5th Cir. Reverses CITGO’s Convictions for Violating the CAA and Mandatory Bird Treaty Act


On September 4, 2015, the U.S. Court of Appeals for the Fifth Circuit issued an important ruling concerning the scope of the Migratory Bird Treaty Act of 1918, 16 U.S.C. § 703 (MBTA), and the federal government’s use  of an EPA rule regulating the operation of petroleum refinery wastewater treatment systems in a criminal prosecution.  The case is U.S. v. CITGO Petroleum Corporation; CITGO Refining and Chemical Company, L. P.  The Court of Appeals , in a unanimous opinion, reversed not only the jury’s determination that CITGO was guilty of violating the Clean Air Act (CAA), but also the trial court’s determination that CITGO was  guilty of violating the MBTA.  As a result, a $2 million criminal fine levied against CITGO, and separate $15,000 fines against CITGO for violating the MBTA, were set aside.

A surprise inspection of CITGO’s Corpus Christi, Texas refinery in 2002 eventually resulted in a ten count 2007 federal grand jury indictment  for alleged violations of the CAA and MBTA.  CITGO was indicted for two counts of excessive emissions of benzene, for which it was found not  guilty by the jury, and one count for making false statements to government authorities, which the presiding judge dismissed as being time-barred.  The remaining counts involved CITGO’s operation of its refinery wastewater treatment system, in particular the use of two large “equalization” tanks which the government argued were subject to EPA’s oil-water separator rules, and the deaths of migratory birds that resulted when these protected species were trapped in the uncovered equalization tanks; the government alleged that these deaths were an illegal “taking” punishable under the MBTA.  According to the government, the equalization tanks were subject to EPA’s CAA-based oil water separator rules (found in EPA’s New Source Performance Standards at Subpart QQQ and 40 C.F.R. §§ 60.690 et seq.) which are intended to control the release of VOCs to the environment, and that CITGO knowingly violated the CAA and these rules when these tanks were not operated in compliance with their requirements.  The jury determined that CITGO was guilty of violating the CAA, but the conviction was reversed by the Court of Appeals which found that the judge had misstated the scope of the controlling regulation in his instructions ( i.e., that these tanks were not in fact oil water separators as defined by the rule), requiring that these convictions be reversed.

With respect to the MBTA counts, the Court of Appeals agreed with the Eighth and Ninth Circuits that a “taking” strictly  prohibited by the MBTA was limited to “deliberate acts done directly and intentionally to migratory birds”.  CITGO had argued that the MBTA does not apply to commercial activity that unintentionally and indirectly cause migratory bird deaths.  The Court of Appeals held that the term “take” as used in the MBTA  must be consistent with the common law definition of the term, that to “take” an animal is to reduce those animals by killing or capturing to human control.  “One does not reduce an animal to human control accidentally or by omission; he does so affirmatively”.  However, the Court of Appeals acknowledged that the Second and Tenth Circuits have more liberally construed the MBTA, so there may now may be a conflict that the Supreme Court will be asked to resolve.