Opinion ID: 700931
Heading Depth: 1
Heading Rank: 2

Heading: Imposition of Civil Penalty

Text: 11 As an introductory matter, the Defendants note that they are not only contesting the district court's decision to impose joint and several liability for the civil penalty but they are also rechallenging the district court's earlier finding of joint and several liability for RCRA compliance in PPP I. PPP Br. at 9 n. 2, 44-45. This court previously decided the latter issue on appeal in a per curiam opinion. United States v. Production Plated Plastics, Inc., No. 91-1728 (6th Cir. Feb. 20, 1992). Accordingly, we find that the law of the case doctrine precludes reconsideration of this issue. Coal Resources, Inc. v. Gulf & Western Indus., Inc., 954 F.2d 1263, 1265 (6th Cir.1992) (citing Coal Resources, Inc. v. Gulf & Western Indus., Inc., 865 F.2d 761, 767 (6th Cir.1989) (quoting Kori Corp. v. Wilco Marsh Buggies & Draglines, Inc., 761 F.2d 649, 657 (Fed.Cir.), cert. denied, 474 U.S. 902 (1985)). 12 With regard to the district court's decision to impose on the Defendants a $1.5 million RCRA civil penalty, jointly and severally, the Defendants argue that the district court abused its discretion because the decision violated the Fifth Amendment (Due Process Clause) and the Eighth Amendment (Excessive Fines Clause) and because the court based its assessment on clearly erroneous factual findings. The assessment of a civil penalty under RCRA is committed to the sound discretion of the trial court, and will be reversed only upon a showing that the district court abused its discretion. United States EPA v. Environmental Waste Control, Inc., 917 F.2d 327, 335 (7th Cir.1990) (citing United States v. ITT Continental Baking Co., 420 U.S. 223, 229 n. 6 (1975)), cert. denied, 499 U.S. 975 (1991).
13 The Defendants claim that case law explaining the requirements of the Fifth Amendment Due Process Clause implies that a court should analyze behavior individually, instead of jointly and severally, when assessing a penalty sought by the government, which amounts to punishment. PPP Br. at 10 (citing Daniels v. Williams, 474 U.S. 327, 331 (1986); Solem v. Helm, 463 U.S. 277, 293 (1983)). The Defendants' efforts to constitutionalize this issue are novel, evidenced by the fact that the cases that the Defendants cited in support do not even remotely discuss the issue in this case. On the other hand, the Defendants admit that several courts have imposed joint and several liability for RCRA civil penalties pursuant to 42 U.S.C. Sec. 6928(g). PPP Br. at 10 n. 3 (citing United States EPA v. Environmental Waste Control, Inc., 710 F.Supp. 1172, 1245 (N.D.Ind.1989), aff'd, 917 F.2d 327 (7th Cir.1990), cert. denied, 499 U.S. 975 (1991); United States v. Vineland Chemical Co., 31 Env't Rep.Cas. (BNA) 1720 (D.N.J.1990), aff'd, 931 F.2d 52 (1991)). 14 Even assuming the possibility that a court's evaluation of the relevant factors for imposition of a civil penalty, see United States v. T & S Brass & Bronze Works, Inc., 681 F.Supp. 314, 322 (D.S.C.), aff'd in part, 865 F.2d 1261 (4th Cir.1988), could lead it, in the face of meaningful differences, to tailor the penalty for each individual RCRA violator, we do not believe such a determination would have been appropriate in this case. The district court found that PPP and MCP were part of a group of companies that was largely owned and completely controlled by Ladney as a single corporate entity. J.A. at 132. Ladney's personal assets were commingled with those of his corporations, and assets within the corporate group were channeled wherever they were needed without regard to corporate form. Id. Although the Defendants contest the district court's factual findings, the district court's conclusion that the Defendants functioned as one entity was clearly permissible, based on the evidence. Thus, the court did not abuse its discretion and violate the Due Process Clause when it imposed joint and several liability on the Defendants for the civil penalty.
15 The Defendants also claim that the civil penalty of $1.5 million for their RCRA violations is excessive and thus violative of the Eighth Amendment. The Eighth Amendment states that [e]xcessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted. U.S. Const. amend. VIII. 16 The district court noted that prior case law had delineated a set of factors that aid a court in determining whether it is appropriate to impose a RCRA civil penalty and if so, how much. J.A. at 145-46; see United States EPA v. Environmental Waste Control, Inc. (EWC), 710 F.Supp. 1172, 1242-45 (N.D.Ind.1989), aff'd, 917 F.2d 327 (7th Cir.1990), cert. denied, 499 U.S. 975 (1991); T & S Brass & Bronze Works, Inc., 681 F.Supp. at 322. Moreover, the court recognized that RCRA provided for a civil penalty in amount not to exceed $25,000 for each day of violation, 42 U.S.C. Sec. 6928(g). J.A. at 145. After applying these factors to this case, the district court determined that a civil penalty of $1,500,000, which was less than $400 per day of violation, was appropriate. J.A. at 146. The district court noted that the Defendants had raised an Excessive Fines Clause defense to the penalty, and after comparing the amount of this penalty with the civil penalties imposed in other environmental cases, the court determined that the penalty was not excessive. J.A. at 147-48; see also EWC, 710 F.Supp. at 1245 (imposing RCRA civil penalty of $2,000 per day for total of $2,778,000 when penalties totalling over $60,000,000 could have been rendered); T & S Brass, 681 F.Supp. at 322 (imposing RCRA civil penalty of $1,000 per day for total of $194,000 when penalties totalling $4,850,000 could have been rendered). 17 Assuming without holding that a RCRA civil penalty is subject to the Excessive Fines Clause, see Austin v. United States, 113 S.Ct. 2801, 2805-06 (1993); Browning-Ferris Indus. of Vermont, Inc. v. Kelco Disposal, Inc., 492 U.S. 257, 266-68 (1989), and recognizing that a reviewing court should afford deference to legislative judgments concerning appropriate sanctions for the conduct at issue, see Browning-Ferris Indus., 492 U.S. at 281 (Brennan, J., concurring); id. at 301 (O'Connor, J., concurring in part and dissenting in part), we conclude that the district court did not impose an excessive civil penalty on the Defendants for their RCRA violations. Given that the Defendants were potentially in violation of RCRA for over 3,900 days and given that a maximum statutory penalty would have totalled over $90,000,000 dollars, we do not think the district court's $1,500,000 civil penalty was excessive.
18 Finally, the Defendants claim that the district court abused its discretion in assessing this penalty because it based the penalty on clearly erroneous factual findings. PPP Br. at 25. After reviewing the district court's factual findings, we find that they were clearly permissible and supported by the facts. Thus, we find that the district court did not abuse its discretion in imposing this civil penalty, jointly and severally, on the Defendants for their RCRA violations.