Case 1:21-cv-00516-MJT Document 2-1 Filed 10/13/21 Page 1 of 99 PageID #: 83
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
` BEAUMONT DIVISION
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`__________________________________
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`UNITED STATES OF AMERICA,
` and STATE OF TEXAS
`Plaintiffs,
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`Civil Action No. 1:21-cv-00516
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`CONSENT DECREE
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`Defendants.
`__________________________________ )
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` v.
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`E.I. DU PONT DE NEMOURS AND
`COMPANY, and
`PERFORMANCE MATERIALS,
`NA, INC.
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`I.
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`II.
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`III.
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`IV.
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`V.
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`VI.
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`TABLE OF CONTENTS
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`JURISDICTION AND VENUE ......................................................................................6
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`APPLICABILITY ............................................................................................................ 7
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`DEFINITIONS ..................................................................................................................9
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`INJUNCTIVE RELIEF REQUIREMENTS FOR COMPLIANCE ...............................11
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`COMPLIANCE EVALUATION AND AUDIT REQUIREMENTS.............................12
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`APPROVAL OF DELIVERABLES ..............................................................................19
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`VII.
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`PERMITS ........................................................................................................................20
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`VIII.
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`CIVIL PENALTY ...........................................................................................................21
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`IX.
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`X.
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`XI.
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`XII.
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`XIII.
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`XIV.
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`XV.
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`REPORTING REQUIREMENTS ..................................................................................24
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`STIPULATED PENALTIES ..........................................................................................27
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`FORCE MAJEURE ........................................................................................................36
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`DISPUTE RESOLUTION ..............................................................................................38
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`INFORMATION COLLECTION AND RETENTION .................................................41
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`EFFECT OF SETTLEMENT/RESERVATION OF RIGHTS .......................................43
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`COSTS ............................................................................................................................45
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`XVI.
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`NOTICES ........................................................................................................................46
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`XVII. EFFECTIVE DATE ........................................................................................................50
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`XVIII. RETENTION OF JURISDICTION ................................................................................50
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`XIX. MODIFICATION ...........................................................................................................51
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`XX.
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`TERMINATION .............................................................................................................51
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`XXI.
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`PUBLIC PARTICIPATION ...........................................................................................55
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`XXII.
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`SIGNATORIES/SERVICE.............................................................................................55
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`XXIII.
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`INTEGRATION .............................................................................................................56
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`XXIV. FINAL JUDGMENT ......................................................................................................56
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`XXV. APPENDICES ................................................................................................................56
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`XXVI. 26 U.S.C. § 162(f)(2)(A)(ii) IDENTIFICATION ..........................................................56
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`WHEREAS, concurrent with the lodging of this Consent Decree, Plaintiffs, the United
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`States of America, on behalf of the United States Environmental Protection Agency (“EPA”),
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`and the State of Texas (the “State”) by and through the Texas Commission on Environmental
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`Quality (“TCEQ”), have filed a Complaint in this action against Defendants E. I. du Pont de
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`Nemours and Company (“DuPont”) and Performance Materials NA, Inc. (“PMNA”)
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`(collectively “Defendants”) for alleged environmental violations during their respective periods
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`of ownership and operation of the Sabine River Operations Facility (also referred to as “the
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`Facility”) located in Orange, Texas.
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`WHEREAS, the Complaint alleges that Defendants have violated the following
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`environmental statutes and their implementing federal and state regulations at the Facility located
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`in Orange County, Texas: the Clean Air Act (“CAA''), 42 U.S.C. §§ 7401-7671q; the Resource
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`Conservation and Recovery Act (“RCRA”), 42 U.S.C. §§ 6901-6992k; and the Clean Water Act
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`(“CWA”), 33 U.S.C. §§ 1251-1387; the Texas Clean Air Act (“TCAA”), Tex. Health & Safety
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`Code §§ 382.001-.510; the Texas Solid Waste Disposal Act (“TSWDA”), Tex. Health & Safety
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`Code §§ 361.001-.992; and Chapters 7 and 26 of the Texas Water Code (“TWC”), Tex. Water
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`Code ch. 7, 26.
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`WHEREAS, in August 2017, DuPont and The Dow Chemical Company (“TDCC”) each
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`merged with subsidiaries of DowDuPont, Inc. (“DowDuPont”) and, as a result, TDCC and
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`DuPont became subsidiaries of DowDuPont.
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`WHEREAS, DuPont owned and operated the Facility until February 1, 2019.
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`WHEREAS, on February 1, 2019, ownership and operation of the Facility was
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`transferred from DuPont to PMNA, then a subsidiary of DuPont.
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`WHEREAS, on April 1, 2019, Dow, Inc. (“Dow”) was spun out of DowDuPont as a
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`standalone publicly traded company, and PMNA became a subsidiary of TDCC, itself a
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`subsidiary of Dow.
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`WHEREAS, on May 4, 2020, Dow and PMNA sold ownership and operation of the
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`Facility’s waste incineration operations to Heritage Thermal of Texas, LLC (“Heritage”),
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`including (i) a rotary kiln, afterburner chamber and associated facilities, and (ii) the Title V
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`Operating Permit for operation of the Sabine Region Incinerator (Regulated Entity No.
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`RN100542711), Permit No. O1896, issued on August 3, 2016, including all existing or
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`applicable permits by rule.
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`WHEREAS, pursuant to the Asset Transfer Agreement dated December 8, 2019, (i)
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`Heritage acknowledged and agreed that the transferred assets may become subject to a
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`multimedia enforcement consent decree, (ii) Heritage and PMNA agreed to communicate,
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`consult, and reasonably cooperate with one another in the design, engineering, procurement,
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`construction, installation and commissioning of capital projects related to the transferred assets
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`as and when and to the extent required pursuant to this Consent Decree, and (iii) PMNA has the
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`right, exercisable at any time, to assume responsibility for such projects and to otherwise comply
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`with any of the obligations in the Consent Decree related to the transferred assets, and to access
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`the transferred assets in connection therewith.
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`WHEREAS, by agreeing to entry of this Consent Decree, Defendants deny and do not
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`admit any liability to the United States or the State arising out of the transactions or occurrences
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`alleged in the Complaint.
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`WHEREAS, the Parties recognize, and the Court by entering this Consent Decree finds,
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`that this Consent Decree has been negotiated by the Parties in good faith and will avoid litigation
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`among the Parties, and that this Consent Decree is fair, reasonable, and in the public interest.
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`NOW, THEREFORE, before the taking of any testimony, without the adjudication or
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`admission of any issue of fact or law except as provided in Section I (Jurisdiction and Venue), and
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`with the consent of the Parties, IT IS HEREBY ADJUDGED, ORDERED, AND DECREED as
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`follows:
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`I. JURISDICTION AND VENUE
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`This Court has jurisdiction over the subject matter of this action and over the
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`Parties pursuant to 28 U.S.C. §§ 1331, 1345, 1355, and 1367; Section 113(b) of the CAA,
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`42 U.S.C. § 7413(b); Section 3008(a)(l) of RCRA, 42 U.S.C. § 6928(a)(l); and Section 309(b) of
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`the CWA, 33 U.S.C. §§ 1319(b). Venue lies in this District pursuant to 28 U.S.C. §§ 1391(b) and
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`(c) and 1395(a), because the violations alleged in the Complaint are alleged to have occurred in,
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`and Defendants conduct business in, this judicial district. This venue is also consistent with
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`Section 113(b) of the CAA, 42 U.S.C. § 7413(b); Section 3008(a) of RCRA, 42 U.S.C.
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`§ 6928(a); and Sections 309 of the CWA, 33 U.S.C. §§ 1319.
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`For purposes of this Consent Decree, or any action to enforce this Consent
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`Decree, Defendants consent to the Court's jurisdiction over this Consent Decree and any such
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`action, and over Defendants, and Defendants consent to venue in this judicial district.
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`For purposes of this Consent Decree, Defendants agree that the Complaint states
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`claims upon which relief may be granted pursuant to Section 113 of the CAA, 42 U.S.C. § 7413;
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`Sections 3004, 3005 and 3008 of RCRA, 42 U.S.C. §§ 6924, 6925 and 6928; Section 309 of the
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`CWA, 33 U.S.C. §§ 1319 and 1321; Section 382.085 of the TCAA, Tex. Health & Safety Code §
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`382.085; Sections 7.101 and 26.121 of the TWC, Tex. Water Code §§ 7.101 and 26.121; and
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`applicable state and federal regulations.
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`II. APPLICABILITY
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`The obligations of this Consent Decree apply to and are binding upon the United
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`States, the State, and upon Defendants and their respective successors, assigns, or other entities
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`or persons otherwise bound to this Decree by law. Notwithstanding the transfer of certain assets
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`to Heritage in May 2020, Defendants remain responsible for performance of their obligations
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`under this Consent Decree that relate to the transferred assets, and Defendants will not argue that
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`the transfer of assets to Heritage has any effect on their obligations to perform injunctive relief
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`under this Decree.
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`At least thirty 30 Days prior to any proposed transfer of ownership or operation of
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`all or substantially all of the assets comprising the Facility (“Transfer”), or within such shorter
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`time as the United States and the State may agree to in writing, the transferring Defendant shall
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`provide a copy of this Consent Decree to the proposed transferee and shall provide written notice
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`describing the prospective Transfer (and Defendant’s confidentiality expectations), together with
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`a copy of the relevant portions of the draft Transfer agreement, to the United States and the State
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`in writing, in accordance with Section XVI (Notices). No Transfer, whether in compliance with
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`the procedures of this Paragraph or otherwise, relieves the transferring Defendant of its
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`obligation to ensure that the terms of this Consent Decree are implemented, unless (i) the
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`transferee agrees to undertake the obligations of this Consent Decree and to be substituted for the
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`transferor as a Party under this Decree and thus bound by the terms hereof, (ii) the United States
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`and the State consent to relieve the transferor of its obligations, or this Court orders such
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`substitution over the objection of the Plaintiffs through the process set forth in Paragraph 7, or a
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`Defendant is merged into its corporate parent existing at the date of Lodging and the surviving
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`corporation, by operation of law, assumes all of the assets and liabilities of the Defendant, and
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`(iii) the Court modifies this Consent Decree and the transferee becomes a Party to this Consent
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`Decree.
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`After the submission to the United States and the State of the notice of the
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`proposed Transfer, as required by Paragraph 5, transferor may request the Plaintiffs’ consent to
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`file a joint motion requesting the Court to approve a modification substituting the transferee for
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`transferor as a Defendant responsible for complying with all or some of the obligations of the
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`Consent Decree. Plaintiffs may consent to such a filing or the United States shall notify the
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`transferring Defendant, after consultation with the State, that Plaintiffs do not agree to modify
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`the Consent Decree to relieve the transferor of responsibility, substitute the transferee for the
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`transferor, and make the transferee responsible for complying with all or some of the obligations
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`of the Consent Decree, as requested.
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`If, for any reason, transferor does not secure the agreement of Plaintiffs to file a
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`joint motion within 30 Days after requesting the Plaintiffs’ consent to file a joint motion under
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`Paragraph 6, transferor and the transferee may file, without the agreement of the United States or
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`the State, a motion requesting the Court to approve a modification substituting the transferee for
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`the transferor as the Party responsible for complying with some or all of the obligations of the
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`Consent Decree. The United States or the State may file an opposition to the motion objecting to
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`the Transfer (a) because EPA or TCEQ has determined that the transferee lacks the financial or
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`technical ability to assume the obligations of the Decree; (b) because the proposed modification
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`fails to effectively transfer all relevant portions of the Consent Decree’s obligations to the
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`transferee; or (c) for any other good cause. The motion to modify the Decree shall be granted
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`unless: (i) the transferor and the transferee fail to show that the transferee has the financial and
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`technical ability to assume the obligations of the Decree, as requested; (ii) the transferor and the
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`transferee fail to show that the modification language effectively transfers such obligations to the
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`transferee; or (iii) the Court finds other good cause for denying the motion.
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`Each Defendant shall provide a copy of relevant portions of this Consent Decree
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`to all officers, employees, and agents that are responsible for compliance with any provision of
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`this Decree, as well as to any vendor, supplier, or contractor retained to perform work required
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`under this Consent Decree. Each Defendant shall condition any such contract upon performance
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`of the work in conformity with the terms of this Consent Decree. A contractor's failure to
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`perform the work in conformity with the terms of this Decree shall not excuse the Defendant’s
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`obligations under this Decree.
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`In any action to enforce this Consent Decree, neither Defendant shall raise as a
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`defense the failure by any of its officers, directors, employees, agents, or contractors to take any
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`actions necessary to comply with the provisions of this Consent Decree.
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`III. DEFINITIONS
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`Terms used in this Consent Decree, including the Appendices hereto, that are
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`defined in the CAA, RCRA, CWA, TCAA, TSWDA, TWC, or in federal and state regulations
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`promulgated thereunder, shall have the meanings assigned to them in the applicable statute or
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`such regulations, unless otherwise provided in this Decree. Whenever the terms set forth below
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`are used in this Consent Decree, the following definitions shall apply:
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`a. “Complaint” shall mean the complaint filed by the United States and the State in
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`this action;
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`b. “Consent Decree” or “Decree” shall mean this Consent Decree and all
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`appendices attached hereto listed in Section XXV (Appendices);
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`c. Date of Lodging” shall mean the date on which the United States initially lodges
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`the Consent Decree with the Court prior to commencement of the public
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`comment period required by Section XXI (Public Participation) or this Consent
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`Decree.
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`d.
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` “Day” or “day” shall mean a calendar day unless expressly stated to be a
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`business day. In computing any period of time under this Consent Decree,
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`where the last day would fall on a Saturday, Sunday, or federal or State of Texas
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`holiday, the period shall run until the close of business of the next business day;
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`e. “Defendants” shall mean E.I. du Pont de Nemours and Company (“DuPont”)
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`and Performance Materials NA, Inc. (“PMNA”);
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`f.
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`“EPA” shall mean the United States Environmental Protection Agency and any
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`of its successor departments or agencies;
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`g. “Effective Date” shall have the definition provided in Section XVII (Effective
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`Date);
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`h. “Environmental Management System” or “EMS” refers to the comprehensive,
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`facility-wide system to ensure environmental compliance, achieve pollution
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`prevention, and accomplish pollution reduction at the Facility;
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`i.
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` “Facility” or “Sabine River Operations Facility” shall mean those portions of
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`the Sabine River Operations Chemical Manufacturing Complex, located at 3055
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`FM 1006, Orange, Orange County, Texas, including real property and operating
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`or closed units or equipment owned or operated by either Defendant and subject
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`to the provisions of this Consent Decree, but not including units or equipment
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`currently operated by INVISTA s.a.r.l. and the real property underlying such
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`units or equipment;
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`j.
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` “Month” or “monthly” shall mean a calendar month;
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`k. “Paragraph” shall mean a portion of this Decree identified by an Arabic
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`numeral;
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`l.
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`“Parties” shall mean the United States of America, the State of Texas, DuPont
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`and PMNA;
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`m. “Plaintiff(s)” shall mean the United States of America and the State of Texas;
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`n. “Section” shall mean a portion of this Decree identified by a roman numeral;
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`o. “TCEQ” shall mean the Texas Commission on Environmental Quality, an
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`agency of the State of Texas, or any successor departments or agencies of
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`TCEQ;
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`p. “Texas” or “the State” shall mean the State of Texas, acting on behalf of the
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`TCEQ;
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`q. “United States” shall mean the United States of America, acting on behalf of
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`EPA.
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`IV. INJUNCTIVE RELIEF REQUIREMENTS FOR COMPLIANCE
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`Benzene Waste Operations National Emission Standards for Hazardous Air
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`Pollutants. Defendants shall undertake the measures set forth in Appendix A of this Consent
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`Decree relating to 40 C.F.R. Part 61, Subpart FF (“Benzene Waste Operations NESHAP”).
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` Miscellaneous Organic Chemical Manufacturing National Emission Standards for
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`Hazardous Air Pollutants. Defendants shall undertake the measures set forth in Appendix B of
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`this Consent Decree relating to 40 C.F.R. Part 63, Subpart FFFF (“Miscellaneous Organic
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`Chemical Manufacturing NESHAP,” or “MON”) and the applicable requirements for wastewater
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`streams and liquid streams in open systems with a miscellaneous organic chemical
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`manufacturing process unit, as set forth in Subpart FFFF, Table 7, at the Facility.
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`RCRA Requirements. Defendants shall undertake the measures set forth in
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`Appendix C of this Consent Decree relating to the RCRA and related State law at the Facility.
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`CWA Requirements. Defendants shall undertake the measures set forth in
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`Appendix D of this Consent Decree relating to the CWA, related State law and permits at the
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`Facility.
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`Environmental Management System (“EMS”) Requirements. Defendants shall
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`undertake the measures set forth in Appendix E of this Consent Decree.
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`Defendants shall be jointly and severally liable for the performance of injunctive
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`relief requirements set forth in Sections IV, V, VI, VII, IX and XIII of this Consent Decree.
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`Defendants may designate one Defendant to be lead point of contact for submission of
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`deliverables related to such injunctive relief requirements, and each Defendant shall advise
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`Plaintiffs of that designation.
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`V. COMPLIANCE EVALUATION AND AUDIT REQUIREMENTS
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`In accordance with Appendices A-D, Defendants shall hire Independent Third
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`Parties to conduct environmental compliance evaluations or audits at the Facility. Defendants
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`shall bear all costs associated with the Independent Third Party evaluations or audits, cooperate
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`fully with the Independent Third Party consultant, and provide the consultant with reasonable
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`and timely access to all records, employees, contractors, units, and facilities that the consultant
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`deems necessary to effectively perform the duties described in this Section and in Appendices A-
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`D.
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`The Independent Third Parties shall be informed of and be required by contract to
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`comply with all applicable workplace safety and health procedures while onsite at the Facility.
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`Representatives of Independent Third Parties responsible for overseeing the duties
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`set forth in this Section and in Appendices A (BWON), B (MON), C (RCRA), and D (CWA) of
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`this Consent Decree shall:
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`a. have a bachelor's or higher degree in a relevant discipline and a license in
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`professional engineering; and
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`b. have expertise and competence in the relevant regulatory programs under
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`federal and state environmental laws, and at least five years of experience,
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`including current experience and training, with the requirements of relevant
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`laws and permits.
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`c. have conducted audits covering these regulatory programs within the last five
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`(5) years.
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`To ensure independence, each Independent Third Party and its personnel, or
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`subcontractors, that perform duties pursuant to this Consent Decree shall act impartially when
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`performing all activities under this section. To demonstrate independence and impartiality,
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`Defendants shall have no financial interest in the Independent Third Party and shall require in the
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`auditing contract with the Independent Third Party, that:
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`a. The Independent Third Party, and its personnel or subcontractors performing the
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`audit work, shall not have any conflict of interest that will compromise, in any
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`way, the independence of the evaluation or audit;
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`b. The Independent Third Party, and its personnel or subcontractors performing the
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`audit work, shall not have conducted past research, development, design,
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`construction services, or consulting for either Defendant within the last 3 years
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`prior to the auditing contract, and not have ever worked at the Facility. For
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`purposes of this Section, the term “consulting” shall not include performing or
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`participating in other third-party audits or evaluations required by this Consent
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`Decree;
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`c. The Independent Third Party, and its personnel or subcontractors performing the
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`audit work, shall not provide other business or consulting services to
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`Defendants, including advice or assistance to implement the findings or
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`recommendations in the audit report, for a period of at least 3 years following
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`the Independent Third Party's submittal of the final Audit report without the
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`prior written consent of the United States in consultation with TCEQ;
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`d. All Independent Third Party personnel who conduct or otherwise participate in
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`the evaluation/audit sign and date a conflict of interest statement attesting that
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`the personnel:
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`i. have met and followed the Independent Third Party requirements in this
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`Section V, Paragraph 20; and
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`ii.
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`receive no financial benefit from the outcome of the evaluation or audit, apart
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`from payment for the performance of such evaluation or audit services;
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`e. Defendants shall not hire as an employee or consultant any of the Independent
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`Third Party's personnel, or contractors retained by the Independent Third Party,
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`who conducted or otherwise participated in the evaluation/audit during the
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`period of the evaluation/audit and for a period of at least 3 years following the
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`Independent Third Party's submittal of its final audit report(s) without the prior
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`written consent of the United States in consultation with TCEQ;
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`f. The Independent Third Party shall retain for five (5) years after completion of
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`its final audit report(s), and if directed by Defendants shall produce for
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`Defendants, and for EPA and TCEQ, copies of any of the evaluation or audit-
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`related reports and records specified in this section; and
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`g. The Independent Third Party shall have in place policies and procedures to
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`memorialize conditions (a) through (f), above, to ensure the Independent Third
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`Party's competence, impartiality, judgment, and operational integrity when
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`auditing under this section.
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`Selection of the Independent Third Party. Unless otherwise set forth in this
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`Consent Decree, no later than thirty (30) days after entry of this Consent Decree, for each
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`evaluation or audit required by this Consent Decree Defendants shall submit to the United States
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`and TCEQ a list of three or more proposed consultants to serve as an Independent Third Party,
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`along with the name, affiliation, and address of the proposed Independent Third Party,
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`information demonstrating how each proposed auditor satisfies the requirements of Paragraphs
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`19 and 20, and a description of any previous work, contracts, or financial relationships with
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`Defendants in the prior ten (10) years. Defendants shall state whether a proposed Independent
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`Third Party is proposed to conduct more than one evaluation or audit or whether more than one
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`Independent Third Party will participate on a single evaluation or audit. If, despite best
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`reasonable efforts, Defendants cannot identify three proposed Independent Third Parties that
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`meet all requirements of Paragraphs 19 and 20, Defendants shall so certify with an explanation
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`of the efforts it has made to locate such Independent Third Parties, and shall submit to the United
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`States and TCEQ a list of three or more proposed candidates to serve as an Independent Third
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`Party, along with the information required under this Paragraph demonstrating that the
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`candidates can perform the duties under this Section in an independent manner, and an
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`explanation of which requirements of Paragraphs 19 and 20 are met and which are not met by
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`each candidate.
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`a. The United States, in consultation with TCEQ, shall notify Defendants
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`regarding whether it approves the proposed Independent Third Party
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`consultant(s) on the list(s). If the United States, after consultation with TCEQ,
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`does not approve any of the proposed consultants on Defendants’ list, then
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`Defendants shall submit a second, and if necessary third list of proposed
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`consultants to the United States and TCEQ within thirty (30) Days of receipt of
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`the United States’ written notice of its disapproval of proposed consultants on
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`the list. If the United States has not approved a proposed consultant on the first,
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`second or third lists submitted by Defendants and the Parties are unable to agree
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`on a proposed consultant, the Parties agree to resolve the selection of
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`Independent Third Parties through the Dispute Resolution process in Section
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`XIII.
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`b. Within 60 Days after receipt of the United States’ approval, in consultation with
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`TCEQ, Defendants shall select one consultant from those approved by the
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`United States for the particular evaluation(s) or audit(s) and shall enter into a
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`contract with the consultant to serve as Independent Third Party and to perform
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`all the duties required for the particular evaluation(s) or audit(s) as required by
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`this Consent Decree. Defendants shall use all commercially reasonable efforts to
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`ensure that the Independent Third Party complies with the requirements set forth
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`in this Decree, including the deadlines established thereunder and in approved
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`schedules. Defendants’ retention contract with the Independent Third Party shall
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`include enforceable obligations paralleling applicable Consent Decree
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`requirements and shall include remedies, including penalties, for
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`nonperformance or delayed performance by the Independent Third Party. In the
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`event the consultant(s) approved by the United States is no longer available or
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`willing to accept the work described in this Consent Decree when notified of
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`their selection by Defendants, then Defendants shall select another auditor
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`approved by the United States and enter into the contract to perform the relevant
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`evaluation(s) or audit(s) within sixty (60) Days.
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`c.
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`If, after retention by Defendants, the selected Independent Third Party cannot
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`satisfactorily perform the evaluation or audit, then within sixty (60) Days of
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`learning that the Independent Third Party cannot satisfactorily perform the
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`evaluation or audit, Defendants shall submit a list of proposed replacement
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`Third Parties to the United States and TCEQ for approval in accordance with
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`this Paragraph.
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`
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`Upon receipt of written notice from the Independent Third Party, Defendants shall
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`immediately notify EPA and TCEQ of any condition the Independent Third Party finds during an
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`evaluation or audit that may present an imminent and substantial endangerment to public health,
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`welfare, or the environment. Either Defendant’s or both Defendants’ contract with the
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`Independent Third Party shall require the Independent Third Party to cooperate fully with any
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`requests made by Defendants, EPA, or TCEQ in investigating the potential endangerment.
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`Defendants shall cooperate fully with any requests made by EPA or TCEQ in investigating the
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`potential endangerment. Nothing in this paragraph shall relieve Defendants of any other
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`obligation imposed by any applicable federal, state, tribal, or local law or order requiring
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`notification or response to the potential endangerment. The notification requirement of this
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`paragraph is in addition to and shall not substitute for any such obligation.
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`General Evaluation or Audit Report Requirements. In addition to the specific
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`requirements for each third party evaluation or audit set forth under this Consent Decree, either
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`Defendant’s or both Defendants’ contract with the Independent Third Party shall require the
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`Independent Third Party to include, as part of its final report after completion of the evaluation
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`or audit, the following:
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`a.
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`the name and address of the Facility reviewed and the dates of the evaluation or
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`audit;
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`b. a description of the info