United States of America et al v United States Steel Corporation
Filing
105
OPINION AND ORDER DENYING 90 Surfrider Foundation's and City of Chicago's motion for an evidentiary hearing or oral argument and GRANTING 46 the United States of America's motion to enter the revised consent decree. The Clerk is ORDERED to enter judgment in accordance with the terms of the revised consent decree. Signed by Chief Judge Jon E DeGuilio on 8/30/2021. (lhc)
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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
UNITED STATES OF AMERICA, et al.,
Plaintiffs,
v.
Case No. 2:18-CV-127 JD
UNITED STATES STEEL
CORPORATION,
Defendant.
OPINION AND ORDER
Federal and state environmental regulators were put on alert in April 2017 when the
United States Steel plant in Portage reported a large release of dangerous chemicals into a
waterway that flows into Lake Michigan and sits adjacent to Indiana Dunes National Park. The
regulators investigated the release and found that the steel plant had a history of environmental
violations stretching back to 2013. The federal government and Indiana initiated enforcement
proceedings over the violations. Two other parties with interests in the outcome of the
enforcement action, the City of Chicago and the Surfrider Foundation, soon intervened in the
case. The governments and U.S. Steel negotiated a revised consent decree to resolve the case that
they insist properly responds to the violations. They now ask this Court to enter the decree
despite intervenor and public opposition. After weighing the extensive record, the Court
determines the decree should be entered for the following reasons. 1
I.
Factual Background
The Court notes that this case was reassigned from Judge Theresa Lazar Springmann to Judge Jon E. DeGuilio on
January 25, 2021. (DE 78.)
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United States Steel is a corporation whose business includes running a steel
manufacturing and finishing facility in Portage, Indiana, known as the Midwest Plant
(“Facility”). (DE 1 ¶ 55, 56; DE 47-1 at 3.) The Facility is located adjacent to Lake Michigan
and Indiana Dunes National Park and, as part of its operations, discharges stormwater and
wastewater into an industrial ditch known as Burns Waterway that then, within approximately
500 feet, feeds directly into Lake Michigan. (DE 1 ¶ 57; DE 47-1 at 3.) U.S. Steel’s discharges
into Burns Waterway are subject to a host of governmental regulations that, among other things,
require U.S. Steel to ensure regular quantitative and narrative oversight and reporting, properly
maintain its facilities and systems, and advise of violations. (DE 1 at 10–12; DE 47-1 at 4–5.)
U.S. Steel is alleged to have frequently violated these requirements from 2013 through 2017.
(DE 1 at 30–31.) This case, filed in April 2018, and the revised consent decree this order
considers are a response to those violations.
A. Parties
While this case has drawn comments from a wide swathe of the public in the
approximately three years it has been pending, the actual parties are more finite. The case
originated as an action by the United States and the State of Indiana (together “Government
Plaintiffs”) against U.S. Steel. The federal government filed the case on behalf of the
Environmental Protection Agency (“EPA”), the National Park Service (“NPS”) of the United
States Department of the Interior, and the National Oceanic and Atmospheric Administration
(“NOAA”) of the U.S. Department of Commerce. The State of Indiana filed on behalf of the
Indiana Department of Environmental Management (“IDEM”) and the Indiana Department of
Natural Resources. (DE 47 at 1.) Each of the sub-entities the Government Plaintiffs represent
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have played a role in the detection, analysis, or negotiation process that led to the proposed
consent decree now before the Court.
At the time the Government Plaintiffs filed their suit in April 2018, two other entities
were in the early stages of pursuing their own litigation over the same issues. The Surfrider
Foundation, a non-profit corporation with a national reach that aims to protect the world’s
oceans, waves, and beaches, and the City of Chicago (“City”), which draws its drinking water
from Lake Michigan, had each filed their own lawsuits several months before the Government
Plaintiffs filed this action. (DE 20 at 1.) Both Surfrider and the City sought to intervene in this
lawsuit (DE 12; DE 13), and the Court granted their motions (DE 20).
B. Pre-enforcement violations
The Facility manufactures steel sheet and tubular products using a variety of processes
that, if not properly controlled, can have a negative impact on the environment. The Facility is
permitted to release wastewater with certain amounts of chemicals and other potential pollutants
that would otherwise represent violations of the Clean Water Act (“CWA”), but it must do so
within the confines of its National Pollution Discharge Elimination System (“NPDES”) permit,
which sets limits based on state and federal regulations. Indiana has the delegated authority from
the EPA to issue the permit and both state and federal regulators can then monitor the Facility to
see if it is abiding by the terms of its permit. (DE 47-1 at 4.) The Facility has two water treatment
plants it uses during its manufacturing process to comply with the requirements. (Id. at 3.)
The catalyst event for this action occurred in April 2017 when U.S. Steel personnel
noticed discoloration in wastewater within the Facility and saw a bluish-green tint to the water
leaving the Facility and flowing into Burns Waterway. (Id. at 4; DE 50-3 at 12.) Upon
inspection, personnel concluded that a wastewater line carrying chrome waste in the Facility had
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failed and caused the water to be sent not to the designated treatment facility for chrome waste
but instead to the plant that was not capable of such treatment. (DE 50-3 at 21–22.) The
wastewater passed through the plant untreated and then flowed into Burns Waterway. (Id.)
Sampling done at the time indicated that the wastewater that passed through the Facility
contained dangerous chromium compounds including roughly 300 pounds of hexavalent
chromium, which can have very serious effects on humans and the environment. (Id. at 18–19,
21–22.) U.S. Steel alerted the regulators that it had observed the problem and EPA and IDEM
personnel responded. Downstream users like the city of Portage and town of Ogden Dunes were
not alerted, however, until Indiana officials made the notifications. (Id. at 12–13.)
Both state and federal regulators determined during their investigation following the
April 2017 spill that U.S. Steel had violated environmental laws and regulations. Specifically,
the regulators found violations of several CWA provisions and corresponding Indiana state
regulations in the form of greater effluent discharges than were allowed under the Facility’s
NPDES permit. They found that the violations were not the result of blatant decisions to dump
large quantities of harmful chemicals into the waterway, but instead more indirectly stemmed
from internal Facility failures caused by a lack of preventative maintenance, poor condition of
equipment and materials within the Facility, and lacking management procedures that led to
inadequate inspection activities and inadequate routine monitoring of the equipment. (DE 47-2 at
15–26.) Additionally, because the discharge involved a large enough amount of chromic acid
that went unreported to regional stakeholders, the regulators found U.S. Steel violated the
Emergency Planning and Community Right-to-Know Act of 1986 (“EPCRA”). (DE 47-1 at 4.)
Further the EPA incurred $350,653.20 in response costs under the Comprehensive
Environmental Response, Compensation, and Liability Act (“CERCLA”), the NPS incurred
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response costs under the System Unit Resources Protection Act (“SURPA”), and the NOAA
incurred costs under CERCLA in conducting natural resource damage assessments at and in the
area around the Facility. NPS also incurred damages for the costs of assessing the risk to Indiana
Dunes National Park and from the lost use of national park beaches that were closed for several
days after the spill. (Id.)
The April 2017 spill also prompted state and federal regulators to look for other NPDES
permit violations at the Facility. Regulators found a host of prior violations beginning in
February 2013. (DE 1 at 30–31; DE 47-1 at 4–5.) The violations included permit effluent
exceedances for several non-chrome pollutants, narrative standard problems stemming from
discharges of discolored water, monitoring and reporting violations, improper operation and
maintenance of systems used to collect and treat wastewater, and stormwater pollution
prevention plan violations. (DE 1 at 30–31; DE 47-1 at 4–5.)
The Facility then experienced another effluent exceedance in October 2017 when it again
violated its chromium discharge limits because of what U.S. Steel reported were failures with
visual inspections within the Facility, failures in having proper pathing to carry the wastewater at
issue, and improper maintenance of the equipment it did have. (DE 50-2 at 73–74.) Aware of this
most recent violation and the preceding violations, including the April 2017 spill, the
Government Plaintiffs engaged U.S. Steel in negotiation discussions in anticipation of filing the
current enforcement action.
C. The negotiations and the decree
The Government Plaintiffs’ information gathering and preliminary discussions with U.S.
Steel began immediately after the April 2017 spill and stretched through the spring and summer
of 2017. Following an in-person meeting between the parties in September 2017, the actual
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negotiations picked up with special attention paid to the information U.S. Steel had submitted to
the government agencies, U.S. Steel’s existing permit requirements, and U.S. Steel’s existing
operations and maintenance plans. (DE 47-1 at 5.) The Government Plaintiffs describe the
process, which lasted until this action was filed in April 2018, as “arms-length over a number of
months” with “substantial give-and-take by experienced environmental lawyers and technical
experts representing the United States, the State, and U.S. Steel.” (Id.) At the same time, U.S.
Steel took several steps to address some of the root causes of the April 2017 spill, including
replacing a concrete trench that had failed to contain the leaking chromium wastewater and
installing stainless steel pipes for use in the chromium treatment process. (DE 46-1 at 15–16; DE
47-1 at 5.)
The negotiations eventually resulted in the first version of the consent decree, which the
Government Plaintiffs filed simultaneously with their complaint. (DE 1; DE 47-1 at 5.) That first
version of the decree was the subject of an extended public comment period. The parties received
approximately 2,700 public comments on the decree, many of which argued there were changes
that needed to be made before the decree could be effective. (DE 47-5.) After receiving those
comments, the Government Plaintiffs and U.S. Steel worked to revise the initial decree and
created the updated version now before the Court.
While the consent decree underwent several important changes over time, the core of the
decree has remained the same since it was first proposed. The decree’s stated objective is to
“cause U.S. Steel to take those steps that are necessary to bring the U.S. Steel’s Midwest Plant
Facility into compliance with” its environmental responsibilities. (DE 46-1 at 7.) It proposes to
achieve that objective in several ways, including by requiring three main plans to help run the
Facility, imposing mandatory notification requirements and stipulated penalties should violations
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occur, and imposing a civil penalty. (DE 46-1; DE 47-1 at 5–6.) It also imposed mandatory
infrastructure upgrades, which U.S. Steel undertook soon after the April 2017 spill and while the
decree was being negotiated. (DE 47-1 at 7.)
The three plans the decree requires U.S. Steel to develop address the key areas in the
Facility’s operational standards the Government Plaintiffs found lacking during their review of
the company’s prior compliance. First, the decree requires that U.S. Steel create a
Comprehensive Wastewater Operations and Maintenance Plan (“O&M Plan”). The O&M Plan is
designed to ensure that U.S. Steel will properly operate and maintain all of its wastewater
treatment process equipment within the Facility. Second, the decree requires a related
Preventative Maintenance Program Plan (“PM Plan”) that is designed to help prevent
breakdowns and improve efficiency within the Facility’s wastewater infrastructure. And third,
the decree requires a Wastewater Process Monitoring System (“Wastewater System”) that covers
early detection of conditions that could precipitate spills like the April 2017 spill or other
discharges that would violate U.S. Steel’s permit limits. The Wastewater System also sets
standards and goals to ensure that new and improved monitoring equipment and technologies are
installed when needed to improve Facility wastewater monitoring. (DE 47-1 at 5–6, 16.)
U.S. Steel created and submitted the O&M and PM Plans to the EPA and IDEM in April
2018, prior to the close of the public comment period on the entire decree. EPA and IDEM did
not approve those initial plans, in part based on their consideration of public comments they had
received to that point, and informed U.S. Steel about the areas for needed improvement. (Id. at
8.) U.S. Steel then came back with updated versions of the two plans that the government
agencies approved in December 2018. Those updated versions included additional operational
procedures aimed at avoiding and minimizing spills from the Facility’s treatment plants, a
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reference list of all standard operating procedures (“SOPs”) related to monitoring compliance
with the NPDES permit, more descriptions of how U.S. Steel would be managing and
documenting activities under the Plans, and language specifically describing how it plans to
inspect, clean, and maintain the outflow channel as well as how it will track those activities. (DE
47-1 at 8.)
U.S. Steel also had its Wastewater Monitoring Design approved after receiving feedback
from the state and federal regulators as well as considering public comments related to the
document. Many of the comments came from the intervenors in this case, who had received a 30day extension on the normal filing deadline. (Id. at 16–17; DE 47-2 at 6–8.) The revised
Wastewater Monitoring Design included detailed recommended actions to improve wastewater
process monitoring for early detection of potential spills as well as to prevent future discharges
that would exceed permit limits. It also included an assessment of the root causes that led to the
April 2017 spill. (DE 47-1 at 16.) Key changes U.S. Steel made in the revised version that
received approval included a schedule for completing installation of all monitoring equipment,
specifications for all monitoring equipment, and a status update for its planned activities. (DE
47-2 at 8.)
In addition to the three core plans, the revised consent decree kept the originally proposed
civil penalty and stipulated penalties. The civil penalty to be imposed totals $601,242 in the form
of two $300,621 payments, one to the United States and one to Indiana. The stipulated penalties
are tied to the type and frequency of any future violation and are designed to be imposed as
penalties on a per-violation and per-day basis. (DE 46-1 at 35–37.) The decree additionally
requires U.S. Steel to pay back the response costs the various government agencies incurred
when responding to the April 2017 spill (Id. at 31–34), imposes various reporting requirements
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for updates from U.S. Steel on its progress and compliance (Id. at 28), and requires daily
chromium sampling and reporting of those results to IDEM. (Id. at 20–21.)
Further, the Government Plaintiffs and U.S. Steel made two larger revisions to the decree
in response to public comments before moving to enter it. First, they greatly revamped Appendix
B to the decree, which lays out the Facility’s notification requirements when there has been a
spill or unauthorized release. The changes added far more specificity to the requirements as well
as specifically listed the parties U.S. Steel is required to notify in the event of a violation. (DE
46-2 at 63–65.) Second, the Government Plaintiffs added a completely new Environmentally
Beneficial Project (“EBP”), which requires U.S. Steel to perform water quality sampling at the
shoreline of seven locations near the Facility, including directly around the Facility, around
Indiana Dunes National Park, and near Michigan City, Gary, and Ogden. (Id. at 21.) The
sampling is to be completed on either a weekly or monthly basis, depending on time of year, and
any results are to be made publicly available. (Id. at 22–23.) U.S. Steel estimates that it would
spend approximately $600,000 over the three-year duration of the EBP. (DE 47-1 at 37.)
D. Post-enforcement violations
Even though U.S. Steel was not required to abide by the technical requirements in the
government-approved O&M and PM Plans before the decree was officially entered, the company
decided to start voluntarily complying anyway after the plans were approved at the end of 2018.
But despite the voluntary compliance, the Facility still experienced NPDES permit violations in
late 2018 and through 2019.
In November 2018, state inspectors found that the Facility was releasing visible foam and
scum into Burns Waterway. (DE 50-1 at 69.) The investigators returned over the ensuing days
but did not see additional foaming. A sample of the water carrying the foam and scum showed
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that while it was present, all effluent discharges were within the limits specified in the NPDES
permit. (Id. at 70; DE 64 at 5.) The Facility again received a complaint about discharging foam in
December 2018. When state officials arrived, they saw limited foaming and again found no
effluent limit violations. U.S. Steel attributed the foaming problems to insufficient use of a new
defoaming agent the Facility was using.(DE 50-1 at 87–88; DE 64 at 6.)
Several more violations occurred throughout the spring and summer of 2019. In early
May 2019, U.S. Steel notified state officials that it was noticing discolored water with a thin
sheen flowing from the Facility into Burns Waterway. (DE 50-1 at 89.) When officials initially
asked U.S. Steel about the source of the problem, U.S. Steel personnel told them it was excessive
iron and acid used to clean metals as they were being manufactured. (Id. at 90.) Five days later,
U.S. Steel issued a report to the state officials notifying them that the real problem appeared to
be a sulfuric acid release, which had not been previously reported either to IDEM or downstream
users despite evidence suggesting U.S. Steel was aware of the cause several days beforehand.
(Id. at 91–93.) There were no effluent limit violations reported from the incident. (Id. at 91–93;
DE 64 at 7.)
U.S. Steel then had more problems in August with reports of oil sheens showing up in
outflows, improper keeping of records on temporary paper notes, a need to revise its operations
manual for one of its treatment plants, and inaccurate reporting of outflow temperatures. (DE 501 at 104–106.) U.S. Steel, in letters to state regulators did appear to have answers for why these
problems occurred and offered steps it planned to take to prevent them in the future. (Id. at 116–
17; DE 64 at 7–9.)
U.S. Steel then had several more violations before the end of 2019. It exceeded its copper
discharge limits on two occasions (DE 50-1 at 57–60), allowed wastewater with an oil sheen to
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be discharged on one occasion (Id. at 123–24), and reported a violation involving water
discoloration and a likely loss of solids into Burns Waterway (Id. at 133–34). U.S. Steel
attributed the additional oil sheen problems, water discoloration, and loss of solids to equipment
problems that it had plans to repair. The Facility also had another violation related to a
hexavalent chromium discharge it reported to regulators in October 2019, although on a far
smaller scale than it did in April 2017. Upon discovering the discharge, U.S. Steel immediately
shut down the relevant production lines and notified government agencies, downstream users,
and other stakeholders. (Id. at 123–24, 129.) It attributed the hexavalent chromium event to
operator error within the Facility that exacerbated a problem with inadequate chemical feed that
was meant to treat the hexavalent chromium before it reached Burns Waterway. It also explained
in detail to regulators how it planned to fix the problem for the future. (Id. at 123–24; DE 64 at
9–10.) No parties have filed any documents to suggest there have been any violations since the
end of 2019 despite having the opportunity, as seen through the parties’ filings on other topics as
this case remained pending, to do so.
E. The litigation over the revised decree
The Government Plaintiffs moved to enter the revised consent decree in November 2019,
arguing it not only would respond to the past violations and bring the Facility into compliance
with its NPDES permit requirements, but also that it adequately reflected the large amount of
feedback the public and intervening parties had given throughout the course of its development.
(DE 46; DE 47.) The Government Plaintiffs filed several attachments with their briefing,
including affidavits from EPA, IDEM, and NPS experts attesting to the expected success of the
consent decree. Both the City and Surfrider filed responses to the Government Plaintiffs’ motion
in December 2019, urging the Court not to approve entering the consent decree for a variety of
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reasons, including its inadequate technical provisions, a civil penalty that was too low, and a lack
of protection for the public. (DE 50; DE 51.) Surfrider filed approximately 640 pages of
additional exhibit material along with its briefing, including an affidavit from a hired expert
giving his opinion about the decree. The City filed several smaller exhibits, including an opinion
from its own hired expert. (DE 52; DE 52-2.)
The Court also received additional filings related to the consent decree both from
Surfrider and several non-parties to this case. Surfrider filed a notice of supplemental authority
(DE 74) alerting the Court to the Supreme Court’s decision in County of Maui, Hawaii v. Hawaii
Wildlife Fund, 140 S. Ct. 1462, 1465 (2020) and how it broadens the ability of a regulator to
pursue environmental damage from groundwater contamination. The Court also received a joint
letter from numerous public interest groups from the northern Indiana region (DE 54) and an
amicus brief from the National Parks Conservation Association (DE 80). Additionally, both
Surfrider and the City filed an additional motion asking that the Court hold an evidentiary
hearing or, in the alternative, allow oral argument to explore factual issues they believe still exist
related to the decree. (DE 90; DE 94.)
II.
Standard of Review
Approval of a consent decree is a judicial act committed to the sound discretion of the
district court. Madison County Jail Inmates v. Thompson, 773 F.2d 834, 845 (7th Cir. 1985); see
also United States v. BP Amoco Oil PLC, 277 F.3d 1012, 1019 (8th Cir. 2002). A district court
reviews a consent decree to determine whether it is fair, adequate, reasonable, and consistent
with applicable law. See United States v. George A. Whiting Paper Co., 644 F.3d 368, 372 (7th
Cir. 2011), as amended (June 17, 2011); United States v. Union Elec. Co., 132 F.3d 422, 430
(8th Cir. 1997); United States v. Akzo Coatings of Am., Inc., 949 F.2d 1409, 1435 (6th Cir.
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1991); United States v. Cannons Eng’g Corp., 899 F.2d 79, 84 (1st Cir. 1990); E.E.O.C. v.
Hiram Walker & Sons, Inc., 768 F.2d 884, 889 (7th Cir. 1985). Of particular importance in that
analysis is determining whether a proposed decree adequately protects and is consistent with the
public interest. United States v. BP Expl. & Oil Co., 167 F. Supp. 2d 1045, 1049 (N.D. Ind.
2001).
In analyzing the decree before it, the Court should be aware of the policy favoring
approval. Public policy strongly favors voluntary settlement of disputes without litigation.
Cannons, 899 F.2d at 84. And that policy is particularly strong where a consent decree has been
negotiated by the Department of Justice on behalf of a federal agency, like the EPA, which
enjoys substantial expertise in the environmental field. See Whiting Paper, 644 F.3d at 372;
Akzo, 949 F.2d at 1426; see also E.E.O.C., 768 F.2d at 890 (“a district court should be chary of
disapproving a consent decree”). But that deference to the Government’s judgment should by no
means be a rubber stamp. BP Exploration, 167 F. Supp. 2d at 1050 (citing Kelley v. Thomas
Solvent Co., 717 F. Supp. 507, 515 (W.D. Mich 1989)). Instead, the Court must conduct an
individual evaluation based on the particular facts of the case but with caution not to substitute
its judgment for that of the parties or engage in the type of detailed investigation that would be
required if the parties were trying the case. Id. (citing Akzo, 949 F.2d at 1434).
III.
Discussion
The parties on either side of this consent decree offer strongly divergent views of the
future it will create for U.S. Steel, Indiana Dunes National Park, and the rest of the region
abutting Lake Michigan. The Government Plaintiffs, along with U.S. Steel, insist that the decree
and the requirements it places the Facility under will bring the Facility into compliance with its
permit. Surfrider and the City, however, foresee a future where U.S. Steel continues its polluting
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under the decree’s too lax requirements to the detriment of the public and the regional
environment. The decree’s stated objective is to “cause U.S. Steel to take those steps that are
necessary to bring U.S. Steel’s Midwest Plant Facility into compliance with” the environmental
regulations imposed upon it. (DE 46-1 at 7.) This opinion determines how well the decree meets
that stated objected and whether it does so in a way that is fair, reasonable, adequate, and
consistent with applicable law.
A. Intervenors’ requests for additional hearing
Before getting into the merits of the revised decree specifically, the Court first addresses
the intervenors’ requests that the Court hold an evidentiary hearing or allow for oral argument.
Surfrider was the primary advocate for an additional hearing (DE 90), with the City later joining
the request (DE 94). Surfrider argued that an additional hearing was necessary because the
Government Plaintiffs’ filings in support of the decree “fail to address adequately many factual
issues relevant to the questions before the Court.” (DE 90 at 2.) The specific issues Surfrider
highlighted as needing more explanation were what it claims are the decree’s inadequate
technical provisions, failure to sufficiently protect Indiana Dunes National Park, and a
substandard civil penalty. (Id.; DE 68 at 4.) Surfrider envisioned the parties having the chance to
cross-examine various experts, hear from U.S. Steel employees, and otherwise press U.S. Steel
and the Government Plaintiffs on those aspects of the revised decree the intervenors still believe
are lacking. U.S. Steel opposed both an evidentiary hearing and oral argument given what it
argued was an already extensively briefed, voluminous record. (DE 66.) The Government
Plaintiffs opposed an evidentiary hearing for similar reasons but stated they “would not object” if
the Court found an oral argument necessary. (DE 63 at 5.)
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The decision to hold an evidentiary hearing or schedule an oral argument is a
discretionary one for the Court. See Union Electric, 132 F.3d at 430; United States v. Metro. St.
Louis Sewer Dist (MSD), 952 F.2d 1040, 1044 (8th Cir. 1992); Cannons, 899 F.2d at 94; N.D.
Ind. L.R. 7-5(c)(1) (“The court may . . . grant or deny a request for oral argument or an
evidentiary hearing in its discretion”). While some courts have found it helpful to hold additional
hearings in environmental consent decree cases, see, e.g., United States v. City of Akron, 794 F.
Supp. 2d 782, 787 (N.D. Ohio 2011); B.P. Exploration, 167 F. Supp. 2d at 1049, many courts
have held that additional hearings are unnecessary. That is particularly true when there is already
an extensive record, when there is evidence that every party has had an opportunity to be heard,
and when there are no unexplored topics essential to the Court’s final decision. See Union
Electric, 132 F.3d at 430; United States v. Charles George Trucking, Inc., 34 F.3d 1081, 1085
(1st Cir. 1994) (noting “requests for evidentiary hearings are, for the most part, routinely
denied—and properly so—at the consent decree stage in environmental cases” and compiling
cases). “[T]he test for granting a hearing should be substantive: given the nature and
circumstances of the case, did the parties have a fair opportunity to present relevant facts and
arguments to the court, and to counter the opponent’s submission?” Cannons, 899 F.2d at 94
(internal quotation omitted).
While the Court understands the intervenors’ concerns and has weighed their arguments
for an additional hearing carefully, it does not find one necessary. The intervenors and the public
have already had repeated opportunities to provide the Court with their opinions and to submit
any evidence they believed pertinent. The public, including the intervenors, participated in the
public comment period on the initially proposed decree, which saw 2,700 comments filed. (DE
47-5.) The intervenors then were able to submit briefing on the revised consent decree to explain
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their opposition, which they ably did. They further had the opportunity to submit any supporting
evidence to the Court they thought relevant, which they did in the form of approximately 650
pages of attachments made up of expert reports, affidavits, and other exhibits. Finally, both the
intervenors and the public have had the opportunity to submit any additional documentation to
the Court outside of briefing as they thought applicable. In that respect, the Court has before it an
amicus brief from the National Parks Conservation Association (DE 80), a joint letter from
numerous northern Indiana organizations (DE 54), and a notice of supplemental authority from
Surfrider (DE 74). All these materials that make up the current record convince the Court that the
intervenors and public have had a sufficient opportunity to be heard without holding additional
hearings and provide an adequate basis upon which to evaluate the decree.
What is more, the Court finds that Surfrider’s and the City’s reasons for holding a hearing
are not new but instead simply mirror the same reasons they already extensively and capably
briefed in their filings before the Court. For example, Surfrider’s reply to its motion for
additional hearing reads as a recitation of the arguments and reasoning already contained in its
response to the Government Plaintiffs’ motion to enter the decree. (DE 50; DE 68.) The Court is
well aware of Surfrider’s and the City’s positions about the decree’s alleged failings and does not
believe a new hearing, either evidentiary or to hear oral argument, is necessary before moving on
to consider the consent decree. The Court thus moves to consider the extensive record and
briefing before it to determine whether the decree is fair, reasonable, adequate, and consistent
with applicable law.
B. Fairness
A court’s fairness analysis for a consent decree is comprised of two prongs, procedural
fairness and substantive fairness. BP Exploration, 167 F. Supp. 2d at 1051 (citing Cannons, 899
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F.2d at 86). Procedural fairness focuses on the negotiations process, specifically whether it was
open, at arms-length, and involved balanced bargaining. Id.; see also United States v. Bayer
Healthcare, LLC, 2007 WL 4224238, at *3 (N.D. Ind. Nov. 28, 2007). Substantive fairness
“concerns concepts of corrective justice and accountability.” Id. The Court evaluates fairness
from the standpoint of signatories and non-parties to the decree. Akzo, 949 F.2d at 1435; BP
Exploration, 167 F. Supp. at 1052.
1. Procedural fairness
There is nothing in the record or from any parties to the case to make the Court doubt the
Government Plaintiffs’ statement that the terms of the decree “were negotiated at arms-length
over a number of months, with substantial give-and-take by experienced environmental lawyers
and technical experts” on both sides. (DE 47-1 at 5.) The Government Plaintiffs took several
months to gather evidence and determine the scope of violations after the April 2017 spill and
only began serious negotiations after they had that information. (Id.) The Government Plaintiffs
and U.S. Steel then took from September 2017 to April 2018 to negotiate the first version of the
decree. (Id.; DE 1.) And after filing the proposed decree, they solicited, evaluated, and made
changes based on the roughly 2,700 public comments they received over an extended comment
period. See United States v. Lexington-Fayette Urban Cty. Gov’t, 591 F.3d 484, 489 (6th Cir.
2010) (recognizing government’s good faith in considering all comments to proposed decree);
(DE 65 at 11–12).
Additionally, while it is true that Surfrider and other non-parties to the decree did not
directly participate in the negotiations (DE 47-5 at 107), direct participation by third parties is
not required. BP Exploration, 167 F. Supp. 2d. at 1052. Further, the record shows non-parties
were kept abreast of the negotiations and that their lack of direct participation did not dilute their
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ability to influence the decree. (DE 47-1 at 13–14, 17–19, 25–31, 33–39, 41, 43.) Given those
facts, the Court concludes the negotiations process was procedurally fair.
2. Substantive fairness
The Court also finds the revised decree substantively fair while acknowledging the
intervenors’ strong belief otherwise. The Seventh Circuit, evaluating consent decrees in other
areas of law, has listed several factors for determining substantive fairness. Those factors are: 1)
a comparison of the strength of the plaintiff’s case with the extent of the settlement offer; 2) the
likely complexity, length, and expense of litigation; 3) the amount of opposition to the settlement
among affected parties; 4) the opinion of counsel; and 5) the stage of the proceedings and
amount of discovery already undertaken at the time of the settlement. Gautreaux v. Pierce, 690
F.2d 616, 631 (7th Cir. 1982); see also EEOC, 768 F.2d at 889 (restating factors). The first factor
is the most important, EEOC, 768 F.2d at 889, so the Court begins and focuses much of its
analysis there.
a. Strength of case versus extent of the settlement offer
The Government Plaintiffs have a strong case against U.S. Steel given U.S. Steel has
already admitted to many of the violations the Government Plaintiffs and intervenors have
alleged. (DE 87; DE 88). U.S. Steel has also been cooperative in the enforcement process to date.
But while the company has made those admissions and been amenable to negotiating up to this
point, it has certainly not admitted to all the violations alleged against it and could very easily
take a more adversarial approach should the case proceed toward trial. The revised decree must
thus reflect the Government Plaintiffs’ strong case and bargaining position, but it need not
amount to the relief the Government Plaintiffs could have achieved through fully litigating this
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matter. See EEOC, 768 F.2d at 889–90 (recognizing that “[e]ach side gains the benefit of
immediate resolution . . . and some measure of vindication for its position while foregoing the
opportunity to achieve an unmitigated victory”).
In determining the appropriateness of the extent of the decree in light of the strength of
the Government Plaintiffs’ case, the Court first considers the civil penalty portion of the decree
as that proved to be a central area of disagreement between the parties to the decree and the
intervenors. Under the decree, U.S. Steel would be required to pay a $601,242 civil penalty split
evenly between the federal government and Indiana. (DE 46-1 at 35.) The Government Plaintiffs
and U.S. Steel argue that penalty is sufficient and substantively fair given the facts of the case
and the other provisions in the decree. (DE 47 at 11–13, 21–23; DE 64.) The intervenors and a
number of public comments disagreed, arguing the civil penalty is too low and makes the decree
substantively unfair. (DE 47-1 at 33–35; DE 50 at 17–23; DE 52 at 7–9.)
Civil penalties in environmental cases are not an exact science. See United States v.
Comunidades Unidas Contra La Contaminacion, 204 F.3d 275, 281 (1st Cir. 2000) (holding
concepts like amount of a penalty imposed “do not lend themselves to verifiable precision”).
And courts have held that the EPA can “depart from rigid adherence to formulae wherever the
agency proffers a reasonable good-faith justification for departure.” Cannons, 899 F.2d at 88
(“we are confident that Congress intended EPA to have considerable flexibility in negotiating
and structuring settlements”); see also Comunidades Unidas, 204 F.3d at 281 (applying Cannons
and holding that “[i]n environmental cases, EPA’s expertise must be given the benefit of the
doubt when weighing substantive fairness”) (internal quotations omitted).
With that flexibility in mind, there is still guidance available to courts and regulators to
ensure a fair penalty is achieved. Section 309(d) of the CWA instructs a court evaluating a civil
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penalty to consider “the seriousness of the violation or violations, the economic benefit (if any)
resulting from the violation, any history of such violations, any good-faith efforts to comply with
the applicable requirements, the economic impact of the penalty on the violator, and such other
matters as justice may require.” 33 U.S.C. § 1319. Specific EPA-issued guidance for CWA
violations, though purely advisory and not binding on the regulators, similarly advises
considering the economic benefit and gravity of the violations as well as weighing litigation
considerations, the violator’s ability to pay, and any supplemental environmental projects. 2 U.S.
Env’t Prot. Agency, Interim Clean Water Act Settlement Penalty Policy 4, 23 (1995) (“EPA
Settlement Policy”).
The Court finds that the civil penalty and the Government Plaintiffs’ reasoning for the
amount is appropriate given that guidance. First, the Government Plaintiffs clearly considered
the economic benefit to U.S. Steel in allowing the violations to occur. In doing so, they noted
that the economic benefit, while present, was not very high given the violations resulted
primarily from poor personnel and operating procedures as opposed to foregoing larger scale
expenditures. (DE 47-1 at 35.) That observation is supported by the Court’s review of the record,
which shows some cost savings from not spending to replace certain infrastructure but that many
of the violations stemmed more centrally from poor reporting procedures and personnel errors.
(DE 1; DE 47-2.) Further, the Government Plaintiffs took U.S. Steel’s failure to replace
infrastructure and other cost savings into account, ensuring that the civil penalty “fully recovers
the economic benefit that U.S. Steel obtained as a result of avoided or delayed expenditures
needed to address the violations.” (DE 47-1 at 33.) Second, the Government Plaintiffs considered
The Government Plaintiffs stated they included the new EBP in the revised decree without considering the cost to
U.S. Steel of implementing it in penalty mitigation. (DE 47 at 14–15.)
2
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the seriousness of the violations as well as the number of violations alleged, deciding that the
violations stemming from the April 2017 spill deserved the most weight because they were the
most serious. (DE 1 at 30–31; DE 47 at 11–14, 22; DE 47-1 at 33–35.) The Court also finds that
decision to account for all violations but increase the penalty most because of the magnitude of
the 2017 violations reflects the factual record. The Court does note that the Government
Plaintiffs did not provide a specific, per-violation calculation, but the Court does not find one
necessary given the flexibility regulators have in determining penalties and the mitigating factors
the Government Plaintiffs considered in imposing a penalty that they admitted is lower than it
would be on a straight, per violation calculation.
One reason the Government Plaintiffs gave for what is ultimately a lower penalty was
U.S. Steel’s good faith efforts shown by participating in negotiations, quickly starting to remedy
the problems at the Facility, and voluntarily complying with the terms of the decree before it was
entered. (DE 47-1 at 33.) That good faith participation, while coming on the heels of a long
string of violations, greatly sped the process for compliance along, made it more likely that
dangerous conditions in the region’s waters would be minimized as the enforcement action
proceeded, and saved the Government Plaintiffs time and resources. See Cannons, 899 F.2d at 88
(discussing the need to encourage early, cost-effective settlements and account for the benefits of
them). (DE 47 at 22; DE 47-1 at 33–34.) There were thus clear benefits to that compliance that
the Government Plaintiffs understandably considered in the penalty calculation.
Additionally, the Government Plaintiffs properly factored litigation considerations into
their penalty determination. EPA Settlement Policy at 4; (DE 65 at 13–14.) Surfrider is correct
that the Government Plaintiffs did not fully explain their specific litigation considerations (DE
50 at 19), but the Court does not find an accounting of the considerations necessary given the
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Government Plaintiffs’ privilege concerns (DE 65 at 14–15) and interest in not broadcasting their
litigation strategies. BP Exploration, 167 F. Supp. 2d at 1052 (“the Government is under no
obligation to telegraph its settlement offers, divulge its negotiating strategy, or surrender the
normal prerogatives of strategic flexibility which any negotiator cherishes”). The Court also
disagrees with Surfrider’s suggestion that given the Government Plaintiffs’ strong case against
U.S. Steel, there is no rationale here where litigation considerations could lead to a lower
penalty. (DE 50 at 19.) The Government Plaintiffs have a strong case, but U.S. Steel has not
admitted to every violation and thus could still mount a defense that leads to not only a
potentially less favorable outcome for the Government Plaintiffs, but also cause the loss of time,
money, and degree of certainty that the Facility will be operating within its permit requirements
on a faster timeline and be protecting both parties and non-parties in the region. These litigation
considerations are certainly relevant in calculating the ultimate penalty assessed.
Finally, the Court did not find any case from Surfrider (DE 47-5 at 124) or elsewhere that
suggests the Government Plaintiffs’ decision to impose a $601,242 civil penalty based on their
consideration of the specific facts and circumstances, including the economic impact on U.S.
Steel and how the penalty fits into the overall scope of the decree, is inconsistent with other
penalties or will create a regional inconsistency in imposed penalties. The civil penalty amount
may not be as much as the intervenors would have sought or what the Government Plaintiffs may
have received through more extensive litigation. But the Court finds the Government Plaintiffs,
with their flexibility and expertise on these topics as well as their understandable decision to
settle instead of pursuing further litigation, sufficiently justified their calculation methodology,
adhered to the standards guiding such consideration, and weighed the relative strength of their
case in arriving at a substantively fair amount.
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Having considered the civil penalty and determined that it is substantively fair under the
circumstances, the Court also notes that the penalty is only one aspect of the decree and thus
does not on its own determine whether the extent of the decree is substantively fair. For example,
the civil penalty is just one of multiple penalties and payments enumerated in the decree. The
decree also requires U.S. Steel to pay approximately $644,000 in statutorily mandated costs
associated with the assessment and monitoring that various government organizations had to
incur following the April 2017 spill (DE 46-1 at 31–34), as well as imposes stipulated penalties
on U.S. Steel for any violations at the Facility should they occur after the decree is entered. Both
of those payment components contribute to the decree’s substantive fairness.
Further, the decree would impose a host of non-monetary requirements on U.S. Steel that
reflect the strength of the case against the company. Those requirements include creating and
abiding by the three core plans that fundamentally reform how the Facility is run, establishing
new, far more thorough notification requirements in the event of a violation, running a threeyear, $600,000 water sampling project that the Government Plaintiffs likely could not have
obtained through further litigation (DE 65 at 12), and agreeing to periodically submit reports to
regulators about progress at the Facility, new compliance problems, and ideas for continued
improvement. The Court also notes that the Facility cannot get out of the decree easily given that
the decree can only end through court order after U.S. Steel shows it has been in full compliance
with the decree for two years. And even then, U.S. Steel would have to have the core aspects of
the decree included as requirements in its NPDES permit, ensuring the decree’s continued
operative value. The fact that the Government Plaintiffs could get U.S. Steel to agree to this
fundamental reforming of its procedures, the thorough oversight provisions, and the civil penalty
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and other payments reflects the strength of the Government Plaintiffs’ case and thus the
substantive fairness of the decree.
b. Other substantive fairness considerations
While that first, most important, consideration supports a finding that the revised decree
is substantively fair, the other considerations that go into a substantive fairness analysis, when
weighed together, also support such a finding. First, any litigation in this case would likely be
complex, lengthy, and expensive given the technical nature and number of violations, even
though U.S. Steel has already admitted to certain violations. That complexity and cost suggests
that a comprehensive consent decree like the one now before the Court provides a fair resolution.
Second, while there was and continues to be public opposition to entry of this decree, the
Government Plaintiffs and U.S. Steel addressed key public concerns by revising the decree to
account for the concerns and make sure it is fair not only for the parties but also to the nonparties in the region who have a stake in this action’s outcome. For example, the Government
Plaintiffs strengthened the O&M Plan, added the EBP, greatly fleshed out the notification
requirements for any violations that might occur, and demanded revisions to U.S. Steel’s initially
proposed plans all in response to public comments. EEOC, 768 F.2d at 892 (holding that a large
number of objectors holds minimal weigh absent other factors); (DE 46-2; DE 47-1).
Third, the Court has also considered the opinions of counsel. Counsel for the parties to
the decree, who are presumed to be competent, clearly support the decree as their clients stand
ready to be bound by it. See Bayer Healthcare, 2007 WL 4224238, at *4. The Court does note
that the intervenors’ counsel, who are likewise presumed to be competent, oppose the revised
decree, which somewhat negates the parties’ counsels’ approval. But that disagreement between
counsel at most makes this a neutral factor.
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And fourth, although the case is technically still in the early, pre-discovery phase of
litigation, the information available to the parties as they came to this revised decree was
expansive and the result of the Government Plaintiffs having engaged closely with U.S. Steel for
approximately a year between the April 2017 spill and the April 2018 filing of this action. The
Court is assured that the record is sufficiently substantial at this point for the parties to have
thoroughly assessed the merits of their positions and reached a substantively fair settlement.
Thus, having considered all the factors, the Court concludes the revised decree represents
corrective justice and ensures accountability in a substantially fair manner.
C.
Reasonableness, adequacy, consistency with applicable law
The Court next evaluates whether the revised decree is reasonable, adequate, and
consistent with applicable law. In doing so, it considers: 1) the nature and extent of potential
hazards; 2) the availability and likelihood of alternatives to the consent decree; 3) whether the
decree is technically adequate to accomplish the goal of cleaning the environment; 4) the extent
to which the decree is consistent with applicable law; 5) the extent to which the Court’s approval
is in the public interest; and 6) whether the consent decree reflects the relative strength or
weakness of the Government’s case against the Defendant. BP Exploration, 167 F. Supp. 2d. at
1053 (citing Akzo, 949 F.2d at 1436; Cannons, 899 F.2d at 89–90.) The Court takes each
consideration in turn.
1. Nature and extent of potential hazards
The hazards at issue in this case encompass impermissible runoff from the Facility
directly into Burns Waterway and the Lake Michigan ecosystem. The specific violations
included a combination of effluent exceedances, water temperature exceedances, and reporting
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violations, each of which risk harm to the region’s ecosystem and citizens. (DE 1 at 30–31.)
Surfrider also claims that this case, and thus the revised decree, should deal with potential
groundwater pollution given the Supreme Court decided County of Maui (DE 74), which held
that groundwater contamination could qualify as source pollution that must be regulated, in the
time this case has been pending. 140 S. Ct. 1462 (2020); (DE 74 at 4.) But the Government
Plaintiffs specifically did not choose to cover groundwater contamination violations in this case,
(DE 47-1 at 21; DE 75 at 2–3), leaving it instead to Indiana alone to bring a separate action
should it choose to do so. (DE 75 at 3.) The nature and extent of potential hazards the revised
decree must cover thus remains those hazards addressed in the Government Plaintiffs’ complaint
and comprehensively in the revised decree.
2. Availability and likelihood of alternatives
If this revised consent decree is not entered, the Government Plaintiffs and U.S. Steel
would be forced to either start the negotiation process for a new decree or forge ahead with what
would likely be a lengthy, complex, and unpredictable litigation process. Either alternative
would not only keep U.S. Steel from being subject to the requirements of the revised decree now
and lessen its incentive to continue voluntarily complying, but would also force the Government
Plaintiffs, U.S. Steel, the intervenors, and the judicial system to expend their limited resources as
the case continues. Those alternatives suggest a settlement like this revised decree, which ends
the litigation while affording relief and protection to the surrounding region, is reasonable and
adequate.
3. Technical adequacy
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The revised decree’s reasonableness and adequacy is also clear through its technical
requirements. The core of the technical fixes within the decree are the three plans U.S. Steel has
already submitted, gotten approved, and starting voluntarily complying with. The first plan is the
O&M Plan, which required a list of the Facility’s NPDES permit requirements, a description of
and operation information for all wastewater treatment process equipment, a compilation of job
descriptions or operating duties of assigned personnel, laboratory requirements, recordkeeping
requirements, references to all pertinent operation and maintenance forms and procedures, and a
plan for proper routine visual inspection, cleaning, and maintenance of outfall channels. (DE 461 at 17.) The second plan is the PM Plan, which required compiling procedures and
methodologies for periodic inspection and servicing of machinery and equipment, recording of
repairs, alterations, and replacements to the Facility’s wastewater treatment infrastructure, and at
least yearly review and reporting of any necessary modifications to the O&M Plan to be
submitted to environmental regulators. (Id. at 17–18.) And the third is the Wastewater System
plan, which required U.S. Steel to evaluate its existing wastewater monitoring to formulate ways
to maximize early detection of conditions that may lead to unauthorized discharges. (Id. at 19–
20; DE 47 at 6.) In addition to the three plans, the technical requirements imposed also include
daily chromium testing (DE 46-1 at 20), extensive public notification requirements (Id. at 63–
70), required reporting on progress and areas for improvement (Id. at 28–31), required repairs of
key infrastructure (Id. at 15–16), and eventual codification of the core of the decree into the
Facility’s NPDES permit (Id. at 53–54).
The Government Plaintiffs argued that the three plans and other technical provisions
contain detailed and comprehensive requirements that directly address conditions that led to past
violations and promote future compliance. (DE 47 at 21.) Surfrider and the City were much more
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wary. Both intervenors, relying in part on the opinions of retained experts, argued that the
violations that occurred after the Facility had supposedly started implementing the three plans
show that the plans and other provisions are inadequate. (DE 50 at 8–9; DE 52 at 2–7.) Surfrider
also went further, arguing that the decree responded too narrowly to the April 2017 spill and is
still missing key components.
The Court finds that the three plans and other technical requirements address the core
underlying issues that led to this lawsuit. As the Government Plaintiffs note somewhat regularly
in their briefing and attachments, regulators’ review of U.S. Steel’s non-compliance at the
Facility showed that most of the violations in the complaint stemmed from deficiencies in
operation and maintenance procedures. (DE 47-1 at 34–35; DE 65 at 4.) It thus stands to reason
that a core component of the decree would be a set of plans to address those inadequate
procedures and ensure the Facility’s proper functioning in the future. The three plans do that by
compiling a comprehensive list of standard operating procedures, documenting job and training
requirements, ensuring there is regular maintenance, and, when needed, requiring replacement of
equipment and technology within the Facility. (DE 47-1 at 34–35; DE 47-2 at 4–8.) The
additional technical provisions add to the plans by reforming notification procedures, imposing
chromium testing, and ensuring the decree will be in place for a long enough time to ensure
sustained compliance. The decree also imposes reporting and regulator oversight requirements
beyond those already required through U.S. Steel’s permit and other statutes, including semiannual progress reports, required inclusion of chromium monitoring results in Facility discharge
monitoring reports and monthly monitoring reports, and a reservation of right for regulators to
enter the Facility at all reasonable times to monitor U.S. Steel’s progress with the decree, verify
information U.S. Steel has submitted in reports, and obtain sampling and other data as may be
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necessary. (DE 46-1 at 20, 22, 28–31, 45.) The Court’s review of the nature of violations that
occurred before the lodging of the decree, the environmental officials’ reports on the violations,
and U.S. Steel’s own account of why certain violations occurred, all support the Government
Plaintiffs’ conclusion that these plans and provisions are necessary and get to the heart of the
underlying issues.
The Court additionally does not give much weight to the intervenors’ argument that the
ongoing NPDES permit violations in late 2018 and through 2019, after U.S. Steel’s voluntary
implementation of the plans, shows the plans and the decree are inadequate. (DE 50 at 8–10; DE
52 at 2–7.) There are three reasons why the Court finds that argument is flawed.
First, it is unreasonable to fully judge the plans and the decree based on only voluntary
compliance. As the Government Plaintiffs noted in their reply, the decree has only been
implemented on a voluntary basis, which prevents any truly effective enforcement of its
provisions. (DE 65 at 3.) If the decree had been entered at the time U.S. Steel committed the
violations in late 2018 and throughout 2019, U.S. Steel would have faced stipulated penalties for
each violation and for each day a violation occurred. The company did not have those
repercussions to worry about or the knowledge that the decree was actually entered at the time of
the violations. Thus, the provisions in the decree were inherently constrained from achieving
their full potential.
Second, pre-judging based on the 2018 and 2019 violations fails to account for the degree
of change that had to occur at the Facility to ensure it was brought into line with its permit
requirements. Surfrider’s own expert, Dr. Ranajit Sahu, concluded in his affidavit that “U.S.
Steel appears to have had no preventative maintenance system in place at all,” before the 2017
spill, was “not recording its maintenance activities,” and had ample evidence of poor equipment
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conditions. (DE 50-1 at 4–5) (emphasis in original). He concluded that “U.S Steel’s Midwest
Plant lagged far behind the current industry standard for maintenance and environmental
compliance programs.” (DE 50-1 ¶ 9.) The plans and other provisions in the revised decree
address each of those key flaws. And while it would have been ideal for the Facility to
voluntarily begin complying with the decree and immediately bring what had been a deeply
flawed system into compliance, it is unsurprising given how far behind U.S. Steel was that there
were ongoing violations as the Facility was first starting to implement changes. Further, the
decree was not designed as a quick fix but instead is meant to create an iterative process where
U.S. Steel will have to periodically review components of its plans to ensure it addresses any
ongoing problems and continues to assure compliance. (DE 46-1 at 18; DE 65 at 3.) In that
sense, the decree becomes even more effective as time goes on.
And third, Surfrider’s argument does not properly account for the improvements in
frequency and types of violations that occurred. While the Court recognizes that any permit
violation is discouraged, it notes that U.S. Steel appeared to quickly work to resolve many of the
violations throughout 2018 and 2019 and that the violations were often much less severe than the
pre-enforcement violations. (DE 52 at 3–4; DE 64 at 4–11.) Of particular note is U.S. Steel’s
hexavalent chromium violation from October 2019, which while admittedly concerning given the
Facility’s history, was in a vastly lower amount than the April 2017 exceedance, had a human
error cause that was readily identified and addressed, and exhibited U.S. Steel’s ability to make
timely, proper notifications to stakeholders in the region as it was required to do under the decree
and which it had previously struggled with in May 2019. (DE 50-1 at 123–24, 129.) Further, the
overall number of effluent exceedances at the Facility dropped significantly after U.S. Steel
began negotiating and voluntarily complying with the consent decree, dropping from thirteen
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instances in 2017 to four between January 2018 and December 2019. (DE 65 at 6.) Additionally,
the Government Plaintiffs were well aware of these subsequent violations but still moved
forward with this motion believing that the decree is reasonable and adequate. The Court thus
finds it would be unreasonable to discount the technical requirements and decree because of the
late 2018 and 2019 violations.
The Court also has considered the intervenors’ experts opinions about the adequacy of
the technical provisions but does not find the problems they believe exist warrant finding the
decree inadequate. The City’s expert premises her opposition almost entirely on the inadequacy
of the technical requirements in light of the violations over the course of 2019. (DE 52-2.) For
the reasons just explained, the Court does not view the 2019 violations as an indication that the
technical requirements are inadequate or unreasonable.
Surfrider’s expert, Dr. Sahu, while offering a more extensive view of why he believes the
revised decree is still flawed, also does not convince the Court that the decree’s technical
provisions are inadequate and unreasonable. Dr. Sahu opined that the decree was too focused on
the 2017 spill and left out certain things like detailed flow numbers, the current condition of U.S.
Steel’s equipment, and a sufficiently independent analysis by government experts of U.S. Steel’s
internal information. (DE 50 at 7.)
Initially, the Court finds the Government Plaintiffs satisfactorily addressed several of Dr.
Sahu’s concerns, including that the decree focused too narrowly on the April 2017 spill and that
the decree doesn’t address the root causes of the Facility’s problems in their revisions to the
initial iteration of the decree and in their thorough responses to comments. (DE 46-2; DE 65 at
10–11.) The Court also does not find the record supports Dr. Sahu’s allegation that the
government experts have not properly analyzed U.S. Steel’s internal information given the
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extensive evidence of regulator review of U.S. Steel’s practices and procedures while negotiating
this decree. (DE 47-1 at 4–5; DE 47-2 at 10–107.)
Additionally, Dr. Sahu’s specific recommendations for needed improvement, while they
may add to the decree, do not suggest to the Court that it is deficient in its current form.
Government experts, who were far more involved in the investigation of the Facility’s violations
than Dr. Sahu, opined that the new plans and standard operating procedures at the Facility give
Facility operators “more than enough information and guidance” to allow U.S. Steel to comply
with its permit and have “adequately addressed the root causes” of the violations. (DE 47-2 at 6,
8; DE 47-3 at 4.) To the extent U.S. Steel or the government regulators believe more peripheral
improvements, like Dr. Sahu’s suggestions of more detailed flow numbers or a list of the current
condition of each piece of Facility equipment, are needed as the decree plays out, the decree
makes room for those improvements to be discussed as part of the ongoing obligation by U.S.
Steel to periodically communicate with the government regulators about progress and places for
improvement. (DE 46-1 at 28–31; DE 65 at 3.)
Considering all the technical requirements in the decree, as well as the expert’s opinions
and the facts of this case, the Court concludes the decree is both well-tailored to address the
Facility’s history of violations and technically adequate to bring about compliance in the future.
See United States v. Metro. Water Reclamation Dist. of Greater Chicago, 792 F.3d 821, 825 (7th
Cir. 2015) (citing Friends of Milwaukee’s Rivers v. Milwaukee Metro. Sewerage Dist., 382 F.3d
743, 759 (7th Cir. 2004)) (considering whether the consent decree is likely to bring about
compliance with environmental regulations).
4. Consistency with applicable law
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The Court also finds the decree is consistent with and furthers the goals of the statutes
underlying this litigation. The statutes at issue here are the CWA, CERCLA, SURPA, the
EPCRA, and Title 13 of Indiana Code, which deals with state environmental regulations. (DE 1.)
The purpose of the CWA is to restore and maintain the integrity of United States waters,
including by preventing toxic discharges of pollutants and protecting wildlife and recreation. The
laws within Title 13 of Indiana Code have a similar goal of preserving, protecting, and enhancing
the quality of the environment so that future generations can enjoy it. Ind. Code § 13-12-3-1. The
revised decree furthers those goals by imposing detailed compliance plans and reporting
requirements on U.S. Steel to prevent toxic emissions from the Facility and alert those within the
Facility and in the surrounding region when there is a potential threat.
The goal of CERCLA is to preserve and protect the environment from the effects of
hazardous substances that may be released and ensure those responsible for any releases bear
responsibility. Cannons, 899 F.2d at 90–91. The revised decree does this not only for the reasons
previously mentioned, but by requiring U.S. Steel to pay both the remediation costs the
government agencies incurred and a civil penalty. (DE 46-1 at 31–36.)
SURPA’s goal is to recover response costs and damages for harm to national parks, 54
U.S.C. § 100723, which the decree does by mandating U.S. Steel pay both response costs and
damages based on what NPS experts found with respect to the damages caused by the Facility’s
permit violations, particularly in relation to the April 2017 spill. (Id. at 32–33; DE 47-4.)
Finally, EPCRA has as one of its purposes to ensure accurate, reliable information on the
presence and release of toxic chemicals is compiled and made available at a reasonably localized
level. Citizens for a Better Environment v. Steel Co., 90 F.3d 1237, 1239 (7th Cir. 1996), vacated
on other grounds, 523 U.S. 83 (1998). The revised decree does this through its notification
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requirements, primarily contained in Appendix B. (DE 46-1 at 63–70.) The decree thus is
consistent with applicable law. See BP Exploration, 167 F. Supp. 2d at 1049.
5. Public interest
The Court next analyzes whether the decree is in the public interest. At the outset, the
Court notes that the public interest is particularly high in this case given the Facility’s proximity
to Indiana Dunes National Park. See Akron, 794 F. Supp. 2d at 792 (finding that there was an
especially high public interest because of presence of Cuyahoga National Park). The presence of
other public beaches and water intake facilities for communities near the Facility adds to the high
public interest here. But the decree and its requirements adequately account for this high public
interest and importantly address the special consideration of a national park in such close
proximity to the Facility.
First, the decree imposes a thorough system of compliance measures on the Facility that
addresses the root causes of the violations that had potentially harmful impacts on the national
park and surrounding area. Those measures, as discussed above, are designed to bring the
Facility into compliance with environmental requirements specifically tailored to the Facility’s
location in the region by ensuring that it is properly maintaining its equipment and is operating
with personnel who are trained in now extensive and detailed standard operating procedures. The
reporting requirements, including semi-annual reports to regulators on the Facility’s progress in
abiding by the decree (DE 46-1 at 20, 22, 28–31), as well as the regulators’ reserved right within
the decree to enter the Facility at any reasonable time to collect information and decide for
themselves if U.S. Steel is properly complying with the terms and goals of the decree, are key
components of those compliance measures. (Id. at 45.) The major reformation the decree
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represents inherently helps the surrounding area as it greatly eliminates the risk for dangerous
water pollution outside the bounds of what the Facility’s NPDES permit allows.
Second, the decree includes extensive requirements for public notification in the event of
a violation. And these notification requirements were heavily fleshed out to specifically respond
to and incorporate concerns contained in the public comments the Government Plaintiffs
received. (DE 2-1 at 56–59; DE 46-2 at 63–70.) Appendix B of the decree, the section
containing the notification requirements, not only instructs U.S. Steel about the specific
information it must gather should a violation occur, (DE 46-1 at 63), but also includes a full list
of parties to be notified as well as descriptions of how those parties should be notified, why they
should be notified, and what personnel within the Facility have certain notification
responsibilities (Id. at 64–66). The section additionally clearly spells out U.S. Steel’s
responsibilities in the event of a wide variety of different violations that could potentially occur.
Surfrider was still unhappy with the revised Appendix B, but the Court does not agree
with Surfrider that the requirements fail to protect the public interest. Surfrider argued that the
changes the Government Plaintiffs made to Appendix B still failed to provide a way to directly
notify individual members of the public who may be interested in notification. (DE 50 at 25.) But
the Government Plaintiffs addressed this concern in their response to comments, concluding that
such a notification requirement, while beneficial, was not necessary because there was no
feasible way to notify every member of the public immediately as Surfrider seemed to be
seeking. (DE 47-1 at 32.) While the Court recognizes that immediate notification may be ideal, it
agrees with the Government Plaintiffs that the current list of entities to be notified sufficiently
accounts for the public interest and will allow members of the public with an interest in being
notified to be notified quickly. Appendix B and its focus on keeping the public, including
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national park officials, patrons, and users of nearby public beaches, informed helps satisfy the
strong public interest in this case.
Third, the Government Plaintiffs included a new environmentally beneficial project
within the revised decree that also furthers the public interest. The EBP would require U.S. Steel
to perform water quality sampling at the shoreline of seven locations near the facility, including
near the national park and surrounding communities. In that way, the EBP would give the public
additional protection by alerting them to potentially harmful compounds and conditions in the
water, whether caused by the Facility or not, should the testing discover them. (DE 46-1 at 21–
23.) This project is special to the decree and the Government Plaintiffs expressed doubt that it
could have achieved this relief through litigation. (DE 65 at 12.) Additionally, the Government
Plaintiffs gave Surfrider an opportunity to negotiate several modifications to the EBP before
putting it into the decree, which they did. But Surfrider still argued the final version of the EBP
was lacking because, among other things, it is not being implemented by an independent research
institution, does not have enough sampling locations, does not sample frequently enough, and
does not include a wide enough variety of factors in testing. (DE 50 at 25–26; DE 50-5.) The
Court appreciates Surfrider’s concerns and has considered them, but ultimately finds that a
project that will test at seven locations for eight potentially harmful conditions on a weekly basis
during peak public use, and will then make that information publicly available, is squarely in the
public interest. (DE 46-1 at 21–25.)
Finally, the Court specifically analyzes the impact on Indiana Dunes National Park as
well as comments the Court received from the National Parks Conservation Association in an
amicus brief. The NPCA’s brief, which echoed and added to the concerns expressed from other
public commenters and the intervenors about the national park, opposed entry of the revised,
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arguing: 1) the decree does not account for the heightened public interest in protecting the park;
2) the decree does not recover adequate past or future damages to the park; and 3) the proposed
civil penalty is too small to serve a deterrent purpose. (DE 80 at 4–10.)
The Court finds the NPCA’s first argument unavailing given the host of technical
requirements, notification requirements, sampling requirements, and monetary penalties, all of
which account for the heightened public interest given the proximity of a national park. It is also
clear that the Government Plaintiffs carefully considered the national park in negotiating the
decree given their reliance on expert reports that spoke specifically to the effect of the Facility’s
violations on the national park. (DE 47-4.) Finally, the Court notes that the NPS, which is
charged with overseeing and protecting the country’s national parks, not only played a central
part in this case but has given its approval to the decree as one of the Government Plaintiffs. The
Court thus finds the heightened interest in the proximity of a national park well represented in
the decree.
The NPCA’s second argument essentially suggests that the Government Plaintiffs got it
wrong when they determined that the only damage to the Park from the five years of violations
was the costs associated with the April 2017 spill. (DE 80 at 7–8.) But the NPCA only theorizes
that there was additional damage, it has offered no proof that was the case. The Government
Plaintiffs, on the other hand, provided the Court with an NPS expert opinion that detailed why
the Government Plaintiffs sought only to recover the response costs and damages associated with
the April 2017 spill. That opinion noted that other than the beach closures associated with the
April 2017 spill, there was no evidence of damage outside of what could have occurred from the
releases allowed under the Facility’s NPDES permit over the preceding five years. (DE 47-4 at
3–4.) Finally, to the extent the NPCA and other non-parties to the decree are concerned about
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future violations, the decree includes stipulated penalties for future violations and does not
prevent regulators from pursuing new enforcement actions should new violations occur.
And as for the NPCA’s third argument, the Court does not give it great weight for the
same reasons it found the civil penalty substantively fair and the decree’s provisions technically
adequate earlier in this opinion. (DE 50 at 20–22; DE 52 at 8–9.) While it is true that there were
violations at the Facility after U.S. Steel was made aware of the amount of the civil penalty, the
process of reforming the Facility was still within its early months at that time and it would be
unreasonable to expect immediate and total compliance that quickly. Further, the number and
severity of violations decreased after U.S. Steel was made aware of the civil penalty, which
suggests that the penalty did serve as a deterrent. The Court thus concludes the civil penalty, as
well as the rest of the decree, is reasonable and adequate in light of the public interest in this
case.
6. Relative strength or weaknesses of Government’s case
The final reasonableness factor largely mirrors the Court’s analysis of the first factor
within the substantive fairness portion of this opinion. There is no doubt that the Government
Plaintiffs have a strong case here given U.S. Steel’s admissions to many of the violations, but the
decree reasonably reflects that strong position. The Government Plaintiffs were able to negotiate
a decree with U.S. Steel that reformed the central functioning processes of the Facility itself and
imposed a host of new requirements at multiple levels of the Facility’s day-to-day operations,
including personnel management, daily chromium sampling, equipment upkeep, reporting
requirements, and longer-term areas of improvement for continued compliance. In addition to the
imposition of those technical requirements, the Government Plaintiffs also had U.S. Steel agree
to a substantial civil penalty, a costly environmentally beneficial project, stipulated penalties, and
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ongoing periodic reporting requirements. (DE 46-1 at 15–21, 28–31, 36–40.) Finally, the
decree’s termination standards, including the two years of full compliance and need to include
the core requirements in the Facility’s NPDES permit, ensures the revised decree will still be
highly effective even after it is technically no longer in force. The Court considers those
provisions and agreements to be reasonable and adequate given the relative strength of the
Government Plaintiffs’ case against U.S. Steel.
In coming to this conclusion, and the overall conclusion that the decree is fair and
reasonable, the Court again notes that the Government Plaintiffs may have been able to impose
more requirements or force higher payments if they had fully litigated this case. But that is not
what happened, and it is not the Court’s role to decide this case as if it had or to substitute its
judgment for that of the parties bound by the decree. EEOC, 768 F.2d at 889; BP Exploration,
167 F. Supp. 2d at 1050. Both the Government Plaintiffs and U.S. Steel decided to negotiate in
good faith toward a settlement in the form of the revised decree now before the Court. “The
essence of settlement is compromise” and that is what the Court finds occurred here. See EEOC,
768 F.2d at 889. The Government Plaintiffs, with extensive public feedback, created and got
U.S. Steel to agree to a consent decree that addresses the root causes of the violations listed in
the complaint and has already led the Facility back toward compliance with its NPDES permit
even without being fully enforceable. The Court thus finds, given its individual evaluation of the
extensive record and the strong policy in approving a consent decree negotiated by federal
regulators with expertise in the environmental field, that the consent decree is reasonable,
adequate, and consist with applicable law.
IV.
Conclusion
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For the foregoing reasons, the Court DENIES the Surfrider Foundation’s and the City of
Chicago’s motion for an evidentiary hearing or oral argument (DE 90; DE 94) and GRANTS the
United States of America’s motion to enter the revised consent decree (DE 46). The Clerk is
ORDERED to enter judgment in accordance with the terms of the revised consent decree.
SO ORDERED.
ENTERED: August 30, 2021
/s/ JON E. DEGUILIO
Chief Judge
United States District Court
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