In 1987, a Harmon manager discovered that Harmon workers were routinely discarding solvent wastes behind the plant from at least 1973 through 1987. Upon management's discovery of this practice, the company contacted the Missouri Department of Natural Resource ("MDNR"), and working with MDNR, developed a plan to remediate the site. As MDNR and Harmon were in the process of developing this plan, EPA initiated a federal enforcement action against Harmon, seeking over two million dollars in penalties.

MDNR and Harmond proceeded to negotiate a consent decree, the terms of which included a full accord and satisfaction from MDNR which released Harmon from al claims for monetary penalties. A Missouri sate court judge approved the consent decree in 1993, while EPA's administrative enforcement action was still pending.

Subsequently an administrative law judge imposed a civil fine of $587,716 in EPA's case against Harmon, which was upheld by a panel of the Environmental Appeals Board.

Harmon then filed a complaint challenging that decision in federal district court. The district court judge concluded that EPA's overfiling violated RCRA and was inconsistent with principles of res judicata , and entered summary judgement for Harmon.

EPA appealed that judgement to the Eighth Circuit. EPA argued that despite the delegation of RCRA authority to the state to administer and enforce a hazardous waste program, EPA retains a right to pursue its own enforcement action against putative violators even if the state is pursuing those same violators with its own enforcement action. This practice, called "overfiling," is an issue not only under RCRA, but in connection with other federal environmental statutes, such as the Clean Air Act and the Clean Water Act, which also permit the individual states to administer their own programs.

In considering whether EPA has such overfiling authority under RCRA, the Eighth Circuit engaged in a detailed analysis of various RCRA provisions, as well as a consideration of the statue as a whole. Based on that review, the court concluded that where a state is already pursuing an enforcement action against a putative violator, EPA cannot file an enforcement action based on the same violations.

The Harmon decision, in addition to its favorable outcome for Harmon Industries, could potentially have a significant impact on other targets of EPA enforcement. For example, if a company or other member of the regulated community believes that it has discovered a RCRA violation, it may be a viable strategy to immediately involve the state authorities and negotiate a consent decree as swiftly as possible. If the Harmon decision proves to be persuasive outside the Eighth Circuit, entities that are potential targets of EPA action may find some comfort in working with the state and possibly avoiding federal attention entirely. Moreover, the conclusions of Harmon may well be followed in other cases involving delegated authority under other federal environmental statutes.

Courtesy - Jenner & Block's Environmental Law Department. Due to space limitations and the general nature of its contents this Bulletin should not be regarded as legal advice. For further information regarding this matter, please call Rebecca L. Raftery, 312-923-2755.