United States v. Homestake Mining Co.

No. CIV78-5002 (D.S.D. August 3, 1978)

On defendant's motion for relief from the terms and conditions of a final consent decree regarding the treatment of pollutants discharged from a gold mine, the court rules that it has the power under FED. R. CIV. P. 60(b)(5) and the terms of the decree itself to grant defendant's motion because extraordinary circumstances and changed conditions have made continued enforcement of the decree inequitable. Mechanical failures, severe weather conditions, and labor strikes have frustrated defendant's extensive compliance efforts. In addition, after the consent decree was agreed to, Congress passed the Clean Water Act of 1977, § 309(a)(5)(B) of which allows the Environmental Protection Agency Administrator to grant compliance extensions to dischargers which are making good-faith efforts to comply with applicable discharge limitations. An examination of the statutory language and the legislative history indicates that Congress intended § 309(a)(5)(B) to apply to discharge permits based on state water quality standards as well as those focused on best practicable control technology. The court notes that defendant has met the prerequisites for receipt of an extension under § 309(a)(5)(B), including the making of a good-faith effort to comply with the decree in which over $14 million have been expended for the construction of a treatment facility.

Counsel for Plaintiff
David V. Vrooman, U.S. Attorney
Federal Bldg. & U.S. Courthouse, 400 S. Phillips St., Sioux Falls SD 57102
(605) 336-2980

Counsel for Defendant
A. P. Fuller
P.O. Box 898, Lead SD 57754
(605) 584-2440

[8 ELR 20717]

Bogue, J.:

On March 10, 1978 this court, by Order, approved a Consent Decree and Stipulation agreed upon by plaintiff, United States of America, and defendant, Homestake Mining Company. The Consent Decree was initially filed with this court on January 17, 1978, followed by mandatory publication in the Federal Register and a thirty (30) day public comment period pursuant to 28 C.F.R. § 50.7. The Consent Decree was a result of lengthy negotiations between the United States and Homestake Mining Company concerning Homestake's obligation to treat the pollutants discharged from its Lead, South Dakota, gold mine into the waters of Whitewood Creek. By agreement, the parties established a compliance schedule under which Homestake was to construct and operate a mill tailings pond by December 4, 1977 and an additional toxic metal treatment facility by April 2, 1978. Defendant Homestake completed construction of its tailings pond on schedule and has operated that portion of its pollution control facilities in accordance with the terms of the decree. Homestake's additional treatment facilities were to be completed and operational by April 2, 1978.

Homestake Mining Company has moved this court to relieve it of the Consent Decree, Stipulation, and Judgment, entered on March 10, 1978.

The memorandums and briefs submitted both by the United States and Homestake Mining Company presented several issues [8 ELR 20718] to this court. First, the court must determine whether or not it has the power to grant defendant's motion to stay the Consent Decree. Rule 62(b) of the Federal Rules of Civil Procedure provides that a court, in its discretion, may stay the execution or proceedings to enforce a judgment or be relieved of a judgment under Rule 60. Rule 60(b)(5) and (6) provides that the court may relieve a party from a final judgment or order if (1) it is no longer equitable that the judgment should have prospective application; or (2) any other reason justifying relief from the operation of the judgment. Consequently, this court does have the power under 60(b)(5) and (6) to relieve a party of its judgment.There are, however, certain requirements that must be met before a judgment can be stayed or relieved. The United States Supreme Court has held that for relief to be granted under Rule 60(b)(5), there must be some change in conditions that makes continued enforcement inequitable. There must be "nothing less than a clear showing of grevious wrong evoked by new and unforseen conditions. . . ." United States v. Swift and Company, 286 U.S. 106, 114, 115, 119 (1932). For relief to be granted under Rule 60(b)(6), there must be "extraordinary circumstances." Ackerman v. United States, 340 U.S. 193, 199 (1950).

Such extraordinary circumstances and change in conditions, that make continued enforcement inequitable have resulted in this instance. First of all, the court recognizes that since the Consent Decree was agreed upon by the parties involved, the United States Congress has passed a law allowing for extensions to comply with the Clean Water Act, 33 U.S.C. § 1319(a)(5)(b) (also referred to as § 309(a)(5)(b)). This statute indicated the congressional intent to allow for an extension for those industries which are making a good faith effort to comply with the clean water standards.

There are other circumstances which were also considered by the court. Homestake Mining Company has made a good faith effort to comply with those standards. Homestake has run into a number of problems since the Consent Decree was signed including: mechanical problems, weather problems, and strikes by various workers.

There is a further reason for the court's power to grant the defendant's motion to stay the Consent Decree. The Consent Decree itself provides:

Nothing shall prevent any party to this Decree from petitioning the Court for modification of this Decree where circumstances, statutory or regulatory amendments, and the interest of justice so warrant or for such further orders and directions as may be necessary or appropriate.

This clause, agreed to both by the United States and by Homestake Mining Company, gives this court the power to reconsider the Consent Decree itself or make any modification, if the interests of justice so warrant.

The second issue, which was extensively briefed by both sides, concerns whether Congress, when it passed 33 U.S.C. § 1319(a)(5)(b), intended to grant extensions to those industries which hold the same type of permit as Homestake Mining Company.

The government contends that § 1319(a)(5)(b) is limited in its application to only BPT permits. Homestake, on the other hand, argues that this section, granting extensions to companies who have made good faith compliance efforts, is extended to the type of permit it possesses, which is a permit based on state water quality standards.

In making its determination, the court looked at three things: the language used in the act, the legislative history, and logic. The statute in question provides:

The administrator may, if he determines (i) that any person who is a violator of, or any person who is otherwise not in compliance with, the time requirements under this chapter or in any permit issued under this chapter, has acted in good faith, and has made a commitment (in the form of contracts or other securities) of necessary resources to achieve compliance by the earliest possible date after July 1, 1977, but not later than April 1, 1979; (ii) that any extension under this provision will not result in the imposition of any additional controls on any other point or nonpoint source; (iii) that an application for a permit under Section 1342 of this Title was filed for such a person prior to December 31, 1974; and (iv) that the facilities necessary for compliance with such requirements are under construction, grant an extension of the date referred to in Section 1311(b)(1)(a) of this Title to a date which will achieve compliance at the earliest time possible but not later than April 1, 1979.

Emphasis added.

The Statute provides that "any person who is not in compliance for any permit issued under this chapter . . . may be granted an extension." Both the government and Homestake are in agreement that Homestake does have a permit which was granted under this chapter. The government, in acknowledging this, disagrees that this section applies to Homestake. It argues that an extension under this section applies only to the type of permits specified in § 1311(b)(1)(a). That section refers to the type of permit called best practicable control technology permit (BPT). It contends that the reference made in § 1319(a)(5)(b), alluding to § 1311(b)(1)(a), limits its application to just those permits called best practicable control technology (BPT). This court, however, reads § 1319(a)(5)(b) differently. That section "grants an extension of the date referred to in § 1311(b)(1)(a) of this title." That portion of the statute does not refer to the type of permit included for the extension, but merely as to the date. Earlier in the section, it referred to the "type" of permit. The "type" of permit mentioned in this section is "any permit issued under this chapter."

The legislative history also supports the view that § 1319(a)(5)(b) applies to "any" permit under this chapter. Congress recognized that some of the deadline requirements of the 1972 Clean Water Act were impossible to achieve.The Senators' comments regarding such deadlines and the types of industries were not limitee strictly to industries with BPT permits:

Even though about 85 percent of all industries did meet their 1977 requirements, a good portion of the remaining 15 percent did not meet their requirements for good cause.

Representative Roberts at H. 12919.

The conferees believed that a case has been made that some relief from penalties must be granted for those sources which have made a good faith effort to comply with the deadlines in the statute but for justifiable reasons have been unable to do so.

Senator Muskie at S. 19650-51.

Those statements by the two Floor Managers do not register an intent to narrowly limit the application of § 1319(a)(5)(b). Similarly, Senator Randolph, the Committee Chairman, stated that: "one key provision of the Bill made allowance for enforcement flexibility for those unable to meet the 1977 water quality requirements despite good faith efforts." At S. 19663. Senator Moynihan stated:

Industrial dischargers who are not in compliance with the 1977 standards will be treated sternly but fairly. The new law will recognize good faith efforts by industry by granting an extension to industrial dischargers that have made an honest attempt to comply with the 1972 law.

At S. 19684.

These comments by Representative Roberts, Senator Moynihan, and Senator Muskie do not evidence an intent to differentiate between the water quality permits and the BPT permits.

Finally, it would be illogical for Congress to provide extensions to those industries with BPT permits and not the industries with permits granted under water quality standards. The technology referred to and of concern to many of the senators and representatives, dealing with the Clean Water Act, involve both types of permits. If the technology is not available for those industries with BPT permits, it is difficult to see why it would be available for those with permits based on the water quality standards.

[8 ELR 20719]

III

The third issue presented to this court is whether, if Homestake does qualify under § 1319(a)(5)(b), has it met all the requirements or criteria enumerated in that section? These criteria were enumerated earlier.¹ The only criteria put into issue by the respective parties is whether Homestake has made a good faith effort to comply with the 1972 Clean Water Act. The government contends that Homestake Mining Company has not made a good faith effort to comply with the 1972 Water Quality Standards. This court disagrees with that assessment. So far, Homestake Mining Company has constructed, since the spring of 1976:

1. Interceptor canal

2. Enbankment (dam)

3. Seepage collection system

4. Pump house (pumping slurry)

5. Slurry pipeline

6. Decant pump house

7. Internal plant modifications:

a. emergency disposal

b. recycle pumps, pipelines

c. one-charplant thickener, one-yet to be completed

d. sand dam enlargement

e. sand dam overflow

f. mill sluice reservoir

g. charplant feed pumps

h. vat overflow thickener

In compliance with its discharge permit, the Homestake Mining Company has expended over 14 million dollars ($14,000,000) in construction and installation of the above named facilities. Homestake Mining Company, in an effort to comply with the water quality standards, has run into numerous obstacles. Such problems include: premature failure of a recycle pump, excessive slimes and water for handling due to frozen pipeline, weather limitations such as snow in the Lead-Deadwood area, general mechanical problems, and strikes by workers.

For the reasons heretofore enumerated, this court has concluded:

(1) This court does have the power to grant the defendant's motion to stay the Consent Decree;

(2) Section 1319(a)(5)(b) which gives the Administrator the power to grant an extension for compliance with the Clean Water Act of 1972 does apply to the defendant's permit.

(3) The defendant, Homestake Mining Company, has made a good faith effort to comply with the requirements of the 1972 Clean Water Act.

The foregoing shall constitute this court's findings of fact and conclusions of law.

1. See pages 4 and 5 [8 ELR 20718], supra.