A few years ago the president of a well-known food brand was convicted and sentenced to serve nine months in federal prison for failing to stop his plant from engaging in a practice that he knew was a violation of environmental laws. A former disgruntled employee who knew of the practice turned the company in to the federal authorities. The practice, emptying a 10,000 gallon food waste vat into the river each month in the middle of the night, was serious enough to cause substantial, although temporary, environmental degradation to a major river in Washington state. Federal agents used infrared video cameras to record the violation as it was occurring.
The federal prosecutor decided to charge the company president, who was subsequently found guilty of violating federal law. The president was an extremely popular and philanthropic person, and was very active in civic and community affairs — over 100 people wrote to the judge asking not to send their civic leader to jail. However, the judge agreed with the prosecutor and felt that only jail time would deter future illegal behavior.
The above scenario is not a hypothetical; it is an actual case. Facts like these raise eyebrows in the corporate board room and at the family dinner table alike. To preemptively answer some of the questions raised by the case: Yes, judges sentence people to jail time for serious environmental violations. Yes, you can be convicted of a crime for not doing something when you had the knowledge, power and authority to stop the misconduct and failed to do so. Yes, it is prosecutorial policy to charge the highest culpable official of a company committing a crime. And, yes, a person’s wealth is a factor in determining whether the sentence would be a satisfactory deterrent to future actions of the defendant and the community.
Regarding environmental crimes, you should know that most states, particularly in the Northeast, have units of specially trained environmental police, typically as part of the state police. They get their cases from referrals by state and local environmental inspectors who find out about egregious or intentional violations from disgruntled employees, environmental volunteers who inspect water bodies (like the River Keepers), and the general public. The federal government also has environmental criminal police in the Environmental Protection Agency (“EPA”) and other agencies. Environmental regulators can be relentless and caution needs to be exercised if they come knocking on your door.
For deterrent purposes, it is the policy of prosecutors to charge the highest culpable official in a company committing a crime. This includes acts or omissions by corporate officers by essentially “looking the other way” at environmental violations. There is a question as to how much knowledge of an actual act is necessary for there to be this deliberate indifference by an official. Creating a policy, effectively insulating officials from knowledge of violations, that furthers a criminal act by deliberate indifference may be enough for a conviction without knowledge of the actual act.
Many corporate officials are better compensated than the average person. At some level of wealth, which is fully revealed to a judge in a presentence report, a judge may not feel that fining a defendant would send the correct message and deter future illegal action by the defendant or the community. That is why many wealthy tax violators are sent to prison, not just fined. It is no different with environmental crimes. The same factors are considered by the judge for sentencing. In the federal courts the judges must follow the mandatory sentencing guidelines, which usually start with a minimum of a $250,000 fine in addition to jail time.
A lot has changed over the last few decades in enforcement of environmental laws. Investigatory techniques and equipment have improved exponentially. Targeting by police and prosecutors has become more sophisticated. Required monitoring and self-reporting make violations difficult to hide. Do not wait until it is too late to seek help and guidance when environmental regulators appear at the front door.
Randall Lutz is a partner at Saul Ewing and the Chair of the Environmental and Natural Resources Practice. He is a former Director of Criminal Enforcement at the United States Environmental Protection Agency. His email is email@example.com.