- WEB EXCLUSIVE
- PE COFFEEHAUS
The suit was brought for actions taken at four Cinergy-owned plants from 1989 to 1992. According to court documents, "Without the required permit, Cinergy was liable for increased pollution caused by the modifications, and faced the prospect of an injunction that would require it to shut down the plants, plus civil penalties of $25,000 for each day that it had violated the permit requirement."
In the court's decision, at particular issue was the problem of the plant functioning under an outdated permit that didn't include the important 1990s revisions that closed this loophole, reason being that the permit was given while Indiana was dragging its heels (for a dozen years) on adding the federal addendum. Because of similar situations across the country, this case could become a bellwether for deciding on how much of an excuse pre-dating major changes to regulations like the 1990 amendments can be for companies.
"The EPA approved Indiana's plan with exceptions that did not include Section 43, thinking that Indiana would submit a revised plan which the EPA would then approve. Which is what happened-only it took 12 years."
The court did note that such a loophole effectively subverts economic forces, providing incentive to Cinergy to keep its less profitable and older plant going simply for the sake of avoiding the cost of meeting current regulations (Ed note: legal scholar Richard Posner, who would be on any list of U.S. experts on economics and the law, was actually one of the three judges who heard the case, and it was he who drafted the opinion, hence all the economics). However, the court's decision – in less harsh words – basically said that despite how stupid the law may be, it was the State of Indiana (who waited far too long to craft its implementation plan), and the EPA (who let permits get passed before Indiana's plan was approved) who are at fault for it, not the company who obtained the permit.
SOURCE: Seventh Circuit Court of Appeals (pdf)