United States District Court, D. Idaho
IDAHO CONSERVATION LEAGUE and NORTHWEST ENVIRONMENTAL DEFENSE CENTER, Plaintiffs,
ATLANTA GOLD CORPORATION, Defendant.
MEMORANDUM DECISION AND ORDER RE: SUBSTANTIAL
HONORABLE RONALD E. BUSH CHIEF U.S. MAGISTRATE JUDGE.
decision resolves the issue of whether Defendant Atlanta Gold
Corporation (“Atlanta Gold”) has substantially
complied with the terms of an environmental permit as
required by a prior order of this Court, relating to Clean
Water Act violations at a mining site near Atlanta, Idaho.
September 15, 2017, this Court held that Atlanta Gold was
liable for violations of the Clean Water Act stemming from
excessive iron and arsenic in the treated effluent flowing
from the company’s mine holdings, specifically at the
900 Level Adit (the “Adit”). The levels of
iron and arsenic in this discharge exceeded at times the
amounts allowed under Atlanta Gold’s National Pollutant
Discharge Elimination System (“NPDES”) permit
(the “Permit”). (Dkt. 159.) This Court also held
Atlanta Gold in civil contempt and ordered it to pay $251,000
to the District Court; however, the imposition of that order
was held in abeyance until September 30, 2018 to give Atlanta
Gold an opportunity to purge its civil contempt by achieving
substantial compliance with its NPDES Permit. The order
stated that the civil contempt payment would be rescinded if
Atlanta Gold was successful in such efforts. Atlanta Gold was
ordered to file periodic status reports detailing its
attempts to reach substantial compliance and reporting the
results achieved. Atlanta Gold timely filed such status
reports. (Dkts. 164, 169, 172, 173, 174, 180.)
the end of the abeyance time period, Plaintiff Idaho
Conservation League (“ICL”) and Atlanta Gold each
submitted written argument and related materials to the Court
concerning whether Atlanta Gold had achieved substantial
compliance. (Dkts. 181, 182, 183.) An evidentiary hearing was
held on January 9, 2019. (Dkt. 186.)
careful consideration of the entire record, the Court
concludes that Atlanta Gold has not achieved substantial
compliance. The treatment system remains incapable of
treating the higher volumes of water associated with annual
snow melt or other high-water events, such as heavy rains.
Progress has been made in reducing the number of violations
of the Permit requirements and reducing the severity of the
violations, but an improvement upon an abysmal record of
non-compliance does not equal substantial compliance with
what is required of Atlanta Gold by the NPDES Permit.
Additionally, Atlanta Gold repeatedly represented in its
status reports that it had plans to begin improvements, or
implied that it had already started making such improvements.
However, most of such described improvements were not
implemented. Indeed, some of the improvements Atlanta Gold
discussed in the filings and testimony leading to this
Decision are the same improvements Atlanta Gold has
discussed, but has never implemented, dating back at least
Atlanta Gold has succeeded in reducing the frequency and
magnitude of Permit exceedances, and although those
improvements do not rise to the level of substantial
compliance they do justify a reduction in the amount of the
civil contempt penalty. Accordingly, the $251,000 civil
contempt penalty Atlanta Gold was previously ordered to pay
if it failed to achieve substantial compliance is reduced to
$125,500. The case will be closed, but the Court will retain
jurisdiction to ensure compliance with its orders.
was first discovered near Atlanta, Idaho in 1863 and mining
has been occurring in that area, off and on, since then.
Simmons Aff. ¶ 2 (Dkt. 20-5). Atlanta Gold is a mining
company pursuing mineral exploration and development; it has
extensive ownership interests in a historic mining site (the
“Project Site”) located at the top of Atlanta
Hill. Id. at ¶ 3. The Project Site was once
known as the Talache Mine and consists of various patented
and unpatented mining claims, lode claims, and mill site
claims, which total approximately 2,159 acres. Id.
at ¶ 4.
Adit was first opened in 1917, as an ore haulage tunnel.
Id. at ¶¶ 6 & 7. The Adit is situated
alongside Montezuma Creek, which flows downstream through the
town of Atlanta and into the Middle Fork of the Boise River.
Compl. ¶ 33 (Dkt. 1). The Middle Fork joins with two
other forks of the Boise River and eventually flows through
the city of Boise and other areas of southwest Idaho, with
its waters eventually reaching the Snake River.
Gold first obtained an interest in the Adit site in 1985.
Simmons Aff. ¶ 2 (Dkt. 20-5). Atlanta Gold never has
processed or produced ore at the Adit site; however, it has
over the years done exploration through core drilling and
excavation. Id. at ¶¶ 2, 5. Beginning in
1988, Atlanta Gold reopened about 200 feet of the previously
collapsed Adit. Glaspey Aff. ¶¶ 8–11 &
Hawley Decl., Exh. 26 (Dkt. 22-5). In 1994, in a joint
venture with Ramrod Gold USA, Atlanta Gold submitted a Plan
of Operation, approved by the Forest Service, for exploration
at the Project Site to include opening and further excavation
of the 900 Adit. Id. at ¶ 19.
that further excavation was completed, the Adit portal was to
be kept open to allow for future exploration. Id. at
p. 21. In 1998, the Forest Service approved a Plan of
Operation to conduct exploratory drilling. Hawley Decl., Exh.
26 (Dkt. 22-5). Under both the 1994 Plan and the 1998 Plan,
the Forest Service required Atlanta Gold to treat the
polluted water flowing from the Adit to meet applicable state
and federal water quality standards. Id.
many years, Atlanta Gold dealt with pollution in Adit waters
either by piping the water through a single settling pond to
filter out suspended solids or by using a land-application
system of disposal. Glaspey Aff. ¶¶ 9, 15,
19–21 (Dkt. 20-12); Hawley Decl., Exh. 26 (Dkt. 22-5).
In 2005, the company worked with the Environmental Protection
Agency (“EPA”) to draft a Consent Order covering
various discharges within the Project Site, including those
from the 900 Adit. Simmons Aff. ¶¶ 8–10 (Dkt.
20-5). However, before a Consent Order was finalized, the
Idaho Conservation League filed a lawsuit alleging that
Atlanta Gold was illegally discharging pollutants from the
900 Adit in violation of the Clean Water Act. See Idaho
Conservation League v. Atlanta Gold Corp., Case No.
1:05-cv-212-EJL. This prior litigation between ICL and
Atlanta Gold resulted in a Consent Decree in which Atlanta
Gold agreed to construct a Pilot Water Treatment Facility
(the “PWTF”) to treat the waters issuing from the
900 Adit. Simmons Aff. ¶ 12 & Exh. A (Dkts. 20-5,
20-6). Further, Atlanta Gold agreed to apply to the EPA for
an NPDES permit that would authorize discharge of pollutants
from the 900 Adit subject to specific limits. Id.,
Exh. A, (Dkt. 20-6). The EPA issued the Permit on August 6,
2009, with an effective date of July 1, 2007, placing limits
of no more than 10 μg/L (micrograms per liter) for arsenic
and no more than 1,000 μg/L for iron in treated effluent.
Hawley Decl., Exh. 1 (Dkt. 22-1).
PWTF consists primarily of two lined settling ponds and
associated pipework. Contaminated water coming out of the
Adit is routed through these ponds and then remains long
enough for the pollutants to precipitate out, a process that
is aided by the addition of a chemical coagulant mixture.
After being treated in the settling ponds, the waters are
discharged into Montezuma Creek. Simmons Aff., Exh. 1, p. 9
of the arsenic and iron levels in the effluent is required by
the Permit. Torf Decl. ¶¶ 8–9 (Dkt. 25).
Atlanta Gold records that data once each week and sends it to
the EPA in monthly “Discharge Monitoring Reports”
(“DMRs”). Id. ¶ 10. The PWTF has
never been able to consistently treat the polluted waters to
meet the requirements of the Permit. For example, the
effluent data collected between August 2009 and January 2012
showed that the arsenic levels in the discharge waters had
ranged from three-hundred to four-hundred times greater than
the 10 μg/L daily effluent limitation. See Id.
¶¶ 7–17, 21; Benner Decl. ¶¶
14–19 (Dkt. 63). On average, each day the
treated Adit effluent released into Montezuma Creek
contained 265 μg/L of arsenic – over twenty-six
times the maximum allowable amount. Benner Decl. ¶ 16
(Dkt. 63). The highest measured level of arsenic during that
period was 3,070 µg/L. Id. The situation with
iron was similar, as the monthly DMRs for the period
beginning in August of 2009 showed levels far exceeding the
1,000 μg/L Permit limit. Torf Decl. ¶ 13 (Dkt. 25);
Hawley Decl., Exhs. 16–21 (Dkt. 22-3).
2009, the Idaho Department of Environmental Quality
designated certain waters of the Middle Fork of the Boise
River as “impaired,” because of arsenic pollution
in Montezuma Creek. Hayes Decl., Exhs. 3, 4 (Dkt. 22-1);
Third Hayes Decl. ¶ 18 (Dkt. 62). The 900 Adit is one
source of this problem, but not the only source. The Adit
site is adjacent to the Talache Mine Tailings Reclamation
Site, a Superfund site which Atlanta Gold describes as an
additional source of direct discharges into Montezuma Creek
containing arsenic contamination. Simmons Aff. ¶ 33
(Dkt. 20-5). People living in Atlanta use the creek’s
waters to irrigate their crops and lawns. Third Hayes Decl.
¶ 29 (Dkt. 62). Some of the flow of the creek is
diverted into open irrigation ditches that run directly
through the town. Id.
state of Idaho regulates water quality in both Montezuma
Creek and the Middle Fork of the Boise River to protect
certain beneficial uses of their waters. For Montezuma Creek,
one such beneficial use is “primary contact
recreation” which requires “water quality
appropriate for prolonged and intimate contact by humans or
for recreational activities when the ingestion of small
quantities of water is likely to occur.” IDAPA
58.01.02(100)(02)(a). In addition, Idaho’s water
quality standards recognize that Montezuma Creek could be
used as an agricultural water supply and, therefore, the
“water quality [must be] appropriate for the irrigation
of crops or as drinking water for livestock.” IDAPA
quality standards for the Middle Fork of the Boise River also
protect designated uses, including primary contact recreation
and the protection of aquatic life. IDAPA 58.01.02(140)(09).
Additionally, the Middle Fork carries a “domestic water
supply” designation, which means that water quality
must be appropriate for drinking supplies. Third Hayes Decl.
¶ 19 (Dkt. 62); see also IDAPA
was constructed, the PWTF was not intended to be a permanent
solution to arsenic and iron pollution from the 900 Adit.
See Atlanta Gold’s Statement of Material Facts
at pp. 8–9 (Dkt. 20-2); see also Fereday Aff.,
Exh. F (Dkt. 20-11) and Hawley Decl., Exh. 13. p. 2 &
Exh. 14, p. 6 (Dkt. 21-2). The treatment facility is able to
remove significant amounts of pollutants from the Adit waters
at times; however, it was never designed to meet the
applicable arsenic effluent limitation of 10 μg/L
contained within the NPDES Permit. Simmons Aff. ¶ 27
(Dkt. 20-5). In fact, Atlanta Gold originally intended to
operate the PWTF only until November 15, 2008, after which
time it anticipated constructing a more permanent water
treatment facility. Simmons Aff. ¶¶ 19, 20 (Dkt.
20-5) & Exh. E at p. 33 (Dkt. 20-6).
years after the PWTF was built, Atlanta Gold told
governmental agencies that more permanent steps would be
taken to address contamination at the 900 Adit. For example,
in the 2006 Supplemental Plan of Operations (upon which the
Forest Service authorized the construction and operation of
the PWTF), Atlanta Gold promised construction of a permanent
treatment facility by November 2008. Id. In October
2009, Atlanta Gold said in its Quality Assurance Project Plan
submitted to the EPA and the Idaho Department of
Environmental Quality that “the PWTF was built as a
temporary structure which will be replaced in the near future
by a permanent WTF.” Hawley Decl., Exh. 14 at p. 6
(Dkt. 22-2 at p. 30).
Gold never did install such a permanent facility. It did,
over a period of years, obtain proposals from contractors and
engineers designed to address water treatment issues on a
more permanent basis. Third Reuther Decl., Exhs. 43–49
(Dkt. 64). Some predate the construction of the PWTF and some
do not. In 2005, Atlanta Gold had a company known as Blue
Water Technologies do a study involving bench-scale tests of
water samples taken from the Project Site, which succeeded in
lowering arsenic levels to less than the applicable 10
μg/L standard. Id. at Exh. 46, pp 1–3.
Then, in 2009, a company known as “AdEdge” tested
a temporary filtration system which Atlanta Gold said was
able to treat the Adit discharge to arsenic levels
“between non-detectable and 10 ppb.” Id.
at Exh. 47, p. 6, ¶ 8. This temporary filtration system
was installed at the Adit site and operated approximately
eight hours a day for three weeks, with these comments about
The current treatment process employed using coagulation/lime
addition and gravity settling (using the impoundments as
clarifier(s)) does appear to provide some benefit for
reducing arsenic from the raw Adit 900 water. However, this
treatment alone is clearly not achieving the desired targets.
Additional or substitutionary treatment is needed. [Atlanta
Gold] could elect to utilize a combination of this existing
treatment system coupled with the AdEdge AD26/E33 integrated
system for a total solution or eliminate the pretreatment
altogether if desired.
Id. at pp. 4, 5.
2009, Atlanta Gold purchased a water treatment plant from
another mining company. Referred to as “the Newmont
Plant,” Atlanta Gold told the EPA that the plant would
be installed by 2012. Third Ruether Decl., Exh. 52, pp.
18–20 (Dkt. 67-2). That never happened. Atlanta Gold
said there were too many obstacles to installing the Newmont
Plant. Id. at pp. 17–37.
would be expected, each option for treating the water
involved some lesser or greater degree of challenge in
getting something accomplished. However, when Atlanta Gold has
discussed an anticipated construction of the more permanent
water treatment facility, it also anticipated the start of
active mining operations. Third Ruether Decl., Exh. 51 at p.
14 (Dkt. 67-1); see also Simmons Aff. ¶ 20
(Dkt. 20-5). Indeed, the company has insisted that long-term
water treatment can only be a component of a mine plan.
Simmons Aff. ¶ 43 (Dkt. 20-5). For instance, in 2006
Atlanta Gold said that it would construct a more permanent
water treatment facility to replace the PWTF as part of its
plan to conduct a heap leach mining operation. Its Plan of
Operations submitted to the Forest Service at that time
represented that the permanent treatment facility would be
working by November 2008. Simmons Aff. ¶ 20 (Dkt. 20-5).
However, in 2008, Atlanta Gold withdrew that plan.
Id. ¶¶ 20, 22.
filed this lawsuit on April 18, 2011. Compl. (Dkt. 1). Ten
days later, Atlanta Gold said it would not exercise its
option to purchase the mining claims upon which the 900 Adit
is located. Points Aff. ¶¶ 2–4 (Dkt. 20-3).
Atlanta Gold then attempted to terminate its NPDES Permit on
May 2, 2011, saying it no longer had any interest in the
site. Id. ¶ 6 & Exh. B. In a letter dated
June 9, 2011, the EPA informed Atlanta Gold that the Permit
“does not automatically terminate upon
notification.” Hawley Decl., Exh. 25 (Dkt. 22-5). On
June 19, 2012, Atlanta Gold told the EPA that it would
continue operation under the Permit and “request[ed]
extension of coverage of that permit for an unspecified
period of time.” (Dkt. 86). The EPA granted this
request on June 28, 2012. Plfs.’ Notice of Factual
Development (Dkt. 85.)
1, 2012, Atlanta Gold submitted a Supplemental Plan of
Operations to the Forest Service (“the 2012
Supplemental Plan”) proposing to close the Adit and
reclaim the site. This plan also contained a new proposal for
treating the Adit waters until the adit closure and
reclamation work was completed. Third Simmons Decl., Exh. A
(Dkt. 77). The plan also said Atlanta Gold could bring the
discharged effluent into compliance with the terms of the
NPDES Permit by October 2012 by: (1) diverting Montezuma
Creek above the 900 Adit to reduce the flow of water through
the Adit; (2) constructing another settling pond to
increase holding capacity and settling times at the PWTF so
that more arsenic and iron could precipitate out; and (3)
adding a layer of sand to the floor at the mouth of the Adit
to assist in the removal of toxins. Third Simmons Decl., Exh.
A, pp. 1–2 (Dkt. 77-3). At the same time, Atlanta Gold
would install a bulkhead to seal off the Adit by 2013, with
reclamation of the site to be complete by 2014. Id.
Finally, this plan provided that “[i]f the proposed
settling pond and sand filtration system are unable to meet
required water quality parameters, a future filtration system
will be constructed downstream of the ponds.”
Id. Atlanta Gold referred to this potential future
filtration system as a “contingency filter.”
2012 Supplemental Plan was approved, in part, and Atlanta
Gold performed some, but not all, of the work it said it
would do. Simmons Decl. ¶ 2 (Dkt. 103-1). Specifically,
Atlanta Gold installed a Zero Valent Iron filtration system
but did not install a third sedimentation pond at the PWTF
for weather-related reasons. Id. Mr. Simmons said in
December 2012 that Atlanta Gold would begin implementation of
the remaining parts of the approved portions of the 2012
Supplemental Plan in Spring 2013. Id. However, that
did not happen. Indeed, Atlanta Gold’s subsequent
filings, including status reports, say nothing about the
other work promised in the 2012 Supplemental Plan. (Dkts.
106, 111, 117.)
2012, the Court issued its Memorandum Decision on
Plaintiffs’ Motion for Remedies (Dkt.
granting an injunction and ordering Atlanta Gold to pay a
partial penalty of $2,000,000. The Court noted that, because
of “the longstanding, serious, and ongoing nature of
the violations, and considering [Atlanta Gold’s]
history of attempting to delay compliance until it had its
mine up and running, an injunction may well be the only way
to ensure that the company complies with the CWA in a timely
fashion.” Id. at 18. The Court entered an
Injunction Order (Dkt. 88) on July 27, 2012 requiring Atlanta
Gold to bring arsenic and iron concentrations into compliance
with its NPDES Permit by October 31, 2012. The Court retained
jurisdiction over the matter to enforce the injunction order.
compliance deadline was extended, first through the end of
November 2012 (Dkt. 96) and then again until December 15,
2012 (Dkt. 87). Atlanta Gold reported in a status report
filed on December 6, 2012 (Dkt. 103) that “through the
installation of the Zero Valent Iron passive filtration
system” Atlanta Gold had “achieved compliance
with the referenced effluent limits” as of November 8,
2012 and had “maintained compliance with the NPDES
permit since that time with few exceptions.” After
reviewing this status report, the Court required Atlanta Gold
to file a subsequent status report on June 1, 2013 so that
the Court could “determine whether the fixes
implemented by [Atlanta Gold] continue to be effective, and
in particular, to determine whether they remain effective
during the spring run-off season.” (Dkt. 105).
part, ICL filed a status report pointing out that Atlanta
Gold’s own monitoring established that the maximum
permitted arsenic levels had been exceeded in 16 of 19 weekly
samples taken between December 15, 2012 and April 31, 2013.
Gold’s June 2013 status report reported what it called
“substantial compliance” with the arsenic and
iron effluent limits in its NPDES Permit. (Dkt. 111.) The
status report included invoices, timesheets, and spreadsheets
documenting Atlanta Gold’s expenses incurred in
treating the Adit discharge. It also included a Discharge
Monitoring Report from April 2013 indicating that there were
two weekly exceedances (each of 12 µg/L) that month.
Atlanta Gold said it had “recently experienced some
clogging issues in the [Zero Valent Iron] Filter, which have
resulted in some ‘spikes’ in test results from
the discharge. In order to address these issues and to
further improve removal of arsenic and iron from the
treatment of water, [Atlanta Gold] plans to install a
supplemental solids filter to remove additional suspended
solids from the effluent prior to the water being routed into
the final Filter.” (Dkt. 111 at 3.) Atlanta Gold also
said the “Filter” was working as designed, but
that the volume of solids entering the Filter from the
settling ponds had shortened the anticipated life expectancy
of the Filter media due to clogging. It described a plan to
decrease the solids entering the PWTF by performing
maintenance on the settling ponds and installing two solids
removal filters in June 2013. Id. The Court required
an additional status report, filed in August 2013, which
contained DMRs for May and June 2013 (Dkt. 117). That status
report indicated that there were no arsenic exceedances in
May 2013 and two arsenic exceedances (of 13 µg/L and 11
µg/L) in June 2013.
the Court did not impose additional penalties and entered
final judgment in the previously-assessed amount. (Dkts. 122,
125.) The case was then closed in September 2013.
little more than three years later, in November 2016,
Plaintiffs moved to reopen the case and asked the Court to
hold Atlanta Gold in civil contempt for additional Clean
Water Act violations related to arsenic contamination (Dkts.
127, 128). Plaintiffs alleged at least 497 identified daily
violations (represented by 71 weekly exceedances, alleged as
seven daily violations) and sought enforcement remedies,
additional Clean Water Act civil penalties, and civil
contempt sanctions. An evidentiary hearing was held in April
2017 (Dkts. 155, 156). Before a decision on Plaintiffs’
motion was issued, Plaintiffs filed a Notice of Continuing
Violations (Dkt. 157). That Notice alleged 16 weekly arsenic
exceedances between March and July 2017, including
exceedances as high as 807 µg/L in May 2017 and 409
µg/L in June 2017. It also alleged seven weekly iron
exceedances in May and June 2017, including exceedances as
high as 7,230 µg/L in May 2017 and 3,130 µg/L in
Memorandum Decision and Order on Motion for Civil Contempt
was issued on September 15, 2017 (Dkt. 159), ordering Atlanta
Gold to pay $251,000 in additional Clean Water Act penalties
and an additional $251,000 for civil contempt. The civil
contempt amount, however, was held in abeyance until
September 30, 2018 to allow Atlanta Gold an opportunity to
comply with its NPDES Permit and with the Court’s
orders and thereby purge its civil contempt. If Atlanta Gold
achieved substantial compliance, the civil contempt payment
would not be owed. Atlanta Gold was to file periodic status
reports “detailing the steps it has taken to reach
compliance with the terms of the Permit and the results
achieved (including all relevant DMRs).” A Second
Injunction Order (Dkt. 166) and Judgment (Dkt. 167) were
Gold filed periodic status reports, the contents of which are
discussed in detail below. This Decision resolves the
question of whether Atlanta Gold has achieved substantial
compliance with its NPDES Permit and whether, therefore, the
reason for the $251,000 civil contempt penalty has been
purged, such that the contempt order should be rescinded or
enacted the Clean Water Act, 33 U.S.C. §§ 1251
et seq., “to restore and maintain the
chemical, physical, and biological integrity of the
Nation’s waters,” including by regulating the
discharge of pollutants. 33 U.S.C. § 1251(a). Such
regulation is done through a permitting process called the
National Pollutant Discharge Elimination System (NPDES),
implemented at 33 U.S.C. § 1342, and corresponding
regulations appearing in Title 40 of the Code of Federal
Regulations. Atlanta Gold sought and received an NPDES permit
allowing discharges of pollutants from the Adit to Montezuma
Creek, subject to specific limits. (Dkt. 22-1.) Among other
things, the water ...