Formosa Plastics Corp. USA has agreed to pay $50 million to settle a Clean Water Act lawsuit over plastic pellet pollution from one of its Texas factories, reportedly the largest settlement brought by private citizens under that federal environmental statute.
The groups that brought the lawsuit said in an Oct. 15 news release that Formosa has agreed to pay for environmental cleanups around its Point Comfort, Texas, plant and meet "zero discharge" standards for resin pellets in the environment.
The consent decree must still be approved by Judge Kenneth Hoyt of the U.S. District Court in Houston. The groups brought the lawsuit in 2017.
"A settlement of this size sends a powerful message to corporate polluters – there's a steep price to pay for flagrant, chronic violations of laws that protect our environment," said Erin Gaines, a lawyer with Texas RioGrande Legal Aid, which helped fund the lawsuit. "And with plastics pollution of our oceans at a crisis, the message comes at a vital time."
Livingston, N.J.-based Formosa, in an Oct. 15 statement, confirmed the broad outlines of the $50 million settlement.
“The conditions agreed to in this settlement demonstrate Formosa’s commitment to manufacturing our products in a safe and environmentally friendly manner,” said Executive Vice President Ken Mounger. “We will continue to partner with local communities and stakeholders to ensure that FPC USA environmental programs are at the top of our industry.”
The plaintiffs said that the $50 million would be paid out over five years and will support projects to reverse the impact of water pollution in Calhoun County, where the factory is located.
It includes $20 million to create a cooperative to revitalize marine ecosystems and fishing, shrimping and oyster harvesting, $10 million for park and lake development, $5 million to support environmental research for the San Antonio and Matagorda bay systems and $2 million for beach erosion control.
As well, it includes $1 million to support "nurdle patrols," volunteer groups that collect plastic pellets to document and research pellet pollution on the coast of the Gulf of Mexico. The nurdle patrols are organized by the University of Texas's Mission-Aransas National Estuarine Research Reserve.
The groups said it would be the largest settlement ever paid out from a private lawsuit under the Clean Water Act and is five times larger than the previous top settlement. The largest Clean Air Act settlement of a private lawsuit is $19.95 million.
"Our engineers were key in documenting that plastic pollution would continue unabated unless dramatic changes were made to the plant," TRLA lawyer Amy Johnson said. "We will now work with Formosa to make sure those improvements are made, and the discharges are stopped."
The news release from the plaintiffs groups said none of the $50 million will be awarded to the plaintiffs.
The groups said the settlement gives details on how the company will eliminate discharge of plastic pellets and said that plaintiffs will review decisions and can make objections. It said penalties for Formosa would start at $10,000 and increase to $54,000 per discharge.
"Through reporting requirements, an independent monitor, site visits and other accountability requirements, we will have access to the process to determine whether Formosa is living up to its side of the bargain," said Bob Lindsey, a plaintiff and a member of the group that brought the lawsuit, the San Antonio Bay Estuarine Waterkeeper.
The waterkeeper organization spent the last three years collecting and documenting evidence of pellet pollution in waters around the Point Comfort facility and presenting it in the lawsuit.
The plaintiffs argued that Formosa could have faced up to $160 million in fines under federal laws. In January, Texas regulators fined the company $121,000 for pellet pollution discharge violations.
In late June, Hoyt issued a strongly worded ruling that the company was a "serial offender" of its Clean Water Act permit and had set a penalty phase in the trial for late October.
Environmental groups suggested the zero discharge requirements in the consent decree should become standard practice for the plastics industry.
"The zero plastic discharge requirement this settlement won should be the standard for all plastic plants across the country,"Julie Teel Simmonds, an attorney with the Center for Biological Diversity, said.