United States v. Smith ( 1998 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 96-2450
T. BRUCE SMITH, II,
Defendant-Appellant.
Appeal from the United States District Court
for the District of South Carolina, at Columbia.
Dennis W. Shedd, District Judge.
(CA-94-2693-3-19)
Submitted: February 27, 1998
Decided: June 18, 1998
Before WILKINS, MICHAEL, and MOTZ, Circuit Judges.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
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COUNSEL
Karl H. Smith, STANTON, JONES & SMITH, Hartsville, South Car-
olina, for Appellant. Lois J. Schiffer, Assistant Attorney General,
David C. Shilton, Lisa E. Jones, UNITED STATES DEPARTMENT
OF JUSTICE, Washington, D.C.; J. Rene Josey, United States Attor-
ney, R. Emery Clark, Assistant United States Attorney, Columbia,
South Carolina, for Appellee.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
Appellant T. Bruce Smith II conceded below that he violated the
Clean Water Act, 33 U.S.C.A. §§ 1251-1387 (West 1994 & Supp.
1997) (the Act), by unlawfully filling 2.2 acres of wetlands in Lee
County, South Carolina, without a permit from the United States
Army Corps of Engineers (the Corps). See 33 U.S.C.A. §§ 1311(a),
1344(a). The district court entered summary judgment for the United
States on the issue of liability and conducted a bench trial to deter-
mine the appropriate remedy. After considering the parties' post-trial
briefs, the court ordered Smith to pay a $35,000 civil penalty and
issued an injunction requiring him to restore the wetlands by remov-
ing the fill. Smith appeals, contending that the district court abused
its discretion. We affirm.
I
In 1987, Fred Veal, a biologist employed by the Corps, inspected
a 4.4-acre tract of land owned by Smith. The property included 3.2
acres of palustrine forested wetlands. Veal noticed that approximately
one acre of wetlands on the property had been filled with material
including sand, highway construction debris, tires, scrap building
materials, and asphalt shingles. The area also had been cleared of veg-
etation. The next day, the Corps issued a verbal cease and desist order
to Smith. Smith indicated that he would comply with the order. One
month later, the Corps sent a letter to Smith stating that the fill had
caused less than a one-acre impact on the wetlands and was therefore
authorized under a general nationwide permit. The Corps informed
Smith that proceeding with any additional fill without prior authoriza-
tion would violate the Act.
Smith nonetheless continued to fill the wetlands without a permit.
He hired several contractors to clear vegetation and to dump fill mate-
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rial on the property. In early July 1991, Veal conducted a second
inspection of the site and discovered that Smith had filled the remain-
ing 2.2 acres of wetlands. Almost all trees and wetland vegetation had
been removed, and there was evidence of recent fill activity. Smith
had not attempted to receive authorization for his activities. The
Corps notified Smith that he was in violation of the Act, and the
United States commenced the subject action, seeking a civil penalty
and an injunction requiring Smith to restore the land.
Smith conceded liability, and the district court conducted a bench
trial to determine the appropriate remedy for Smith's violation of the
Act. At trial, the government's chief witness was Veal, who testified
that properly functioning wetlands acted as filters for pesticides and
herbicides, were good for flood retention, and provided valuable
cover and habitat for wildlife corridors. Between 1987 and 1991,
Smith had destroyed the 2.2 acres of wetlands. Veal testified that
removal of the fill material was necessary to restore the normal water
flow and fluctuations at the property. Only after the fill was removed,
and natural reseeding had taken place, could the wetlands return to
their pre-fill status.
Johnnie Brigman, an environmental consultant, testified on Smith's
behalf. He stated that the property in its present state was different
than the forested wetlands system that previously existed. He con-
curred that the fill was preventing the water purification process and
that the fill would have to be removed in order to restore the property.
After trial and the submission of post-trial briefs, the district court
entered an order imposing a $35,000 civil penalty. The court also
imposed an injunction requiring removal of the fill. The removal
would restore the wetlands to its productive character and thereby
serve the public interest. The court observed that the injunction would
confer maximum environmental benefits, bore an equitable relation-
ship to the degree and kind of wrong sought to be remedied, and was
achievable as a practical matter.
II
Smith appeals only the district court's remedial order. We review
both the amount of the civil penalty and the grant of the injunction
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for abuse of discretion. See Sierra Club v. Cedar Point Oil Co., 73
F.3d 546, 576 (5th Cir.), cert. denied, ___ U.S. ___, 65 U.S.L.W.
3241 (U.S. Oct. 7, 1996) (No. 95-1831) (amount of penalty); Wilson
v. CHAMPUS, 65 F.3d 361, 363 (4th Cir. 1995) (grant of permanent
injunction).
Civil Penalty
Once liability for a violation of the Act is established, the imposi-
tion of a civil penalty is mandatory. See 33 U.S.C.A. § 1319(d); Leslie
Salt Co. v. United States, 55 F.3d 1388 (9th Cir.) (Pregerson, J., con-
curring), cert. denied, ___ U.S. #6D 6D6D#, 64 U.S.L.W. 3313 (U.S. Oct. 30,
1995) (No. 95-73); Atlantic States Legal Found., Inc. v. Tyson Foods,
Inc., 897 F.2d 1128, 1142 (11th Cir. 1990). The district court has
wide discretion in assessing the penalty, up to the statutory maximum
of $25,000 per day. See 33 U.S.C.A. § 1319(d); Atlantic States, 897
F.2d at 1142. The district court is statutorily obligated to consider the
following factors when setting the penalty: "the seriousness of the
violation . . ., the economic benefit (if any) resulting from the viola-
tion, any history of such violations, any good-faith efforts to comply
with the applicable requirements, the economic impact of the penalty
on the violator, and such other matters as justice may require." 33
U.S.C.A. § 1319(d).
The district court considered each of these factors. The court noted
that Smith had "not only destroyed the hydrological regime of these
wetlands, but . . . introduced potentially environmentally hazardous
materials to our fresh water system." Second, the court found that
Smith's motive in filling the property was profit-driven: he antici-
pated building and operating a furniture store on the site. Further, the
court observed that, even after the restoration of the property, it will
be more attractive to potential buyers than it would have been prior
to the destruction of trees and wetlands vegetation. Thus, Smith's
activities had some lasting economic benefit to him. Third, Smith's
tax records demonstrated that he could pay the penalty. Fourth, there
was no evidence that Smith previously had violated federal or state
environmental laws. Finally, the court noted "[t]he intentional, delib-
erate nature of Mr. Smith's violation, and his subsequent lack of
cooperation with the Corps," which supported a higher penalty.
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Smith contends in his brief that the district court should have con-
sidered the projected cost of restoration (between $45,000 and
$75,000) in addition to his tax records, which the United States sub-
mitted under seal, when evaluating his ability to pay the penalty.
Smith also argues that the court incorrectly construed his behavior as
hostile and defiant. We do not find Smith's arguments persuasive.
There is no requirement that the district court consider the cost of res-
toration when setting a penalty; moreover, the court had the projected
cost before it and may have considered the cost when determining the
amount of the penalty. In any event, the burden was Smith's to show
an inability to pay the penalty, see Public Interest Research Group of
N.J. v. Powell Duffryn Terminals, Inc., 720 F. Supp. 1158, 1165-66
(D.N.J. 1989), aff'd in part and rev'd in part , 913 F.2d 64 (3rd Cir.
1990), and Smith neither presented testimony regarding his financial
status nor submitted information concerning his claimed inability to
pay for the restoration.
The district court addressed each factor set forth in § 1319(d) and
supported its findings as to each factor with evidence of record. Under
these circumstances, the court did not abuse its discretion in setting
a civil penalty of $35,000.
Injunction
The Clean Water Act authorizes district courts to issue appropriate
injunctive relief for certain violations of the Act. See 33 U.S.C.A.
§ 1319(b). The restorative injunction issued in this case requires
Smith to remove all fill material from the wetlands save one acre of
wetland fill to the east of the stream channel. Further restrictions con-
cerning the fill on the one-acre area are established. Finally, Smith is
to implement erosion control measures and to dispose of removed fill
material appropriately.
Smith contends that the district court did not apply traditional equi-
table principles in fashioning the injunction. He asserts that the court
should have made three findings prior to requiring restoration of the
wetlands: (1) that the plan confers maximum environmental benefits;
(2) that the plan is achievable as a practical matter; and (3) that the
plan bears an equitable relationship to the degree and kind of wrong
which it is intended to remedy. His primary contention is that the
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court-ordered plan would not have significantly more environmental
benefits than allowing the natural rejuvenation of the wetlands to con-
tinue uninterrupted. According to Smith, the property has reverted to
a meadow-type wetlands and, in two years, will evolve into a swamp
wetlands almost identical to the original wetlands. Additionally,
Smith claims that the costs of the restoration plan significantly out-
weigh the plan's benefits.
Contrary to Smith's assertions, the district court considered the
three factors that Smith insists it did not. First, the court found that
removal of all fill would confer maximum environmental benefits.
The wetlands as they previously existed served various functions,
including habitat sites for wildlife, water filtration, food chain produc-
tion, and flood water control. Removal of all the fill would reestablish
the pre-existing hydrology and set the stage for restoring the area to
a productive, swampy, palustrine forested wetland.
Second, the district court determined that removal of the fill was
achievable as a practical matter. The court observed that there was no
testimony that removal of the fill was not feasible, and the court took
note of the area's proximity to highways as well as the cost of remov-
ing and transporting the fill.
Finally, the court found that the injunction bore an equitable rela-
tionship to the degree and type of wrong to be remedied. The court
observed that Smith had destroyed the hydrological regime of the
wetlands and, in the process, had introduced environmentally hazard-
ous materials into the fresh water system. Smith continued to fill the
wetlands after he was warned in 1987 that placing additional fill
would require a permit. The district court characterized Smith's viola-
tions as "intentional, flagrant, egregious, and openly defiant," so as to
militate against any equitable considerations.
Smith contends that the property soon will become a wetlands vir-
tually identical to the original forested palustrine wetlands. Therefore,
he argues, removal of the fill will not particularly benefit the environ-
ment. However, testimony by experts for both sides revealed that the
wetlands on the property differ markedly from the wetlands originally
on the site. One purpose of the Act is to restore and maintain the
integrity of the nation's waters. See 33 U.S.C.A. § 1251(a). The wet-
6
lands as they currently exist do not function in the same way as they
did prior to Smith's illegal filling. Removal of the fill is necessary to
restore the wetlands to their natural and functional hydrology and
therefore fulfill a central purpose of the Act.
III
Because the district court's order imposing a restorative injunction
and a civil penalty of $35,000 did not constitute an abuse of discre-
tion, we affirm. We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
AFFIRMED
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