EPA v. Rust-Oleum Corp (ROC Limited Partnership)

Case summary

U.S. EPA issued an FOV to Republic Powdered Metals on March 29, 2004 and an FOV to Euclid and Rust-Oleum on December 22, 2004 for violations of the Architectural Coatings Standards at 40 C.F.R. Part 59, Subpart D. Specifically, Republic failed to provide a statement of its recommendation on thinning and the VOC content on all its containers of architectural coatings. Euclid and Rust-Oleum, as a single manufacturer, exceeded the VOC content limits of some of their architectural coatings without paying exceedance fees. Euclid, Rust-Oleum, and Republic are subsidiaries of RPM International, Inc. According to the Architectural Coatings Standards, a manufacturer is defined as a person that produces, packages, or repackages architectural coatings for sale or distribution in the United States. ... [D]ivisions of a company, subsidiaries, and parent companies are considered to be a single manufacturer. Euclid, Rust-Oleum, and Republic produce architectural coatings and therefore, since they are all subsidiaries of the same company, together are a single manufacturer of architectural coatings. From September 1999 to January 2004, Euclid and Rust-Oleum produced architectural coatings that exceeded the applicable VOC content limits. When an architecural coatings manufacturer produces coatings with VOC contents that exceed the applicable VOC content limits, the manufacturer may claim a limited quantity of these coatings to be exempt from the VOC content limits and exceedance fee provisions, also known as claiming the tonnage exemption. The maximum amount of VOCs contained in all the coatings that the manufacturer can select for exemption is 23 megagrams for coatings manufactured in 1999/2000, 18 megagrams for coatings manufactured in 2001, and 9 megagrams for coatings manufactured in 2002 and each year thereafter. After claiming the tonnage exemption, the manufacturer must pay an exceedance fee for the remaining volume of coatings exceeding the VOC content limits. In the years 2001, 2002, 2003, and 2004, Euclid and Rust-Oleum each claimed the maximum tonnage exemption allowed for a single manufacturer for coatings manufactured in the previous year. Since the tonnage exemption is available to a manufacturer once per year, and Euclid and Rust-Oleum are considered to be a single manufacturer, Euclid and Rust-Oleum violated the Architectural Coatings Standards by claiming the tonnage exemption twice for each of the years. Republic and U.S. EPA held a 113 conference on April 4, 2004. Shortly after the conference, Republic revised its architectural coating container labels to portray all required information. On February 16, 2005, U.S. EPA met with Euclid and Rust-Oleum regarding the tonnage exemption issue described above. At the conference, Rust-Oleum indicated that it would pay the past exceedance fees for the volume of coatings that it had previously claimed were exempt. And, hereafter, Euclid and Rust-Oleum both agreed that only one of them will claim the tonnage exemption. Per this CAFO/APO, Euclid, Rust-Oleum, and Republic together must pay a penalty of $70,312. In addition, Rust-Oleum has agreed to reformulate its architectural coatings cited in the FOV such that the total VOC content of each coating is reduced to levels at or below the applicable VOC content limits. Based on 2004 sales, this reformulation will reduce VOCs by approximately 55,400 lbs/yr. Rust-Oleum agrees to reformulate six of the coatings within 30 days of the effective date of the CAFO, five more no later than December 31, 2005, and the final six no later than June 30, 2006. If Rust-Oleum fails to accomplish the reformulation of its products by these deadlines, it will discontinue its efforts to reformulate and pay an additional civil penalty of $14,062, within 30 days of such failure.

Defendants (3)

• Rust Oleum CorporationNamed in complaintNamed in settlement
• Euclid Chemical Company, Cleveland, OHNamed in complaintNamed in settlement
• Republic Powdered Metals, Inc., Medina, OHNamed in complaintNamed in settlement

Facilities (3)

• REPUBLIC POWDERED METALS

  2628 PEARL RD, MEDINA, OH, 44256

  Registry ID: 110000388937

• EUCLID CHEMICAL COMPANY

  19218 REDWOOD RD, CLEVELAND, OH, 44110

  Registry ID: 110000386920

• RUST - OLEUM CORP

  8105 95TH ST, PLEASANT PRAIRIE, WI, 53158

  Registry ID: 110058909819

Statutes cited

• CAA 111 — New Source Performance Standards

Enforcement conclusions (1)

• Rust-Oleum Corp (ROC Limited Partnership)entered 2005-07-28

  Primary law: CAA

  Federal penalty: $70,312

Timeline (3 milestones)

• 2005-07-28Complaint Filed/Proposed Order
• 2005-07-28Final Order Issued
• 2005-08-17Enforcement Action Data Entered