Opinion ID: 75555
Heading Depth: 4
Heading Rank: 2

Heading: Randall

Text: 41 Randall claims that the government presented no evidence that he personally treated, stored, or disposed of a hazardous waste, personally effected a CWA violation, or instructed an agent to do so. He maintains that, under the laws of bankruptcy and corporate governance, he lacked the authority to close the plant or to allocate the funds for the needed capital improvements. He contends that LCP needed the bankruptcy court's approval to use the bankruptcy estate's assets, or to obtain a new debt, to perform the needed repairs at the Brunswick plant. 42 In February 1994, LCP applied to the bankruptcy court for the funds to shutdown the plant and for new equipment, but the motion was denied. Def. Randall Ex. 1, Amended Notice of Motion at 5; R9-228, Ex. C and 8 Feb letter. Hanlin Board of Directors member James Mathis testified that Randall was responsible for run[ning] the day-to-day operations of the company once he became the interim CEO and COO. R19-160. He said that the Board was very interested in whether the environmental problems-whether we were in a position of compliance with the environmental regulations. But the information that we had indicated that, really, compliance was not a problem. Id. at 164. He explained that, as a result of the weekly reports on the plant's operations, the Board believed that there were really no excursions of any significance going on. Id. at 165. 27 Mathis said that Randall had the primary responsibility for providing information regarding the environmental compliance issues to the Board and that Hansen fed information to Randall in that regard. Id. at 166. He agreed that the decision to sell the plant would have been a board decision requiring the approval of the bankruptcy court. Id. at 174-75. 43 LCP, as a debtor in possession, could use the property of the estate in the ordinary course of business, but needed court approval to use, sell, or lease, other than in the ordinary course of business, property of the estate. 11 U.S.C. § 363(c)(1) and (b)(1). It could obtain unsecured credit . . . in the ordinary course of business, but needed court approval to obtain unsecured credit or to incur unsecured debt other than in the ordinary course of business. Id. at 364(a) and (b). Bankruptcy does not insulate a debtor from environmental regulatory statutes. In reviewing an injunction to clean up a hazardous waste site, the Supreme Court commented: 44 [W]e do not suggest that [the debtor's] discharge [in bankruptcy] will shield him from prosecution for having violated the environmental laws . . . or for criminal contempt for not performing his obligations under the injunction prior to bankruptcy. . . . [W]e do not hold that the injunction . . . against any conduct that will contribute to the pollution of the site or the State's wasters is dischargeable in bankruptcy . . . Finally, we do not question that anyone in possession of the site . . . must comply with the environmental laws . . . . Plainly, that person or firm may not maintain a nuisance, pollute the waters of the State, or refuse to remove the source of such conditions. 45 Ohio v. Kovacs, 469 U.S. 274, 284-85, 105 S. Ct. 705, 710-11 (1985). See also Midatlantic Nat'l Bank v. New Jersey Dept. of Envtl. Protection, 474 U.S. 494, 407, 106 S. Ct. 755, 762 (1985) (A bankrupt debtor in possession may not abandon property in contravention of a . . . regulation that is reasonably designed to protect the public health or safety from identified hazards.). 46 Although Randall claims that his role as Executive Vice-President and acting CEO was limited to financial matters, he also received daily reports about the plant's operations and environmental problems, R16-97-98, R21, 359, wrote and received memos regarding specific plant operational problems, Govt. Ex. 104, 1-6f, 1-8a, 1-12, received monthly written environmental reports, Govt. Ex. 10-1o-10-1nn, 10-7c-7d, 10-7f, and oral environmental reports, R21-64, 359. He admitted that Hanlin's bankruptcy was not an excuse for violating environmental laws. R21-219-21. There is no indication that he asked the Hanlin Board or the bankruptcy court to close the plant. The evidence indicates that he apparently misled them into believing that environmental compliance was not a problem. After the Georgia EPD attempted to revoke the plant's NPDES permit in June 1993, Randall contested the revocation, explaining that the plant's CWA violations were due to a lightning strike and equipment failures, and asserted that LCP has already taken steps to improve the situation. Govt. Ex. 10-6. This evidence was sufficient for the jury to conclude that Randall actions were in furtherance of the violations. 47