

ty. Accordingly, you are advised that the following

50a

corrective actions are necessary to remedy the viola-

tion(s). By August 16, 1983, submit to the administra-

tion a written report detailing the reasons for non-

submittal, request for permit modifications, detail correc-

tional plan and a plan for monitoring record keeping and

reporting.” ( Plaintiff’s Exhibit 20)

23. On September 21, 1983, a state inspector, Michael

D. Griffen issued a site complaint to A.D. Gamber. plant

engineer of Simkins Industries, Inc. Griffen asserted:

“No discharge monitoring reports are filed as of. this

date.” ( Plaintiff’s Exhibit 24).

24. Between August 1, 1981 and October 1, 1984. the

senior person at the Simkins plant who was ultimately

responsible for the filing of these discharge monitoring

reports changed nine times. ( Frey testimony).

25. On August 29, 1984, the acting plant manager

Jim Grant instructed Robert Frey, controller, to see that

all applicable state and federal monitoring and reporting

requirements were complied with. (Frey testimony and

Defendant’s Exhibit 1).

26. Two days thereafter, on August 31, 1984. the

Sierra Club mailed a 60 day notice pursuant to 33 U.S.C

, . 1565'a)i(1) to defendant to the effect that Simkins

failed to file discharge monitoring reports from August

1981 through March 31, 1984. The letter was mailed to

Leon Simkins, President, Simkins Industries. Inc.. P.O.

Box 3249, Baltimore, Maryland 21228.

27. The NPDES permit requires that the defendant

conduct monthly tests and file a discharge monit ring

report (DMR) with the State on a quarterly basis. (See

pp. 2,5, 4, 7 of the permit

ZS. rhe defendant did not e nauct mont!

September 50, 1984. (See DMRs)}

29. The defendant did not file a DMR with the s!

until October 1, 1984. (Stipulation of counsel

————ao

>»

o2a

knows what the defendant discharged into the river.

Should the survey reveal substantial pollution, it will be

necessary to clean it up. Pending the survey finding,

Dr. Wright could not estimate the cost of clean up, if

.eded

needed.

36. David A. Wright, Ph.D. recommended ten sam-

pling sites upstream, downstream, at the intake point

and at the outtake overflow. He also suggested additional

analyses of the sediment for metal, lead, mercury, arsenic

and other metals.

37. Dr. Wright recommended a large seale survey to

determine what, if any, pollution was in the sediment.

Wright suggested a survey of materials in addition to

the materials which are identified in the discharge per-

mit. An analysis of this type would allow one to analyze

the sediment and look for persistent pollution in the

vicinity of the plant. His opinion on the need for a

survey is not affected by the fact that the defendant

started filing DMR’s on October 1, 1984.

38. The survey of the river sediment would cost ap-

proximately $52,000. ( Plaintiff’s Exhibit 10).

39. If the survey is limited to the materials which

were identified in the discharge permit, it would cost

approximately $26,000.

Fi. FINANCIAL STATUS AND FINANCIAL SAV-

INGS OF SIMKINS

10. During the years in question, fiscal 1981 through

fiscal 1984, the Simkins Baltimore plant has consistently

operated at a loss of between $400,000 and $500,000 an-

nually. (Frey and Baisch testimony) .

41. Net sale and operating revenues for Simkins, Ince.

and its subsidiaries for 1984 were $133,335,685. Gross

profit for 1984 was $18,401,854. Net income for 1984

was $8,000,567. Plaintiff’s Exhibit 11—Simkins 1984

Annual Report).

42. Penniman and Browne, Inc. charged Simkins In-

dustries, Ine. $5,030.50 to do the analysis and file dis-

charge monitoring reports with the State between Decem-

ber 1, 1984 and June 1, 1985.

43. After the Sierra Club filed its 60-day letter on

August 31, 1984, Simkins spent $34,641.54, (See Defend-

ant’s Exhibit 5), in order to come into compliance with

State requirements. (Frey testimony).

44. Had the defendant made these improvements on

or before July 27, 1981 when its permit became effective.

the defendant would have lost the use of $34,641.54 for

thirty seven months (approximately $3,400.00 a year on

this income for three years). (Frey testimony).

G. PLAINTIFF’S EXPENSES AND COUNSEL FEES

45. David A. Wright, Ph.D. has submitted a bill for

$2,187.00.

46. Bruce A. Bell, Ph.D., P.E.. has submitted a bill

for the Simkins case in the amount of $379.91.

47. Plaintiff has submitted a bill for the Simkins case

exclusively in the amount

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