LOS ANGELES – The company that produces “Crystal Geyser Natural Alpine Spring Water” was sentenced today to three years of probation and ordered to pay criminal fines totaling $5 million for illegally storing and transporting hazardous waste created from filtering arsenic out of spring water at its facility in Olancha, California.
United States District Judge Dolly M. Gee also ordered CG Roxane LLC to implement a compliance program within 90 days to ensure it complies with federal and state environmental laws and implement that program within 180 days of today’s sentencing hearing. The compliance program includes the company’s retention of a qualified and experienced third-party environmental auditor to conduct annual audits of CG Roxane’s Olancha facility.
The company pleaded guilty on January 9 to one count of unlawful storage of hazardous waste and one count of unlawful transportation of hazardous material. The financial penalty Judge Gee imposed today consisted of a $2.5 million criminal fine for each count.
CG Roxane obtained water by drawing groundwater from the eastern slope of the Sierra Nevada mountains that contained naturally occurring arsenic. The company used sand filters to reduce the concentration of arsenic so the water would meet federal drinking water standards. To maintain the effectiveness of the sand filters, CG Roxane back-flushed the filters with a sodium hydroxide solution, which generated thousands of gallons of arsenic-contaminated wastewater.
For approximately 15 years, CG Roxane discharged the arsenic-contaminated wastewater into a manmade pond – known as “the Arsenic Pond” – at its Olancha facility along Highway 395 in Inyo County.
In March 2013, the Lahontan Regional Water Quality Control Board took a sample from the Arsenic Pond and in 2014 informed CG Roxane that the sample had an arsenic concentration that was more than eight times the hazardous waste limit, creating a risk to the area’s groundwater and wildlife. The water board referred the matter to the California Department of Toxic Substances Control (DTSC), which took its own samples that showed the Arsenic Pond had an arsenic concentration almost five times the federal hazardous waste limit. Subsequent sampling and testing by CG Roxane and its retained laboratory confirmed a similar arsenic concentration in the Arsenic Pond.
DTSC officials met with CG Roxane representatives in April 2015, presented a list of preliminary violations, and instructed the company to arrange for the removal of the Arsenic Pond.
In May 2015, CG Roxane hired two Los Angeles-area entities to remove the hazardous waste and transport it – which was done without the proper manifest and without identifying the wastewater as a hazardous material, according to court documents. The arsenic-contaminated wastewater was ultimately transported to a Southern California facility that was not authorized to receive or treat hazardous waste. As a result, more than 23,000 gallons of the wastewater from the Arsenic Pond allegedly was discharged into a sewer without appropriate treatment.
The two companies hired to transport and treat the wastewater – United Pumping Services, Inc. and United Storm Water, Inc., both located in the City of Industry – each pleaded guilty on June 10 to four counts of negligently causing a violation of a pretreatment program requirement. On July 29, Judge Gee ordered each company to pay a $375,000 criminal fine.
The investigation in this case focused on alleged violations involving the handling, storage and transportation of CG Roxane’s wastewater, not the safety or quality of CG Roxane’s bottled water.
The investigation in this matter was conducted by the United States Environmental Protection Agency, Criminal Investigations Division and the United States Department of Transportation’s Office of Inspector General. These federal agencies received assistance from the California Department of Toxic Substances Control.
This case was prosecuted by Assistant United States Attorneys Dennis Mitchell and Heather C. Gorman of the Environmental and Community Safety Crimes Section.
The United States Attorney’s Office for the Eastern District of California also assisted in the investigation.
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| Component | USAO - California, Central; |
| OIG | Department of Transportation OIG |