655 F.3d 699
7th Cir.2011Background
- FCP (and affiliates EnviroPower and Khanjee) sought a PSD permit to build a coal plant in southern Illinois; permit was issued in 2001 with expiration rules tied to start or continuation of construction.
- Khanjee became lead developer in 2002; site excavation began 2003 but was abandoned; development actions continued through 2004.
- In 2004, Illinois EPA preliminarily found PSD permit expired after construction had commenced; Sierra Club filed suit in 2005 seeking penalties and an injunction for failure to obtain a new permit.
- District court granted summary judgment for Sierra Club and enjoined construction; court later awarded penalties ($100,000) and attorneys’ fees to Sierra Club.
- This court’s Sierra Club v. Franklin County Power (Sierra Club I) held Sierra Club had standing and that PSD permit had expired, affirming the injunction and summary judgment.
- Khanjee appeals, challenging jurisdiction, constitutional claims, and the penalties/fees; district court proceedings and prior law-of-the-case guidance are cited in defense.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction under §7604(a)(3) | Sierra Club contends jurisdiction exists under §7604(a)(3) for violative permit conditions. | Khanjee argues jurisdiction was improper per CleanCOALition regarding permits or permit process. | No reversal; jurisdiction affirmed as per Sierra Club I law-of-the-case. |
| Constitutional challenges to penalties/fees | Sierra Club argues penalties/fees constitutional as authorized under Clean Air Act. | Khanjee raises separation of powers, Appointments Clause, and Excessive Fines concerns. | Constitutional challenges waived; only Excessive Fines claim addressed and rejected on ripeness/waiver grounds; penalties upheld. |
| Liability of Khanjee as owner/operator | Khanjee should be liable under §7604(a)(3) due to control over project. | Khanjee argues insufficient ownership/control to impose liability. | Khanjee liable; evidence shows substantial control and decisive role in development and management. |
| Appropriateness and amount of penalties | District court appropriately weighed §7413(e) factors; maximum penalty possible given project scale. | Penalty should reflect greater potential liability or different weighting of factors. | Court did not abuse discretion; $100,000 penalty deemed reasonable given circumstances. |
| Attorney's fees, prevailing party | Sierra Club entitled to fees for public-interest enforcement of Clean Air Act. | Fees should be limited due to defendants’ financial heft and public-interest considerations. | Fees awarded; district court did not abuse discretion; public-interest purpose supported. |
Key Cases Cited
- Sierra Club v. Franklin County Power of Illinois, LLC, 546 F.3d 918 (7th Cir.2008) (standing and permit-expiration law as basis for injunction)
- CleanCOALition v. TXU Power, 536 F.3d 469 (5th Cir.2008) (shows limits of §7604(a)(3) where permit exists or is being obtained)
- B & W Inv. Props. v. United States, 38 F.3d 362 (7th Cir.1994) (owner/operator liability and per-day penalties under Clean Air Act)
- Cinergy Corp., 623 F.3d 455 (7th Cir.2010) (penalties under Clean Air Act not tied to state SIP compliance in this context)
- Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983) (fee-shifting and public-interest enforcement under environmental statutes)