District of Columbia v. Miss Dallas Trucking, LLC ( 2020 )

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 19-CV-540
DISTRICT OF COLUMBIA, APPELLANT,
V.
MISS DALLAS TRUCKING, LLC, APPELLEE.
Appeal from the Superior Court
of the District of Columbia
(CAB-4996-18)
(Hon. Heidi M. Pasichow, Trial Judge)
(Argued May 26, 2020 Decided October 22, 2020)
Carl J. Schifferle, Assistant Attorney General, with whom Karl A. Racine,
Attorney General for the District of Columbia, Loren L. AliKhan, Solicitor General,
and Caroline S. Van Zile, Deputy Solicitor General, were on the brief, for appellant.
Before MCLEESE and DEAHL, Associate Judges, and FISHER, Senior Judge. ∗
DEAHL, Associate Judge: The District of Columbia brought a civil
enforcement action against Miss Dallas Trucking, LLC for violating the Water
Pollution Control Act (WPCA), D.C. Code § 8-103.01 et seq. (2019 Repl.). The
∗
Judge Fisher was an Associate Judge at the time of argument. His status
changed to Senior Judge on August 23, 2020.
2
District alleged one of the company’s trucks crashed, causing it to leak about 900
gallons of diesel fuel and engine oil into a drainage channel feeding into the Potomac
River. Dallas Trucking refused the District’s request to clean up the spill, leaving
the District to remediate the site on its own and subsequently file a lawsuit against
Dallas Trucking. Following Dallas Trucking’s failure to answer the District’s
complaint, the Superior Court entered a default judgment in the District’s favor in
an amount equal to its cleanup costs, about $31,000. The court, over the District’s
objections, declined to impose any kind of civil penalty on Dallas Trucking, a
decision the District now appeals.
The District raises two challenges to the trial court’s decision not to impose a
civil penalty. First, it argues the relevant statutory language—providing that
violators of the WPCA “shall be subject to a civil penalty of no more than $50,000,”
D.C. Code § 8-103.18(b)(2)(A)—mandates that some penalty be imposed, however
minimal. Second, it argues that even if the imposition of a civil penalty were
discretionary, the trial court abused its discretion in finding the District failed to
present adequate evidence on each of the four statutory factors the trial court was to
consider when fashioning a penalty. See generally D.C. Code § 8-103.18(b)(2)(C).
We disagree on the first point but agree on the second. We vacate the trial court’s
judgment and remand the case for further proceedings consistent with this opinion.
3
I.
In March 2016, one of Dallas Trucking’s drivers lost control of a company
dump truck while exiting Interstate 295 in Southwest Washington, D.C. The truck
crashed in a wooded area and spilled about 900 gallons of fuel and engine oil into a
drainage channel feeding into the Potomac River. The District’s Department of
Energy & Environment (DOEE) determined the spill presented “an imminent and
substantial threat to the public health or welfare.” DOEE reached out to an agent for
Dallas Trucking with instructions that it had just two hours to begin cleanup efforts,
while offering contact information for local vendors potentially capable of cleaning
up the spill. Dallas Trucking refused to take any steps toward remediating the site.
DOEE was left to do the cleanup on its own, spending $31,399.69 in the process.
After failed attempts to recover its expenses from Dallas Trucking, the District
brought a civil enforcement action against the company under the WPCA, D.C. Code
§ 8-103.18. The District alleged Dallas Trucking unlawfully discharged pollutants
into the District’s waters in violation of D.C. Code § 8-103.02 and sought to recover
$31,399.69 in cleanup costs, plus a $50,000 civil penalty. Dallas Trucking failed to
answer the complaint, and the trial court entered a default in the District’s favor.
4
Following a hearing on damages, the trial court awarded the District
$31,399.69 for its cleanup costs but declined to impose a civil penalty. The trial
court explained it had to consider four statutory factors in fashioning any civil
penalty: (1) “the size” of the business, (2) its ability “to continue the business despite
the penalty,” (3) the “seriousness of the violation,” and (4) the “nature and extent of
its success in” its cleanup efforts. D.C. Code § 8-103.18(b)(2)(C). It concluded the
District “did not adequately address” the first two factors regarding Dallas
Trucking’s size and ability to absorb a fine, even after the court requested
supplemental briefing addressing those factors. While the District provided public
records showing that Dallas Trucking owned six trucks and employed fourteen
drivers, it provided little else, in part because Dallas Trucking failed to participate
in the litigation and was non-responsive to the District’s inquiries on those topics.
The District thus provided some evidence regarding Dallas Trucking’s size and,
inferentially from that, its ability to pay a civil penalty, but the court indicated it had
no point of reference to determine if the company was “large or small in the trucking
industry.” In the court’s view, that deficiency left it with insufficient information
about Dallas Trucking’s size and ability to absorb a fine to impose a penalty.
The District asked the court to reconsider imposing a civil penalty, arguing
the WPCA’s language that violators “shall be subject to a civil penalty” required the
5
court to impose one. See generally D.C. Code § 8-103.18(b)(2). It further argued
that any lack of evidence on the first two statutory factors regarding size and ability
to absorb a fine should be held against Dallas Trucking—the entity that possessed
and withheld the pertinent information—rather than the District. Short of that, the
District continued, the court should simply treat those two factors as “insignificant”
in its calculus and levy a civil penalty based on the information it did have. The
court remained unpersuaded. It concluded imposition of a civil penalty was not
mandatory, but discretionary, under the WPCA’s terms. It also found the lack of
evidence about Dallas Trucking’s size and ability to absorb a penalty precluded
imposition of one, reasoning it “is not the Court’s burden to investigate” those
factors, as the District “seems to suggest,” but the District’s. The District now brings
this appeal.
II.
On appeal, the District advances the same two arguments it made in support
of its motion for reconsideration in the trial court: (1) a civil penalty, however
minimal, is mandatory under D.C. Code § 8-103.18(b)(2)(A); and (2) even if a civil
penalty is not mandatory, the trial court abused its discretion in concluding no
penalty was warranted due to perceived deficiencies in the District’s evidence on
6
two of the four statutory factors relevant to fashioning a civil penalty. We disagree
on the first point but agree on the second.
A.
Whether civil penalties are mandatory under the WPCA is a question of
statutory interpretation. We review it de novo, Eaglin v. District of Columbia, 123
A.3d 953, 955 (D.C. 2015), and conclude such penalties are not mandatory.
We begin with the relevant statutory text. See Peoples Drug Stores, Inc. v.
District of Columbia, 470 A.2d 751, 753 (D.C. 1983) (en banc) (“[W]e must first
look at the language of the statute by itself to see if the language is plain and admits
of no more than one meaning. . . . [T]he intent of the lawmaker is to be found in the
language that he has used.”) (internal citation and quotation marks omitted). The
statute provides, “A person who violates the [WPCA] shall be subject to a civil
penalty of no more than $50,000 for each violation.” D.C. Code § 8-
103.18(b)(2)(A). The critical phrase is “shall be subject to a civil penalty,” which
the District contends requires that a civil penalty be imposed because the word
“shall” typically connotes a mandate. This much is true. See, e.g., Williams v.
United States, 33 A.3d 358, 360 (D.C. 2011) (“Verbs such as ‘must’ or ‘shall’ denote
mandatory requirements.”) (alterations and citation omitted).
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But we cannot stop reading at the word “shall.” The words that follow, “be
subject to,” indicate violators are only exposed to a civil penalty, not that they must
incur one. See BLACK’S LAW DICTIONARY 1651 (10th ed. 2014) (defining “subject”
as “exposed, liable, or prone,” and “dependent on or exposed to (some contingency);
esp., being under discretionary authority”) (emphasis added); AMERICAN HERITAGE
DICTIONARY 1788 (3d ed. 1992) (defining “subject” as “in a position or in
circumstances that place one under the power or authority of another,” and as
“[p]rone, disposed” and “exposed”). That a violator “shall be subject to” a civil
penalty thus, most naturally read, means only that “a violator is liable to be assessed
a civil penalty, not that he or she must be.” Leslie Salt Co. v. United States, 55 F.3d
1388, 1397 (9th Cir. 1995) (O’Scannlain, J., dissenting in part) (emphasis in
original); see also Bernstein Mgmt. Corp. v. District of Columbia Rental Hous.
Comm’n, 952 A.2d 190, 193–94 & n.6 (D.C. 2008) (noting D.C. Council’s intent for
statute providing violators “shall be subject to a civil fine” was “to make clear . . .
[agencies] may impose the fines authorized”) (emphasis added); DCX, Inc. v.
District of Columbia Taxicab Comm’n, 705 A.2d 1096, 1099 (D.C. 1998) (where a
statute provided “any violation . . . shall be subject to a civil fine” and two violations
occurred, “as a matter of plain meaning . . . two fines may be imposed”) (emphasis
added). Indeed, given the indeterminate nature of the words “be subject to,” the
8
word “shall” communicates only that the violator’s exposure to a civil penalty is
certain, not that she must be assessed one.
We acknowledge the District has considerable support for its contrary
interpretation. It cites four United States Courts of Appeals decisions interpreting
the same “shall be subject to a civil penalty” language in the federal Clean Water
Act, 33 U.S.C. § 1319(d)—which the WPCA was modeled after—as mandating a
civil penalty. See United States v. Lexington-Fayette Urban Cnty. Gov’t, 591 F.3d
484, 488 (6th Cir. 2010) (“Several courts of appeals have read this language to
require that a civil penalty must be imposed in every case in which a court has found
a Clean Water Act violation.”); Leslie Salt, 55 F.3d at 1397 (“[T]he use of the words
‘shall be subject to’ means that civil penalties are mandatory” under the federal
Clean Water Act.); Atl. States Legal Found., Inc. v. Tyson Foods, Inc., 897 F.2d
1128, 1142 (11th Cir. 1990) (“This language makes clear that . . . some form of
penalty is required.”); Stoddard v. W. Carolina Reg’l Sewer Auth., 784 F.2d 1200,
1208 (4th Cir. 1986) (“This language leaves little doubt that . . . a penalty in some
form is mandated.”).
Those decisions are not binding on us and we find their reasoning
unpersuasive. Only one of the four circuits—the Ninth Circuit, over dissent, in
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Leslie Salt—even attempted to grapple with the indeterminate nature of the phrase
“be subject to.” 55 F.3d at 1396–97. It acknowledged, “[a]t first glance,” the phrase
“shall be subject to” means “penalties are discretionary,” id., just as we conclude.
Yet, the Ninth Circuit deviated from that admittedly most-natural reading of the
statutory language in significant part because its sister circuits before it had done so.
Id. at 1397. While there is a strong pull to interpret a federal statute uniformly across
circuits, see Am. Vantage Co. v. Table Mtn. Rancheria, 292 F.3d 1091, 1098 (9th
Cir. 2002), there is no similarly strong incentive for us to align our interpretation of
the District’s WPCA with the distinct federal Clean Water Act.
Even if we found the phrase “shall be subject to” ambiguous, the remainder
of the statute points to resolving that ambiguity in favor of discretionary, rather than
mandatory, civil penalties. First, the D.C. Council did not set a minimum civil
penalty, so that if one were mandated, it could be nominal, such as a penny. See
D.C. Code § 8-103.18(b)(2)(A) (permitting “a civil penalty of no more than
$50,000”); id. § 8-103.18(b)(2)(B) (permitting “a civil penalty of no more than
$250,000”). That would be a strange intention to attribute to the D.C. Council
because it is difficult to see the value of a mandatory civil penalty of a mere nominal
amount. The District counters that even a nominal penalty can serve the symbolic
function of demonstrating WPCA violations “are treated seriously.” We fail to see
10
how tacking a cent or two onto an award conveys anything serious. Moreover, such
a symbolic gesture seems ill-fitting where the WPCA imposes a form of strict
liability on violators, 1 without regard to their culpability. See generally Loftus v.
District of Columbia, 51 A.3d 1285, 1289 (D.C. 2012) (noting “the extent to which
a strict liability reading of the statute would seemingly encompass entirely innocent
conduct”) (quoting Santos v. District of Columbia, 940 A.2d 113, 117 (D.C. 2007)).
A person who took all reasonable or even excessive measures to prevent WPCA
infractions might nonetheless find herself violating it, through no fault of her own,
making the WPCA a poor candidate for symbolic gestures of condemnation.
Second, the WPCA elsewhere—in its provisions governing criminal
enforcement, applicable only to those who “willfully or negligently” violate the
WPCA, D.C. Code § 8-103.16(a)(1)—uses plain and unmistakable language
indicating fines are mandatory (in the absence of imprisonment, at least) while
setting a minimum fine amount. Section 8-103.16(a)(2) of the D.C. Code states, “[a]
person shall be fined at least $2,500” for each criminal violation, which is exactly
the type of language we would expect to see if a civil penalty were likewise
1
The WPCA makes all violators “liable for the full costs of” remediation
unless the pollutant “discharge was caused solely by (1) an act of God, (2) negligence
on the part of the District, (3) an act of war, (4) an act or omission of a 3rd party, or
(5) any combination of the foregoing causes[.]” D.C. Code § 8-103.17(e).
11
mandatory. (emphasis added) Cf. Bd. of Trs. of Univ. of District of Columbia v.
Joint Review Comm. on Educ. in Radiologic Tech., 114 A.3d 1279, 1283 (D.C. 2015)
(“[W]here Congress includes particular language in one section of a statute but omits
it in another, it is generally presumed that Congress acts intentionally and purposely
in the disparate inclusion or exclusion.”) (ellipsis omitted) (quoting Keene Corp. v.
United States, 508 U.S. 200, 208 (1993)). That is in marked contrast with the Ninth
Circuit’s analysis in Leslie Salt, which relied on the fact that elsewhere in the federal
Clean Water Act, Congress used the phrase “may . . . assess a . . . civil penalty,” 33
U.S.C. § 1319(g)(1), reasoning that Congress knew how to plainly state when
penalties were discretionary and the “shall be subject to” language in § 1319(d) was
not so clear, 55 F.3d at 1397. Here we have the inverse situation, and we draw the
opposite conclusion: Our WPCA uses clear language when criminal fines are
mandatory, see D.C. Code § 8-103.16(a)(2), so that the absence of such a clear
mandate in § 8-103.18(b)(2)(A) suggests civil penalties are discretionary. Far from
reason to abandon the most natural reading of the phrase “shall be subject to,” the
accompanying provisions of the WPCA support our view that it connotes a
discretionary civil penalty, not a mandatory one.
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B.
While the trial court had the discretion to impose no civil penalty, we remand
for reconsideration because it appears the court believed itself precluded from
imposing one due to the “incomplete” information on the first and second relevant
statutory factors. See generally D.C. Code § 8-103.18(b)(2)(C). The WPCA does
not embody so rigid a rule; a relative lack of evidence on two of the four pertinent
statutory factors does not preclude imposition of a civil penalty. The court’s mistake
of law was an abuse of discretion warranting a remand for reconsideration. See P.F.
v. N.C., 953 A.2d 1107, 1116 (D.C. 2008) (“The exercise of judicial discretion must
be founded on correct legal principles.”) (alterations and citations omitted); In re
J.D.C., 594 A.2d 70, 75 (D.C. 1991) (“[A] trial court abuses its discretion when it
rests its conclusions on incorrect legal standards.”).
The trial court, in determining the amount of any civil penalty to be imposed,
was required to consider four factors: (1) the size of Dallas Trucking’s business; (2)
its ability to continue doing business despite the penalty; (3) the seriousness of its
violation; and (4) the nature and the extent of success in its efforts to mitigate the
effects of the discharge. See D.C. Code § 8-103.18(b)(2)(C). The trial court never
weighed the information it possessed on those four factors. It said nothing about
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Dallas Trucking’s dereliction of cleanup efforts, only explaining it “did not award a
penalty of more than $0” because the District “gave the Court incomplete
information” on the first two factors related to Dallas Trucking’s size and ability to
absorb a fine. But in listing the four pertinent statutory factors that the trial court
must consider, the statute does not instruct that all four factors must be established
as counseling in favor of a civil penalty for one to be imposed. See id. That would
be a particularly unjust scheme in those cases where critical information in the
violator’s possession—related to the company’s size and ability to absorb a fine—is
practically unavailable to the District so that a company might effectively immunize
itself from a civil penalty by withholding it. The statute does not create so perverse
an incentive. Indeed, even if it were clearly established that Dallas Trucking is a
small company, unable to absorb the $50,000 penalty sought by the District, the trial
court might still determine the violation was serious enough and the failure to
undertake cleanup efforts aggravating enough to warrant a fine that would cripple
the relatively small business.
The District further argues, as it did in the trial court, that it was Dallas
Trucking’s burden to show it lacked the size and ability to absorb a fine if those
factors were to mitigate an otherwise fitting civil penalty. Because the information
as to those factors “would have been uniquely within Dallas Trucking’s possession,”
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the argument goes, any uncertainty as to them should be held against Dallas
Trucking. The District offers substantial support for its position, by analogy to cases
interpreting the federal Clean Water Act. See, e.g., United States v. Gulf Park Water
Co., Inc., 14 F. Supp. 2d 854, 868 (S.D. Miss. 1998) (“Where a violator cannot show
that a penalty will have a ruinous effect, the economic impact factor under Section
309(d) [of the Clean Water Act] will not reduce the penalty.”); United States v.
Smith, No. 96-2450, 1998 WL 325954, at *3 (4th Cir. June 18, 1998) (“[T]he burden
was [defendant’s] to show an inability to pay the penalty.”). But there is also strong
reason to draw the contrary conclusion, as courts interpreting similar civil penalty
provisions have held the “proponent of the penalty assessment” has “the burden of
going forward with evidence on all the statutory factors—including ability to pay.”
Dazzio v. F.D.I.C., 970 F.2d 71, 77 (5th Cir. 1992); see also Merritt v. United States,
960 F.2d 15, 18 (2d Cir. 1992) (“If Congress had intended a different result than
placing the burden of proof on the proponent [of a civil penalty] when a defendant’s
lack of resources is an issue, it could have written inability to pay a fine into the
statute as an affirmative defense and shifted the burden of going forward with
evidence onto the defendant. Congress did not do that.”). 2
2
Notably, both Merritt and Dazzio were reviewing agency actions following
administrative proceedings. We doubt that is a meaningful distinction, though,
particularly where the WPCA provision at issue, D.C. Code § 8-103.18(b)(2), is also
enforceable through administrative proceedings, D.C. Code § 8-103.17(d)(1)
(providing for enforcement through “administrative processes,” including by
15
It is admittedly a tricky legal issue. Rather than squarely confronting it here—
where we do not have the benefit of adversarial briefing—we hold Dallas Trucking’s
failure to participate in this litigation against it. See Hobley v. L. Off. of S. Howard
Woodson, III, 983 A.2d 1000, 1004 n.6 (D.C. 2009) (“[A]n appellee’s failure to file
a brief is a factor that we may appropriately consider” when determining whether
reversal is warranted.); Cal. Sportfishing Prot. All. v. Callaway, No. 12-cv-0843,
2012 WL 3561968, at *1 (E.D. Cal. Aug. 17, 2012) (recommending full amount of
requested civil penalty for federal Clean Water Act violation “[b]ecause defendant
has not responded to the complaint” and “the court has no evidence before it
regarding . . . the economic impact of the penalty on defendant or any other evidence
favoring a reduction of the penalty”), adopted by 2012 WL 4834406 (E.D. Cal. Oct.
10, 2012). Faced with some uncertainty on the legal issue—and with substantial
support for each of the competing views—we conclude Dallas Trucking had the
burden of establishing its size and inability to pay a fine if those factors were to
levying civil penalties “under § 8-103.18(b)(2)”). It would be quite the curiosity if
the District bore the burden of establishing the § 8-103.18(b)(2)(C) factors in
administrative proceedings—as Merritt, Dazzio, and our own administrative
regulations suggest, 1 DCMR § 2822.1 (“Unless otherwise established by law, the
proponent of an order shall have the burden of proof, that is, the requirement to
persuade the Administrative Law Judge on every contested factual issue.”)
(emphasis added)—but not in civil proceedings before a court of law.
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mitigate an otherwise fitting civil penalty because it has forfeited any argument to
the contrary.
We do not foreclose the possibility that the trial court, on remand, will reach
the same conclusion as before: that no civil penalty is warranted. The trial court
does have some evidence before it as to Dallas Trucking’s size and ability to pay a
fine and it is possible the trial court will determine that evidence is enough to
preclude imposition of a civil penalty here when weighing all the statutory factors.
But it must undertake that inquiry disabused of any view that the WPCA required
the District to establish all four factors militated in favor of imposing a penalty. We
conclude Dallas Trucking’s failure to participate in the litigation forfeits any
argument that it was the District’s burden to establish the first two of those factors.
III.
We vacate the Superior Court’s judgment and remand for the trial court to
reconsider, in light of the above, whether a civil penalty should be imposed.
So ordered.