EPA Settles with Slack Chemical Company Following Alleged EPCRA Violations

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On October 11, 2023, EPA announced a settlement with Slack Chemical Company, Inc. (“Slack”) following alleged violations of the Emergency Planning and Community Right-to-Know Act (EPCRA) at two of the New York corporation’s facilities. The settlement includes a civil penalty of $231,300.

Under Section 313 of EPCRA, owners or operators of certain facilities are required to annually submit a Toxic Chemical Release Inventory Reporting Form R (“TRI Form R”) report for each chemical listed under 40 CFR 372.65 that was manufactured, processed or otherwise used in quantities exceeding a certain threshold. TRI Form R reports require information about on-site releases of the chemical into the environment, transfers of the chemical in waste to off-site locations, on-site waste treatment methods, and source reduction and recycling activities. Alternatively, owners or operators can opt to submit a simpler Toxic Chemical Release Inventory Reporting Form A (“TRI Form A”)  report when the quantity of the chemical manufactured, processed, or otherwise used is one million pounds or less, the total quantity released, disposed, and treated at the facility is 500 pounds or less, and the chemical is not considered to be of special concern. TRI Form R/Form A reports are due no later than July 1 for the preceding calendar year.

EPA alleges that Slack, which describes itself as a “chemical warehousing, repackaging and distribution company,” failed to submit timely TRI Form R/Form A reports at its Carthage and Saratoga Springs facilities for calendar years 2019 and 2021. More specifically, EPA alleges that Slack:

  • Submitted TRI Forms R or A for the chemical’s ammonia, methanol, nitric acid, and toluene at its Carthage facility and a TRI Form R for methanol at its Saratoga Springs facility on May 10, 2021, for calendar year 2019, approximately 10 months late; and
  • Submitted TRI Forms R or A for the same chemicals at the facilities on November 21, 2022, for the calendar year 2021, approximately 4.5 months late.

In a news release, EPA stated that Slack has “voluntarily instituted a corporate compliance plan to prevent recurrence of EPCRA reporting violations,” which includes a written procedure listing the steps needed to identify TRI chemicals and their quantities.

DOJ Files Lawsuit Against eBay for Environmental Violations

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On behalf of EPA, the Department of Justice (DOJ) has filed a lawsuit against the online retailer eBay for selling and distributing “hundreds of thousands of products” that allegedly violate the Clean Air Act (CAA), the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), and the Toxic Substances Control Act (TSCA).

DOJ first alleges that eBay violated the CAA by selling or causing the sale of over 343,000 automotive aftermarket defeat devices.  These devices, which are often advertised as vehicle power enhancers, “can cause motor vehicles to emit hundreds to thousands of times more pollution than a motor vehicle with properly functioning emission controls,” the complaint says.  DOJ alleges that each aftermarket defeat device sold, offered for sale, or caused to sell by eBay constitutes a violation of CAA section 203(a)(3)(B), which forbids selling or offering to sell a motor vehicle part that bypasses an emission-related element of design.

Second, the complaint alleges that eBay committed a series of FIFRA violations by selling or distributing a minimum of 23,000 unregistered, misbranded, or restricted use pesticide products.  DOJ also alleges 8,074 violations of a Stop Sale, Use, or Removal Order (SSURO) issued by EPA in 2020 (and amended in 2021), which identified some of these allegedly unlawful pesticide products.  Among the products sold in alleged violation of the SSURO was an insecticide containing dichlorvos, which DOJ characterizes as highly dangerous, and a “disinfection card” claiming to protect users from COVID-19 when worn around their neck.

Finally, eBay is being sued under TSCA for violating a 2019 rule prohibiting the manufacture, processing, and distribution of products containing methylene chloride for consumer paint and coating removal.  The TSCA section 6(a) rule was the result of EPA’s determination that those uses pose an unreasonable risk of injury to health due to methylene chloride’s acute human lethality.  According to the complaint, eBay has distributed over 5,600 items in violation of the rule.

The lawsuit seeks injunctive relief to prevent eBay from further selling products violating the CAA, FIFRA, and TSCA.  The complaint additionally requests civil penalties for each of the CAA violations, which could amount to $5,580 per violation.

EPA Settles with Kyocera After Self-Disclosure of TSCA Violations

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On September 5, 2023, EPA signed a consent agreement with Kyocera International, Inc. (“Kyocera”) over three alleged violations of the Toxic Substances Control Act (TSCA). Kyocera’s civil penalty was reduced to $105,937 because of EPA’s audit policy, which rewards companies that “voluntarily discover, promptly disclose and expeditiously correct” violations with reduced fines.

The alleged violations, which pertain to six unnamed chemicals (Chemicals A, B, C, D, E, and F), are as follows:

  1. Importation of Chemical A at least 12 times, Chemical B at least 21 times, and Chemical C at least 18 times without first filing a premanufacture notice (PMN) or an exemption to PMN requirements, in violation of TSCA section 5(a)(1);
  2. Failure to comply with recordkeeping requirements for Chemical D and E’s polymer exemptions to PMN requirements, in violation of TSCA section 5(a)(1); and
  3. Importation of Chemical A at least 12 times, Chemical B at least 21 times, and Chemical C at least 18 times without submission of proper certifications prior to the importation, and importation of Chemical F three times without providing a positive TSCA certification statement for each import, in violation of TSCA section 13(a)(1)(B).

The electronics manufacturer corrected the alleged violations by ceasing importation of Chemicals A, B, C, and D, submitting low-volume exemptions to PMN requirements for Chemicals B and C (which were granted by the Agency), and complying with the polymer exemption requirements for Chemical D. Under the terms of the settlement, EPA gave Kyocera permission to release its self-imposed quarantined stocks of Chemicals B, C, and D.

Kyocera self-disclosed the violations on June 23, 2021, with supplemental information provided in March 2023. The company disclosure and subsequent corrective action satisfied all of EPA’s audit policy conditions except the requirement that the violations be uncovered by “systematic discovery” and was therefore eligible for a 75% reduction in the gravity-based portion of the civil penalty.

The consent decree comes after a June 30, 2022, EPA Inspector General report which found that eDisclosure, EPA’s violation self-disclosure system, “does not have adequate internal controls in place to ensure that the EPA’s screening process is effective and that significant concerns . . . are identified and addressed.” EPA agreed with all four of the report’s recommendations and proposed corrective actions, including the development of national guidance and eDisclosure-specific training for EPA staff who monitor eDisclosure submissions.

Clothing Accessories Companies Penalized for False Made in USA Claims

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In August 2023, the Federal Trade Commission (FTC) finalized a complaint and order against Chaucer Accessories, Inc. and two other companies owned by Thomas P. Bates for falsely labeling belts, shoes, and other products as “Made in the USA” (MUSA). The order includes a monetary judgment of $191,481.

According to FTC, the New England-based companies regularly claimed that certain products were MUSA, even though these products were wholly or largely imported. In other instances, the companies claimed that certain belts were “Made in the USA from Global Materials,” when in reality, the companies merely affixed buckles to imported belt straps. FTC alleged three violations of section 5(a) of the Federal Trade Commission Act: one violation for the false MUSA claims, one violation for the false MUSA from global materials claim, and one violation for distributing the false claims to resellers for their use in the resale of the products.

In addition to the monetary judgment, the order places restrictions on the companies and Bates on making unqualified MUSA claims, prohibits them from misrepresenting their products’ country of origin or providing others the means to make misrepresentations and imposes requirements for qualified MUSA claims and assembly claims. The companies must also notify affected customers of the violations and provide FTC with sufficient customer information for the Commission to administer customer redress.

Better Business Bureau Challenge Results in Clarifying Disclosure in Antimicrobial Toilet Seat Advertising

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Business Bureau (BBB) National Programs develops self-regulatory industry programs and resolves disputes on issues including advertising and privacy.  According to BBB National Programs, National Advertising Division (NAD) case decisions “represent the single largest body of advertising law in the country.”

A recent NAD case concerned antimicrobial claims made by Ginsey Industries, Inc. (“Ginsey”) on its Clorox-branded toilet seats.  Bemis Manufacturing Company challenged elements of these claims (though not the product’s antimicrobial efficacy).  During the challenge, Ginsey voluntarily committed to add a disclosure acknowledging that the product does not protect uses against bacteria and remove an “antimicrobial checkmark image inside the Clorox chevron logo.”

NAD additionally recommended that Ginsey modify its website to display the disclosure statement more conspicuously and work with retailers to do the same with their websites.  In response, the company stated that while it disagrees that “further modifications to its online product listings are necessary to protect consumers,” it would comply with NAD’s decision.

Walmart and Reynolds Sued Over Recyclable Plastic Bag Marketing Claim

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The State Attorney General of Minnesota has filed a lawsuit against Walmart Inc. and Reynolds Consumer Products Inc. (the owner of the trash bag trademark “Hefty”) for falsely marketing their plastic bags as recyclable. The Complaint alleges violations of Minnesota’s Prevention of Consumer Fraud Protection Act, Deceptive Trade Practices Act, False Statement in Advertising Act, and deceptive environmental marketing claim regulations.

These statutes utilize language explicitly prohibiting the use and dissemination of false, deceptive, or misleading statements. For example, Minnesota’s False Statement in Advertising Act strictly prohibits advertising that contains any material assertion, representation, or statement of fact that is untrue, deceptive, or misleading. Minnesota’s Deceptive Trade Practices Act further states:

“A person engages in a deceptive trade practice when …the person … represents that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have….” (emphasis added).

Defendants, through their product labeling, advertised their products as recyclable, which was false.  In addition, their actions disqualified the recyclable contents of the plastic bags from being recycled. In Minnesota, when recyclable materials or products are placed in non-recyclable bags on the curb, waste management will render the contents of the entire bag unrecyclable, leading both the bag and its contents to end up in landfills.

Additionally, the Complaint alleges deceptive environmental marketing claims by Walmart, citing the Federal Trade Commission’s (“FTCs”) Guides for the Use of Environmental Marketing Claims (also referred to as the “Green Guides”). The Green Guides state, “it is deceptive to misrepresent, directly or by implication, that a product or package is recyclable. A product or package should not be marketed as recyclable unless it can be collected, separated, or otherwise recovered from the waste stream through an established recycling program for reuse or use in manufacturing or assembling another item.” Minnesota recycling facilities cannot process the Hefty brand plastic trash bags labeled as recyclable); in fact, they can cause machine malfunctions and even serious damage.

The Complaint asked the court to order a stop on the sale of these products as marketed. Further, the Complaint requests that the court order the defendants to fund a program to educate Minnesota residents about recyclable materials.

This is not the only lawsuit related to Hefty’s recycling bags. Last year Connecticut’s Attorney General filed a lawsuit against the manufacturer, Reynolds, alleging the company has falsely and deceptively marketed the same Hefty recycling at issue in the Minnesota case. The Complaint states that Reynolds has marketed and sold these bags “despite full knowledge that their bags were incompatible with recycling facilities in Connecticut.” This case is still being litigated.

New Jersey Reaches Historic Settlement with Solvay Polymers over PFAS Contamination

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On June 28, 2023, New Jersey’s Department of Environmental Protection (NJDEP) announced a proposed settlement with Solvay Specialty Polymers USA, LLC (“Solvay”) over the company’s discharge of PFAS and other hazardous substances from its West Deptford facility.  According to a press release from New Jersey’s Office of Attorney General (NJOAG), the $392.7 million proposed settlement is the “largest single-site natural resource damages and remediation case in New Jersey history.”

In the 2020 complaint that led to the proposed settlement, NJDEP alleged that PFAS discharges and emissions from Solvay’s West Deptford facility had caused “widespread soil, sediment, groundwater, and surface water contamination.”  In particular, NJDEP asserted that levels of PFNA­—a type of PFAS—detected in surface water and public drinking water near the facility were higher than levels reported “anywhere else in the world.”  According to NJDEP, Solvay and the facility’s previous owner knew or should have known about the dangers posed by PFAS but “failed to disclose the impact of their use and releases of PFAS into the environment to the Department and the surrounding community.”

Under the terms of the proposed settlement, Solvay would be required to reimburse NJDEP for previous remediation efforts, pay claims for natural resource damages, and fund additional remedial activities to be undertaken by NJDEP and the company.  Solvay would be responsible for identifying and remediating contaminated natural resources and wells and providing regular reports of its remedial activities to NJDEP.  Funds allocated to NJDEP would primarily be used to address PFAS in drinking water systems.

The settlement comes after a 2019 NJDEP directive for Solvay and four other chemical manufacturers responsible for “significant contamination of New Jersey’s natural resources” to provide financial compensation for PFAS-related contamination and information on their PFAS use and emissions.  NJDEP’s 2020 complaint argued that Solvay did not fully comply with the directive.  According to NJOAG, Solvay is the first company identified by the directive to reach a proposed settlement with NJDEP.

A formal notice of the proposed settlement was published in the New Jersey Register on August 7, 2023.  Public comments on the proposal will be accepted through October 6, 2023.

TSCA Enforcement Action Taken Over Failure to Comply with PFAS SNUR

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In December 2022, two separate lawsuits were filed against Inhance Technologies USA regarding its alleged production of certain PFAS substances in violation of the Toxic Substances Control Act (“TSCA”). These lawsuits are important as they raise novel questions of TSCA interpretation and enforcement.

The first lawsuit was filed by the U.S. Department of Justice, Environment and Natural Resources Division on behalf of the U.S. Environmental Protection Agency (“EPA”).  The second case is a citizen suit filed by the non-profit organizations Center for Environmental Health (“CEH”) and Public Employees for Environmental Responsibility (“PEER”). U.S. v. Inhance Technologies LLC, U.S. Eastern District of Pennsylvania, Case No. 2:22-cv-05055; Center for Environmental Health v. Inhance Technologies USA, U.S. District Court for the District of Columbia, Case No. 1:22-cv-03819. It is rare that EPA pursues TSCA enforcement actions in federal court. Similarly, the citizen suit provision of TSCA is exercised infrequently.

Defendant Inhance Technologies USA (“Inhance”) is a Texas-based corporation that treats plastic containers, including high-density polyethylene (HDPE), using a fluorination process. Inhance is the principal supplier of post-mold fluorination services in the United States.

According to the Complaints, Inhance has been in violation of the Long-Chain Perfluoroalkyl Carboxylate (“LCPFAC”)  Significant New Use Rule (“SNUR”) that requires manufacturers to file a Significant New Use Notice (“SNUN”) for any manufacturing (including importing) or processing of an LCPFAC for which there were no ongoing uses as of January 21, 2015. See 40 CFR 721.10536. This includes substances that are typically exempt byproducts under TSCA and LCPFACs that are imported as part of articles. Inhance allegedly violated two SNUR requirements.  The complaints assert that Inhance failed to submit a SNUN for LCPFAC substances formed during the fluorination of plastic containers at least 90 days prior to the manufacture of these substances. The second violation charged is the company’s manufacture of these substances before completion of the requisite 90-day SNUN review period.

Inhance received warning of its violation of the LCPFAC Rule by the Plaintiffs of each lawsuit months prior to litigation. The lawsuits follow a March 2022 letter EPA sent to the HDPE industry. EPA issued the letter, first “to remind industry of this issue to help prevent unintended PFAS formation and contamination,” and second, to “emphasize the requirement under TSCA as it related to PFAS and fluorinated polyolefins.” In its letter, EPA reminded the industry of the SNUR, highlighting that while LCPFAC chemical substances are byproducts of the fluorination process from the chemical and commercial standpoint, these substances are not eligible for the byproducts exemption in 40 CFR § 721.45(e). The Agency letter further encouraged the industry to pursue alternative fluorination processes which are less likely to foster unintentional PFAS creation. EPA’s lawsuit is its first enforcement matter against the HDPE industry following the Agency’s warnings.

In March 2022, EPA issued a Notice of Violation (NOV), requesting that Inhance provide the Agency with additional information on changes the company may have made to the HDPE fluorination process that would eliminate PFAS production. The NOV stated that if no changes to the manufacturing process had been made, Inhance would need to immediately cease manufacturing PFAS and submit a SNUN to the Agency for review. Agency review of the information submitted by the company confirmed that the company was producing substances that are subject to the LCPFAC Rule.

In September 2022, Inhance notified EPA that it intended to submit a SNUN for its fluorination processes, but that it was unwilling to cease its fluorination processes before or during the EPA SNUN review period. Inhance has consistently maintained that it believes its operations are in full regulatory compliance.

EPA’s lawsuit was filed on December 19, 2022, with the non-profit lawsuit following about a week behind. The Complaints allege a variety of TSCA violations, namely the following:

  • Section 5(a)(1) of TSCA, which states no person may manufacture or process a chemical substance for a significant new use unless (1) that person submits a Significant New Use Notice (“New Use Notice”) to the EPA; (2) the EPA reviews that notice; and (3) the EPA makes a determination on that use under Section 5(a)(3) of TSCA, 15 U.S.C. § 2604(a)(3). 15 U.S.C. § 2604(a)(1).
  • Title 40 C.F.R. § 721.25 prescribes similar requirements for any person seeking to engage in a significant new use of a chemical substance.
  • Section 15 of TSCA, which states that it is a prohibited act to fail or refuse to comply with any requirement of TSCA or any rule promulgated under TSCA. 15 U.S.C. § 2614.
  • Under 40 C.F.R. § 721.35, it is a violation of Section 15 of TSCA to fail to comply with any provision of Title 40, Part 721 of the regulations implementing TSCA.

Plaintiffs in both cases are seeking declaratory and injunctive relief under Section 15(a) of TSCA (15 U.S.C. § 2616(a)) and the Declaratory Judgment Act (28 U.S.C. § 2201) for Inhance to cease production of all products using the PFAS forming fluorination process. To resume production, Inhance must demonstrate to EPA that it has altered its production process to eliminate PFAS production.

Case Update

In April 2023, the U.S. District Court of the District of Columbia dismissed the lawsuit brought by CEH and PEER. Shortly after CEH and PEER filed their lawsuit, Inhance filed a motion to dismiss the case arguing that the lawsuit was inappropriate under TSCA’s diligent prosecution bar. DOJ filed an amicus brief supporting Inhance’s motion to dismiss. For the CEH and PEER lawsuit to proceed, the organizations would have needed to demonstrate that DOJ was not diligently prosecuting the case. The court granted Inhance’s motion stating that “[n]othing in the eight days between when DOJ filed its lawsuit and when the Plaintiffs filed theirs suggests that [DOJ] was not diligently prosecuting the case.”

On June 13, the court presiding over the DOJ lawsuit scheduled oral arguments for August 23, 2023.

EPA Takes Action Against Denka for Air Pollution

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On March 20, 2023, the Department of Justice (“DOJ”), on behalf of EPA, filed a motion for a preliminary injunction under the Clean Air Act (“CAA”), asking the federal district court for the eastern district of Louisiana to order Denka Performance Elastomer LLC (“Denka”) to immediately reduce chloroprene emissions from its neoprene manufacturing facility in LaPlace, Louisiana. The motion follows DOJ’s February complaint arguing that plant operations present an imminent and substantial endangerment to public health and welfare due to cancer risks posed by Denka’s chloroprene emissions.

The Denka facility is currently the only facility in the country producing neoprene, a flexible, synthetic rubber used to manufacture a variety of products, including wetsuits, automotive belts and hoses, and orthopedic braces. Chloroprene is a liquid raw material used to produce neoprene.  It is emitted into the air from various production processes at the facility.

In 2010, EPA Integrated Risk Information System (IRIS) found that chloroprene is “likely to be carcinogenic to humans.” In a separate civil proceeding, Denka has challenged the process by which the Environmental Protection Agency considered the scientific information supporting its understanding of the human health risks posed by chloroprene.

According to the complaint, air monitoring conducted by both the EPA and Denka over the past several years consistently shows chloroprene concentrations in the air near Denka’s LaPlace facility that are as high as 14 times the recommended levels.  In the complaint, DOJ expressed particular concern for students attending the 5th Ward Elementary School, located approximately 450 feet from Denka’s facility.

Associate Attorney General Vanita Gupta commented on the complaint stating, “We allege that Denka’s emissions have led to unsafe concentrations of carcinogenic chloroprene near homes and schools in St. John the Baptist Parish, Louisiana. The Justice Department’s environmental justice efforts require ensuring that every community, no matter its demographics, can breathe clean air and drink clean water. Our suit aims to stop Denka’s dangerous pollution.”

EPA Takes Enforcement Action Against Companies for Misbranded Pesticide

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On September 21, 2022, EPA announced settlements with two New Jersey companies for the sale and distribution of the pesticide Zoono Microbe Shield. The companies made false and misleading claims stating that the registered pesticide was suitable for use as a disinfectant or sanitizer against the virus which causes COVID-19. The companies’ claims were a violation of the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) which prohibits false and misleading claims of registered pesticide products.

The two companies, Zoono USA and Zoono Holdings, advertised and sold the Zoono Micro Shield product on their own company websites as well as on Amazon. The product’s labeling contained public health claims that EPA stated differ substantially from statements submitted to the Agency in connection with its pesticide registration; in other words, the companies were committing misbranding under FIFRA, The product’s registration allows only for labeling claims related to effectiveness against odor-causing bacteria, bacteria that cause staining and discoloration, fungi, and algae. The product is not registered for use as a disinfectant or sanitizer, nor is it registered for any public health purpose. Therefore, it was a violation of the statute to make such claims. The settlements included civil penalties in the amounts of $205,000 and $120,000.