1. 70-400
ILLINOIS POLLUTION CONTROL BOARD
July 2, 1986
ILLINOIS ENVIRONMENTAL
)
PROTECTION AGENCY,
)
)
Complainant,
)
)
v.
)
PCB
79-145
)
THE CELOTEX CORPORATION
)
and PHILIP CAREY COMPANY,
)
)
Respondents.
)
ORDER OF THE BOARD
(by
J. Anderson):
In summary, this Order:
1) denies
the Agency’s May 13
motion for sanctions relating to Celotex’ May 12,
1986 inspection
and copying of documents at the Agency’s Naywood Office,
2)
grants Celotex’ May 27 motion for sanctions relating to non-
compliance with the Hearing Officer’s April
4 Order requiring
specification of water pollution standards and parameters
allegedly violated by Celotex,
and specifies these sanctions, and
3)
specifies the nature of the sanctions imposed on the Agency
pursuant to the Board’s findings of April
24 and May
9,
1986
relating to inspection of the Joliet Army Arsenal groundwater
documents and to failure to produce Agency witnesses for
deposition.
The May 12 Maywood file inspection
The relevant
filings on this issue are the Agency’s
May. 13
motion for special Board meeting, and for sanctions,
and Celotex’
May
14 opposition thereto,
as well as the Hearing Officer’s June
3 Order granting Celotex’ May 13 unopposed motion for permission
to complete the inspection and copying of the Maywood documents,
and the Hearing Officer’s May 20 Recommendation in response to
the April
24 and May
9 sanctions Orders.
The request for sanctions arises from the events occurring
on May
12,
1986 during the course of Celotex’
inspection of
documents at the Agency’s Maywood office.
(This inspection of
Joliet Army Ammunition documents appears to have been arranged
after the Board’s April 24 decision to impose sanctions for the
cancellation of the April
10 inspection date.)
By Order of
November
11,
1985,
the Hearing Officer had noted that there were
some 30 to
35 wells at the Joliet Army site, and that production
of some 15 years
of documents for each of these wells would be
unduly burdensome and oppressive.
Accordingly, the Order stated
that:
70-395
-2-
“Complainant
is
directed
to
produce
or
make
available
for
inspection,
the
records
of
documents
in
its
possession relating to
three
wells
at
said
site.
Said
wells
are
to
be
selected
by
Respondent.
Obviously
this
entails
some disclosure
of
information
so
as
to
enable
Respondent
to
make
such
a
selection.
This
Order
is
made
on
the
assumption
that
no
secret
or
confidential
material
is
involved
in
any
such
disclosures.
Considering
the nature
of
the
site,
an
objection,
if
any,
based
upon
such
grounds,
may
be
made
at
any
time
prior
to
disclosure of the documents.
Respondent
is to
be supplied with information by December
6,
so
as
to enable it
to select
three wells for this
purpose.
Complainant
is
given
30
days
from
identification
of
said
wells
to
supply
documents
in
its
possession
or
to make
said
documents
available
for
inspection.
Objections
to
this
mode
of
production
based
upon technical arguments will
be considered by
the Hearing Officer only upon the simultaneous
submission
of
sworn
affidavits
from
persons
with backgrounds and qualifications that might
enable them
to
qualify
as experts in the area
of ground- water flow, water pollution, or the
like.”
Celotex’
counsel, Mr. Parker, accompanied by a court
reporter, arrived at the Agency’s Maywood office on May 12 and
was shown to
a conference room.
There Mr. Archier, counsel for
the Agency, tendered “several piles”
of documents before leaving
the room.
Upon his return, Mr. Archier noted that Mr.
Parker had
been copying documents on
a portable copier.
Mr. Archier, both
verbally and
in writing, objected to the copying on the grounds
that copying was outside the scope of the Hearing Officer’s
order, and requested that all copies be left in the room.
The
verbal objection and request and Mr. Parker’s responses were
transcribed by the court reporter.
Mr. Archier asserts that Mr.
Parker took with him the copies he had made.
On May 13,
the
Agency moved the Board for sanctions, including issuance of
a
default judgment
as to Court
IV,
and issuance of
an order
requiring return of the copies and barring respondent from their
use.
On the same day, Celotex applied to the Hearing Officer for
an order permitting completion of the inspection.
The motion was
granted by Order of June
3,
in which the Hearing Officer stated
in pertinent part that
70-396
-3-
“Insofar
as
there
are
unstated
claims
of
privilege
or
trade
secret
or
other
privilege
status
that may attach to any such documents,
Respondent
is
denied
permission
to
copy
any
such additional
documents
if
before
the
next
disclosure
to Respondent,
a specific
claim
of
confidentiality
is
raised.
Obviously,
Respondent
has
already
copied
certain
documents.
If
Complainant
wishes
to
assert
confidentiality
claims
to
such
copied
documents,
even
though
the
cat
is
out
of
the
bag,
so
to
speak,
Complainant
has
leave
to
brief
its authority to
do so,
and the hearing
officer
will
take
the
matter
under
advisement.
With
the
limitation
expressed
herein,
Respondent
has
leave
to
copy
any
material
disclosed
to
Respondent
in
the
relevant Maywood files at its own expense.”
The Hearing Officer provided further comment on the copying
issue
in his May 28 Recommendation to the Board on the sanctions
issue:
“As
far
as
the
potential
assertions
of
confidentiality
raised
in
the
inspection
of
the
Maywood
files,
the
Hearing
Officer’s
November
11,
1985
order
addressed
a
proper
method
for raising any such assertions.
That
has not been complied
with.
However, neither
has
the
initial
order
that
provided
that
information on three wells was all that was to
be
required
to
be
provided.
Complainant
has
apparently
provided
(at
least
for
visual
inspection)
all
of
the
material
at
Maywood
relating
to
any well
that was located
at
the
Army
site.
By
doing
so,
and
doing
so
without
explanation
such
as
that
the
files
were
commingled,
Complainant
has
further
complicated
this
matter,
but
it
should
be
noted,
complicated
it
by
providing
more
disclosure
than required.”
Based on the totality of the circumstances, the Board denies
the Agency’s motion.
The Hearing Officer has made no finding
that copying was clearly outside the scope of his November 11
Order.
This situation does not appear to involve defiance of
a
Hearing Officer Order, but rather
a misunderstanding which could
have been prevented by closer communication during the inspection
process.
Finally, the
Board must again comment
(as
it did on May
9) on the now-moot motion for special Board meeting that the
motion did not plead special circumstances such
as to make the
need for expedited relief compelling.
The Board also notes that
70-397
—4—
motions predicated on facts not of record should be supported by
affidavit.
Celotex
May
27
Motion
for
Sanctions
Relating
To
Admissions
of
Fact
The filings relevant to this issue are Celotex’ May 27
motion for further sanctions,
the Agency’s June
2 response, and
Celotex’ June
3 reply thereto.
On June
18, 1985,
the Agency took samples
from three wells
at the Celotex site and specified
31 parameters for which the
samples would
be tested.
On April
4,
1986,
in the stated
interest
of curtailing unnecessary discovery, the Hearing Officer
issued an Order directing the Agency “to identify which of the
31
tested parameters which
it contends evidence violation of
Illinois Water Pollution regulations” by April
18, unless
a sworn
affidavit was submitted explaining why this information could not
be timely supplied.
As no response had been filed, on April
29,
the Hearing Officer ordered that
a response be filed by May
2.
On May
2,
the Agency submitted
a letter stating that the
“parameters which have exceeded the applicable...Board rules
“were iron for Well ClOl, none for G102, and boron,
iron, silver
and ROE (TDS) for Well G103.
On the same day, Celotex filed
a
Seventh Request for Admission of fact based on the letter,
including
a request
for admission
(No.
49) setting forth the
above parameters,
and stating that “complainant contends that the
specific standards of...Board Rules...Title
35,
Subtitle
C: Water
Pollution Sections 302.201
et
seq.
and 302.301 et seq.
are
exceeded...for only those
parameters.”
On May
21, the Agency
denied the request to admit.
Celotex characterizes
this actions
as “sham responses which
throw the entire discovery process in
this proceeding into
a cocked hat.”
Celotex requests sanctions
in the form of an Order denying admission of any June 18,
1985
water sample results and/or requiring the Agency to abide by the
May
2 letter.
The Agency’s June
2 response
is that the May
2 letter was
based “on the parameters compared to the general use water
quality standards only,
Section 302.201.
Respondents’ request to
admit references other sections and, therefore, was appropriately
denied by Complainant.”
The Board does not find the Agency’s explanation
persuasive.
The Hearing Officer’s general Order on its face
required evaluation of all
31 parameters against all applicable
regulations.
The obvious purpose was to require crystallization
of
the Agency’s case.
It would appear from the Agency’s
explanation that the Agency did not consider the public water
supply standards of Sections
302.301 et
seq. applicable on May
2,
but that
it reversed its decision on June
2 after Celotex’
request to admit specifically focused its attention on these
70.398
—5—
rules.
The Agency’s failure to conduct
a thorough review of
Board regulations and/or to make final litigation decisions as
required by the Hearing Officer’s Order has not been explained,
and has resulted in unfair surprise to Celotex.
The motion for
sanctions
is hereby granted.
The Agency is barred from alleging
or presenting any evidence or data concerning violations
of Board
regulations obtained as
a result of the June 18, 1985,
sampling
of the wells at the Celotex site other than those
specified in
the May 2,
1986, letter,
which are: Well GlOl-iron, and Well
Gl03-baron,
iron, silver and ROE (TDS).
In
so holding,
the Board
must note that this sanction may be subsumed by or encompassed in
the sanctions imposed below.
Sanctions pursuant to the April
24 and May
9,
1986 Orders.
The
factual background for these sanctions
is outlined in
the Orders of April
24 and May
9 and will not
be repeated here.
Relevant
pleadings are the Agency and Celotex briefs of May
7 and
May 20;
the Hearing Officer’s Recommendation of May 28;
and
Celotex response thereto of June
3, leave to file which is hereby
granted.
The Hearing Officer’s Recommendation asserts his belief that
there
is interrelationship between the two sets of sanctions to
the extent that the Joliet Army Munitions plant information
arguably relates
to groundwater flow and contamination issues
concerning the Celotex and/or Carey site, and that one of the
Agency deponents, Monte Nienkirk, “will be the Complainant’s
expert on groundwater flow, and the level of contamination,
if
any” at the site.
The Hearing Officer does not believe that the
testimony to be given
by Kenneth Bechely relates
to this issue.
The Hearing Officer’s Recommendation is that the “most serious
sanctions,
striking of causes of action, would not
be
appropriate”
based
on
his
“review
of
the
legal
authority
cited
by
Complainant, and bearing in mind the statement
of the Court
in Cedric
Spring and Associates,
Inc. v. NEI Corporation, 402 N.W.
2d
352,
356,
(2nd
Dist.
1980)
that,
“A
just order
is
one
which
to
the
degree
possible
insures
both
discovery
and
a
trial
on
the merits”
(citing
Williams
v.
City
of
Chicago,
370
N.E.2d
119
(1st
Dist.
1977)
and
the
perception
of
the
Hearing
Officer
that
there
has
not
been
“a
scheme
of deliberate
defiance of
the rules
of
discovery
and the court’s
Hearing
Officer’s
authority
or
that
the
Complainant
has
attempted
to
stall
significant
discovery”
Cedric supra at 402 N.E.2d 357...
70-399
—6—
However, bearing
in mind the sanction approved
in
the Williams
case,
supra,
of
an
order
for
payment
of
$433
of
legal
fees,
and
also
bearing
in
mind
that
cancellation
of
depositions may have caused Respondent to have
had
a
court
reporter
present
who
had
to
be
paid
some
amount,
it
would
be
the
recommendation of the Hearing Officer that the
most
appropriate
sanction
for
the
delay
in
depositions
would
be
assessing such attorneys
fees and associated costs.
With
regards
to
the
Army
Munitions
Plant
material...
option
(c)
as
outlined
in
the
April
24
Order
which
will
probably
impose
significant
cost
upon
Complainant
in
transporting
a
working
file
at
least for
one
day
to
Chicago,
appears
most
just
and
appropriate.
An
associated
sanction,
or
a
related sanction, might
be to require that the
Complainant
duplicate
all
material
in
the
Springfield or Maywood file at its expense and
supply
such
file
to
Respondent.
Since
Respondent
has
been
bearing
the
cost
of
all
other
duplication
of
this
sort,
this
is
a
distinct
benefit
to
Respondent
which
is
somewhat
related
to
the
conduct
of
Complainant.
The Agency’s position,
in brief, is
that no sanctions should
be imposed against it for the deposition defaults
as continuation
sessions had been scheduled for late May and early June, that the
striking of any portions of
the Complaint
is an inappropriate
sanction, that no sanctions
should be imposed for the document
default given the events of May 12 but that the least
inappropriate remedy would be option a)
as outlined
in the April
24 Order that “all data relating to groundwater facts
at the
Joliet Army Arsenal shall
be barred and all presumptions from the
lack of that data shall favor respondent Celotex.”
Celotex, for its part, asserts that
the sanctions suggested
by the Hearing Officer are too narrow.
There are essentially two
grounds for this position.
.The first
is that, contrary to the
Hearing Officer’s assessment, the Agency’s responses to discovery
requests evidence of
a “scheme of deliberate defiance” to
discovery orders,
and a
“deliberate and contumacious disregard of
the
Board’s
authority” for which there are no sufficient
extenuating circumstances of the sort presented in the Cedric
factual situation.
The second
is that the Board must impose
sanctions on the Agency consistent with its Orders imposing
70-400
—7—
sanctions on Celotex, which Orders Celotex contends have
established “the law of this case”
concerning sanctions.~
The relevant Orders are the Board’s Order of April
3, 1980,
imposing sanctions,
its Orders of May 1 and May 29, 1980,
reaffirming that Order, and its Order of October 25, 1984,
denying a motion to set aside the April
3, 1980, Order.
The
subject of sanctions was Celotex failure to answer certain
interrogatories which had been propounded by the Agency on
October 11, 1979.
Pursuant to a motion to compel, the Hearing
Officer ordered the filing of responses on or before February 18,
1980.
On March
24, 1980, no responses having been filed,
the
Agency made
a motion for sanctions.
Later that day, Celotex
filed interrogatory responses and objections,
as well as
a reply
to the motion.
In its April
3 Order,
the Board found that:
“Respondent
has...violated
the
order
of
the
hearing
officer.
The
Board
finds
that
the
Agency
has
been
substantially
and materially
prejudiced
by Respondent’s violations
in
that
it
is now unable to prepare for hearing and is
subject to surprise at that hearing.
In order
to
alleviate
this
hardship,
the
Board orders
that
Respondent
be
barred
from
introducing
evidence,
including
witnesses
and
documents,
at
hearing
regarding
facts
relevant
to
any
paragraphs
of
the
complaint
to
which
answers
of
the
above-cited
interrogatories
are
material.”
The May
1 and May
29 Orders reaffirm that finding with little
comment.
The Board’s October 25, 1984, Order declined to set
aside these sanctions, reasoning that:
“Celotex
had
the
opportunity
to
provide
the
discovery
when
requested
and
the opportunity
to
provide discovery when ordered to do so by
the hearing officer.
Having failed
to do so,
this Board
imposed
the
appropriate response,
sanctions against the admission of evidence at
hearing.
In
the
more
than
four
years
that
have
past
sic
since
then
the docket
sheet
alone
shows
over
eight
pages
of
filings,
and
hearing
must
now
be
held
by
December
22,
1984.
To
allow
inquiry
into
the
previously
closed
areas
of
evidence
would
further
delay
this
matter
and
may prejudice the Agency as
it
relied on the Board’s Order limiting the scope
of this matter for four years.”
70-401
—8—
Based on the rationale of these sanctions against
it,
Celotex requests that the entire complaint be stricken.
Failing
that, Celotex asserts
that
Count
IV of the Complaint containing
the express groundwater claims should
be stricken, and
in
addition that:
“Complainant
should
be
barred,
as
is Celotex,
from any expert testimony at the hearings
(and
all
such
testimony
presently
in
the
record
should
be
stricken),
Complainant
should
be
barred
from
presenting
any
evidence
as
to
title of the site in question
(as
is Celotex),
and
Complainant
should
be
barred
from
introducing
any
evidence
at
the
hearings
concerning
the nature,
quantities,
and source
of
any materials
disposed
of
at
the
site
(as
is Celotex).”
In consideration of all the facts and circumstances of this
case,
the Board finds the most appropriate sanction is to strike
Count
IV of the Complaint,
and to bar assertion of any and all
groundwater claims
in conjunction with any of the remaining
Counts
in the Complaint.
The Board further
finds that monetary
sanctions
of
the type imposed in Cedric are insufficient.
In
Cedric,
the court
found that the defendant,
the party sanctioned,
had “advanced
a reasonable explanation” for
not
producing two
out-of-state witnesses at trial;
cost of transporting them
to
Illinois.
Further, to avoid prejudice to the plaintiff’s
case,
the defendant had offered to make any necessary factual
stipulations,
to produce the witnesses at plaintiff’s expense and
to make various other arrangements prior
to trial.
By contrast,
the court found it significant that the plaintiff had not
attempted to secure the witnesses’
testimony prior to trial
through less costly and burdensome means.
Under these
circumstances, the court found that there was no indication of
a
“scheme of deliberate defiance of the rules
of discovery and the
court’s authority or has attempted to stall significant
discovery” 402 N.E.2d 352 at 357.
Viewed
in the light most favorable to the Agency,
the events
giving rise to the four motions for sanctions described herein
indicate that Celotex’ attempts to make significant discovery
have been stalled, through no fault of its own.
Where the Agency
has ventured explanations for its discovery defaults, these
explanations are not reasonable.
The Board finds
that the
imposition of the sanctions specified here is necessary to
encourage future timely compliance with discovery requests in
order to assure that hearings
in this 7-year old action may be
completed
in
the foreseeable future.
Additionally, the Board
finds
that this form of sanction is also necessary to achieve
parity of treatment of the parties:
to reconsider and readjust
the form of the sanctions against Celotex in order
to equitably
70-402
—9-
impose lesser sanctions on the Agency would,
as the Board stated
on October 25, 1984, further delay this matter and could
prejudice the remainder of the Agency’s case.
IT
IS
SO
ORDERED.
I,
Dorothy
M. Gunn, Clerk of the Illinois Pollution Control
Board, hereby certify that the above Order was adopted on
the~’—~day of
___________________,
1986,
by
a
vote
of
-~--O
.
1~
K’
~4
z~2.~
Dorothy
M.
Cu~nn, Clerk
Illinois
Pollution
Control
Board
70-403

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