Lawsuit over Clean Water Act violations closer to resolution

A lawsuit involving KFTC and allies, coal companies ICG and Frasure Creek, and the Kentucky Energy and Environment Cabinet came one step closer to a resolution at a status conference on Monday.

This case began in 2010 after Appalachian Voices reviewed the discharge monitoring reports of ICG (International Coal Group) and Frasure Creek, finding that many of their records appeared to be fraudulent. In total, Appalachian Voices found more than 20,000 violations of the Clean Water Act, which can result in up to $740 million in fines.

Appalachian Voices, KFTC and other groups filed a 60-day intent to sue against both companies. One day before the 60 days were up, the Kentucky Energy and Environment Cabinet attempted to prevent the lawsuit by filing its own lawsuit against the companies, charging them with 2,700 violations and setting a combined fine of $660,000, much less than the possible maximum fines.

Soon after, KFTC and allies filed a motion to intervene in the case, claiming the cabinet’s proposed fine was not nearly enough, and that their proposal would do little to deter future violations.

Sue Tallichet, a member of the KFTC litigation team, described the decision to intervene: “We objected and said what the cabinet is doing is not adequate, not fair, and not in the public interest.”

In February 2011, Judge Phillip Shepherd agreed that the public had an interest in this case, granting KFTC and its partners the right to intervene. Tallichet described the ruling as historic, as it marked the first time a third party has been allowed to intervene in a state proceeding of this type. “Before this case, citizens weren’t even allowed to intervene. We had to win the right to intervene,” she said.

Frasure Creek and the cabinet appealed, going all the way to the Kentucky Supreme Court, which ruled in favor of KFTC and our allies in April 2012.

Since January, the intervening parties have been negotiating with the coal companies to come to an agreement that emphasizes correcting the problem and establishes measures to ensure the companies do not violate the Clean Water Act again, as well as sets fines for past violations. “The money’s not really the issue,” said Ted Withrow, another member of the KFTC litigation team. “It’s about making them follow the law.”

Most recently, Judge Shepherd called for a status conference to find out how the negotiations are progressing between the parties. At Monday’s conference, the parties reported that progress had been made in the negotiations and settlements were possible. Shepherd set a 60-day deadline for the two coal companies, the intervening groups and the cabinet to reach an agreement. “If an agreement is not reached, the court would go ahead and rule,” Shepherd said.

The intervenors (KFTC, Appalachian Voices, Kentucky Riverkeeper and the Waterkeeper Alliance) were represented by Mary Cromer of the Appalachian Citizens Law Center and Lauren Waterworth.