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United States v. Louisiana Pac. Corp.

ELR Citation: 27 ELR 20405
Nos. 95-CIR-215-B, 925 F. Supp. 1484/(D. Colo., 05/16/1996) reconsideration denied

The court refuses to reconsider its denial of a company's motion to dismiss criminal charges alleging that it conspired to violate and violated the Clean Air Act (CAA) and the False Statements Act (FSA) by falsifying resin and continuous opacity monitoring system (COMS) reports. The court first holds that the COMS requirements in the company's 1988 state-issued "emissions permit" were a permissible delegation of authority enforceable under the CAA. The court next holds that the 1988 emissions permit was an operating permit issued under a U.S. Environmental Protection Agency (EPA)-approved program that is incorporated into the Colorado state implementation plan (SIP) and that expressly requires adherence to any permit issued under such program. The 1988 permit is, therefore, federally enforceable. The issue is not whether it is a CAA Title V permit, but whether it contains requirements that were included in an EPA-approved permitting program. The court next refuses to reconsider the application of 40 C.F.R. §51.214 to the COMS requirements. Moreover, because the court has found that the COMS requirements are federally enforceable as a matter of law, the company has no constitutional right to jury consideration of the issue. The court next holds that there need not be a financial link between the false statement and the use of federal funds for the FSA to apply. Also, the government does not have to prove that the statement was made directly to a federal agency, but must prove a nexus between the deception of the nonfederal agency and the function of a federal agency. The court holds that reports submitted to the implementing state agency as required by a permit issued under a SIP are relied on by EPA and, therefore, are within EPA's jurisdiction. The company's resin consumption and production reports, however, are not within EPA's jurisdiction, because there are no resin reporting requirements in the permit or in the SIP, and because there is currently no federal authority to regulate resin. The court therefore strikes the counts regarding the company's falsification of the resin consumption and production reports. The court finally holds that false statements in the COMS reports that the company submitted after 1992 are within EPA's jurisdiction. Although the company's 1992 permit did not require the COMS reports, the company knew that the state and EPA used the reports to determine compliance with the opacity limitation and voluntarily caused false statements to be made in order to circumvent this policy.

[The court's earlier opinion is published at 26 ELR 20726.]

Counsel for Plaintiff
John Haried, Ass't U.S. Attorney
U.S. Attorney's Office
1961 Stout St., Rm. 1200, Denver CO 80294
(303) 844-2081

Counsel for Defendants
Elliot R. Peters
Keker & Van Nest
710 Sansome St., San Francisco CA 94111
(415) 391-5400