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EQT Prevails in Court Fight Over PA's $4.5M Impoundment Leak Fine

The Pennsylvania Commonwealth Court has ruled that the state Department of Environmental Protection's (DEP) interpretation of the Clean Streams Law would result in "potentially limitless continuing violations," handing a win to EQT Corp., which has been battling the agency over the issue since May 2014.

The court found that fines for the state's Clean Streams Laws cannot include fees for ongoing discharges, ruling that they must depend on the duration of the initial spill. In 2014, DEP fined EQT $1.27 million, including $900,000 for alleged ongoing discharges from an impoundment in Tioga County that leaked in 2012. EQT later filed a lawsuit with the Commonwealth Court, challenging DEP's interpretation of the Clean Streams Law and asking the court to decide whether fines could include fees based on how long pollution remains in affected waters or areas.

In response, DEP filed a lawsuit seeking $4.53 million for ongoing pollution and said the company was failing to cooperate with its investigation. The Commonwealth Court initially dismissed EQT's complaint, saying the state's Environmental Hearing Board (EHB) should decide on determining and imposing the fine. But EQT appealed in the ongoing battle and a year ago the state Supreme Court said the case qualified for judicial review.

The Commonwealth Court said if DEP's interpretation of the law were allowed to stand, transgressors could be punished "indefinitely." While EQT praised the ruling, DEP said it plans to appeal to the state Supreme Court. The lower court's decision will limit how much the EHB, which is currently considering the penalty, can fine the company.

The Commonwealth Court also said its decision doesn’t mean there aren’t consequences for spills and said the law empowers DEP to prevent violations and enforce them.

In May 2012, DEP said it discovered a release of flowback water from a transfer line serving the impoundment. In a separate incident, EQT reported that the impoundment was leaking, which affected a cold water fishery, a stream, an unnamed tributary, vegetation and groundwater. Eventually, the impoundment was drained, revealing dozens of holes in the liner, which EQT said were caused by a contractor.

DEP has said in court documents that the incident was one of the worst the agency has ever faced and said it cost millions of dollars to remediate. EQT cleared the site of wastewater and sludge and has maintained that all discharges ended by June 2012.

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