BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
PEOPLE OF THE STATE OF ILLINOIS,
by LISA MADIGAN, Attorney General
of the State of Illinois,
Complainant,
)
v
.
)
PCB 96-98
SKOKIE VALLEY ASPHALT CO ., INC.,
)
(Enforcement -
RCRA)
an Illinois Corporation, EDWIN L . FREDERICK,
)
JR., Individually and as Owner and President of
)
Skokie Valley Asphalt Co ., Inc., and
)
RICHARD J. FREDERICK, Individually
)
and as Owner and Vice President of Skokie
)
Valley Asphalt Co
., Inc.,
)
Respondents .
)
NOTICE OF MOTION
TO : Mr. David S
. O'Neill, Esq .
Ms. Carol Webb, Hearing Officer
Mr
. Michael B . Jawgiel, Esq .
Pollution Control Board
5487 North Milwaukee Avenue
1021 North Grand Avenue East
Chicago, Illinois 60630-1249
P.O. Box 19274
Springfield, Illinois 62794-9274
PLEASE TAKE NOTICE that I have today filed
Complainant's Motion for Final
Order,
with the Office of the Clerk of the Illinois Pollution Control Board, true and correct
copies of which are attached hereto and herewith served upon you.
PEOPLE OF THE STATE OF ILLINOIS,
by LISA MADIGAN, Attorney General
of the State of Illinois
BY:
MICHAEL C. PARTEE
Assistant Attorney General
Environmental Bureau/North
188 West Randolph Street, Suite 2000
Chicago, Illinois 60601
Tel : 312.814.2069
Fax : 312 .814.2347
E-Mail
: mpartee@atg .state.il.us
RECEIVED
CLERK'S
OFFICE
MAR 3 0 2006
STATE OF ILLINOIS
Pollution Control Board
RECEIVED
CLERK'S OFFICE
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
MAR 3 0 2006
PEOPLE OF THE STATE OF ILLINOIS,
)
STATE
OF ILLINOIS
by LISA MADIGAN, Attorney General
)
Pollution Control Board
of the State of Illinois,
)
Complainant,
)
v.
)
PCB 96-98
SKOKIE VALLEY ASPHALT CO ., INC .,
)
(Enforcement -
RCRA)
an Illinois Corporation, EDWIN L
. FREDERICK, )
JR.,
Individually and as Owner and President of
)
Skokie Valley Asphalt Co ., Inc ., and
)
RICHARD J
. FREDERICK, Individually
)
and as Owner and Vice President of Skokie
)
Valley Asphalt Co ., Inc.,
)
Respondents .
)
COMPLAINANT'S MOTION FOR FINAL ORDER
Complainant, PEOPLE OF THE STATE OF ILLINOIS ("People"), by LISA
MADIGAN, Attorney General of the State of Illinois, hereby moves the Board, pursuant to 35
111. Adm. Code 101
.516, for a final order granting the People's September 17, 2004 verified
petition for attorneys' fees and costs, as modified by the Board's April 7, 2005 Order
. In support
of this Motion, the People state and allege as follows
:
RELEVANT BACKGROUND
1 .
On September 2, 2004, following a hearing on all issues on October 30 and 31,
2003, the Board entered an Order finding willful, knowing or repeated violations of the Illinois
Environmental Protection Act ("Act")
and Board rules, assessing a $153,000 civil penalty, and
assessing the People's attorneys' fees and costs against the Respondents
. The Board further
directed the People to file a petition for attorneys' fees and costs
.
2.
On September 17, 2004, the People then filed a verified petition for $134,250
.00
in attorneys' fees and $3,482
.84 in costs ("Fee Petition"), which reflects only a portion of the
People's fees and costs in this case . A copy of the People's Fee Petition is attached hereto as
Exhibit A .
3 .
The Fee Petition was verified with the affidavits of Assistant Attorneys General
("AAGs") Mitchell Cohen, Joel Sternstein and Bernard Murphy, whose fees were included in the
Fee Petition
. Each service included in the Fee Petition is listed with the corresponding specific
time allotment
. (See
Fee Petition at Exhs . A, B and C .) The People's costs were also itemized in
their Fee Petition.
4.
On September 28, 2004, Respondents filed their "Initial Response to and Motion
to Stay and/or Extend Time to Respond to Complainant's Petition for Attorneys' Fees and Costs"
in which they disputed AAG Sternstein's fees based on a tenuous argument involving his prior
Board employment, made desperate and unfounded allegations against the People's attorneys,
and stridently demanded discovery, including the depositions of "Members and employees of the
Illinois Pollution Control Board ."
5 .
On October 21, 2004, the Board stayed the Respondents' payment of the
$153,000 civil penalty pending resolution of the dispute over the People's Fee Petition
.
6.
On December 16, 2004, the Board ruled that the stay of Respondents' $153,000
civil penalty payment would remain in effect until the dispute over the People's Fee Petition was
resolved through a final order . The Board further ruled that "The Board will not hold any
hearings on the issue of attorney's fees and costs, but will allow the respondents additional time
to respond ." (Dec
. 16, 2004 Order at 3 (underline added) .)
2
7.
On January 10, 2005, despite the Board's clear Order to the contrary, the
Respondents did not respond, but instead moved the Board for a discovery schedule and hearing
on the People's Fee Petition.
8.
On January 18, 2005, the People responded to Respondents' motion for a
discovery schedule and hearing by objecting to the need for any discovery or hearing on a
verified fee petition.
9.
On April 7, 2005, the Board disallowed AAG Sternstein's fees of $33,675
.00
(224.5 hours at $150.00/hour) and granted Respondents' request for discovery regarding the Fee
Petition for the remaining $100,575 .00 in fees (reflecting a deduction of $33,675
.00 for AAG
Sternstein's disallowed fees) and $3,482 .84 in costs, but ordered that discovery shall be
"limited," that "the parties are not to address [AAG Sternstein's disallowed fees] in conducting
discovery" and that "any pleading by either party not designed to further a speedy and ultimate
resolution of this case will not be tolerated by the hearing officer or the Board ." (April 7, 2005
Order at 1 and 4 (underlines added) .)
10.
On April 25, 2005, despite the clear limitations placed on discovery by the Board,
Respondents served the People with voluminous discovery requests, including 43 Requests to
Admit Facts, 50 Interrogatories including subparts, 24 Document Requests and two deposition
notices .' Respondents' voluminous discovery requests not only addressed AAG Stemstein's fees
and costs, which were previously disallowed and were not to be addressed pursuant to the
Board's April 7, 2005 Order, but contained further ad hominem
attacks on the People's attorneys
I Respondents' discovery requests regarding the People's Fee Petition are significantly more voluminous than the
sum of Respondents' discovery prior to the hearing on all issues in this case, which consisted of 16 Interrogatories
and 14 Document Requests . Even measured against their own prior discovery in this case, Respondents' recent
discovery requests cannot be considered "limited ."
3
and sought highly inappropriate information (e.g., the People's attorneys' take home pay), for
which Respondents never adequately explained the need .
11 .
On May 24, 2005, the People timely responded to the Respondents' voluminous
discovery requests . As part of their responses, the People provided Respondents with all
available attorney time records, receipts for costs, and curriculums vitae for AAGs involved in
this case
. Copies of this back-up documentation is attached hereto as Exhibit B
.
12.
After receiving this back-up documentation, Respondents' attorneys ceased all
communications with the People's attorneys . Respondents then commenced a campaign of delay
by filing eight motions to strike or quash various discovery items, all of which were denied by
the Board or Hearing Officer . (See Respondents' motions filed on July 6, 2005 (three motions to
strike), August 15, 2005 (one motion to strike), December 14, 2005 (one motion to quash),
and
January 9, 2006 (two motions to strike)
.) Throughout, the People's attorneys have, in full and
good faith, attempted to informally resolve discovery disputes with Respondents, but again,
Respondents' attorneys have refused to communicate with the People's attorneys . (See People's
Rule 201(k) Letters, dated May 24, 2005, June 14, 2005, Dec . 15, 2005, and Feb . 16, 2006
(Exhibit C hereto).)
13 .
At the same time, Respondents have refused to respond to the People's limited
discovery requests.
14.
On February 8, 2006, the Hearing Officer entered a protective order requiring that
"respondents' attorneys must relate the measures taken to resolve the problem with
complainant's attorneys before the filing of the motion
." (Feb. 8, 2006 Order at 3 .)
15 .
Respondents then unilaterally filed an interlocutory "Appeal" of the Hearing
officer's February 8, 2006 Order, which is currently pending before the Board . As part and
4
parcel of their Appeal, and contrary to Rule 101 .502(c) of the Board's Procedural Rules
(Motions Directed to the Hearing Officer), Respondents have taken the position that their own
dispute of the People's Fee Petition is stayed . (Rule 101 .502(c) provides that the appeal to the
Board of a hearing officer order does not stay a proceeding absent a Board Order, and that all
hearing officer orders will remain in effect during the pendency of any appeal to the Board .)
16.
As of today's date, two and a half years after the hearing on all issues in October
2003 and one year after the Board authorized limited discovery regarding the People's Fee
Petition, a final order has not yet been entered in this case due to Respondents' unsubstantiated
dispute of the Fee Petition . Despite the benefit of an entire year's worth of discovery on the
remaining $100,575 .00 in fees and $3,482
.84 in costs requested in the People's Fee Petition,
Respondents have failed to specifically identify a single hour of attorney time or a single cost
that was excessive for the corresponding service performed, nor will they because that would, of
course, allow the Board to decide this dispute, thereby resulting in a final order .
APPLICABLE LEGAL STANDARDS
17.
Section 42(f) of the Act, 415 ILCS 5/42(f) (2004), provides, in relevant part, as
follows :
. . . Without limiting any other authority which may exist for the awarding of
attorney's fees and costs, the Board . . . may award costs and reasonable
attorney's fees, including the reasonable costs of expert witnesses and consultants,
to the . . . Attorney General in a case where he has prevailed against a person who
has committed a wilful, knowing or repeated violation of this Act, any rule or
regulation adopted under this Act, any permit or term or condition of a permit, or
any Board order.
18.
On September 2, 2004, after a hearing on all issues, the Board entered an Order
finding, in part, that Respondents committed willful, knowing or repeated violations of the Act
5
and Board rules and assessing the People's attorneys' fees and costs against the Respondents
.
(Sept
. 2, 2004 Order at 22-24 .)
19.
On April 7, 2005, the Board set forth the general standard for the reasonableness
of a petition for attorneys' fees and costs (April 7, 2005 Order at 3-4)
:
In determining this reasonableness, the Board will be guided by the factors set out
in long-established precedent
. The Board will consider, among other factors, [a]
the nature of the cause and the novelty and difficulty of the questions at issue, [b]
the amount and importance of the subject matter, [c] the degree of responsibility
involved in
the management of the cause, [d] the time and labor required, [e] the
usual and customary charge in the community, and [f] the benefits resulting to the
client.
20.
In the context of environmental enforcement actions before the Board pursuant to
the Act, it is also well-established that the usual and customary charge for AAGs is $120
.00 to
$150 .00 per hour, with rates in recent cases assessed at $150
.00 per hour
. See, e.g., People v. J
& F Hauling, Inc., 02-21,.2003
WL 21129678, at *2 (May 1, 2003) (finding AAG's rate of
$150 .00 per hour to be reasonable) ;
People v. D Angelo Enterprises Inc.,
PCB 97-66, 2002 WL
31545432, at *2-3 (Nov
. 7, 2002) (finding AAG's rate of $120
.00 per hour to be reasonable) ;
People v. Panhandle Eastern Pipe Line Co .,
PCB 99-191, 2001 WL 1509515, at *33 (Nov
. 15,
2001) (finding AAG's rate of $120 .00 per hour to be reasonable)
; People v. Spirco
Environmental, Inc.,
PCB 97-203, 1999 WL 304591, at * 1 (May 6, 1999) (finding AAG's rate of
$120.00 per hour to be reasonable).
THE BOARD SHOULD ISSUE A FINAL ORDER
21 .
The People's Fee Petition contains sworn affidavits and itemized costs, and is
supported by extensive back-up documentation
. Despite the limitations placed on discovery by
the Board, Respondents served voluminous discovery requests on the People to which the People
6
responded and, at the same time, Respondents refused to answer any questions regarding their
own fees and costs .
22.
Allowing discovery on a petition for attorneys' fees and costs is unprecedented .
The People were unable to locate a Board decision in any prior case, including those cited in
paragraph 20 above, where a respondent was allowed to conduct discovery regarding a fee
petition
. Moreover, the People were unable to locate any precedent, in any fora where a
respondent or defendant was allowed an entire course of voluminous written and oral discovery,
followed by a hearing, in order to challenge a fee petition
.
23.
As of today's date, a year after the Board authorized a speedy course of limited
discovery and a hearing on Respondents' dispute of the People's Fee Petition, Respondents have
not yet identified a single hour of attorney time or single cost improperly included in the
$100,575
.00 in fees (reflecting a deduction of $33,675 .00 for AAG Sternstein's disallowed fees)
and $3,482 .84 in costs remaining in the People's Fee Petition
.
24.
Instead, Respondents have used their unprecedented discovery opportunity for the
purpose of delaying entry of a final order .
25 .
The People's Fee Petition is supported by affidavits and documentation,
Respondents have not filed any counter-affidavits and, based on the following factors, the
People's Fee Petition is reasonable as a matter of law and the Board should enter a final order
granting the People $100,575.00 in fees and $3,482 .84 in costs .
The People's Fee Petition Should Be Granted Based on the Nature of the Cause and the
Novelty and Difficulty of the Questions at Issue, and the Amount and Importance of the
Subiect Matter
26 .
Fundamentally, Section 42(f) of the Act includes no limitation on the Attorney
General's fees and costs based on the nature of the cause and the novelty and difficulty of the
7
questions at issue because all fee petitions pursuant to Section 42(f), including the Fee Petition in,
the present case, involve cases of the same nature . Notwithstanding, the issues in the present
case were not necessarily novel, but were difficult relative to other cases involving the Act . The
present case involved not only violations of the general prohibition against water pollution under
Section 12(a) of the Act, 415 ILCS 5/12(a), but also involved numerous statutory and regulatory
violations of the National Pollutant Discharge Elimination System Permit Program over a period
of time measured in years . (Sept . 2, 2004 Order at 19 and 24 .) The present case also involved
administrative law and procedure issues, expert testimony and evidentiary issues at hearing, and
numerous and lengthy legal briefs by both parties, including the People's 48 page post-trial brief
filed on January 15, 2004 . Furthermore, the Board's decision after the October 2003 hearing
necessitated a 24-page Board Order .
(See Sept
. 2, 2004 Order .)
27.
In terms of the amount of subject matter, the present case involved numerous
statutory and regulatory violations over a period of time measured in years
. (Sept 2, 2004 Order
at 19 .)
28.
This case also involved important subject matter . The public has a right to
healthy and safe environment
. "By enactment of the Environmental Protection Act the General
Assembly declared the public policy of the State of Illinois with reference to water pollution,
and
subsequently the public policy of the State, by adoption of the 1970 Constitution, was declared to
be that every person has an inherent right to a clean and healthful environment ." Meadowlark
Farms, Inc . v. Illinois Pollution Control Bd ., 17 I11.App.3d 851, 856, 308 N .E .2d 829, 832 (Ill
.
App . 5th Dist . 1974) . A more important example of a public right cannot be imagined .
8
The People's Fee Petition Should Be Granted Based on the Degree of Responsibility
Involved in the Management of the Cause
29.
AAGs assumed the responsibility for preparation and trial of this case and there is
no potentially-duplicative supervisory or management level attorney oversight time requested
.
The People's Fee Petition Should Be Granted Based on the Time and Labor Required
30.
The remaining $100,575
.00 in requested fees is documented, supported with
sworn affidavits, and represents only a portion of the People's actual time and labor required to
resolve this case.
31
.
The affidavits and documentation in support of the People's Fee Petition
adequately supports the fees sought and Respondents have not filed any counter-affidavits
specifically identifying any excessive fees for the corresponding service performed
.
32 .
The People's time and labor required to resolve this case was also the direct result
of Respondents' own decision to actively oppose the People's case
.
33 .
Furthermore, as mentioned above, the People's Fee Petition only includes a
portion of the actual time and labor required to resolve this case
. First, AAG's Sternstein's fees
were disallowed
. AAG Sternstein was responsible for, and performed numerous tasks in, the
preparation of this case for hearing
. His $33,675 .00 in fees will not be assessed against
Respondents according to the Board's April 7, 2005 Order
.
Second, and perhaps more
significantly, the Complaint in this case was filed on November 3, 1995, but the earliest
fees or
costs included in the People's Fee Petition are AAG Cohen's fees beginning on May 29, 2002
.
"Nothing in the record indicates that the People were not diligent in pursuing their claim
." (Sept
.
2, 2004 Order at 8
.) However, six out of the eight years that the People spent prosecuting this
case are not included in their Fee Petition
.
34 .
Put in perspective, the People's Fee Petition only covers 25% of the years spent
prosecuting case (approximately two out of eight years are included in the Fee Petition) and, as
to the two years covered by the Fee Petition, only 75% of the People's attorneys' fees are
included ($100,575
.00 out of $134,250 .00, reflecting a reduction of $33,675 .00 for disallowance
of AAG Sternstein's fees) .
35 .
Held to a standard of reasonableness, the time and labor requested in the People's
Fee Petition is reasonable because it is accurate, documented, supported by affidavits, and only
represents a fraction of the actual time and labor required to resolve this case .
The People's Fee Petition Should Be Granted Based on the Usual and Customary Charge
in the Community and the Benefits Resulting to the Client
36
.
This case was handled by experienced attorneys for the People . At the time of the
hearing in October 2003, AAG Cohen had about 14 years of experience as a lawyer, about 12
years of which was spent as a prosecutor, and AAG Murphy had about 12 years of experience as
a lawyer, about eight years of which was spent as a prosecutor . (See curriculums vitae
at Exhibit
B hereto .)
37
.
Moreover, even without consideration of the annual increases in billing rates for
environmental lawyers in downtown Chicago, the $150.00
per hour rate requested in the
People's Fee Petition is supported by the Board's prior decisions in J & F Hauling, Inc
.,
D Angelo Enterprises Inc ., Panhandle Eastern Pipe Line Co
., and Spirco Environmental, Inc.
38 .
Therefore, the $150 .00 per hour rate requested in the People's Fee Petition is
reasonable, and the market would support an even higher rate
.
39.
In terms of the benefits resulting to the People, the People prevailed in this case
and the purpose of the Act will be served when a final order is entered
.
10
Lastly, the People's Fee Petition Should Be Granted Because Respondents Have Failed
Over the Last Year to Specifically Identify Any Excessive Fees or Costs Included
Therein
40.
hi addition to the non-exclusive factors set forth by the Board for determining the
reasonableness of the People's Fee Petition (See April 7, 2005 Order at 3-4), the Board should
also consider that the Respondents have had an entire year and an unprecedented discovery
opportunity to specifically identify any attorney time or cost that was excessive for the
corresponding service performed, but they failed to do so because that would, of course,
allow
the Board to decide this dispute, thereby resulting in a final order .
41 .
Respondents also refused to answer any questions regarding their own fees and
costs . Instead, Respondents have used this proceeding for the sole purpose of delaying the entry
of a final order .
42. Allowed to continue, at some point in the not too distant future, Respondents will
force the People to incur more attorneys' fees and costs in obtaining the relief requested in their
Fee Petition than are actually sought in the Fee Petition itself, which is abusive and defeats the
purpose of Section 42(f) of the Act .
CONCLUSION
43.
The People's Fee Petition is supported by sworn affidavits, adequate
documentation and is reasonable based on the factors set forth by the Board . It is also reasonable
in light of the extraordinary length of time and scope of discovery afforded Respondents and the
fact that they have failed to specifically identify any attorney time or costs that are excessive
relative to the corresponding service performed .
44.
Respondents have used their unprecedented opportunity to create endless
discovery disputes and, thereby, delay entry of a final order in this case .
11
45
.
Because Respondents have failed to substantiate their dispute of the People's Fee
Petition, the Board should, as a matter of law, enter a final order assessing $100,575 .00 in fees
and $3,482 .84 in costs against Respondents' and assessing any further relief that is fair and just
under the circumstances .
46 .
If for any reason, the Board does not grant this Motion, the People respectfully
request that the Board direct the Hearing Officer to schedule a final hearing to occur no later than
60 days after deciding this Motion .
WHEREFORE, the People respectfully request that the Board enter a final order
assessing $100,575 .00 in fees and $3,482 .84 in costs against Respondents' and for any further
relief that is fair and just under the circumstances. If the Board does not enter a final order based
on this Motion, the People respectfully request that the Board direct the Hearing Officer to set a
final hearing as soon as possible, and not later than 60 days after a decision on this Motion .
Respectfully submitted,
PEOPLE OF THE STATE OF ILLINOIS
by LISA MADIGAN, Attorney General
of the State of Illinois
IL
BY:
MICHAEL C. PARTEE
Assistant Attorney General
Environmental Bureau/North
188 West Randolph, Suite 2000
Chicago, Illinois 60601
Tel: 312.814.2069
Fax: 312 .814 .2347
12
