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Revised November 16, 2000
UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 99-60694
NEWELL RECYCLING COMPANY, INC.,
Petitioner,
VERSUS
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
On Petition For Review of a Final Order of the
Environmental Protection Agency

November 8, 2000
Before DUHÉ, EMILIO M. GARZA and DeMOSS, Circuit Judges.
DUHÉ, Circuit Judge.
1
Newell Recycling Company, Inc. ("Newell") appeals a final
2
decision of the Environmental Protection Agency's Environmental
3
Appeals Board ("EAB") holding Newell liable for violating the
4
disposal requirements for polychlorinated biphenyls ("PCBs")
5
established in Section 6(e) of the Toxic Substances Control Act
6
("TSCA"). The EAB's decision penalized Newell $1.345 million, less
7
an amount paid in settlement by a co-defendant, for violating the
8
TSCA. For the following reasons, we affirm.

9
BACKGROUND
10

Newell owned and operated a recycling facility in Houston,
11
Texas, during the 1970's and early 1980's. In 1982, Newell sold
12
the facility to Oklahoma Metal Processing, Inc. d/b/a Houston Metal
13
Processing Company ("HMPC"). In the sale, Newell agreed to
14
"specifically assume any liability resulting from an occurrence
15
prior to the closing date of this sale."
16
Within two years of the sale, the Texas Department of Health
17
sought soil samples to verify its suspicions of lead contamination
18
at the recycling facility site. Shortly thereafter, Newell
19
Enterprises asked HMPC to authorize Newell Recycling Company, Inc.
20
(i.e., "Newell," the Petitioner in this case), Newell Products of
21
Houston, Inc., and Newell Industries, Inc., to commence testing for
22
lead contamination and cleanup on the site. After the soil samples
23
showed lead contamination, a consultant recommended to Newell that
24
the contaminated soil be removed to a hazardous waste facility for
25
disposal. The consultant noted that HMPC had authorized Newell to
26
perform testing, cleanup, and soil transportation functions at the
27
site.
28
While superintending lead cleanup operations there in 1985,
29
Newell discovered the PCB contamination that this case concerns.
30
Electric capacitors seeping PCB-contaminated fluids lay buried in
31
the soil unearthed during the lead contamination cleanup. Newell
32
although advised repeatedly by another consultant it had hired
33
that the PCB-contaminated soil piled at the site had to be treated
2

34
or disposed of by methods acceptable to the EPA under the TSCA
35
waited until after the EPA filed an administrative complaint
36
against it in 1995 for violating the TSCA to remove the soil to a
37
disposal facility. Approximately ten years elapsed, then, from
38
Newell's discovery of the buried capacitors in 1985 to its proper
39
disposal of the PCB-contaminated soil pile in 1995. The record
40
does not explain this delay.
41
The Presiding Officer granted the EPA an accelerated decision
42
(the equivalent of summary judgment) on its administrative
43
complaint, holding that Newell committed an act of improper
44
disposal by knowingly causing PCB-contaminated soil to be excavated
45
and stockpiled at the site and then "leaving [the soil] there and
46
taking no further clean-up action." In re Oklahoma Metal
47
Processing Co., Inc., No. VI-659C (EPA April 29, 1997) (order
48
granting partial accelerated decision on issue of liability). The
49
Presiding Officer assessed Newell a $1.345 million fine for the
50
disposal violation, less the amount HMPC paid the EPA to settle an
51
action regarding its role in the improper disposal at the site.
52
Newell appealed the Presiding Officer's liability rulings and his
53
penalty assessment decision to the EAB. It affirmed the Presiding
54
Officer's decision. Newell appeals the EAB's decision.
55
Newell argues that a five-year statute of limitations barred
56
the EPA's TSCA complaint, that on the merits Newell is not liable
57
for an "improper disposal" under the TSCA, and that the Presiding
58
Officer's application of the EPA's 1990 Polychlorinated Biphenyls
3

59
Penalty Policy (the "Penalty Policy") generated an excessive
60
penalty that violated Newell's constitutional rights.
61
DISCUSSION
62
We must affirm the EAB's decision unless it is "arbitrary,
63
capricious, an abuse of discretion, or otherwise not in accordance
64
with law." 5 U.S.C. § 706(2)(A). See also Amoco Production Co. v.
65
Lujan, 877 F.2d 1243, 1248 (5th Cir. 1989) ("On review of an agency
66
adjudication, . . . the reviewing court must in general affirm the
67
decision unless the agency's action was arbitrary, capricious, or
68
otherwise not in accordance with law").
69
I.
Limitations
70
28 U.S.C. § 2462 supplies the statute of limitations
71
applicable here:
72
Except as otherwise provided by Act of Congress, an action,
73
suit or proceeding for the enforcement of any civil fine,
74
penalty, or forfeiture, pecuniary or otherwise, shall not be
75
entertained unless commenced within five years of the date
76
when the claim first accrued. . . .
77
Newell argues that the EPA's improper disposal claim "accrued" when
78
the PCBs polluting the soil pile were "taken out of service." See
79
40 C.F.R. § 761.3 ("Disposal means intentionally or accidentally to
80
discard, throw away, or otherwise complete or terminate the useful
81
life of PCBs and PCB Items. Disposal includes spills, leaks, and
82
other uncontrolled discharges of PCBs as well as actions related to
83
containing, transporting, destroying, degrading, decontaminating,
84
or confining PCBs and PCB Items"). Since, Newell asserts, the PCBs
4

85
were "taken out of service" sometime before 1990, the EPA's claim
86
accrued more than five years before the filing of its TSCA
87
complaint against Newell in 1995 and is thus time-barred. The EPA
88
argues that Newell's TSCA violation -- excavating and stockpiling
89
the soil and then leaving it on the site for ten years before
90
disposing of it in accordance with 40 C.F.R. § 761.60(a), which
91
requires that soil contaminated with PCBs above a certain ppm
92
threshold be disposed of in an EPA-approved incinerator or landfill
93
-- was "continuing" in nature. See InterAmericas Investments, Ltd.
94
v. Board of Governors of the Federal Reserve System, 111 F.3d 376,
95
382 (5th Cir. 1997) ("A continuing violation applies when the
96
conduct is ongoing, rather than a single event"). The EAB agreed
97
with the EPA. The EAB held that the EPA's TSCA cause of action
98
against Newell did not accrue until the course of conduct
99
complained of no longer continued. See Fiswick v. United States,
100
329 U.S. 211, 216 (1946) (statute of limitations for continuing
101
offenses runs from the last day of the continuing offense); In re
102
Standard Scrap, TSCA Appeal No. 87-4, 3 E.A.D. 267, 1997 WL 603524,
103
at *2 (EAB Aug. 2, 1990) (Final Decision) ("Failure to [properly
104
dispose of PCBs] constitutes a violation of the regulation, and the
105
violation continues as long as the PCBs remain out of service and
106
in a state of improper disposal"). That is, it did not accrue
107
until 1995, when Newell properly disposed of the soil. If
108
stockpiling the soil was a disposal, we cannot say the EAB's
109
conclusion was arbitrary, capricious, an abuse of discretion or
5

110
otherwise not in accordance with law.1 Because we hold that the
111
EPA's TSCA cause of action against Newell did not accrue for
112
limitations purposes until 1995, we also affirm the EAB's denial of
113
Newell's request for additional discovery. This discovery, Newell
114
claims, would establish that the EPA had actual notice of
115
conditions at the site earlier than five years before the EPA filed
116
its complaint. Information about when the EPA actually knew of the
117
site's conditions is not "significant[ly] probative" of any fact
118
relevant to our statute of limitations determination. See 40
119
C.F.R. § 22.19(f).
120
II.
Liability
121
Newell challenges its TSCA liability on two grounds. First,
122
Newell argues that the EAB erroneously held that Newell contributed
123
to the creation of the PCB-contaminated soil pile. Second, Newell
124
contends that if, arguendo, it did cause the creation of the soil
125
pile, that act of creation and Newell's subsequent involvement with
126
the pile did not constitute an improper disposal of PCBs within the
127
meaning of the TSCA.
128
The EAB properly determined that Newell contributed to the
129
creation of the soil pile. The PCB Rule of the TSCA extends civil
130
penalty liability to any "person who violates these regulations."
131
40 C.F.R. § 761.1(d). "Violators" in this context are those who
132
have "caused (or contributed to the cause of) the [improper]
1See discussion of disposal that follows.
6

133
disposal." In re City of Detroit, 3 E.A.D. 514, 526 (CJO 1991).
134
Ample evidence indicates that Newell at least contributed to
135
the creation of the soil pile. Newell contends that a Newell
136
affiliate, not Newell itself, created the pile. The record
137
suggests otherwise. The EAB aptly characterized its contents:
138
Newell "may not have acted alone, but it was certainly an active
139
party in the events constituting the TSCA violation." Newell
140
Recycling Co., Inc. v. United States Environmental Protection
141
Agency, TSCA Appeal No. 97-7, slip op. at 33 (EAB Sept. 13, 1999).
142
Newell, and not one of its affiliates, owned the Fidelity Road site
143
immediately before conveying it to HMPC. In the sale of the site
144
Newell assumed liability for "occurrence[s] prior to the closing
145
date of th[e] sale." This covenant produced Newell's extensive
146
involvement in remedying the lead and PCB contamination at the
147
site. Newell's involvement included, the EAB correctly found: a
148
visit by Newell's owner, Alton Newell, to the site in response to
149
HMPC's demand for remedial action; Newell's two-time (1987 and
150
1989-90) retention of an environmental consulting firm to recommend
151
remedies for PCB contamination at the site; execution in 1987 of an
152
agreement with HMPC and another party interested in the site
153
tolling the statute of limitations on claims against Newell arising
154
from the site's contamination; and Newell's removal in 1995 of the
155
contaminated soil to a disposal facility at its own expense.
156
Moreover, until this enforcement action, Newell never suggested to
157
the Texas or federal authorities involved in decontamination of the
7

158
site that some other Newell entity was responsible for the
159
contaminated soil pile.
160
In view of these facts, the EAB's determination that Newell
161
contributed to the creation of the soil pile was not arbitrary,
162
capricious, an abuse of discretion or otherwise not in accordance
163
with law.
164
Newell, however, argues that if it contributed to the creation
165
of the soil pile, its contribution was not an improper disposal
166
under the TSCA. Newell argues that PCB disposal is a one-time
167
event occurring, in a case like this one, only when capacitors
168
containing PCBs are buried and their contents released into the
169
surrounding soil. Because, Newell contends, there is no evidence
170
implicating Newell in the original disposal of the capacitors, the
171
EPA failed to establish that Newell improperly disposed of PCBs.
172
The EAB rejected this argument, noting that Newell's interpretation
173
of "disposal" would have "no TSCA liability . . . attach even if
174
Newell had taken the pile of contaminated soil from the Fidelity
175
Road site and dumped it into the nearest river, stream, or vacant
176
lot." Newell Recycling Co., Inc. v. United States Environmental
177
Protection Agency, TSCA Appeal No. 97-7, slip op. at 29-30 (EAB
178
Sept. 13, 1999). Such an interpretation, the EAB continued, would
179
subvert the environmental protection goals of the TSCA regime. See
180
In re Samsonite Corp., 3 E.A.D. 196, 199 (CJO 1990) (PCB
181
regulations "should be read in such a way as to further the
182
purposes of the Act, particularly where, as in this case, public
8

183
health and safety are involved"). At any rate, the EAB concluded,
184
Newell's interpretation of "disposal" fails because it would
185
effectively exclude what the textual definition of disposal cited
186
above indisputably includes: activities undertaken to address known
187
PCB contamination. See 40 C.F.R. § 761.3 ("[d]isposal includes
188
spills, leaks, and other uncontrolled discharges as well as actions
189
related to containing, transporting, destroying, degrading,
190
decontaminating, or confining PCBs or PCB items"). The EAB
191
determined that Newell's involvement with the soil pile, described
192
above, fits this definition of "disposal." Newell Recycling Co.,
193
Inc. v. United States Environmental Protection Agency, TSCA Appeal
194
No. 97-7, slip op. at 31 (EAB Sept. 13, 1999) ("The act of
195
excavating and stockpiling PCB-contaminated soil at the Fidelity
196
Road site is clearly in the nature of an action to 'contain,'
197
'transport,' and 'confine' PCBs. Moreover, leaving the stockpiled
198
waste abandoned there for years is evidence that the PCB-
199
contaminated soil was 'discarded' within the meaning of the rule").
200
We cannot say that this determination was arbitrary,
201
capricious, an abuse of discretion or otherwise not in accordance
202
with law.
203
III. Penalty
204
Because an agency's selection of an appropriate sanction to
205
effect its policies is an act peculiarly within its institutional
206
competence, our review of the penalty in this case is limited. See
207
Wayne Cusimano, Inc. v. Block, 692 F.2d 1025, 1030 (5th Cir. 1982).
9

208
An agency's penalty determination "is reviewed with significant
209
deference;" we will not reverse it unless it is arbitrary,
210
capricious, an abuse of discretion or otherwise not in accordance
211
with law. InterAmericas Investments, Ltd., 111 F.3d at 384.
212
Accordingly, although the penalty here strikes us as severe since
213
there was no actual harm, we cannot disturb it.
214
The Penalty Policy limns a two-part process for PCB penalty
215
assessment. First, the Penalty Policy requires the administrative
216
law judge (the "Administrator") to examine the nature,
217
circumstances, gravity and extent of the violation. Those factors
218
suggest a gravity-based penalty. After the Administrator
219
determines the gravity-based penalty, he or she considers (the
220
second part of the process) the violator's ability to pay the
221
penalty, the effect of the penalty on the violator's ability to
222
continue to do business, the violator's history (if any) of such
223
violations, the degree of culpability, and "such other matters as
224
justice may require." POLYCHLORINATED BIPHENYLS (PCB) PENALTY POLICY
225
(1990). The Administrator may adjust the gravity-based penalty in
226
view of these factors.
227
A.
The Gravity-Based Penalty
228
The Penalty Policy makes the gravity-based penalty
229
determination process mostly mechanical by pegging the above-
230
described factors (the nature, circumstances, gravity and extent of
10

231
the violation2) to statistical benchmarks or fixed formulations.
232
So, for example, the Presiding Officer did not err by concluding
233
that the "extent" of Newell's violation was "major;" the Penalty
234
Policy expressly defines violations involving more than 300 cubic
235
feet of contaminated soil as "major," and the soil pile here was
236
approximately 540 cubic feet in size. Id. Similarly, the
237
Presiding Officer correctly characterized the "circumstances" of
238
Newell's violation as "High Range, Level One" under the Penalty
239
Policy.3 The Penalty Policy states that "any disposal of PCBs or
240
PCB Items in a manner that is not authorized by the PCB
241
regulations" is automatically ranked "High Range, Level One." Id.
242
Because discarding and abandoning PCB-contaminated soil in a pile
243
is a disposal not authorized by the PCB regulations, the Presiding
244
Officer rightly characterized Newell's as a "High Range, Level One"
245
violation.
246
B.
Adjustment of the Gravity-Based Penalty
247
The Presiding Officer may adjust the gravity-based penalty in
248
view of the violator's ability to pay it, the effect the penalty
249
might have on the violator's ability to continue to do business,
250
the violator's history (if any) of prior such violations, the
251
violator's degree of culpability, and such other matters as justice
2 Newell challenges the Presiding Officer's treatment of the "circumstances"
and "extent" factors, but not his treatment of the "nature" and "gravity" ones.
3 The Penalty Policy ranks the "circumstances" of a violation as Low,
Medium, or High Range, and subdivides each of these categories into two Levels.
11

252
may require. 15 U.S.C. § 2615(a)(2)(B). The "as justice may
253
require" rubric includes whether the violator voluntarily disclosed
254
the violation, any economic benefits the violator reaped from the
255
violation, and any environmentally beneficial measures a violator
256
may perform in exchange for penalty reduction. Newell argues that
257
some of these factors counsel reduction of its penalty, and that
258
the Presiding Officer's refusal to reduce it, in turn, was error.
259
1.
Culpability
260
The Presiding Officer's determination that the "culpability"
261
factor did not recommend mitigation of Newell's penalty was sound.
262
The "two principal criteria" in the Penalty Policy for assessing
263
culpability are: 1) the violator's knowledge of the particular
264
requirement; and 2) the degree of the violator's control over the
265
violative condition. POLYCHLORINATED BIPHENYLS (PCB) PENALTY POLICY
266
(1990). As noted above, Newell knew the TSCA required more than
267
the excavation and complete abandonment of the PCB-contaminated
268
soil; Newell's environmental consultants repeatedly told Newell as
269
much. Even though Newell did not own the property on which the
270
soil lay, Newell had extensive control, described above, over the
271
violative condition here. The record does not explain to our
272
satisfaction why Newell waited years to properly dispose of the
273
soil. The Presiding Officer, therefore, appropriately declined to
274
mitigate Newell's penalty on culpability grounds.
275
2.
Voluntary Disclosure
276
The Presiding Officer correctly declined to adjust the penalty
12

277
in view of Newell's alleged4 voluntary disclosure of the TSCA
278
violation. Newell waived this argument by failing to request in
279
its submissions to the Presiding Officer a reduction in the penalty
280
for voluntary disclosure. See In re Britton Construction Co., CWA
281
Appeal Nos. 97-5 & 97-8, slip op. at 22-23 (EAB, Mar. 30, 1999), 8
282
E.A.D._ (under 40 C.F.R. § 22.30, appellant "may not appeal issues
283
that were not raised before the presiding officer. As a result,
284
arguments raised for the first time on appeal . . . are deemed
285
waived") (citations omitted).
286
3.
Ability to Pay / Continue to Do Business
287
The Penalty Policy requires the EPA to assume that an alleged
288
TSCA violator has the ability to pay any fine assessed under the
289
Penalty Policy and, therefore, to continue in business.
290
POLYCHLORINATED BIPHENYLS (PCB) PENALTY POLICY (1990). The alleged TSCA
291
violator may raise the issue of its ability to pay in its answer to
292
the EPA's administrative complaint and "shall present sufficient
293
documentation to permit the Agency to establish such inability."
294
Id. If "the alleged violator fails to provide the necessary
4 Waiver aside, nothing in the record indicates that Newell, in fact,
voluntarily disclosed the violation here before the EPA initiated its TSCA
action. Newell tacitly admits as much in its brief, but argues that the
Presiding Officer erroneously denied Newell discovery that "would have provided
conclusive evidence that the remediated soil pile was reported to the Texas
Department of Health and to EPA [sic]." See Petitioner's Brief at 48. The EAB
found this claim "a disingenuous proposition. If Newell had indeed made a
voluntary disclosure, then, surely, Newell was in the best position to attest to
it. Having failed to do so by affidavit in Response to the Region's motion for
penalty assessment, Newell cannot credibly revive this argument on appeal."
Newell Recycling Co., Inc. v. United States Environmental Protection Agency, TSCA
Appeal No. 97-7, slip op. at 60 (EAB Sept. 13, 1999).
13

295
information, and the information is not readily available from
296
other sources, then the violator will be presumed to be able to
297
pay." Id. Newell's brief candidly states (and the Presiding
298
Officer and EAB both held) that the record here features "a
299
complete absence of evidence as to Newell's ability to pay and any
300
effect on it's [sic] ability to do business." Petitioner's Brief
301
at 39. Surely Newell was in possession of such information if
302
anyone was. Nothing in the record, moreover, intimates that
303
information regarding Newell's ability to pay is readily available
304
from a source other than Newell. The Presiding Officer, therefore,
305
correctly declined to mitigate the penalty on the basis of Newell's
306
putative inability to pay it.
307
IV. Constitutional Concerns
308
Newell also argues that the penalty violated the Eighth
309
Amendment's proscription of excessive fines and Newell's due
310
process rights. Newell's constitutional claims fail.
311
A.
Eighth Amendment Concerns
312
Newell's argument that the penalty is excessive,5 and
313
therefore a violation of its Eighth Amendment rights, is erroneous.
314
Newell argues that the Excessive Fines Clause of the Eighth
315
Amendment requires us to consider the value of its fine ($1.345
5 Newell also argues that the penalty is excessive when compared to
penalties in similar cases. The penalty here, however, need not resemble those
assessed in similar cases. See Butz v. Glover Livestock Comm'n Co., 411 U.S.
182, 187 (1973) ("[t]he employment of a sanction within the authority of an
administrative agency is . . . not rendered invalid in a particular case because
it is more severe than sanctions imposed in other cases").
14

316
million) in relation to the magnitude of the offense inspiring it
317
(Newell suggests that the $84,000 it paid to dispose of the soil
318
accurately indicates the magnitude of its offense). See U.S. CONST.
319
amend. VIII ("Excessive bail shall not be required, nor excessive
320
fines imposed, nor cruel and unusual punishments inflicted"). No
321
matter how excessive (in lay terms) an administrative fine may
322
appear, if the fine does not exceed the limits prescribed by the
323
statute authorizing it, the fine does not violate the Eighth
324
Amendment. Here, the fine assessed against Newell is only about
325
10% of the maximum fine for which Newell was eligible under the
326
TSCA. Newell's fine, therefore, does not violate the Eighth
327
Amendment. See Pharaon v. Board of Governors of Federal Reserve
328
System, 135 F.3d 148, 155-57 (D.C. Cir. 1998) (finding no Eighth
329
Amendment violation because the penalty was within the limits
330
established by the applicable statute).
331
B.
Due Process Concerns
332
Newell's due process argument also fails. Newell argues that
333
an evidentiary hearing was "required" in this matter, and that the
334
absence of one violated Newell's right to due process of law.
335
Petitioner's Brief at 55. EPA regulations require that a hearing
336
be held at a respondent's request if the party requesting the
337
hearing has raised a genuine issue of material fact. 40 C.F.R. §
338
22.15; see also In re Green Thumb Nursery, Inc., FIFRA Appeal No.
339
95-42, 6 E.A.D. 782, 1997 WL 131973, at *8 (EAB Mar. 6, 1997)
340
(Final Order). Similarly, constitutional due process doctrine
15

341
requires that the person claiming the benefit of due process
342
protections place some relevant matter into dispute. See Codd v.
343
Velger, 429 U.S. 624, 627 (1977) ("[I]f the hearing mandated by the
344
Due Process Clause is to serve any useful purpose, there must be
345
some factual dispute. . . ."); Costle v. Pacific Legal Foundation,
346
445 U.S. 198, 213 (1980) (permitting the EPA to condition an
347
adjudicatory hearing on "identification of a disputed issue of fact
348
by an interested party"). The Presiding Officer's accelerated
349
decision held that Newell raised no genuine issue of material fact
350
that would necessitate an evidentiary hearing. The EAB agreed. We
351
find no contested issue of fact on penalty in the record. We
352
decline to set aside the penalty on due process grounds.
353
CONCLUSION
354
Because the applicable five-year statute of limitations does
355
not bar the EPA's TSCA complaint, because Newell was liable for an
356
"improper disposal" under the TSCA, and because the Presiding
357
Officer's application of the EPA's 1990 Polychlorinated Biphenyls
358
Penalty Policy generated a penalty that was not arbitrary,
359
capricious, an abuse of discretion, constitutionally infirm or
360
otherwise illicit, we affirm.
361
AFFIRMED.
362

16