Department of Toxic Substances Control v. Lisa Marie Rossi, an individual

Background

The California Department of Toxic Substances Control brought claims under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and California law concerning the release or threatened release of hazardous substances at or from the E-D Coat Site. The site consists of identified properties in Oakland, California, and the contamination in soil and groundwater resulting from activities on those properties.

The Department sought reimbursement of past response costs, a declaration that the defendants were responsible for future response costs, injunctions requiring response actions and access to the site, orders barring interference with the Department’s work, and civil penalties for failing to comply with Department orders.

On August 24, 2022, the court found the defendants in contempt and determined that it would enter default judgment. The court later received briefing and heard oral argument on the remaining issues: the injunction’s terms, unreimbursed past response costs, the future-cost declaration, and civil penalties.

Past and Future Response Costs

The court entered judgment against the defendants, jointly and severally, for $801,719.58 in past response costs. The judgment defines these costs as Department response activities from April 24, 2017, through September 30, 2022, and Department costs for legal representation in the cost-recovery action from June 2, 2017, through December 31, 2022. The defendants must pay that amount within 30 days after the judgment’s effective date.

The court also declared that the defendants are responsible parties under CERCLA and jointly and severally liable, without regard to fault, for future response costs arising from or related to the E-D Coat Site. The Department must provide quarterly bills, and the defendants must pay undisputed future costs within 30 days after receiving a bill. The judgment provides a dispute process for challenged bills.

Permanent Injunctions

The judgment requires E-D Coat, Inc.; Lisa Marie Rossi; Gerald F. Rossi in specified individual and trustee capacities; and Patricia S. Rossi in her trustee capacity to perform the response actions identified in the attached Scope of Work. The work must comply with applicable California and federal laws and regulations.

The defendants must designate a project coordinator and a qualified California-licensed professional engineer or registered geologist, provide required reports and deliverables, submit monthly summaries, follow approved quality-control procedures, and obtain the Department’s review and approval of response-action documents. They must preserve relevant records for at least 10 years after all activities under the judgment conclude and permit the Department to inspect and copy those records.

Defendants who own affected portions of the site must provide the Department and its authorized agents physical access at reasonable times. The defendants must also provide site-related records, cooperate with required institutional controls or land-use restrictions, give advance notice of a planned sale of an affected parcel, and use best efforts to obtain access from other owners or tenants when necessary. The defendants must not impede, hinder, prevent, or interfere with the Department’s response actions.

Civil Penalties

The court imposed the following civil penalties:

- E-D Coat, Inc.: $2,057,000. - Lisa Marie Rossi: $2,057,000. - Gerald F. Rossi, individually: $2,057,000. - Gerald F. Rossi, as trustee of the Rossi Family Trust II: $1,267,000. - Patricia S. Rossi, as trustee of the Rossi Family Trust II: $1,267,000.

The judgment states that the failures to comply with the Department’s orders were knowing, chronic, and willful, presented the potential for major harm, and warranted substantial penalties to deter similar conduct. The specified defendants must pay their respective penalties within 30 days after the judgment’s effective date.

Enforcement and Continuing Jurisdiction

Interest accrues on late payments under the cited California statute. The court warned that failure to pay or comply with any other term of the judgment could result in a contempt finding and sanctions. The judgment supersedes the defendants’ obligations under the First Amended Imminent and/or Substantial Endangerment Determination and Order and Remedial Action Order, while the court retains jurisdiction to enforce, modify, and resolve disputes concerning the judgment.