Current trends and environmental and federal enforcement – Advice Eating

In this episode of the Bracewell Environmental Law Monitor, host Daniel Pope joins Kevin Collins, Jason Hutt and Robert Wagman to discuss current trends and enforcement of environmental and federal regulations.

Kevin Collins is a partner in our Austin office. He is a former Assistant US Attorney from the Eastern District of Texas and helps deal with the problems that arise during federal investigations.

Jason Hutt is a partner in our DC office and chairs the company’s environmental division. He advises and defends clients in the complex environmental and energy issues of our time.

Robert Wagman is a Partner in our DC office and leads the Government Contracts practice. He does a lot of work in enforcing the government.

In general, what do you see of the DOJ as it relates to law enforcement these days? What is the EPA doing on the civilian side?

There was a resurgence and activity in the DOJ. I think they feel empowered under the new government. The statistics support this feeling. United States law firms across the country have increased their fees by about 10 percent. They have charged around 5,500 people with white-collar crime. In particular, the DOJ’s Environment Natural Resources Division has already indicted 11 companies and 34 individuals. Many of these individuals are senior executives. As for the budget, they charge a lot more money. So there’s definitely an interest in taking action against bad actors, especially individuals in companies to a degree.

We still enforce the same environmental laws, but the forbearance factor or posture factor is different. Part of the comparison expectations is increasingly the protection of the community in which an institution or a perpetrator is active. We are seeing heightened expectations around demands to monitor fence lines and seek redress or mitigation under a resolution that involves doing things right but in the community where the violation occurs or where the environmental damage associated with that violation occurs. These are plays that are seen as changing attitudes in government.

One of the terms that has come up a number of times throughout this podcast is the term suspension and expulsion. Can you give us your quickest suspension and expulsion course for dummies so we’re all on the same page?

Many companies are unaware that being exempt from suspension will affect them. It’s not just for government contractors. It often applies to both procurement campaigns and so-called non-procurement campaigns. The term used in the regulations is hedging, which is essentially anything that is not exempt. If government funds are involved, it is likely a covered transaction. This is common in federal leases. If you are a federal tenant or if you are an oilfield service company serving federal tenants, a suspension waiver can have a tremendous impact on your business. Often these are companies, individuals. They don’t think of suspension and disqualification and the administrative remedies that go with them. So, broadly speaking, suspension and barring means you’re barred from doing business with the federal government for a period of time, usually three years. But it can vary. It usually follows criminal or civil enforcement, but need not follow civil or criminal enforcement. It can come from any recommendations.

In which areas could suspension and expulsion issues pose a higher risk than others?

Environment due to the statutory exclusion provisions. It is far more likely to hit the radar of the suspension and expulsion officer than other types of enforcement action. If you do a lot of business with the government, you’re more likely to get on someone’s radar. Again, each agency has its own suspension and expulsion officer, so you may face expulsion. It’s not just an EPA thing or just a specific agency. Any authority could theoretically exclude you. If it is blocked, it applies company-wide.

There is also a statutory disqualification under several environmental laws, but also the possibility of escalating into the realm of criminal guilt based on sheer negligence. This is very different from most of these other statutes that we are talking about. It is the coupling of these two things that makes this an increased risk in the environmental world. In the event of an incident or accident in particular, the notion of negligence is almost in the minds of law enforcement officials because there has been some significant environmental damage or loss of life that in their opinion and perhaps reasonably should not be. That will not happen.

What best practices can organizations implement into their accountability systems to ensure they are addressing these types of issues and where their risks lie?

There really is no substitute for good corporate governance – all the things that say this is a trustworthy company that the government is happy to do business with. It will help you with your criminal enforcement, your civil enforcement and everything else you do.

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