In Kanawha Forest Coalition, et al. v. Keystone WV, 2:22-cv-00367, 2023 WL 6466210 (S.D. W.V. Oct. 4, 2023), the Honorable Joseph R. Goodwin of the United States District Court for the Southern District of West Virginia, Charleston Division granted summary judgment against the operator of three defunct surface mines for past violations of the Clean Water Act (“CWA”) and Surface Mining Control and Reclamation Act (“SMCRA”) but granted summary judgment in favor of the operator with regard to claims of ongoing permit violations, finding that the Plaintiffs’ theories constituted a collateral attack on validly-issued permits.

Keystone West Virginia, LLC (“Keystone”) began operating the Rush Creek Mine, Rush Creek Mine No. 2, and KD Mine No. 1, following the bankruptcy and subsequent abandonment of the mines by the prior owner. Keystone operated the site to reclaim the properties and bring the mines back into compliance with applicable environmental laws. All three mines had been issued SMCRA and National Pollutant Discharge Elimination System (“NPDES”) permits by the West Virginia Department of Environmental Protection (“WVDEP”). However, prior to Keystone’s control of the site, WVDEP revoked the SMCRA permits for the mines due to noncompliance and the NPDES permits for Rush Creek Mine No. 2 and KD Surface Mine No. 1 had expired. Approximately seven months after Keystone obtained control of the mines, WVDEP reinstated the SMCRA permits and consolidated all of the NPDES permits into the NPDES permit for the Rush Creek Mine.

The Kanawha Forest Coalition, West Virginia Highlands Conservancy, Inc., Appalachian Voices, and Sierra Club (collectively “Plaintiffs”), filed a complaint against Keystone under the citizen suit provisions of the CWA and SMCRA alleging that Keystone (1) violated and continues to violate the CWA by discharging pollutants from the Rush Creek Mine No. 2 and KD Mine No. 1 without a valid NPDES permit, (2) violated the CWA by failing to conduct required monitoring and reporting under the NPDES permit for the Rush Creek Mine, and (3) violated and continues to violate the performance standards of the SMCRA at all three mines. Plaintiffs asked the Court to enjoin Keystone’s continuing violations and to assess penalties for the violations already committed. Plaintiffs filed a motion for summary judgment as to Keystone’s liability for the violations (“Plaintiffs’ Motion”). Keystone did not dispute (1) that it had unpermitted discharges from Rush Creek Mine No. 2 prior to the consolidation of the NPDES permits, and (2) that it did not conduct the required monitoring and reporting under the NPDES permit for the Rush Creek Mine because it was unaware that it had to comply with the NPDES permit while its application to consolidate the NPDES permits was pending. Keystone filed a cross-motion for summary judgment on the basis that the mines are now in compliance and therefore Plaintiffs’ complaint is moot (“Keystone’s Motion”).

A “citizen-plaintiffs may prove ongoing violations either (1) by proving violations that continue on or after the date the complaint is filed, or (2) by adducing evidence from which a reasonable trier of fact could find a continuing likelihood of recurrence in intermittent or sporadic violations.” Id. at *9, citing Chesapeake Bay Found., Inc. v. Gwaltney of Smithfield, Ltd., 844 F.2d 170, 171-72 (4th Cir. 1988) (internal quotations omitted).

Against this backdrop, Judge Goodwin granted in part and denied in part certain portions of Plaintiffs’ and Keystone’s Motions, as follows. Judge Goodman granted Plaintiffs’ Motion for Keystone’s past violations of the CWA and SMCRA, as Keystone admitted that it had unpermitted discharges and did not perform the required monitoring under the NPDES permit for the Rush Creek Mine. Keystone WV at *10, *12. Judge Goodman discounted Keystone’s lack of awareness as a valid defense, since the CWA is a strict liability statute. Id. at *12. In addition, because “each violation of the CWA is, in turn, a violation of the SMCRA,” Keystone also violated the SMCRA by allowing unpermitted discharges at Rush Creek Mine No. 2 and by failing to conduct the required monitoring at the Rush Creek Mine. Id.

However, Judge Goodman denied Plaintiffs’ Motion and granted Keystone’s Motion as to ongoing violations. Judge Goodman reasoned that as of the date that WVDEP issued the consolidated NPDES permit, Keystone was no longer violating the CWA and SMCRA. Judge Goodman was disturbed that the arguments asserted by Plaintiffs amounted to an impermissible collateral attack of the underlying permit. Id. at *10-11. Unless or until Plaintiffs prevailed in a separate suit to invalidate the NPDES permit, Judge Goodman found that they could not assert arguments attacking the validity of the consolidated NPDES permit. Id. Judge Goodman reserved rendering an opinion on the number of violations and the imposition of a civil penalty for a later time. Id. at *13.

This case serves as a reminder that, despite good intentions, subsequent owners and/or operators can be held responsible for the problems that they inherit. It is important to ensure, prior to taking ownership or control a property, that the property is in compliance with all applicable environmental laws and, if not, discuss how to proceed with the state and/or federal permitting authority.