Introduction To Everything There is Season

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Introduction To Everything There is Season Powered By Docstoc
					Vol. 10, No. 1                                             A Newsletter published by the oregoN stAte bAr                         spriNg 2009

                                                                             Environmental Crimes

 Table of Contents
                                                                  Introduction: To Everything
  Introduction: To Everything,
                                                                       There is a Season
  There is a Season                                                By Susan L. Smith, Executive Committee and Issue Editor,
  Susan L. Smith, Executive Committee                            Environmental and Natural Resources Section, Oregon State Bar
  and Issue Editor . . . . . . . . . . . . . . . . . . 1
  Enforcing Environmental Crimes:                          During the last few years, most Oregon      Attorney General John Kroger is seeking
  Filling the Gap in Oregon                                environmental lawyers have lost track       resources to create an environmental
  John Kroger, Attorney General                            of both federal and state environmental     crimes unit within the Oregon
  of the State of Oregon . . . . . . . . . . . . . . 2     crimes issues. Although the U.S.            Department of Justice. Since 1997, when
                                                           Attorney for the District of Oregon         Oregon enacted its environmental crimes
  DEQ Supports Criminal Prosecution
  of Environmental Liars and Cheaters
                                                           Karen Immergut indicated that she           statute, district attorneys across the state
  Les Carlough, Senior Policy Advisor,                     placed emphasis on environmental            have had responsibility for prosecuting
  Office of Compliance and                                 crimes, competing priorities pre-           environmental crimes and they have only
  Enforcement, DEQ . . . . . . . . . . . . . . . . 2       vented her from devoting significant        occasionally brought such prosecutions.
                                                           prosecutorial resources to that effort.     That, however, is about to change. The
  Avoiding Criminal Prosecution of                         Environmental crimes were clearly           creation of an environmental crimes
  Environmental Violations in Oregon                       not a national priority of the Justice      unit within Oregon DOJ would the same
  Hong N. Huynh, Miller Nash Llp . . . . . 4               Department and nationally environ-          strong stimulus for environmental crimes
  Environmental & Natural Resources                        mental criminal prosecutions declined.      prosecutions as did the initial creation
  CLE Registration Flyer. . . . . . . . . . . . 7          On the state level, as District Attorneys   of the Environmental Crimes Section in
                                                           in Oregon counties struggled to find        the U.S. Justice Department back in the
  Traps for the Unwary: Interpreting the                   sufficient resources to prosecute violent
  Mental State Requirements in Oregon                                                                  mid-1980s. Although district attorneys
                                                           crimes and to find beds in county jails     will retain authority to prosecute
  Environmental Crimes
  Susan L. Smith, Professor of Law,                        for violent offenders, prosecution of       environmental crimes and the Attorney
  Willamette University College of Law . . 8               environmental crimes was the last thing     General will no doubt coordinate closely
                                                           on their minds. As a result, during the     with district attorneys, clients with
  It’s For the Birds: Criminal Prosecution                 last decade, environmental violators        recurrent environmental violations, espe-
  of Wind Energy Producers                                 in Oregon faced a diminishingly small
  Ryan McGraw, J.D./M.B.A. 2009                                                                        cially those that result in harm to human
                                                           risk of criminal prosecution along with     health or the environment, face a much
  (expected), Willamette University . . . . 12             extremely small administrative penalties.   higher risk of criminal prosecution.
  A National Perspective on                                Times have changed. The administration
  Environmental Criminal Enforcement:                                                                  As a result, Oregon environmental
                                                           of President Barack Obama will be far       lawyers need to refresh their recollection
  Will it Change?
                                                           more supportive of more stringent envi-     about Oregon environmental crimes as
  Walter D. James III, Tracy D. Hester,
  and W. Bruce Pasfield                                    ronmental regulation and strict enforce-    well as federal environmental crimes.
  Past and current co-chairs,                              ment of environmental laws, including       The most recent issue of the ABA’s
  Environmental Enforcement Committee,                     prosecution of environmental crimes.        Section on Environment, Energy, and
  ABA Section on Environment, Energy,                      When a new U.S. Attorney appointed          Resources magazine E&NR dealt with
  and Natural Resources . . . . . . . . . . . . 16         by President Obama replaces Ms.
                                                                                                       environmental crimes, primarily at the
                                                           Immergut, that presidential appointee is
  Research Resources . . . . . . . . . . . . . 19                                                      federal level. This issue of Outlook seeks
                                                           likely to prove more zealous in prosecut-
                                                                                                       to bring an Oregon perspective to the
                                                           ing environmental crimes.
                                                                                                       issues that surround environmental
                                                           Even more important to Oregon lawyers,      criminal prosecution.
2                                                                                              Environmental & Natural Resources

                      Enforcing Environmental Crimes:
                         Filling the Gap in Oregon
                                 By John Kroger, Attorney General for the State of Oregon

Oregon has a worldwide reputation as an     Police. The goal of the unit is to pros-      years of repeated civil penalties.
environmental leader. Yet the state lacks   ecute serious violations of the criminal
                                                                                           While most people and businesses in
a weapon that is crucial for an effective   laws that protect the quality of the
                                                                                          Oregon take our environmental laws
environmental enforcement program: the      water, air, land and wildlife resources
                                                                                          seriously, those who cut corners on
capacity to prosecute criminal violations   that make Oregon such a special place
                                                                                          environmental compliance gain an
of environmental laws.                      to live. Even at a time of tight budgets,
                                                                                          unfair competitive advantage. In today’s
                                            this minimal level of funding is critical
 There is not a single full-time environ-                                                 economic climate, creating a strong
                                            to deter violations that for some have
mental crimes prosecutor for the State                                                    environmental enforcement program
                                            unfortunately been seen as merely a cost
of Oregon. The fact that many states                                                      not only is good for our water and air, it
                                            of doing business.
and even cities around the country have                                                   also helps create a level playing field for
robust environmental crimes units only       The new unit would work closely with         the vast majority of businesses who take
makes the absence of such a unit in         investigators from DEQ and the Oregon         Oregon’s environmental laws seriously.
Oregon more glaring.                        State Police to identify the cases where
                                                                                           The Environmental Crimes Unit will
                                            criminal enforcement is warranted. New
 The lack of state environmental                                                          work closely with DEQ and the Oregon
                                            DEQ Director Dick Pedersen supports
prosecutors means that DEQ and other                                                      State Police in prosecuting cases as well
                                            increasing the state’s capacity to enforce
state agencies must turn to over-worked                                                   as supporting District Attorney’s offices in
                                            environmental crimes and I believe hav-
county district attorneys to go after                                                     their prosecution of environmental crimes.
                                            ing a close working relationship between
criminal polluters. But many DAs lack       the Department of Justice and DEQ is          Civil enforcement plays a critical role
the resources or expertise to prosecute     absolutely necessary for the environmen-      in Oregon’s overall environmental
complex environmental cases. A              tal crimes unit to succeed.                   enforcement program. But there is an
Department of Justice Environmental                                                       equally important need for criminal
Crimes Unit would be perfectly poised        Even with the addition of two new
                                                                                          enforcement, especially in cases where
to take on such cases.                      prosecutors and an investigator, the
                                                                                          civil enforcement has proven ineffective.
                                            Department of Justice will have to
 To achieve this goal I have asked the                                                    Most Oregonians assume that the State
                                            prioritize our enforcement efforts. The
Oregon Legislature for roughly $700,000                                                   already has the capacity to prosecute
                                            Department’s main focus will be on
                                                                                          environmental crimes and it is time to
a year to fund the state’s first environ-   repeat violators or violations that pose
                                                                                          make that assumption a reality.
mental crimes unit. The unit would          a significant risk to public health or the
include two prosecutors and an investi-     environment. The case for criminal pros-      I believe this initiative is of vital impor-
gator who would work with state natural     ecution is especially strong for a polluter   tance to our state and look forward to
resource agencies and the Oregon State      who has failed to obey the law even after     working with everyone to see it succeed.

              DEQ Supports Criminal Prosecution of
                Environmental Liars and Cheaters
            By Les Carlough, Senior Policy Advisor, Office of Compliance and Enforcement, Oregon DEQ

Deterrence is the holy grail of             less likely to violate if they run the risk   understanding. This is because deter-
environmental enforcement. Both the         of enforcement. For this reason, enforce-     rence is notoriously difficult to measure.
government and the public believe that      ment is often considered the fundamen-
penalizing environmental violators          tal and critical element of environmental     Much of deterrence occurs in the minds
deters both the person penalized and        regulatory programs. But our quest,           of unidentified people who – through
other potential violators from violating    like that of King Arthur’s knights, has       news, casual conversation and other
environmental regulations: a person is      been based more on faith than informed        means – hear that someone else was
Environmental & Natural Resources                                                                                                 3

penalized for wrongful conduct, and         penalties at other companies. These          viewed as too small increase the likeli-
then decide not to do something that the    results may initially seem paradoxical       hood of continued noncompliance and
law prohibits. How does one measure         because we often assume that penalties       also defection by complying companies.
that?! How does one predict whether         are the primary motivator for deterrence.
                                                                                         Penalties that are too severe, however,
enforcement will deter in a given
                                            However, it is difficult to tease apart      may not be good deterrents either. If
case or given program? We think that
                                            the contributing effects of multiple         penalties are overly large, they may
incentives, education and assistance are
                                            and overlapping factors and there are        encourage additional illegal conduct
effective in stimulating compliance and
                                            several possible explanations. First,        by those hoping to avoid detection and
that civil penalties and criminal pros-
                                            DEQ contacts many more companies             punishment for their original violations.
ecutions are also effective. But what mix
                                            through inspections and assistance than      If the regulated community perceives
of these various alternatives produces
                                            through enforcement, so hearing about        penalties as too large, they may develop
the greatest compliance and highest
                                            penalties may simply be less common.         contempt for the compliance program
environmental return? State and federal
                                            Second, companies may have meant that        and goad others into violating. If the
agencies are increasingly concerned
                                            hearing about inspections or assistance      public views the penalties as unfair,
about these questions as they are more
                                            visits gave them the proximal motivation     there may be administrative, judicial, or
and more obligated to make strategic
                                            to make the change, but they may also        political ramifications that undermine
decisions based on data and to produce
                                            have been concerned about the possibil-      enforcement. Because there are disad-
measurable results.
                                            ity of later detection and enforcement       vantages in penalties that are too small
Oregon’s DEQ is at the forefront of this    should they not make required changes.       and that are too large, agencies like DEQ
debate, having done seminal research        Third, companies may not think that          must carefully consider the appropriate-
into the deterrent effect of our own        penalties are a financial threat – indeed,   ness and equity of the penalties imposed
enforcement programs. DEQ hired an          28% of the companies surveyed thought        for noncompliance.
independent marketing firm to survey        that penalties would be less than the
450 randomly-chosen small, medium           amount saved through violation. Last,        Using its rules and internal manage-
and large “companies” located through-      while penalties themselves may not           ment directives, DEQ considers many
out Oregon that have licenses, permits      be the most important direct concern,        factors in determining whether to issue
or registrations with DEQ. Participants     penalties tend to accompany secondary        a warning letter, whether to assess an
were asked a variety of questions           negative impacts like forced shut-down       administrative penalty, and – if a penalty
designed to ascertain their company         and criminal prosecution. According to       is issued – how large it should be. We
attitudes about environmental compli-       the survey results, these were statisti-     believe these tools are generally adequate
ance and enforcement, whether their         cally more important motivators than         to stimulate compliance, to take away
company had made pro-environment            penalties themselves. Penalties may also     the economic advantage of noncompli-
changes in their operations and pollu-      cause damage to reputation, community        ance, and to create risks needed to
tion management during the preceding        pressure, and deterioration of customer      deter others. These administrative cases
three years, what motivated their com-      loyalty which also appeared to be more       also initiate an escalating enforcement
pany to make the changes, and which         important motivators.                        process if the company does not return
factors were most important in their                                                     to compliance or repeatedly violates.
                                            Determining the “right” penalty amount       Repeated or continuous violations will
decision-making processes. A discussion
                                            for violations is complicated because of     receive increasingly larger penalties.
of all the conclusions from the study is
                                            the many factual, evidentiary, legal, and    At the top of this escalation process is
beyond the scope of this article, but the
                                            policy issues which must be considered.      revocation of the permit or license for
full report is available online at DEQ’s
                                            A particular penalty must be sufficiently    companies that demonstrate they are
                                            severe to be taken seriously by the viola-   unable or unwilling to comply with
One surprising finding from the study is    tor as well as by the whole regulatory       environmental laws. According to the
that technical assistance and inspection    community. A rule of thumb about             participants in the survey, the possibility
visits appeared to prompt more changes      compliance with regulatory systems is        of this “death penalty for business” is
than the threat of penalties. Based on      that 20% will always try to comply, 5%       one of the top motivators for compliance,
the responses from the survey and other     will always try to evade compliance,         but it is seldom used because most enti-
verification data, DEQ estimates that       and 75% will try to comply as long as        ties come into compliance or go out of
hearing about technical assistance at       the noncompliant 5% are caught and           business for other reasons.
other companies stimulated 15% of their     penalized. Because violators often gain
compliance changes and hearing about        an economic advantage by avoiding            Another type of enforcement – criminal
inspections at other companies stimu-       costs of compliance, the penalty must        prosecution – is also one of the top
lated 28% of their compliance changes.      be sufficiently potent to assure the many    motivators. In fact, most violations of
Compare those successes to 7% of the        complying companies that their interests
changes resulting from hearing about        are being protected. Penalties that are                         Continued on next page
4                                                                                             Environmental & Natural Resources

environmental laws may be prosecuted           the environment;                           that the violation meets those guide-
as misdemeanors. Violations related to      5. Whether the person had a history of        lines. The Department of Justice adopted
water quality, air quality, and hazardous      noncompliance with environmental           “Model Guidelines for Prosecution of
waste may also be prosecuted as felo-                                                     Environmental Crimes” that county
                                               laws, especially the law at issue;
nies, if the violator meets the requisite                                                 district attorneys may use in establish-
mens rea requirement or the violation       6. Whether the person attempted to            ing their own county guidelines. DEQ’s
causes substantial harm. Generally,            conceal violations through false state-    Environmental Crimes Coordinator
these crimes are white-collar versions of      ments or tampering with monitoring         often assists in presenting the case to
typical criminal behavior: lying, cheat-       or pollution control equipment; and        the prosecutor, in outlining the prima
ing, and stealing. In the early days of                                                   facie case, and in evaluating whether
                                            7. Whether the person cooperated with
environmental crimes prosecution many                                                     the violations meet the prosecution
                                               regulatory authorities to correct the
considered environmental crimes to be                                                     guidelines. Those guidelines may differ
                                               violation, mitigate the harm, or clean
victimless and therefore less important                                                   slightly between counties, but generally
                                               it up.
than other crimes. That attitude is                                                       will include many of the same factors
shifting. With increased press coverage     Cases with some or all of these factors       that DEQ considers, as listed above, plus
of environmental matters, people are        are then discussed with the Oregon            other factors including:
realizing that those who cheat on envi-     State Police or the U.S. Environmental
                                                                                          1. Whether public sanctions are needed
ronmental requirements can degrade          Protection Agency’s Criminal
                                                                                             to protect human health and the
the integrity of our environment and its    Investigation Division. On occasion,
                                                                                             environment or to deter others from
ability to sustain our good health. While   DEQ has also worked with the U.S.
                                                                                             committing similar violations;
the consequences of a criminal convic-      Federal Bureau of Investigation, the
tion can be loss of personal liberties      U.S. Bureau of Land Management, and           2. Whether administrative penalties
like freedom and the right to vote, in      the U.S. Coast Guard. If the criminal            and remedial orders would be more
addition to monetary penalty, the public,   investigatory agency determines that             efficient, effective or enforceable;
legislators, and the courts have been,      an investigation is warranted, it may         3. Whether the prosecution would likely
and are increasingly, very supportive       conduct additional inquiry which may             result in conviction;
of enforcement of environmental laws        involve execution of search warrants,
                                                                                          4. Whether the conviction would result
through criminal prosecution.               interrogation of witnesses and suspects,
                                                                                             in a significant sentence; and
                                            and other work. If the investigators
Because our data show that the possibil-    determine that a crime was committed          5. Whether the prosecution justifies the
ity of criminal prosecution is one of the   they may immediately cite the alleged            resources necessary for the prosecution.
most important motivators for deter-        violator with a misdemeanor in the
rence and compliance, DEQ is diligent                                                     The result is that the violations most
                                            Oregon state system or may present the        likely to be prosecuted criminally at
in identifying possible environmental       matter to a prosecutor in the county dis-     both the state and federal level are those
crimes and referring them to the proper     trict attorney’s office or sometimes to the   in which the violator did something
authorities. DEQ learns about potential     U.S. Attorney’s office for other charges.     similar to conduct that is already
criminal behavior through citizen           Oregon Attorney General, John Kroger,         generally accepted as criminal activity
complaints, disgruntled employees, and      has stressed that there is inadequate         in other areas of the law: cheating
routine inspections and file reviews. If    prosecution of environmental crime and        on taxes, assaulting someone for
DEQ inspectors encounter violations         that this deficiency undermines com-          personal gain, covering up to escape
that appear deliberate, deceitful, or       pliance with the laws designed to pro-        legal responsibility or liability. Common
dishonest, they discuss the matter with     tect public health and the environment.       environmental violations that are
staff in DEQ’s Office of Compliance and     Currently, his office is seeking to fund      criminally prosecuted include deliberate
Enforcement. Important considerations       an environmental crimes unit, which           illegal disposal of wastes; illegal emis-
at this stage of the analysis include:      would assist district attorneys and con-      sions or discharges; deliberate illegal
1. Whether the person knew or should        duct additional prosecutions of environ-      cost-saving short-cuts in pollutant
   have known and understood the law;       mental crimes in the State courts.            management; reckless pollution that
                                            Prosecutors conduct their own evalua-         injures others; falsification of informa-
2. Whether the person intended or                                                         tion in applications, monitoring reports,
   knew the likely outcome of the           tion about whether the violations should
                                            be prosecuted criminally. ORS 468.961         or certifications; and dishonesty with
   action;                                                                                government regulators or investigators
                                            requires the Oregon Attorney General
3. Whether the violation showed reck-                                                     trying to address the resulting problem.
                                            or county district attorney to personally
   less disregard for others;               adopt guidelines for deciding which           Businesses and DEQ both know that
4. Whether the violation created actual     environmental felonies to prosecute and       perfect compliance with environmental
   or potential harm to humans or to        to approve a pre-indictment certification     laws can be difficult. Advances in
Environmental & Natural Resources                                                                                                      5

environmental science and shifts in            compliance. DEQ believes that there is        not. Research shows that one of the
political climates result in changes in        a need for discretion to avoid draconian      most effective deterrents is the criminal
the technical requirements of rules and        enforcement in situations of rare and         sanction. For the sake of compliance,
permits. Abnormal weather, unpredict-          minor violations. However, DEQ also is        for the sake of public health and the
able equipment failures, tortious conduct      aware that threats of enforcement are         environment, if your clients lie, cheat, or
by others, and other unforeseen circum-        needed to create fairness for those who       steal with regard to their environmental
stances can interfere with routine com-        work to meet regulatory obligations and       responsibilities, DEQ hopes they will be
pany procedures, further complicating          to create deterrence for those who might      prosecuted.

                   Avoiding Criminal Prosecution of
                  Environmental Violations in Oregon
                                               By Hong N. Huynh, Miller Nash LLP

Ms. Huynh is a partner practicing environ-     Oregon law provides several tools and         mental audit privilege law that protects
mental and natural resources law at Miller     procedures allowing companies to assess       qualified audit reports from being
Nash LLP. She frequently advises clients on    their compliance status and resolve the       admitted as evidence in an administra-
environmental compliance matters as well       discovered violations before those viola-     tive or civil action. See ORS 468.963.
as defends them in administrative and judi-    tions give rise to criminal prosecution.      Note, however, that the audit cannot be
cial enforcement proceedings. She litigated                                                  withheld from a criminal proceeding.
Oregon’s diligent prosecution standard under   Auditing the Current Status                   Also, the United States does not recog-
the Clean Water Act.                           First, a company needs to know its cur-       nize state environmental audit privileges
                                               rent compliance status. An ongoing com-       and, subject to limitations provided
John Kroger, Oregon’s new Attorney                                                           in the United States Environmental
                                               prehensive management program that
General, has made prosecuting environ-                                                       Protection Agency’s (EPA) audit policy,
                                               frequently tracks and reports violations
mental crimes one of his top priorities.                                                     may seek to discover and use such infor-
                                               to all levels of corporate management
He affirmed this campaign promise by                                                         mation in federal administrative, civil,
                                               is the best way for a company to be in
appointing Brent Foster as special coun-                                                     and criminal enforcement actions.
                                               control of its environmental compliance.
sel for environmental enforcement and          Absent such a program, companies can
policy. Mr. Foster was the former execu-                                                     Under Oregon’s environmental audit
                                               conduct a one-time audit, using either        privilege, the audit must meet certain
tive director of Columbia Riverkeepers, a      a consultant or internal expertise. The
nonprofit citizen group that has brought                                                     requirements in order to be privileged.
                                               audit should be carried out in compli-
citizen suits against a number of compa-                                                     The audit must be a voluntary, internal,
                                               ance with industry standards such as
nies in the Pacific Northwest region for                                                     and comprehensive evaluation, and may
                                               ISO 14011 or ASTM E 2107.
environmental law violations.                                                                be conducted by the owner or operator,
                                               The information from the audit will help      by the owner’s or operator’s employ-
With the Attorney General’s high level of      the company assess compliance with            ees, or by independent contractors.
commitment to environmental criminal           various environmental program require-        Furthermore, the audit report must:
prosecutions, Oregon Department of             ments, from wastewater to air discharges
Environmental Quality (“DEQ”) will no          to historical and current releases of         1. Be labeled “Environmental Audit
doubt scrutinize companies subject to          hazardous substances. Frequently, com-           Report: Privileged Document” and
environmental regulation more closely.         panies are concerned that conducting an          prepared as a result of an environ-
Because of this increased attention,           audit will lead to information that will be      mental audit.
regulated companies must become                discovered by DEQ or citizen groups. To       2. Be prepared by the auditor, which
more attuned to their environmental            avoid this risk, companies can conduct           may include the scope of the audit,
compliance status, even in this time of        an audit under the direction of an attor-        the information gained in the audit,
economic hardship. By taking immedi-           ney, which may provide protection of             and conclusions and recommenda-
ate steps to address potential noncompli-      audit information as attorney-client com-        tions, together with exhibits and
ance issues, companies reduce the risk         munication or attorney work product.             appendices;
of being criminally prosecuted, which is       Additionally, the company can conduct
costly in countless ways.                      such an audit under Oregon environ-                              Continued on next page
6                                                                                                 Environmental & Natural Resources

3. Have memoranda and documents                 that result in a sheen; and                  benefit of such settlement far outweighs
   analyzing portions or all of the audit     • Violations of certain requirements           the risks and burden of criminal
   report and potentially discussing            or conditions in air and wastewater          enforcement.
   implementation issues; and                   discharge permits.                           Depending on the type of violations
4. Have an implementation plan that           There are other environmental condi-           involved, DEQ may take several actions
   addresses correcting past noncompli-       tions for which the law does not require       to administratively resolve the viola-
   ance, improving current compliance,        reporting. For example, a company’s            tions. Once the violations are known,
   and preventing future noncompliance.       discovery of a historical release of a         DEQ may issue a notice of noncompli-
Certain information cannot be privi-          hazardous substance on land is argu-           ance or a notice of permit violation.
leged and protected, even if it is made a     ably not reportable when it does not           DEQ may follow this with a formal
part of a qualified audit report: (1) docu-   know whether a reportable quantity was         enforcement action by issuing a notice of
ments, communications, data, reports,         released.                                      assessment of civil penalty or a remedial
or other information required to be col-                                                     action order.
                                              Beyond the statutory audit privilege,
lected, developed, maintained, reported,      DEQ issued a policy in 2005 that pro-          If a penalty amount is assessed, DEQ
or otherwise made available to a regula-      vides incentives to encourage companies        has discretion to settle at a reduced
tory agency; (2) information obtained by      to conduct a voluntary audit and to            amount. OAR 340-012-0170(1). DEQ
observation, sampling, or monitoring by       disclose the discovered violations. See        takes into consideration the following
any regulatory agency; and (3) informa-       Internal Management Directive on Self-         factors in reaching a settlement:
tion obtained from a source independent       Policing, Disclosure, and Penalty Mitigation
of the environmental audit.                                                                  1. New information obtained through
                                              (the “Self-Policing Policy”). If a company        further investigation or provided by
                                              meets this policy, DEQ will not refer the         the company;
Reporting the Violations                      violation for criminal proceedings and
                                              will reduce any civil penalties that are       2. Deterrent effect of compromise or
If a company conducts an audit or a
                                              assessed.                                         settlement;
compliance assessment, it needs to
be prepared to make reports of those                                                         3. Whether the company will employ
                                              Under the Self-Policing Policy, the com-
violations for which the law mandates                                                           extraordinary means to correct the
                                              pany must conduct a voluntary audit
reporting and otherwise address viola-                                                          violation or maintain compliance;
                                              and must disclose the discovered viola-
tions that are discovered.                    tions within 21 days of the discovery.         4. Prior penalty settlements;
Certain federal and state environmental       The discovery of the violations must be        5. The company’s ability to pay the civil
laws and permits require reporting of         through “voluntary” means in that they            penalty;
known violations. While not an exhaus-        cannot be discovered through mandated
                                              monitoring, sampling, or auditing              6. Impact of settlement on the goal of
tive list, the following violations must be                                                     protecting human health and the
reported upon discovery:                      required by law, permit, order, or con-
                                              sent agreement. For example, wastewater           environment; and
• Releases of a reportable quantity           discharge violations discovered as part        7. The relative strength or weakness of
  of hazardous substances within 24           of a compulsory monthly sampling and              DEQ’s evidence.
  hours under cleanup and hazardous           reporting program do not qualify as
  waste laws;                                                                                The company can also urge DEQ to
                                              voluntary discovery. On the other hand,
                                                                                             allow it to fund a supplemental envi-
• Releases of hazardous material or           other violations, such as inaccurate
                                                                                             ronmental project, in lieu of paying any
  substances into the public water            record keeping or operating without
                                                                                             penalty or at least in lieu of a portion of
  system, including groundwater               a permit, may qualify when they are
                                                                                             the penalty. These projects represent a
  sources, that result in a violation of      discovered through a voluntary audit.
                                                                                             positive solution for all parties, allowing
  the primary drinking water standards        When disclosing, the company must fol-
                                                                                             the company’s money to benefit directly
  under the Safe Drinking Water Act;          low a detailed process and must respond
                                                                                             the local community rather than disap-
                                              to requests for extensive information,
• Any below ground releases of petro-                                                        pear into the dark hole of the govern-
                                              including plans for corrective action.
  leum from an underground storage                                                           ment’s coffers.
  tank (“UST”) system;                        Settling the Violations                        DEQ and the company often finalize
• Above ground releases of petroleum          Once the company discloses the                 the settlement through a formal Mutual
  from a UST system in excess of 42           violations, the company should try to          Agreement and Order (“MAO”). The
  gallons (or less if the release cannot      resolve them through an administrative         MAO stipulates certain facts, assesses
  be contained or cleaned up within 24        settlement with DEQ. While companies           penalties, and provides a compliance
  hours);                                     may regard these settlement discussions
• Any above ground releases to waters         as time-consuming and expensive, the                              Continued on next page
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Seventh Mountain Resort 18575 SW Century Drive, Bend, OR 97702 (541) 382-8711                                                                                                 Students/Nonprofits/Government ......................... $125.00
                                                                                                                                                                                                                                 TOTAL = $_______

                                                                                                                                                                            Seminar Registration:
                                                                                                                                                                            ❍ I would like to participate via web conference
                                                                                                                                                                              (email address required below)
Thursday May 7, 2009, 1 ATJ or general MCLE credit Nancy Gilbert, U.S. Fish and Wildlife Service: A federal regulator’s perspective.
6:00-6:30 p.m.: Registration                                                        Robert Brunoe, Confederated Tribes of the Warm Springs Reservation of Oregon,           Name:_______________________________ Bar Number: _____________
                                                                                    A tribal perspective.
6:30-7:30 p.m.: Robert A. Brunoe, General Manager, Branch of Natural                                                                                                        Firm Name: ____________________________________________________
                Resources, Confederated Tribes of the Warm Springs Reservation      Brett Swift, American Rivers: A perspective from an environmental non-govern-
                of Oregon, Tribal Perspective on Furthering Resource Protection     mental organization.
                                                                                                                                                                            Phone: ________________________Fax: ____________________________
                and Economic Development (Presentation and Q&A)(Introduced by       Julie Keil, Portland General Electric Company (PGE): On the hook, too—Federal
                Ellen Grover, Karnopp Peterson LLP)                                 hydropower licensee perspective.                                                        Email: _________________________________________________________
7:30-9:00 p.m.: Reception and short Environmental and Natural Resources             12:00-1:00 p.m.: Lunch speaker and Q&A: Brent Foster, Oregon Depart-
                Section monthly Executive Committee meeting—all welcome                                ment of Justice, Special Counsel to the Attorney General, The Role   Address: _______________________________________________________
                                                                                                       of Environmental Enforcement in a New Economy (Introduction by
                                                                                                                                                                            City: ________________________ State: _____ Zip Code: ____________
                                                                                                       Ellen Grover, Karnopp Peterson LLP) (Buffet lunch provided)
Friday May 8, 2009, 9.5 general MCLE credits                                        1:00-1:15 p.m.: Break
                                                                                    1:15-5:30 p.m.: Afternoon Session: The State of Renewable Energy in Oregon              Three Ways to Register with this Form:
7:30-8:00 a.m.: Registration
                                                                                                       (Introduction by Hong Huynh, Miller Nash LLP.)
8:00-8:45 a.m.: Mike Carrier, Governor Kulongoski’s Natural Resource Policy                                                                                                 Registrations and orders will not be processed without payment.
                                                                                    1:15-1:45 p.m.: Michael Grainey, Director, Oregon Department of Energy.
                    Director (Presentation and Q&A) (Introduced by Diane Henkels,
                                                                                                       Current sources of energy powering Oregon with focus on central
                    Attorney at Law)                                                                                                                                        1. PHONE: 503-684-7413, or toll-free in Oregon at
                                                                                                       Oregon; forecasted energy sources expected to power Oregon with
8:45-10:00 a.m.: Panel Discussion: Rural Land Development and Resource                                 focus on Central Oregon; main policy issues.                             1-800-452-8260, ext. 413
                    Management—Are Destination Resorts Good or Bad?                                    (Introduction by Hong Huynh, Miller Nash LLP)                        2. FAX with VISA or MasterCard number: 503-968-4456
                    (Moderated by Pam Hardy, Attorney at Law)
                                                                                    1:45-3:00 p.m.: Panel Discussion: Technical presentation on renewable energy            3. MAIL with check: Oregon State Bar, CLE Service Desk,
Ken Lite, Hydrologist, Oregon Water Resources Department. What is known                                sources and their challenges (moderated by Kimberlee Stafford,
about the flow of groundwater in the Upper Desichutes Basin.                                           Tonkon Torp, LLP )                                                       PO Box 231935, Tigard, OR 97281-1935
Paul Dewey, Attorney. Recognizing and assessing potential resource impacts          Alex Sifford, Sifford Energy Services: Biomass and geothermal power generation
from rural development, such as destination resorts                                                                                                                         All information below required when paying by credit card
                                                                                    Matt Giblin, Invenergy: Wind power generation
Martha Pagel, Schwabe Williamson & Wyatt. Understanding ground water
                                                                                    Steve Hummel: Solar power generation
permits and the effect of mitigation                                                                                                                                        Credit Card Number: ________________________ Exp. Date: ________
                                                                                    3:00-3:10 p.m.: Break
Richard Whitman, Director, Oregon Department of Land Conservation and
Development. How does Goal 5 work and what is the state’s role in managing          3:10-5:00 p.m.: Panel Discussion: The Nuts and Bolts of Renewable Energy                Name on Credit Card (Please Print): ______________________________
resource impacts?                                                                                      Projects (moderated by Hong Huynh, Miller Nash LLP)
                                                                                                                                                                            Credit Card Billing Address: _____________________________________
Steve Hultberg, Ball Janik LLP. Destination resorts: Economic development           Lizzie Rubado, Energy Trust of Oregon: Public policy incentives
and effective mitigation.                                                           Karen Williams, Lane Powell PC: Tax credits for renewable energy: Challenges            City: ________________________ State: ______ Zip Code: ____________
10:00-10:10 a.m.: Break                                                             and opportunities for bringing a renewable energy project to market
                                                                                                                                                                            Authorized Signature: __________________________________________
10:10-11:45 a.m.: Panel Discussion Fish and water:                                  John White, Oregon Department of Energy: Oregon energy siting requirements
                    Habitat Conservation Plans in Central Oregon                    Chris Rycewicz, Miller Nash LLP: Environmental permitting and impacts of
                    (Moderated by John Marsh, Parametrix, Inc.)                     renewable energy projects                                                               Cancellation requests must be received at least 48 hours prior to the start
Steve Johnson, Central Oregon Irrigation District: On the hook—An irrigation        5:00-5:30          Plenary for Q & A for renewable energy speakers and panelists        of the seminar to qualify for a refund. Requested are accepted by via phone,
district perspective.                                                                                                                                                       fax, or mail; please see “Three Ways to Register” for contact information.
8                                                                                                  Environmental & Natural Resources

                                                  schedule that allows the company time to     compliance with environmental laws.
                                                  achieve ultimate compliance. This is par-    Companies should exert increasing
                                                  ticularly useful if the company needs time   efforts to comply with environmental
                                                  to assess its noncompliance condition,       laws and to discover and address known
                                                  to procure and operate pollution-control     violations, before they become involved
Spring 2009                                       equipment, or to obtain a required per-
                                                                                               in criminal proceedings.
EnvironmEnTal CrimEs                              mit. In some cases, the MAO may need
                                                  to go through a public comment period
Issue Editor:
                                                  before it can be finalized.
Susan L. Smith,
Willamette University College of Law
Managing Editor:
                                                  While the economy may be in flux,
David Ashton 503-944-7090                         Oregon has clearly signaled the high
                                                  priority it intends to place on criminal
Environmental & Natural                           prosecution of environmental violations.
Resources Section Officers:                       Companies will face increasing pressure
Diane Henkels, Chairperson                        in the coming years to remain in full
David Ashton, Chair-Elect
William Sherlock, Past Chair
Jas Jeffrey Adams, Treasurer
Hong N. Huynh, Secretary
Executive Committee:
                                                             Traps for the Unwary:
Michael R. Campbell                                        Interpreting Mental State
                                                            Requirements in Oregon
Ellen Grover
Pamela Hardy
Joe Hobson
Hong N. Huynh
Laura Maffei
                                                             Environmental Crimes
John H. Marsh
Susan O’Toole                                                          By Susan L. Smith, Professor of Law,
Don H. Pyle                                                            Willamette University College of Law
Kimberlee A. Stafford
Susan L. Smith
                                                  In 1997, Oregon adopted the Oregon           regulatory violations by one or more
Robert M. Lehner (BOG Contact)
Scott A. Morrill (Bar Liason)                     Environmental Crimes Act (OECA),             of three elements. First and foremost,
Abby Blodgett (Law Student Liason)                codified at ORS 468.920 - 468.959,           environmental crimes require a culpable
Crystal Chase (Law Student Liason)                recognizing that, under certain circum-      mental state, typically “knowingly.” For
La’Ree Felton (Law Student Liason)                stances, violations of environmental         example, all of the Oregon hazardous
Mark McLaughlin (Law Student Liason)              regulations concerning hazardous             waste crimes, the air pollution and
                                                  waste, air pollution, and water pollution    water pollution felonies, the aggravated
There are Issue Editor and author                 should be treated as crimes, rather than
opportunities available for upcoming                                                           felony of environmental endangerment,
newsletters. As Issue Editor you can coordinate   as administrative enforcement matters.       and the supplying false information
writers and articles to educate ENR Section       These newly created environmental            felony require a “knowing” mental state
members on a timely topic. Each issue has         crimes joined a number of other crimes
at least one volunteer issue editor.                                                           as to some element of the crime. Four
                                                  related to the environment and natural
We are also seeking volunteers to write case                                                   Oregon environmental felonies elevate
summaries of leading environmental and            resources, ranging from poaching to dis-
                                                                                               a misdemeanor to a felony if, in com-
natural resources cases. If interested, please    carding refuse in waters of the state. The
contact David Ashton.                                                                          mitting the misdemeanor, the defendant
                                                  analysis of mental state in this article,
Those wishing to follow up on topics                                                           “recklessly” causes substantial harm to
                                                  however, is limited to the pollution
addressed in Outlook should consider
                                                  control crimes created by the OECA.          human health or the environment. The
purchasing the 2006 Supplement to the                                                          misdemeanor water pollution offense
Environmental and Natural Resources Law
Deskbook. With 43 chapters of detailed            The Importance of Mental                     requires only “criminal negligence.”
information, the Deskbook and Supplement                                                       Second, several Oregon environmental
present discussions on national and Oregon        State Requirements in Defining
environmental statutes, rules, and cases.                                                      felonies turn on the element of harm: a
Contact OSB CLE Publications or an ENR
                                                  Oregon Environmental Crimes                  misdemeanor violation becomes a felony
Executive Committee Member for more               Oregon environmental crimes are typi-        by the State proving “substantial harm
                                                  cally distinguished from garden variety      to human health or the environment” as
Attorneys using Outlook should also research
original and other sources.
Environmental & Natural Resources                                                                                                 9

defined in ORS 468.920. Third, several        Oregon Criminal Code                        acts with a culpable mental state with
Oregon environmental felonies can be          Provisions on Mental State                  respect to each material element of the
proven by showing the defendant knew                                                      offense that necessarily requires a cul-
his actions violated the law.                 The Oregon Criminal Code (OCC) gener-       pable mental state, unless ORS 161.105
                                              al provisions, including those on mental    provides otherwise. “Culpable mental
Given the prominence of mental state          state, generally apply to crimes outside    state” is defined by ORS 161.085 (6) to
in distinguishing between a crime             the code unless the statute creating the    be intentionally, knowingly, recklessly,
and a mere violation of environmental         crime specifies otherwise. With respect     or with criminal negligence as defined
regulations, it may seem surprising that      to environmental crimes, the legislative    in 161.085 (7) – (10), which provide
there is little case law addressing the       history does not indicate any legislative   specific definitions of each of those
mental state requirement in Oregon            intent to supersede the OCC. Thus,          culpable mental states. Thus, the mini-
environmental crimes. The only Oregon         the OCC provisions on mental state as       mum culpable mental state in Oregon is
environmental crimes case reported            well as the Oregon case law discussing      criminal negligence.
to date concerning mental state, State        mistake of fact and mistake of law should
v. Maxwell, 161 Or App 468 (1999)                                                         ORS 161.105 contains the exceptions to
                                              be used to interpret the OECA mental
examined whether the State had offered                                                    the culpable mental state requirement.
                                              state requirements. ORS 161.035(2); State
sufficient evidence to establish defen-                                                   ORS 161.105 (1) (a) classifies any offense
                                              v. Rutley, 343 Or 368 (2007).
dant’s knowing disregard of the law. The                                                  included within the OCC that eliminates
other reported Oregon environmental           Two major sets of issues typically arise    the requirement for a culpable mental
crimes case, State v. Stevens Equipment       in interpreting statutory mental state      state as a non-criminal violation. ORS
Co., 165 Or App 673 (2000) (tried             requirements. The first set occurs          161.105 (1) (b) allows an offense defined
by the author), dealt with defendant’s        when the offense contains no specific       by a statute outside the OCC enacted
challenges to the District Attorney’s         mental state element. In that event, the    after 1971 to be classified as a crime
decision to prosecute. The dearth of          courts must determine the minimum           even though it lacks a culpable mental
case law on Oregon environmental              culpable mental state that a defendant      state, provided that the criminal statute
crimes can be explained by two factors.       must have to commit the crime and to        clearly indicates a legislative intent to
First, there have to date been relatively     which elements that culpable mental         dispense with any culpable mental
few environmental criminal prosecu-           state applies? The second set of issues     state requirement for the offense or
tions brought by the State, due to the        occurs when one or more mental state        for any material element thereof. ORS
technical difficulty and expense of these     elements are specified by the offense. In   161.105 (2) classifies an offense, defined
prosecutions and the competing priori-        that event, the courts must determine       by a statute outside the OCC that was
ties of district attorneys who have been      to which elements that mental state         enacted before 1972, that does not
solely responsible for prosecution of         applies. In other words, how far down       require a culpable mental state as a
these crimes. Second, due to reluctance       does the mental state element travel?       violation. Under ORS 161.105(3), when
of some judges and juries to treat regula-    The courts must also determine, for         an offense outside the OCC requires
tory offenses as serious crimes, state        cases in which the mental state does not    no culpable mental state as to one or
prosecutors are unlikely to bring cases       apply to every element of the offense,      more of its material elements, the State
when culpability in terms of mental state     whether any culpable mental state is        may allege and prove at least criminal
is at all questionable.                       required for the remaining elements?        negligence, in which case commission of
                                              Fortunately, no environmental crimes        the offense is a crime.
However, as Attorney General Kroger
                                              created by the OECA raise the first set     ORS 161.115 contains rules for constru-
devotes Oregon Department of Justice
                                              of issues because each environmental        ing the mental state requirements of
(DOJ) resources to environmental
                                              crime contains at least one mental state    offenses. ORS 161.115 (1) states that
crimes, we are likely to see both more
                                              requirement. However, the second set        when an offense specifies a culpable
state environmental criminal prosecu-
                                              of issues is raised by virtually every      mental state, but does not specify the
tions overall as well as state prosecutions
                                              Oregon environmental crime.                 element to which it applies, that culpa-
in situations where the defendant’s
mental state may be a bit more arguable.      Several key OCC provisions on mental        ble mental state applies to each material
Thus, given the new environmental             state bear on interpretation of the         elements of the offense “that necessarily
criminal enforcement structure in             mental state requirements for Oregon        requires a culpable mental state.” Thus,
Oregon, it behooves all environmental         environmental crimes. First, ORS            ORS 161.115(1) indicates that any men-
lawyers to have a clear understanding of      161.095 provides the basic requirements     tal state word included in the offense
the mental state requirements associated      of culpability: a conduct that includes a   is applied to every material element to
with Oregon environmental crimes as           voluntary act or omission and a culpable    the extent that the element “necessarily
well as the recently evolving case law        mental state. As to mental state, ORS       requires a culpable mental state.” As
in Oregon with respect to mental state        161.095 (2) specifies that a person is
requirements more generally.                  not guilty of a crime unless the person                       Continued on next page
10                                                                                              Environmental & Natural Resources

we explore later, Oregon courts have         Take a rather common example: mis-            That would appear to be a mistake
experienced great difficulty in interpret-   handling storage of hazardous wastes.         of fact rather than the mistake of law
ing mental state requirements due to the     This occurs whenever a facility violates      analysis adopted in Maxwell. Looking
“confusing appearance of circularity”        the conditions placed on conditionally        back to the statute, the language that
of this phrase. State v. Blanton, 284 Or     exempt generators or small quantity           makes knowing storage of hazardous
591 (1978). ORS 161.115(2) specifies         generators of hazardous wastes, and as a      waste a crime is the “violation of ORS
that the culpability required for an         consequence needs a treatment, storage        466.095 or 466.100 or any rule, stan-
offense is at least criminal negligence.     or disposal facility (TSDF) permit. It is a   dard, license, permit or order adopted
ORS 161.115(3) provides that proving         misdemeanor for a person, in violation        or issued under ORS 466.020, 466.095
a more culpable mental state is suf-         of the TSDF permit requirement, to            or 466.100.” ORS 466.100 forbids
ficient to establish a lesser mental state   knowingly store hazardous waste. If           disposal of hazardous waste except at
requirement. For example, when a crime       a plant manager avoids knowledge of           permitted hazardous waste disposal
requires criminal negligence, it is suf-     how his plant is handling hazardous           sites. But, there is no mental state word
ficient if the State proves recklessness.    waste, he is as guilty as the manager         connected to the violation clause and it
                                             who knowingly allows his plant to             precedes the words “knowingly treats,
Interpreting Mental State                    accumulate sufficient waste so that it        stores, or disposes.” Ordinary statutory
Requirements for Oregon                      is no longer qualifies as a conditionally     interpretation would not apply the
                                             exempt or small quantity generator, but       “knowing” requirement to any aspect
Environmental Crimes that                    chooses not to obtain a TSDF permit.          of the violation because of the careful
Require “Knowingly” Conduct                                                                placement of the “knowing” mental state
                                             In cases of actual knowledge, let us look
Most Oregon environmental crimes con-                                                      requirement after the violation clause
                                             at what the plant manager might need
tain a “knowing” or “knowingly” mental                                                     and before the conduct of treat, store
                                             to know. Obviously, the defendant must
state requirement as to the conduct of                                                     or dispose. But, ORS 161.115 (1) takes
                                             know that he is storing something. But,
the defendant. The crimes imposing a                                                       the mental state word in the crime and
                                             there are other questions to answer:
knowing requirement for the conduct                                                        applies it to all material elements “that
                                             does he need to know that he is storing
include:                                                                                   necessarily require a culpable mental
                                             a waste that is hazardous in character?
                                                                                           state.” Similarly, 161.095 (2) requires
                                             Does he need to know that the waste
• unlawful storage, disposal or treat-                                                     a culpable mental state for all material
                                             being stored is classified as hazardous
  ment of hazardous waste in the first                                                     elements “that necessarily require a
                                             waste? Does he need to know that how
  and second degrees,                                                                      culpable mental state.”
                                             much waste is being stored? Does he
• unlawful transportation of hazardous       need to know that the law requires            The question becomes what do ORS
  waste in the first and second degrees,     a permit if he is storing more than a         161.115 (1) and ORS 161.095 (2) mean?
• unlawful air pollution in the first        certain amount of waste? Does he need         Based on the Oregon courts’ interpreta-
  degree,                                    to know that the facility does not have       tion of “material elements,” the element
                                             a permit? Does he need to know that a         of violating Oregon hazardous waste
• unlawful water pollution in the first      permit is required?                           law is clearly a material element. But, is
  degree,                                                                                  it a material element “that necessarily
                                             The OCC indicates that when a statute
• environmental endangerment, and                                                          require[s] a culpable mental state?” The
                                             defining an offense contains a mental
• supplying false information by mis-                                                      Oregon Supreme Court has refused
                                             state requirement, that mental state
  handling required documents.                                                             to make sense of this phrase in ORS
                                             requirement applies to all material
                                                                                           161.095 (2) observing that this section
To begin, it is critical to note that        elements of the crime “that necessarily
                                                                                           appears to be circular. State v. Rutley,
“knowingly” is specifically defined in       require a culpable mental state.” The
                                                                                           363 Or 368 (2007); State v. Blanton,
ORS 468.020 to include both the mean-        Oregon Supreme Court has defined
                                                                                           284 Or 591 (1978). As a result, it has
ing given to the term under the OCC          “material element” to include all elements
                                                                                           simply thrown up its hands and ignored
definition in ORS 161.085 and what           defining the offense, not including ele-
                                                                                           that phrase. As interpreted by the most
                                             ments such as jurisdiction, venue, and
criminal lawyers call willful blindness:                                                   recent decision of the Oregon Court of
                                             such. Thus, in the example above, the
knowingly can mean “a person acts with                                                     Appeals, if there is a mental state word
                                             defendant must know he is committing
conscious purpose to avoid knowledge                                                       in the crime, it applies to every material
                                             the acts that the law considers “storing.”
of a conduct or a circumstance in viola-                                                   element. State v. Rutley, 202 Or App 639
                                             But he does not need to know that the
tion of [environmental requirements].”                                                     (2005), rev’d in part on other grounds,
                                             law considers those acts to be “storing.”
So, a client who deliberately avoids                                                       363 Or 368 (2007). This interpretation
                                             State v. Maxwell, 161 Or App 468 (1999).
knowing what is happening at a plant                                                       is quite problematic in the context of
is as guilty as the client who has actual    But what if the defendant mistakenly          interpreting both the hazardous waste
knowledge.                                   believes that the facility has a permit?      misdemeanors as well as the air pollu-
Environmental & Natural Resources                                                                                              11

tion and water pollution misdemeanors,      In the case of unlawful disposal, treat-     Interpreting the “Knowingly
as will become apparent when those          ment or storage in the second degree,        Violate” Requirement in the
crimes are discussed more fully below.      is the circumstance that the defendant’s
                                            conduct violates hazardous waste law         Misdemeanor Air Pollution
An Alternative Interpretation               essential to the wrongfulness of the         Crime and the Misdemeanor
Restricting the Material                    conduct? Possibly one could argue that       Water Pollution Crime
                                            disposing, treating or storing hazardous
Elements That Require a                                                                  Unlawful air pollution in the second
                                            waste is always wrong even without a
Culpable Mental State                       violation of law. However, more realisti-
                                                                                         degree punishes persons who “know-
                                                                                         ingly violate” various air pollution
Although Oregon courts have been            cally, the key to why the defendant’s
                                                                                         control requirements. Because it is struc-
frustrated in construing the phrase “that   conduct is wrong is that it violates a
                                                                                         tured so differently from the hazardous
necessarily require a culpable mental       legal requirement regarding the safe
                                                                                         waste misdemeanors, one might interpret
state” in ORS 161.095 and 161.115, that     handling of hazardous waste. So, not
                                                                                         this crime to require knowledge of the
phrase does not make the OCC mental         having a permit required by hazardous
                                                                                         pollution control requirements being
state requirements circular and should      waste law is essential to the wrongful-
                                                                                         violated. However, three considerations
not be simply stricken by the courts as     ness of the conduct and the knowingly
                                                                                         counsel against such an interpretation
surplusage. The Oregon courts appear to     mental state must be applied. Thus, if
                                                                                         and in favor of interpreting them in the
lack the background information neces-      one mistakenly believed one had a per-
                                                                                         same manner as the hazardous waste
sary to make sense of this phrase and       mit, but actually did not, ORS 161.115
                                                                                         misdemeanors. First and foremost, like
as a result have wrongly decided cases      (1) would prevent a conviction.
                                                                                         the crimes analyzed above, the only
involving mental state.                     But, what if one knows one does not          difference between a second degree
The best interpretation of that phrase      have a permit, but mistakenly believes       misdemeanor and a first degree felony is
in both ORS 161.095 and ORS 161.115         that hazardous waste law does not            “knowingly disregards the law in com-
derives from the common law doctrine        require a permit. That is a mistake of       mitting the violation.” So, to preserve
of mens rea. The common law required        non-criminal law, which in a majority        the distinction between the felony and
that the defendant have a culpable          of states is treated like a mistake of       the misdemeanor, the misdemeanor air
mental state with respect to any circum-    criminal law, i.e. it is not a defense. In   pollution crime should be interpreted
stance element that was essential to the    a minority of states, a mistake of non-      to require knowledge of the facts that
wrongfulness of the defendant’s conduct.    criminal law is treated like a mistake       constitute a violation, not knowledge of
For example, the defendant in a burglary    of fact, i.e. it is a defense. What is the   the law that makes the facts a violation.
needs have a culpable mental state as       Oregon position on this question?            Second, similarly worded federal statutes
to the dwelling being that “of another”     Honestly, we do not know.                    are construed in that manner. Third, that
(i.e. someone else’s house) because if                                                   construction is consistent with the gen-
                                            Yet, the offense of unlawful disposal,       eral principles of criminal law regarding
the house was his own there would           treatment or storage of hazardous waste      mistakes of non-criminal law.
be nothing wrong with breaking and          in the second degree needs to be
entering into it. On the other hand, the    construed in light of its sister felony,     Unlawful water pollution in the second
defendant in a burglary does not need       unlawful disposal, treatment or storage      degree punishes a person who “with
to have a culpable mental state as to the   of hazardous waste in the first degree.      criminal negligence violates” various
building in question being a “dwelling.”    The only attribute that distinguishes        water pollution control requirements.
If the defendant thinks he’s breaking       the two crimes is that the first degree      A common sense construction might
into someone’s office, but it turns out     felony requires the defendant acted in       require criminal negligence as to the
to be someone’s dwelling because they       knowing disregard of the law. Thus, this     non-criminal law being violated, the
routinely sleep in the office, the defen-   misdemeanor should not be construed          water pollution control requirements.
dant still committed conduct that was       to require knowing disregard of hazard-      Unlike the misdemeanor air pollution
wrongful and the element of “dwelling”      ous waste law. Similarly, the unlawful       crime, the felony requires knowing
is thus not essential to the wrongfulness   transportation of hazardous waste            conduct that leads to water pollution,
of his conduct. Thus, ORS 161.095 and       misdemeanor should not be construed          not just negligent conduct. So the
ORS 161.115 should be interpreted to        to require knowing disregard of hazard-      analysis used for the hazardous waste
give meaning to the phrase “that neces-     ous waste law.                               misdemeanors and the air pollution
sarily require a culpable mental state,”                                                 misdemeanor, that the felony and misde-
and the meaning, supplied by the com-                                                    meanor would be indistinguishable if so
mon law, is that a culpable mental state                                                 interpreted, does not apply in this case.
is required only for material elements                                                   Yet the parallel language between the
essential to the wrongfulness of the
defendant’s conduct.                                                                                       Continued on next page
12                                                                                            Environmental & Natural Resources

misdemeanor air pollution crime and          of ORS 161.115(1) is most dramatic with      the alternative interpretation or giving
the misdemeanor water pollution crime        respect to this crime, which is a felony     weight to the legislature’s structuring of
suggests that they should be construed       punishable by 15 years in prison and a       the statute, no mental state is required
similarly. Also, the general principles of   $1 million fine for individuals and a $2     for the endangerment element.
criminal law regarding mistakes of non-      million fine for corporations and other
criminal law suggest that a criminally       organizations. Following the rule of ORS     Conclusion
negligent mistake of non-criminal law        161.115 (1) as currently interpreted by      When counseling clients about
should not excuse a defendant who is         Oregon courts, the knowingly mental          potential criminal liability, one must
criminally negligent with respect to the     state requirement should be extended
conduct, circumstances, and results that                                                  use care in discussing the mental state
                                             to the endangerment element, requiring       requirements of environmental crimes.
constitute a water pollution violation.      that the defendant know that by his          Those who litigate these cases should
                                             conduct he was placing someone in            appreciate the lack of case law constru-
The Mental State Requirements                imminent danger of death or causing          ing the mental state requirements
for Environmental                            serious bodily injury. This will be a dif-   associated with environmental crimes,
Endangerment                                 ficult burden for the State to meet even     use care in articulating the mental state
The most serious environmental felony,       in the most egregious cases. However, if     requirements associated with these
environmental endangerment, is com-          one adopts the alternative interpretation    crimes, and anticipate that a great deal
mitted when one knowingly commits            suggested above and gives weight to the      of litigation will be necessary before the
felony hazardous waste, air pollution or     restrictive language of “that necessarily    courts fully flesh out just exactly what
water pollution crimes and “as a result,     requires a culpable mental state,” endan-    a defendant must be thinking to com-
places another person in imminent dan-       germent is not essential to the wrongful-    mit an Oregon environmental crime.
ger of death or causes serious physical      ness of defendant’s conduct (which           Otherwise, you may get ensnared in
injury.” The problematic interpretation      already constitutes a felony). So, under     these traps for the unwary.

                It’s For the Birds:
 Criminal Prosecution of Wind Energy Producers
                                       By Ryan McGraw, J.D./M.B.A. 2009 (expected)
                                                 Willamette University

This article argues that rapid deploy-       sions, accounting for over 40% of emis-      cumulative capacity of wind energy in
ment of wind turbines is an essential        sions from energy, while wind energy         the United States.
component of the effort to mitigate          generation emits zero pollutants. Wind
                                                                                          Wind energy is an extremely efficient
climate change and that the substantial      generated electricity currently displaces
                                                                                          energy source as measured by its energy
exposure of the wind industry to pos-        28 million tons of CO2 per year in the
                                                                                          payback ratio (EPR). The EPR is the
sible criminal prosecution for causing       United States with the potential to dis-
bird death must be eliminated by             place upwards of 800 million tons CO2        amount of energy produced divided by
amending the Endangered Species Act,         per year by 2030.                            the amount of energy invested, thus the
the Migratory Bird Treaty Act, and the                                                    higher the ratio, the more efficient the
                                             According to the American Wind Energy        energy source. An Elsevier Science study
Bald and Golden Eagle Protection Act
                                             Association, wind energy currently           compared the various EPR of various
to exempt bird fatalities caused by colli-
                                             accounts for nearly 1% of America’s          energy options. According to the study,
sions with wind turbines.
                                             electricity supply with a total installed    wind energy has the second highest EPR
                                             capacity of approximately 19,500             with a ratio of 39. Figure 2 indicates the
Why Wind?                                    megawatts (“MW”). Growth in the wind         study’s results.
Wind energy has become a key alterna-        industry has been rapid, with a 45%
tive energy source in our battle to cut      increase in installed capacity in calendar   The Environmental Drawback:
greenhouse gas emissions and mitigate        year 2007 alone, and in the past 10
global warming. Conventional electric-       years the cumulative capacity from
                                                                                          Wind Turbines Kill Birds
ity generation is the largest industrial     wind energy has increased more than          The chief environmental drawback of
source of greenhouse gas (GHG) emis-         five-fold. Figure 1 shows annual and         wind energy is its effect on birds. Since
Environmental & Natural Resources                                                                                               13

at least the early 1980s, wind turbines have been known to          to graze on tree seedlings that, when fully grown, might have
kill birds due to collisions. Estimates on the amount of deaths     fed or sheltered endangered birds. Note, however, that ele-
are widely varied, due to inaccuracies in reporting, collection,    ments of actual and proximate causation still must be met.
and scavenging. In addition, bird kills can be minimized by
                                                                     “Knowledge” for the purposes of the ESA is interpreted to be
turbine design and location. However, one commonly accepted
                                                                    general intent. General intent can be established by showing
figure is that a wind turbine generally kills an average of 1-2
                                                                    that the defendant had knowledge s/he was taking an animal,
birds per year. These bird fatalities cause significant tension
within the wind energy industry, as media coverage has
spawned public uneasiness, mitigation costs have soared, and
cases are beginning to be litigated.

Federal Laws Protecting Birds Could Be Enforced
Against the Wind Industry
Three federal laws arguably apply against those in the wind
energy industry who construct or operate wind turbines due to
the bird fatalities caused by turbine collisions: the Endangered
Species Act (ESA), the Migratory Bird Treaty Act (MBTA), and
the Bald and Golden Eagle Protection Act (BGEPA) (called
collectively the “bird laws”).

Endangered Species Act
Those in the wind industry constructing and operating wind
turbines that kill birds face possible ESA criminal enforcement
action, in addition to civil enforcement under a strict liability
Under the ESA, a defendant is criminally liable if the defen-
dant knowingly violates a number of provisions of the statute       Figure 1: U.S. Annual and Cumulative Wind Power Capacity
and regulations, including the provision forbidding acts that       Source:
cause a take of a threatened or endangered
species. Killing birds by constructing or
operating wind turbines appears to fit
within the ESA’s broad definition of take.
Defendants “take” wildlife if they “harass,
harm, pursue, hunt, shoot, wound, kill,
trap, capture, or collect, or to attempt to
engage in any such conduct.” Courts inter-
pret “take” broadly, with one court stating
that it should be “construed in the broadest
possible manner to include every conceiv-
able way in which a person can take or
attempt to take...wildlife.” The U.S. Supreme
Court in Babbit v. Sweet Home Chapter of
Communities for a Great Oregon, 515 US 687
(1995), approved the broad definition of
harm found in U.S. Fish and Wildlife regu-
lations, 50 C.F.R. Part 17. The Court held
that logging operations adversely modifying
habitat of listed species in ways that led         Figure 2: Energy Payback Ratio of Energy Options
to actual killing of members of the species        Source:
does constitute a taking under the ESA. An
example of the breadth of ESA takings can
be found in Palila v. Hawaii Dept, of Land and Natural Resources
(Palila II), 852 F.2d 1106 (1988), in which the Ninth Circuit
held that a taking occurred when a state agency allowed sheep                                             Continued on next page
14                                                                                            Environmental & Natural Resources

regardless of whether s/he knew it was       the word “poison” in the BGEPA was          the same transaction leads to multiple
protected. When convicted of know-           sufficient to show legislative intent to    takings or killings of protected birds,
ingly killing an animal under the ESA,       include poisoning in the MBTA. Due to       the defendant may only be convicted of
a defendant can be fined $50,000 per         the divergent Ninth Circuit holdings, a     one violation. The “unit of prosecution,”
violation up to $250,000 for individuals     legal question exists even in the Ninth     therefore, is the transaction leading to
and $500,000 for an organization, and        Circuit regarding whether actions not       the taking of protected birds, and not
imprisoned for up to one year.               traditionally performed by hunters and      the raw number of takings.
                                             poachers may constitute a take or kill
The Migratory Bird Treaty Act                under the MBTA.                             The Bald and Golden Eagle
The wind industry also may face crimi-       The MBTA provides penalties in the          Protection Act
nal enforcement under the Migratory          form of criminal misdemeanors and           The wind industry could also face crimi-
Bird Treaty Act, 16 USC § 703-711, in        felonies, as well as forfeiture of equip-   nal liability as well as civil penalties and
addition to being strict liable for civil    ment used in the taking or transporta-      forfeiture of wind turbines and other
penalties.                                   tion of migratory birds. Since the felony   equipment under the Bald and Golden
A defendant commits a misdemeanor            provisions and forfeiture provisions        Eagle Protection Act (BGEPA), 16 USC
under the MBTA if the defendant’s act        of the MBTA have intent to sell as an       § 668. Under the BGEPA, a defendant
caused a take or kill of a native migra-     element, they are unlikely to be applied    is subject to enforcement action if the
tory bird. The government must prove         to construction and operation of wind       person knowingly, or with wanton
the defendant did “by any means or           turbines. On the other hand, the MBTA       disregard for the consequences of his
in any manner…take... [or] kill…any          misdemeanor is an attractive charge         act, takes a bald or golden eagle without
migratory bird, [or] any part, nest, or      for prosecutors because it does not         a permit. To “take” means to “pursue,
egg of any such bird ...” Under the U.S.     contain a mental state requirement and      shoot, shoot at, poison, wound, kill, cap-
Fish and Wildlife Service regulations,       can be interpreted as a strict liability    ture, trap, collect, molest, or disturb” an
50 CFR Part 10, “take” for purposes of       offense. Even though the U.S. Supreme       eagle. A taking is not necessarily limited
the MBTA is defined as to “pursue, hunt,     Court under Liparota v. U.S., 471 U.S.      to acts traditionally undertaken by hunt-
shoot, wound, kill, trap, capture, or col-   419 (1985) and Staples v. U.S., 511 U.S.    ers but possibly any act that could lead
lect,” or to attempt any such act.           600 (1994) interpreted federal criminal     to an eagle being harmed. Takings have
                                             statutes to require proof of a culpable     thus been found due to electrocutions
The Ninth Circuit held in Seattle            mental state when the regulatory viola-     from power lines, the misapplication of
Audubon v. Evans 952 F.2d 297 (9th Cir.      tions involve “an innocent activity,”       pesticides, and dumping waste water.
1991), that this regulatory definition       Professors Mandiberg and Smith in their
proscribes only conduct traditionally                                                    The mental state requirement that a
                                             environmental crimes treatise Crimes
undertaken by hunters and poachers.                                                      person must “know” or act with “wanton
                                             Against the Environment (1997) suggest
Under Seattle Audubon, obviously con-                                                    disregard for the consequences” is a
                                             that the Liparota and Staples innocent
struction and operation of wind turbines                                                 lower threshold than it might appear on
                                             activity analysis is limited to felony
that incidentally kill migratory birds                                                   its face. Although courts acknowledge
would not constitute a take under the                                                    that the BGEPA is not a strict liability
MBTA because those activities are not        Any person violating the MBTA can be        offense, some courts construe it as
traditionally performed by hunters and       convicted of a misdemeanor, fined up        a general intent statute, which only
poachers                                     to $15,000, and be imprisoned for up to     requires an intent to commit the act that
                                             six months. A misdemeanor conviction        naturally and probably would result in
 In earlier cases, the Ninth Circuit was     is based on strict liability, meaning a     harm, even if the accused did not know
more liberal in applying the MBTA. In
                                             person unintentionally committing a         his/her actions would harm an eagle.
United States v. Corbin Farm Serv., 578
                                             MBTA violation can still be sentenced       Other courts state that specific intent to
F.2d 259 (9th Cir. 1978), the court held
                                             to prison. In theory, therefore, a person   cause harm must be shown. In short,
that the misapplication of pesticides
                                             could pay $15,000 and go to prison for      most courts have held that, as used
to farmlands resulting in the deaths of
                                             six months if s/he accidentally killed a    in the BGEPA, the term “knowledge”
migratory birds was sufficient to consti-
                                             protected bird in an innocent manner.       means that the accused need only know
tute a killing “by any means or in any
                                             However, such accidents usually meet        that wildlife could be harmed by his/
manner” under the MBTA. In making
                                             with only nominal punishment.               her actions for misdemeanor offenses.
this decision, the court relied heavily on
                                                                                         The government might well be able to
an amendment to the Act that included        While the MBTA does not provide for
                                                                                         make such a showing with respect to
the word “poison” within the definition      heightened penalties after a subsequent
                                                                                         persons constructing and operating
of a “take.” The court reasoned that the     offense, courts have held that multiple
                                                                                         wind turbines.
legislative reliance of the BGEPA on         acts leading to MBTA violations can lead
the MBTA and subsequent inclusion of         to multiple convictions. If, however,       A first-time criminal offender may be
Environmental & Natural Resources                                                                                                15

fined $5,000 and imprisoned for up           eagle deaths, the sanction illustrates the   the MBTA,” one can argue that takings
to one year. A second or subsequent          government’s ability and willingness to      and killings under the BGEPA must also
BGEPA conviction leads to enhanced           criminally prosecute organizations that      be performed in a manner traditionally
criminal penalties of $10,000 per viola-     do not take steps to mitigate harm to        undertaken by hunters and poachers.
tion up to a $250,000 maximum fine           protected birds.                             Thus, this argument should be made
for an individual or $500,000 for an                                                      simultaneously for the MBTA and
                                             Section 668b(b) states that “all…equip-
organization, and two years in prison.                                                    BGEPA in the event that the government
                                             ment…used to aid in the taking…of
As “the commission of each taking…                                                        files charges alleging such violations.
                                             any bird, or part, nest, or egg thereof,
constitute[s] a separate violation,” each                                                 Prevailing on this argument would
                                             in violation of [the BGEPA]…shall
taking could be fined the maximum                                                         absolve companies and their directors
                                             be subject to forfeiture to the United
amount under the act. While courts are                                                    and officers of all liability under the
                                             States.” This means that, even without
divided on the issue, recent precedent                                                    MBTA and BGEPA.
                                             specific intent to cause harm to an eagle,
indicates multiple violations in one con-    personal property used in the commis-        The defendant must be able to distin-
viction can lead to enhanced penalties.      sion of the violation may be seized by       guish United States v. Corbin Farm Serv.,
In Street, the defendant simultaneously      the government. The legal threshold          578 F.2d 259 (9th Cir. 1978), which
pled guilty to two counts of illegally       for the government to seize property is      expanded the coverage of the MBTA in
taking bald and golden eagles. Street        thus significantly lower than under the      the Ninth Circuit by including poison-
received a sentence of sixteen months,       MBTA.                                        ing as an illegal method of “taking”
thereby evoking imposition of the act’s                                                   migratory birds. The defendant could
enhanced penalty clause. Upon review
by the appellate court, the judgment
was affirmed on the basis of persuasive              Penalty                   ESA               MBTA               BGEPA
U.S. Supreme Court precedent in Deal
v. United States, 508 U.S. 129 (1993).              Maximum
                                                                              $50,000            $15,000             $10,000
Invoking enhanced penalties for mul-               Criminal Fine
tiple violations in one conviction means            Maximum
that, if multiple eagles are harmed, the                                       1 year            6 Months            2 years
                                                   Prison Term
accused can be sentenced to a maximum
of two years in prison and ordered to                Maximum
                                                                              $25,000               -                $5,000
pay a maximum of $10,000 for each                    Civil Fine
eagle s/he harmed.                                                          Permissive         Permissive
                                                     Forfeiture                                                     Permissive
Imposition of criminal sanctions                                            with felony        with felony
varies as a function of the violation’s
severity. In cases involving only the        Table 1: Penalties Associated with the Bird Laws.
illegal possession of eagle parts, small
fines and probationary periods are
                                             Do Bird Kills “Take” Under the               argue the holdings in Bull Run, Seattle
commonly assessed. When defendants
                                                                                          Audubon and Corbin Farm are consistent.
are convicted of illegally hunting and/      Bird Laws?                                   While Corbin Farm held that poisoning
or selling eagles or eagle parts, criminal
                                             The key issue in any enforcement action      is covered by the MBTA, the company
fines of $2,000 or more and prison
                                             against a defendant wind energy compa-       could argue that poisoning is a tradi-
sentences longer than a year have been
                                             ny under either the MBTA or the BGEPA        tional method of hunting and poaching.
assessed. In United States v. Moon Lake
                                             is likely to be whether a “take or kill”     If accepted, the argument would restrict
Electric Ass’n, 45 F.Supp.2d 1070 (D.
                                             occurred. The most recent decisions in       the reach of the MBTA in the Ninth
Colo. 1999), a defendant was convicted
                                             the Ninth Circuit, Citizens Interested in    Circuit to methods used by hunters and
of illegally killing twelve golden eagles,                                                poachers. As turbine collisions are not
                                             Bull Run, Inc. v. Edringon, 781 F.Supp.
four ferruginous hawks, and one great                                                     now, nor have they ever been, methods
                                             1502 (D. Or. 1991) and Seattle Audubon
horned owl, totaling seven violations                                                     of hunting or poaching, and following
                                             v. Evans, 952 F.2d 297 (9th Cir. 1991)
of the BGEPA and six violations of                                                        Ninth Circuit precedent, wind farm
                                             hold that an illegal MBTA taking occurs
the MBTA. Due to the severity of the                                                      operators would not be found guilty of
                                             only when fatalities are due to actions
violation and the ability of the defendant                                                any MBTA or BGEPA violations
                                             traditionally performed by hunters and
to mitigate harm, a fine of $100,000,        poachers. The Ninth Circuit has not yet
a three-year probationary period, and                                                     While it is true that the Ninth Circuit
                                             addressed this question with respect to      defines a “take or kill” to apply
mandatory retrofit of equipment were         the BGEPA. Given Ninth Circuit dicta
imposed on the cooperative. Although         that “the BGEPA was modeled after…
the violations were not limited to golden                                                                    Continued on next page
16                                                                                              Environmental & Natural Resources

only in the context of acts traditionally      Readers interested in this issue may         not be able to justify huge investments
undertaken by hunters and poachers,            want to also read John A. McKinsey,          in equipment that will not produce the
a circuit split exists on this issue.          Regulating Avian Impacts Under the           desired returns. The use of amendments
The District Court of Colorado, for            Migratory Bird Treaty Act and Other Laws:    to the Bird Laws has the effect of pro-
instance, held in United States v. Moon        The Wind Industry Collides with One of       ducing an economic stimulus to rational
Lake Electric Ass’n, 45 F.Supp.2d 1070         Its Own, the Environmental Protection        investors by reducing the overall risk of
(D. Colo. 1999), that a “take or kill” is      Movement, 28 Energy L. J. 71 (2007).         the investment, increasing the value of
not restricted to intentionally harmful                                                     investing in wind energy, and encour-
conduct. In Moon Lake, an electrical           Conclusion                                   aging development of this critically
cooperative was convicted of illegally
                                               The high risk of civil enforcement,          important alternative energy source.
killing twelve golden eagles, four fer-
                                               criminal prosecution, and forfeiture
ruginous hawks, and one great horned                                                        The current high level of investment in
                                               under the Bird Laws that is faced by the
owl by accidental electrocution from                                                        wind energy is of significant importance
                                               wind industry may depress investment
power lines. This holding effectively                                                       to the security of our nation and world.
                                               in this critical industry. Congress has
interpreted the reach of the Bird Laws                                                      As the deleterious effects of global
                                               an opportunity to spur continued high
to all acts that harm federally protected                                                   warming are observed at increasing
                                               levels of investment in the wind energy
birds, taking a different approach than                                                     levels, our nation must take action to
                                               industry at near-zero cost to society by
the Ninth Circuit. As such, the govern-                                                     reduce the amount of GHG emissions
                                               amending the ESA, the MBTA, and the
ment can argue that the court should                                                        on a long-term scale. While wind energy
                                               BGEPA to clearly exempt bird fatalities
adopt that approach and hold that avian                                                     is certainly not the only answer to this
                                               due to wind turbine collisions. Such
fatalities due to wind turbine collisions
                                               amendments would drastically reduce          problem, it has the potential to become
are covered by the Bird Laws.
                                               the risk to investors that prosecution       a major part of our renewable portfolio
While a court could justifiably hold either    may occur, which would result in huge        and reduce the overall GHG emissions
way, the legislative history, public policy,   cash outflows and reduced cash inflows,      in the United States. As such, it is
and lack of specific intent required in        and thus drastically reducing the overall    critical that the federal government take
the Bird Laws likely tips the scales in        value of wind energy investments.            significant steps to encourage continued
favor of the government. Moreover, even        Moreover, such amendments are argu-          high investment levels in wind energy,
if the industry did prevail on this argu-      ably no different than the laws as written   and that our society understands the
ment with respect to the MBTA and the          today – in such case amendments would        need to balance renewable, sustainable
BGEPA, the government could prosecute          serve only to clarify ambiguous language
                                                                                            energy against the risk of prosecution for
under the ESA without any difficulty if        and provide explicit security to inves-
                                                                                            unintentional avian fatalities.
it could prove that threatened or endan-       tors. As tax subsidies to the wind energy
gered species had been harmed.                 industry are phased out, investors will

          A National Perspective on Environmental
           Criminal Enforcement: Will it Change?
                              By Walter D. James III, Tracy D. Hester, and W. Bruce Pasfield
                            Past and current co-chairs, Environmental Enforcement Committee,
                               ABA Section on Environment, Energy, and Natural Resources

This article provides a national perspec-      policies more generally. This article        Administrator for Compliance and
tive on federal environmental criminal         also provides insight into other new         Enforcement in charge of criminal
prosecutions in terms of historical            developments at the federal level that       enforcement for the U.S. Environmental
priorities of the U.S. Environmental           will affect federal environmental crimes     Protection Agency (EPA) stated that
Protection Agency (EPA) and the                prosecutions.                                he expected criminal enforcement to
Department of Justice (DOJ) and the                                                         increase, stressing “high-impact” cases
possible effect of the election on those                                                    expected to most benefit human health
                                               Recent Historical Perspective
priorities and on federal environmental                                                     and the environment. High impact
criminal enforcement structure and             In 2007, Grant Nakayama, Assistant           cases include cases that address an
Environmental & Natural Resources                                                                                                  17

environmental or health problem was            to violate federal clean air and water       neys at the USEPA and USDOJ who will
national in scope (i.e. one that leaves        regulations and laws governing work-         often initiate and manage cases through
a significant environmental footprint)         place safety, as well as obstruction of      multiple Presidential administrations.
with widespread noncompliance.                 criminal and regulatory investigations       Any effort to intervene in environmental
                                               by the USEPA and OSHA. On April              enforcement actions by political appoin-
At the same point in time, DOJ’s
                                               26, 2006, after a seven month trial and      tees or other agencies carries a high risk
priorities were slightly broader. Stacey
                                               six days of jury deliberations, Atlantic     of public outcry and backlash if those
Mitchell, Chief of the U.S. Department
                                               States and four company officials were       efforts come under public scrutiny. As a
of Justice (DOJ) Environmental Crimes                                                       result, environmental enforcement ini-
                                               found guilty of committing flagrant
Section, indicated DOJ was focusing                                                         tiatives can move forward even when a
                                               abuses of environmental and worker
prosecutions in three specific areas:                                                       new Presidential administration directly
                                               safety laws. The charges included,
the Worker Endangerment Initiative;                                                         disagrees with the underlying legal
                                               among others, the regular discharge of
the Vessel initiative and EPA’s National                                                    theory of the enforcement action or even
                                               oil into the Delaware River, concealing
Enforcement Priorities. DOJ’s Worker                                                        seeks changes to regulations that would
                                               serious worker injuries from health and
Endangerment Initiative prosecutes                                                          bar similar future enforcement actions.
                                               safety inspectors, and maintaining a
OSHA and environmental violations                                                           For example, New Source Review air
                                               dangerous workplace that contributed
together because DOJ believes that                                                          enforcement actions against utilities and
                                               to multiple severe injuries and the death
companies that ignore OSHA regula-                                                          refineries have continued throughout
                                               of one employee at its Phillipsburg, New
tions also ignore EPA regulations. Ms.                                                      the current Bush Administration despite
                                               Jersey facility. The individual defendants
Mitchell indicated, however, that even                                                      efforts to reform NSR regulations that
                                               convicted were the plant manager, the
though OSHA was continuing to refer                                                         would have foreclosed similar lawsuits
                                               maintenance supervisor, the finishing
cases, DOJ did not currently have any                                                       in the future.
                                               superintendent, and the human resource
new worker endangerment cases. Vessel
                                               manager. The former engineering              Congressional efforts may also influ-
cases continued to be a focus of the
                                               manager at the plant was acquitted on        ence enforcement policies in the new
Environmental Crimes Section because
                                               three counts. The case and is the longest    Administration. Congress has directly
the desired deterrent effect had not yet
                                               environmental crimes trial prosecuted        intervened before into EPA’s enforcement
been achieved. In response to EPA’s
                                               by the USDOJ.                                decisions by mandating the hiring of
National Enforcement Priorities, DOJ
was focusing on Clean Air Act cases and                                                     additional enforcement officers and
persistent non-compliance with permits
                                               How will the Election Change                 rejecting efforts to cut enforcement
under the Clean Water Act.                     Federal Environment Criminal                 budgets. Beyond forcing the allocation
                                                                                            of resources to enforcement efforts,
Based upon the considerable number of
                                               Prosecutions ?
                                                                                            Congress has turned the light of
cases DOJ prosecuted in 2008, Mitchell’s       Will the election affect EPA and DOJ         public scrutiny onto environmental
analysis that federal criminal prosecu-        enforcement policies? The answer, of         enforcement trends under the current
tions have not yet effectively deterred ves-   course, is both yes and no. A change         Administration to criticize allegedly
sel violations appears accurate. In 2008       in presidential administrations will         low numbers of enforcement actions,
alone, DOJ concluded seven vessel cases.       undeniably bring new enforcement             prosecutions and convictions. This
Six cases involved deliberate discharges       priorities and initiatives. The Obama        congressional examination has led to
of oily water. One case was brought            Administration, by contrast, will wrestle    reports on the state of CERCLA enforce-
against Kinder Morgan Bulk Terminals           with environmental enforcement issues        ment as well as inquiries into the scope
Incorporated (“KMBT”) located in               raised by increased renewable energy         and nature of prosecutions under the
Portland, Oregon. KMBT was convicted           production, expanded biofuel refining        Federal Water Pollution Control Act after
of a felony Ocean Dumping Act offense,         and marketing, and newly implemented         the Rapanos decision.
for its participation in loading wet, off-     climate change regulations. As these
                                                                                            This milieu will probably lead to a
specification potash on a vessel that was      new priorities filter into the strategic     strong degree of consistency between
later dumped into the ocean. The federal       plans and initiatives of the USEPA and       past and future environmental enforce-
court fined KMBT $ 240,000.                    the USDOJ, they will inevitably color        ment policy at the ground level. While
                                               the enforcement choices made by upper        the new President will undoubtedly help
Although new worker endangerment
                                               agency management.                           shape fundamental policy and directions
cases were not brought in the final two
years of the Bush administrative, the          These changes at the upper echelons of       for EPA and DOJ into the future, envi-
Atlantic States case remains illustrative      government, however, do not translate        ronmental enforcement – like a steadily
of those cases. The 34-count indictment        into deeper shifts in on-going enforce-      paced train on a level track – will
charged Atlantic States Cast Iron Pipe         ment initiatives. The power to choose        initially swerve only slowly through any
Co, a subsidiary of McWane Inc., and           and pursue environmental enforcement
five named managers, with conspiracy           rests largely with career staff and attor-                     Continued on next page
18                                                                                              Environmental & Natural Resources

new Administration.                           reject the agreement, and the victims         she approved the plea agreement of a $50
                                              filed a mandamus petition with the Fifth      million fine and three years probation.
The Crime Victims’ Rights Act                 Circuit Court of Appeals.
The Justice for All Act was signed into       The Fifth Circuit granted the manda-
                                                                                            McNulty Issues
law by President George W. Bush on            mus, in part because the Fifth Circuit        On August 28, 2008, Deputy Attorney
October 30, 2004. The Act contained           was under a seventy-two (72) hour             General Mark R. Filip announced that
four major sections, including the Crime      deadline. The Fifth Circuit ultimately        DOJ has revised its corporate charging
Victims’ Rights Act (CVRA) enumerating        held that the plea agreement violated the     guidelines. The new guidelines address
eight victims’ rights. Generally, the         CVRA for two reasons: 1) the govern-          one issues of particular interest, the
CVRA requires prosecutors to let victims      ment filed sealed, ex parte motions           area of cooperation credit. The revised
know that they can seek the advice of         when it should have conferred with the        guidelines state that credit for coopera-
an attorney about the rights established      victims; 2) the District Court’s rationale    tion will not depend on the corporation’s
by the CVRA; it allows victims to file        of protecting BP from prejudicial media       waiver of attorney-client privilege or
motions to reopen a plea or a sentence        coverage was not sufficient to waive the      work product protection. Rather, credit
in certain circumstances; and mandates        victims’ rights under the CVRA. But, the      for cooperation will depend upon the
that victims have the right to be reason-     Fifth Circuit did not issue a final writ      disclosure of relevant facts. Corporations
ably heard at any public proceeding           of mandamus because the victims had           that disclose relevant facts may receive
involving release, plea, or sentencing.       all been granted an opportunity to be         due credit for cooperation, regardless
Either the victim or the government may       heard on the date on which BP entered         of whether they waive attorney-client
assert the victim’s rights in the district    its plea and through their supplemental       privilege or work product protection in
court and may file a petition with the        briefs. The Fifth Circuit’s admonished        the process. Corporations that do not
court of appeals if not satisfied. The        that it leans very heavily upon the           disclose relevant facts may not receive
CVRA requires the Attorney General to         District Court to consider the victims        such credit. Under the predecessor
designate a DOJ administrative authority      rights and expressed confidence that the      policies (the Thompson and McNulty
to investigate complaints about viola-        District Court would “carefully consider      memoranda) federal prosecutors were
tions of crime victims’ rights and to cre-    [the victims’] objections and briefs as       allowed to request the disclosure of
ate sanctions for DOJ employees who fail      this matter proceeds” when the District       non-factual attorney-client privileged
to meet obligations to victims. However,      Court decides whether to approve the          communications and work product.
the CVRA does not create a separate           plea agreement.                               With two well established exceptions,
cause of action allowing victims to bring                                                   the new guidance forbids it.
suit against the Federal government, nor      The victims then asked the United States
is it intended to impair prosecutorial        Supreme Court to delay the action on the      The new guidelines also introduce
discretion in a case. The CVRA creates        plea agreement and contended that the         changes beyond the question of attor-
no attorney-client relationship between       plea deal is too lenient, and that it was     ney-client privilege and work product
the victim and a DOJ representative.          worked out without any input from the         waivers. They instruct prosecutors not
                                              victims in violation of the CVRA. The         to consider a corporation’s advancement
On March 23, 2005, there was an explo-        issue in the stay application was the stan-   of attorneys’ fees to employees when
sion at the BP Products refinery in Texas     dard of review to be applied by federal       evaluating cooperation. They also make
City, Texas. Fifteen workers were killed,     appeals courts when crime victims seek        clear that the mere participation in a
and more than 170 others were seriously       an order to compel a judge to uphold          joint defense agreement will not render
injured. With permission from a federal       their rights under the CVRA.                  a corporation ineligible for cooperation
judge to avoid notifying victims of plea                                                    credit. In addition, the new guidance
discussions, federal prosecutors and BP       In July 2008, the U.S. Supreme Court
                                                                                            provides that prosecutors may not con-
worked out a deal and then submitted          denied a request by the victims to
                                                                                            sider whether a corporation has sanc-
it to a District Court for approval. The      stop a settlement in the case. The
                                                                                            tioned or retained culpable employees in
agreement has a BP subsidiary pleading        Supreme Court’s action made Judge Lee
                                                                                            evaluating whether to assign cooperation
guilty to a violation of the Clean Air Act,   Rosenthal’s decision on approval of the
                                                                                            credit to the corporation.
calls for a $50 million fine and sentences    plea agreement the next step in sentenc-
the oil giant to three years’ probation.      ing. Judge Rosenthal heard evidence on        The announced revisions and policy
Twelve of the injured victims joined in a     medical bills and lost wages of people        changes are being included for the first
challenge to a plea bargain. The victims      who died or were hurt in the 2005             time to the United States Attorneys
were ultimately granted a hearing, and        explosion at BP’s Texas City refinery         Manual, which is binding on all fed-
filed 134 impact statements. The victims      to determine whether a $50 million            eral prosecutors within DOJ. For more
even made comments on the date BP             fine is sufficient given tangible victim      information about the DOJ’s Principles
entered its guilty plea. The District         losses, but she refused to consider non-      of Federal Prosecution of Business
Court denied the victims’ request to          economic losses. On March 12, 2009,           Organizations, you can visit the DOJ’s
Environmental & Natural Resources                                                                                               19

web site at To        Client Privilege Protection Act (HR            would prevent future administrations
read Deputy Attorney General Mark R.        3013), which passed the House and              from overturning the Filip directive and
Filip’s speech announcing the changes -     awaits action in the Senate. The               apply it to all agencies, not just DOJ.
ttp://      Attorney-Client Privilege Protection
dag-speech-0808286.html.                    Act would protect the privilege in any
The change in the policy was DOJ’s          federal investigation or criminal or civil
attempt to forestall the Attorney-          enforcement matter. That legislation

   Research Resources
   Readers may benefit from reviewing the research resources that are listed below:

   Mandiberg and Smith, Crimes Against the Environment (LEXIS 1997 with supplements through 2004)
   Comprehensive treatise covering all aspects of criminal, administrative, environmental, wildlife and natural resources law
   pertinent to federal environmental crimes. This resource should soon be available without charge on line at SSRN.
   Kathleen F. Brickey, Environmental Crime: Law, Policy, Prosecution, Aspen Publishers (2008) Introductory text
   on federal environmental crimes by white collar criminal expert.
   Environmental Crimes Blog, Walter James III, author,
   Environmental Law Prof Blog, Susan L. Smith, editor and author,
   U.S. EPA Criminal Enforcement website,
   International Network for Environmental Compliance and Enforcement website,
   Environmental Crimes, Natural Resources & Environment magazine, (ABA Section on Environment, Energy and
   Resources Winter 2009)
       Martin Harrell, Joseph J. Lisa, and Catherine L. Votaw, Federal Environmental Crime:
       A Different Kind of “White Collar” Prosecution
       Milo C. Mason and Paul B. Smyth, Reviewing Nonreviewable Prosecutorial Discretion:
       What and Who Is Behind the Big, Powerful Curtain
       James J. Periconi, The State of Environmental Crimes Prosecutions in New York
       Claudia A. McMurray, Wildlife Trafficking: U.S. Efforts to Tackle a Global Crisis
       Ani Youatt and Thomas Cmar, The Fight for Red Gold: Ending Illegal Mahogany Trade from Peru
       Susan F. Mandiberg, What Does an Environmental Criminal Know?
       J. T. Morgan, The Mythical Erosion of Mens Rea
       Kirk F. Marty, Criminal Prosecution of Responsible Corporate Officers and Negligent Conduct under Environmental Law
       Kevin M. Cassidy, The Role of Motive in White Collar Environmental Crimes
       Judson W. Starr, Brian L. Flack, and Allison D. Foley, A New Intersection: Environmental Crimes and Victims’ Rights
       James D. Oesterle, “Citizen Rewards” to Promote Environmental Crimes Prosecutions
       Gregory F. Linsin, Environmental Self-Audit and Voluntary Disclosure to What End?

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