Four Texas Companies Agree to Pay $3.5 Million

WASHINGTON, October 11, 2016 – The Department of Justice, U.S. Attorney’s Office for the Eastern District of Texas and the Environmental Protection Agency (EPA) announced today that four Texas companies pleaded guilty and agreed to pay a total of $3.5 million dollars for criminal violations of the Clean Air Act at two oil and chemical processing facilities in Texas.

The Information filed in federal court in the Eastern District of Texas charges KTX Limited and KTX Properties Inc., with negligently releasing hazardous air pollutants after a tank explosion at their chemical and petroleum processing facility located in Port Arthur, Texas on March 31, 2011. The explosion killed one worker at the plant and severely injured two others.

According to the factual basis of the plea agreement, KTX Limited and KTX Properties Inc, authorized two contract workers to perform welding or “hot work” on piping connected to a tank at their Port Arthur, Texas, facility. Prior to beginning the welding, the defendants falsified the “hot work” permit issued to the workers and failed to properly drain, isolate and decontaminate the tank and connecting equipment as required by Occupational Safety and Health Act (OSHA) regulations. As a result, the welding work ignited vapors causing the tank to explode and release hazardous air pollutants to the environment. Because the defendants had failed to properly inspect and maintain the tank pursuant to generally accepted industry standards, the exploding tank collapsed spilling burning product which severely injured two workers. A third worker was killed when the rails and ladder from the collapsing tank fell on his head.

“The dishonest [and outright] failure to adhere to workplace standards and practices can lead to death and injury to American workers who deserve better, as this case tragically shows,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “The Justice Department is committed to enforcing environmental and workplace safety laws that protect workers from this kind of egregious behavior and to help ensure it doesn’t happen again.”

The information also charges Crosby LP and Ramsey Properties LP with failing to monitor leaks of ground-level ozone (smog) producing air pollutants at their chemical processing facility in Crosby, Texas, from 2008 until 2012. Pursuant to the factual basis, the defendants also admitted that they falsified records and reports for these Title V permit requirements to EPA and the Texas Commission of Environmental Quality certifying the facility was complying with the permit requirements.

“Safety inspections involving toxic or hazardous materials are mandatory and vital to the safety of the worker and the surrounding communities,” said Acting U.S. Attorney Brit Featherston for the Eastern District of Texas. Non-performance is unacceptable and will not be tolerated, and offenders will be prosecuted.”

The plea agreement requires the companies to pay a total of $3.3 million in criminal fines. In addition, the companies will make a $200,000 community service payment to the Southern Environmental Enforcement Network (SEEN). The payment will be used by SEEN for hazardous air release prevention and emergency response training to state and local environmental and law enforcement agencies.

“When handled or stored improperly, chemicals can result in severe injuries or even death, so protecting communities from the harmful effects of hazardous chemicals is a priority for EPA,” said Special Agent in Charge Christopher R. Brooks of EPA’s criminal enforcement program for Texas. “This case emphasizes the importance of having – and following – a plan to manage risks associated with storing hazardous chemicals, which help companies avoid accidents and enable local emergency responders to be better prepared.”

“Employee safety is of paramount importance as there is no excuse for workers not returning to their families at the end of the day,” said Regional Administrator Kelly Knighton for OSHA Region 6. “Resulting from an initial OSHA fatality investigation, I commend the Federal and State partners for holding accountable, to the fullest extent of the law, those employers that take shortcuts and endanger the safety and health of their workers.”

Assistant U.S. Attorney Joseph R. Batte of the Eastern District of Texas and Trial Attorneys Richard Powers and David Kehoe of the Department of Justice, Environmental Crimes Section, prosecuted the case. The case was investigated by EPA’s Criminal Investigation Division and assisted by the Texas Commission on Environmental Quality, the Texas Parks and Wildlife Department, and the Occupational Safety and Health Administration.

 
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