Circuit court rules against ExxonMobil a third time, upholds record Clean Air Act penalty

NEW ORLEANS—On August 30, the federal 5th Circuit Court of Appeals again ruled against ExxonMobil Corporation in a long-running case and upheld a $14.25 million civil penalty imposed by the trial court.

The trial judge imposed this sizeable fine to sanction the company for profiting from 3,651 instances of illegal flaring and other unauthorized releases of pollutants over a period of eight years at its Baytown, Texas, oil refinery and chemical plant complex, and to deter future violations.

“After 13 years of litigation—including a three-week trial, two appeals, two remands of the case to the trial court for additional findings, and three appellate decisions against them—it is long past time for Exxon to accept responsibility and finally pay what it owes to the public for years of illegal, toxic pollution,” said NELC Senior Attorney Josh Kratka.

The case centers on thousands of so-called “upset” events at Exxon’s Baytown complex, the largest manufacturing facility in the country. From 2005 to 2013, Exxon illegally released millions of pounds of sulfur dioxide, ozone-forming chemicals, and toxic and carcinogenic pollutants into surrounding neighborhoods, where members of plaintiffs Environment Texas and Sierra Club live.

Of primary importance for this and other citizen enforcement suits, the majority decision by a three-judge appellate panel flatly rejected Exxon’s arguments that the two environmental groups lacked legal “standing” to seek civil penalties against Exxon. The panel affirmed the trial judge’s finding that each of the 3,651 violations was “fairly traceable” to the litany of undisputed injuries suffered by the groups’ members.

Exxon contended that the legal standard for determining “traceability” set out by the 5th Circuit panel at an earlier stage of this appeal was invalid. During the June 28 oral argument, however, when asked by a judge on the panel what standard should be applied, Exxon’s attorney had no clear answer.

“Exxon has essentially been seeking a ‘get out of jail free’ card, trying to persuade the courts that—even though it indisputably committed many thousands of violations of federal law—the very citizens who have the greatest interest in Exxon’s compliance should not even be allowed into court to try to enforce the Clean Air Act as Congress intended them to do,” explained Kratka, who argued the latest appeal on behalf of the citizen groups. “We hope the 5th Circuit panel’s rejection of this untenable defense brings an end to this case.”

“The Court of Appeals’ decision thoroughly discredits Exxon’s attempts to worm out of responsibility for thousands of Clean Air Act violations,” added NELC Litigation Director Chuck Caldart. “The decision affirms the right of citizens to hold even the biggest, deepest-pocketed polluters to account for violating environmental laws.”

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Rhode Island clean water suit focuses on improving wastewater treatment

PROVIDENCE, R.I.—On August 23, NELC attorneys filed a citizen suit against Kenyon Industries, Inc., and its parent company, Brookwood Companies Incorporated, for alleged violations of the federal Clean Water Act (CWA) at their textile mill in Kenyon, Rhode Island.

Kenyon Industries operates what it calls a “state of the art” textile manufacturing facility on the Pawcatuck River in southern Rhode Island, less than a quarter mile upstream of historic Horseshoe Falls. NELC’s lawsuit, filed on behalf of Environment Rhode Island, alleges that the mill has violated the CWA 1,784 times since 2017, routinely discharging wastewater with concentrations of copper, a toxic pollutant, more than 2.5 times its permitted limits.

In addition to enumerating the copper violations, the suit alleges that the wastewater discharged by Kenyon into the Pawcatuck River has repeatedly been found to be acutely toxic to aquatic life, also in violation of Kenyon’s permit.

The state of Rhode Island has designated the 2.16-mile portion of the Pawcatuck River immediately downstream from the Kenyon textile mill as an “impaired” water body. The designation classifies the river as “not supporting” a habitat for fish and wildlife because of elevated toxicity levels.

“Although the lawsuit is limited by law to violations occurring within the past five years, we’ve recently secured public records that indicate Kenyon’s discharge into the Pawcatuck has consistently contained illegal amounts of copper since the 1990s,” explains NELC Attorney Matt Donohue. “Our focus is
on identifying and addressing the causes of this prolonged noncompliance as quickly as possible.”

To that end, NELC attorneys agreed in October to “stay” (postpone) litigation deadlines while they determine whether they can reach a settlement with Kenyon that will help ensure the long-term health of the river. The decision follows numerous meetings with representatives of Kenyon, including a detailed discussion between Kenyon employees and a wastewater treatment engineer retained by NELC.

A particular point of focus is the persistence of the alleged CWA violations despite the completion of Kenyon’s substantial upgrade of its wastewater treatment system in 2016. NELC’s review of publicly-available materials— some readily available online, others, including a detailed engineering report, secured through public record requests—revealed potential flaws in the new system’s design and operation.

Working with their wastewater treatment engineer, NELC attorneys have developed a proposal designed to optimize the system’s operation, which has the potential both to resolve the violations identified in the complaint and to decrease the water quality impacts of Kenyon’s discharge across the board.

“Whether through a structured settlement or sustained litigation, our over-riding goal is to curb these illegal discharges and bring Kenyon into sustained compliance,” notes NELC’s Donohue.

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Exxon seeks to undermine citizen suits via ‘en banc’ rehearing

NEW ORLEANS—ExxonMobil Corporation remains determined to skirt responsibility for illegally emitting millions of pounds of air pollutants into the communities surrounding its Baytown, Texas, petrochemical complex. Its last-ditch tactic is to take aim at the very ability of citizens to enforce the Clean Air Act.

Following the latest decision of the federal 5th Circuit Court of Appeals upholding a record $14.25 million Clean Air Act penalty secured by NELC on behalf of Environment Texas and Sierra Club (see page 1), Exxon is now seeking an “en banc” rehearing of the case before all 17 of the judges of the 5th Circuit. Exxon wants to avoid a financial penalty by persuading enough judges to undermine the role that Congress intended citizens to play in enforcing the nation’s core environmental laws.

This ploy is contrary to settled interpretations of the U.S. Constitution, the text of the Clean Air Act, and the procedures established by the 5th Circuit.

Convening the entire court for a rehearing is a time-consuming process reserved only for exceptional cases: those where the decision by a three-judge panel conflicts with settled Supreme Court or 5th Circuit precedent, or where an issue of exceptional public importance is being addressed for the first time. Neither of those situations exists here.

There is a substantial body of Supreme Court and 5th Circuit case law that both fully addresses the legal issues Exxon raises and clearly supports the panel’s ruling that thousands of Exxon’s violations were proven to be “fairly traceable” to the injuries suffered by the citizen groups’ members, thus giving them legal standing to seek a civil penalty for those violations.

In fact, if the court were to adopt Exxon’s proposal to severely restrict citizens’ ability to sue major polluters, a split between the 5th Circuit and other circuit courts on this issue would then be created—one of the very things en banc review is intended to prevent.

Article 3 of the U.S. Constitution limits the jurisdiction of federal courts to actual “cases or controversies”—in other words, cases in which the plaintiff has a personal stake in the outcome, not just a theoretical interest. The citizen groups’ members, who live, work, and shop next to Exxon’s Baytown
complex, clearly meet this requirement. That Exxon has had to resort to mischaracterizing the holdings of numerous court decisions throughout the country that apply Article 3 to environmental cases reveals the essentially political nature of its position, which is to protect corporate wrongdoers at the expense of the people they harm.

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Chevron settlement benefits Gulf Coast air quality

HOUSTON—In 2017, NELC attorneys filed a federal lawsuit on behalf of Environment Texas and Sierra Club against a Pasadena, Texas, oil refinery— now owned by Chevron Corporation—for thousands of violations of the federal Clean Air Act. Our subsequent settlement of the case continues to produce air quality benefits for residents of the Texas Gulf Coast.

First, the settlement mandated significant operational and equipment up-grades at the plant, and these have dramatically cut the unauthorized emissions of sulfur dioxide, nitrogen oxides, volatile organic compounds, and particulate matter that had long plagued surrounding neighborhoods. Second, the settlement created a local “Vehicle Emission Reduction Fund,” financed by Chevron, that has thus far spent more than $3 million replacing old polluting buses and other municipal vehicles with new low- and zero-emission vehicles.

In addition to cutting refinery and motor vehicle emissions, this two-pronged approach has kept the heat on the company: Chevron paid an additional $94,000 penalty to the clean vehicle fund in July 2022 because it had not sufficiently reduced emissions from one problem refinery unit. And the company will keep paying, and putting more clean vehicles on the road, until it achieves full compliance.

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