United States District Court, S.D. West Virginia, Huntington Division
OHIO VALLEY ENVIRONMENTAL COALITION, INC., WEST VIRGINIA HIGHLANDS CONSERVANCY, INC., and SIERRA CLUB, Plaintiffs,
ERP ENVIRONMENTAL FUND, INC. Defendant, APPALACHIAN HEADWATERS, INC., Nonparty in whose favor an has been entered, VCLF LAND TRUST, INC., Nonparty against whom an order may be enforced.
MEMORANDUM OPINION AND ORDER
C. CHAMBERS, UNITED STATES DISTRICT JUDGE
before the Court is the Motion to Enforce the Second Modified
Consent Decree and Selenium Settlement Agreement and Award
Attorney's Fees by Plaintiffs Ohio Valley Environmental
Coalition, Inc.; West Virginia Highlands Conservancy, Inc.;
and Sierra Club (collectively “Plaintiffs”). ECF
No. 110. For the foregoing reasons, Plaintiffs' Motion is
GRANTED. The Court FINDS
ERP Environmental Fund, Inc. (“ERP”) and VCLF
Land Trust, Inc. (“VCLF Land Trust”) have failed
to perform the required donations to Appalachian Headwaters,
Inc. (“Appalachian Headwaters”) in accordance
with the terms of the Second Modified Consent Decree.
Appalachian Headwaters is awarded the arrearage owed in the
amount of $1, 950, 000. Furthermore, the Court
GRANTS attorney's fees in favor of
Plaintiffs, consistent with the Second Modified Consent
Second Modified Consent Decree, (ECF No. 105), stems from a
civil action brought by Plaintiffs under the citizen suit
provisions of the Clean Water Act, 33 U.S.C. § 1365, and
the Surface Mining Control and Reclamation Act, 30 U.S.C.
§ 1270. First Am. Compl., ¶ 1, ECF No. 23.
In their complaint, Plaintiffs alleged illegal discharging of
selenium in excess of the limitations contained in permits
held by then-defendants Patriot Coal Corporation
(“Patriot Coal”) and three of its subsidiaries.
Id. ¶¶ 1-2. This suit was resolved on
March 15, 2012, when the Court entered a Consent Decree, (ECF
No. 51), which in turn was succeeded by the Modified Consent
Decree, (ECF No. 87), on January 9, 2013. The Second Modified
Consent Decree, entered on October 7, 2017, represents the
most recent iteration of the Court's judgment in this
matter and was necessitated by Patriot Coal's bankruptcy.
the course of the bankruptcy proceedings, Patriot Coal
negotiated the sale or transfer of substantially all of its
assets to Blackhawk Mining, LLC (“Blackhawk”) and
Virginia Conservation Legacy Fund (“VCLF”).
Joint Mot. to Modify Modified Consent Decree, ¶
3, ECF No. 99. The Bankruptcy Court entered its Confirmation
Order on October 9, 2015, providing that Blackhawk and VCLF
would assume responsibility for the portions of the Modified
Consent Decree applicable to their assets. Id.
¶¶ 5-6. All obligations owed by Blackhawk and VCLF
were then assumed by ERP. Id. ¶¶ 7-8.
Pursuant to an Assignment and Assumption Agreement, the Court
substituted ERP as the Defendant in this action on May 2,
2016. ECF No. 97.
assuming responsibility under the Modified Consent Decree,
ERP acknowledged it was out of compliance and its financial
condition would likely cause further violations. Id.
¶ 9. Plaintiffs and ERP accordingly agreed to a
modification that would delay deadlines imposed by the
Modified Consent Decree by forty-two months, and “[i]n
consideration for the extended deadlines, [ERP] and its
parent company VCLF Land Trust, Inc., . . . agreed to fund
forest and stream restoration projects in West Virginia
pursuant to a Selenium Settlement Agreement.”
Id. ¶ 12; see also Second Modified Consent
Decree, ¶ 18. The Selenium Settlement Agreement was
both incorporated by reference and physically attached to the
proposed Second Modified Consent Decree. Though the proposal
stated the donation would come directly from VCLF Land Trust,
it clarified that both ERP and VCLF Land Trust would be
responsible for a six-million-dollar donation to Appalachian
Headwaters, paid in monthly intervals. Proposed Second
Modified Consent Decree, at 76-77, ECF No. 99-1. This
donation was secured by one-hundred-percent interest in VCLF
Loudoun Holdings, LLC, whose sole asset was an eighty-nine
percent interest in 313 acres of land in Loudon County,
Virginia. Id. October 7, 2016, the Second Modified
Consent Decree was entered by this Court.
to this modification, half of the required donation was made
to Appalachian Headwaters, $2, 125, 000 of which was wired
directly by ERP. Second Sutton Decl, ¶¶
10-23, ECF No. 137-1. However, both ERP and VCLF Land Trust
admit they fell into arrears on the required donation.
ERP's Substituted Resp., at 1, ECF No. 121;
VCLF Land Trust's Resp., at 2, ECF No.132. As a
result, Appalachian Headwater exercised its option to take
possession of the collateral. Howell Decl.,
¶¶ 5-9, ECF No. 110-3. Plaintiffs then filed the
present Motion to Enforce. Mot. to Enforce, at 1,
ECF No. 110.
decrees are both a “negotiated agreement that is
entered as a judgment, ” as well as “a continuing
order . . . having prospective effect.” Bragg v.
Robertson, 83 F.Supp.2d 713, 717 (S.D. W.Va. 2000),
aff'd sub nom. Bragg v. W.Va. Coal Ass'n,
248 F.3d 275 (4th Cir. 2001). Since they have the weight of a
court judgment, consent decrees are “subject to the
rules generally applicable to other judgments and
decrees.” Rufo v. Inmates of Suffolk County
Jail, 502 U.S. 367, 378 (1992) (internal citations
omitted). The United States Supreme Court has recognized the
dual nature of consent decrees, stating they have
“elements of both contracts and judicial
decrees.” Frew ex rel. Frew v. Hawkins, 540
U.S. 431, 437 (2004) (citing Firefighters v.
Cleveland, 478 U.S. 501, 519 (1986)). Accordingly,
courts should interpret consent decrees as a contract. In
doing so, “reliance upon certain aids to construction
is proper, as with any other contract. Such aids include . .
. any other documents expressly incorporated in the
decree.” United States v. ITT Cont'l
Baking Co., 420 U.S. 223, 238 (1975) (emphasis added).
parties consent to a court's continuing jurisdiction to
enforce a consent decree, an aggrieved party may apply for
relief. See Bragg, 83 F.Supp.2d at 717. In
making determinations of proper relief, a hearing is not
necessary. The Fourth Circuit recognizes “the authority
of a trial court [to] summarily enforce a settlement
agreement and to enter judgment based on that agreement
without plenary hearing.” Millner v. Norfolk &
W. R. Co., 643 F.2d 1005, 1009 (4th Cir. 1981) (internal
citations omitted). “This authority, however, arises
not under Rule 56 of the Federal Rules of Civil Procedure but
under the trial court's inherent equitable power
summarily to enforce a settlement agreement when the
practical effect is merely to enter a judgment by
consent.” Id. (citing Wood v. Virginia
Hauling Co., 528 F.2d 423, 425 (4th Cir. 1975). Summary
procedures are appropriate when the existence of a binding
settlement is undisputed and there is no substantial excuse
for nonperformance. Id.
selecting a means of enforcement of a consent decree,
“courts have inherent power to enforce compliance with
their lawful orders through civil contempt.”
Shillitani v. United States, 384 U.S. 364, 370
(1966). However, if “there was an agreed upon
settlement that can be translated into terms of dollars and
cents, [the court] should enforce payment of precisely that
amount. It is settled that he has the power and authority to
do so.” Wood v. Virginia Hauling Co., 528 F.2d
423, 425 (4th Cir. 1975).
argument is a direct one. ERP and VCLF Land Trust have not
made their required payments to Appalachian Headwaters under
the terms of the Second Modified Consent Decree and they seek
remedy on that basis. Mem. Supp. Mot. to Enforce, at
1, ECF No. 111. Specifically, Plaintiffs seek declaratory
relief, an order of specific performance, and a judgment
order in favor of Appalachian Headwaters. Id. at
VCLF Land Trust do not deny that proper payment has not been
remitted. However, they attempt to create jurisdictional and
procedural smokescreens to obfuscate a simple matter. This
includes claims from ERP that only VCLF Land Trust is liable
for payments to Appalachian Headwater, granting
Plaintiffs' requests would require a modification of the
Second Modified Consent Decree or a grant of summary
judgment, and Appalachian Headwaters must itself intervene in
the case. ERP's Supp. Resp., at 2, 5, 8, ECF No.
136. VCLF Land Trust makes similar arguments and claims this
matter is an independent breach of contract dispute between
non-parties. VCLF Land Trust's Resp., at 13.
VCLF Land Trust further contends the Court's ...