McWane's Cast Iron Pipe Division Facing Six-Count Environmental Indictment

Nov. 7, 2005
Executives from Provo, Utah-based Pacific States Cast Iron Pipe Co. and from its parent company, McWane Inc., have been indicted on charges of violating the Clean Air Act, submitting false statements to the government and other environmental violations.

The six-count indictment charges the owner of Pacific States Birmingham, Ala.-based McWane as well as Charles Matlock, who is both a vice president of McWane and general manager of Pacific States, and Charles "Barry" Robison, vice president of environmental affairs for McWane, with conspiracy to violate federal clean air regulations as well as the submission of false documents required by the EPA.

"McWane has repeatedly illustrated an indifference to the laws that protect our environment," said Kelly Johnson, acting assistant attorney general for the Justice Department's Environmental and Natural Resources Division. "[This] indictment is proof that companies that break our nation's environmental laws and show blatant disregard for telling the truth will be prosecuted and brought to justice."

McWane and the individual defendants were charged in connection with, among other things:

  • Operating the cupola furnace when it was known that the air pollution control device was insufficient to remove pollutants to the extent required by law.
  • Causing compliance tests to be rendered inaccurate by melting pig iron on test days, rather than the normal feedstock of shredded scrap automobiles to avoid the cost of upgrading pollution control equipment and taking other measures that would have been necessary to reduce the emission of a dangerous air pollutant from the Provo facility and comply with environmental regulations.
  • Submitting to the state of Utah Emission Inventory Reports and other correspondence that intentionally misrepresented the amount of the air pollutant PM10 emitted by the facility. PM10 is particulate matter that settles very slowly and stays suspended in the air; it can become deeply embedded in human lung tissue and cause respiratory problems and exacerbate other cardiovascular diseases.

"Environmental crime hurts all of us in Utah," said U.S. Attorney Paul Warner. "You do not have to be an environmentalist to want clean air and clean water for yourself and others. Those who pollute the environment for commercial gain here in Utah will do so at their risk, as we will aggressively pursue them and hold them personally responsible. With this prosecution today we are sending the message that the cost of doing business for corporate polluters in Utah just went up way up."

Pacific States Claims its Innocence

In a statement issued Nov. 3, Pacific States says it plans to "demonstrate the innocence of both the company and our employees."

"We will show that the action by the [Department of Justice] does not accurately portray Pacific States, either in the past or today," according to the statement. "Pacific States is committed to managing its business activities to meet all safety, health and environmental laws and regulations. Our internal policies and procedures in many cases exceed state and federal regulatory requirements. McWane has worked honestly and in good faith with environmental and safety regulators and will continue to do so."

According to the statement issued by Pacific States, the company has evidence that "there was nothing improper about the way the stack tests were conducted and Pacific States is innocent of these charges."

The statement adds that before federal authorities began investigating Pacific States, parent company McWane had installed a $6 million, state-of-the-art emission control system at Pacific States' facility. Pacific States says it has invested more than $10 million in environmental improvements since 1997, resulting in a 95 percent reduction in carbon monoxide emissions and a 47 percent reduction in volatile organic compounds.

"We maintain a strong commitment to the environment and focus intensely on compliance and the safety of our workers," said John Balian, vice president and general manager of Pacific States. "McWane demands comprehensive and industry-leading environment, health and safety programs at all of its facilities. Here at PSCIPCO we endeavor to play a responsible role our community the very community in which our own families live."

Execs Could Face up to 10 Years in Prison

The indictment charges McWane and each of the defendants with conspiracy. For the individuals named in the indictment, the conspiracy charge carries a maximum penalty of 5 years and a $250,000 fine, and for the company carries a maximum fine of $500,000.

Matlock also was charged with one count of violating the Clean Air Act by tampering with a monitoring device, which carries a maximum prison sentence of 5 years.

Robison also was charged with one count of making a false statement for submitting a report of the emissions inventory for the facility that he knew to be inaccurate, which carries a maximum prison sentence of 5 years.

The company is charged in all counts of the indictment.

McWane is among the largest manufacturers in the world of ductile iron pipe with more than a dozen plants in the United States and Canada. McWane's products are used primarily for municipal and commercial water and sewer installations.

"Flagrant violations of environmental law will be vigorously pursued," said Granta Nakayama, EPA's assistant administrator for Enforcement and Compliance Assurance. "This shows complete disregard for the well-being of the whole community."

McWane Has a History of EPA, Safety Violations

Pacific States is not the first McWane division to face federal charges of environmental or occupational safety and health violations.

Earlier this fall, McWane division Union Foundry Co. of Anniston, Ala., was sentenced to $4.25 million in criminal fines and community service after pleading guilty in a federal court to a violation of the Resource Conservation and Recovery Act and to a willful OSHA violation that led to the death of a worker.

In one of two guilty pleas, Union Foundry admitted to a willful OSHA violation that resulted in the death of maintenance employee Reginald Elston on Aug. 22, 2000.

In March, Tyler Pipe Co. Inc. of Tyler, Texas, pleaded guilty to submitting a false statement and violating the Clean Air Act. Tyler Pipe agreed to pay a criminal fine of $4.5 million and is subject to a probation period of 5 years.

In June, McWane and former vice president and general manager of the McWane Cast Iron Pipe Co. James Delk were convicted of conspiracy to violate the Clean Water Act and of violating the Clean Water Act by allowing discharges of industrial process wastewater into Avondale Creek in Birmingham, Ala., through storm drains in violation of their permit.

Robison, the vice president for environmental affairs at McWane, also was convicted of submitting a false statement to the EPA. Sentencing for this case is scheduled for Dec. 5.

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