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APPEALS COURT UPHOLDS RULING AGAINST SMITHFIELD FOODS FOR POLLUTING VIRGINIA RIVER

Release Date: 09/15/99
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WEDNESDAY, SEPTEMBER 15, 1999

WASHINGTON, D.C. – The 4th U.S. Circuit Court of Appeals has upheld a lower court ruling that Smithfield Foods Inc. and its subsidiaries violated the Clean Water Act by discharging illegal levels of pollutants from their slaughterhouse into the Pagan River, the EPA and the Justice Department announced today.

Smithfield appealed a series of district court rulings that the company violated federal law, arguing that the United States was barred from suing the company because of an agreement between the company and the Virginia Department of Environmental Quality that allowed Smithfield to exceed its permit limits. The district court had rejected that argument and ruled that the United States could seek penalties for violations that “had a significant impact on the environment and the public.” After trial, the court imposed a penalty of $12.6 million, the largest fine ever imposed under the Clean Water Act.

“The Fourth Circuit has affirmed the principle that if you break the environmental laws that protect our nation’s waters, a many million dollar penalty is appropriate,” said Lois Schiffer, Assistant Attorney General for the Environment and Natural Resources Division. “The Court affirmed that when the State of Virginia took no action to stop Smithfield Foods from illegally discharging slaughterhouse waste into the Pagan River, the federal government could take strong action to hold the company accountable. This decision is a victory for all who care about public health and the environment.”

The appellate court yesterday affirmed the lower court’s ruling that the Smithfield companies were liable. The unanimous, three-judge panel held that Virginia’s agreement not to enforce the phosphorous limits did not excuse Smithfield’s violations because the agreement with the state was not part of the permit approved by the EPA. In addition, the three-judge panel upheld the lower court’s conclusion that, at the time Virginia entered into the agreement, Virginia’s state law was not comparable to the federal law.

The appellate court also approved the district court’s calculation of the penalty, with one exception, meaning that the penalty assessed in the Smithfield case will stand as the largest ever under the Clean Water Act. The appellate court sent the case back to the district court only to correct the amount of money Smithfield saved by not installing the necessary pollution control equipment. The appellate court acknowledged that this error would amount to between $100,000 and $200,000.
99-417