Compliance Management Inc.

CRISIS MANAGEMENT - CASE STUDIES

Ocean Spray

Situation: EPA indicted Ocean Spray with 70 misdemeanors and 6 felonies for ongoing pH violations from discharges of cranberry wastes into the local publicly-owned treatment works (POTW). Discharges caused "sludge blooms" at POTW that caused it to violate its own discharge permit into a local river. Conviction as a felon would have resulted in loss of $150 million in annual sales to the Defense Department.

Strategy: 1. Technical analysis. Ocean Spray hired nationally known biologist expert in secondary treatment plants. He discovered real problem at POTW was not pH violations that were subject of indictments but imbalance in BOD between projected town waste stream and actual client waste stream and proposed solution to POTW problem.
2. Negotiation. Compliance Management helped client obtain approval from state regulators to demonstrate solution to problem. Solution worked on schedule.
3. Lawyers. Negotiated with federal EPA officials once real problems were understood and a mitigation strategy was demonstrated by firm that would avoid future violations and solve sludge "bloom" problem at POTW.

Outcome: Compliance Management teamed with lawyers and biologists to demonstrate solution to the problem of illegal discharges from POTW that resulted in:

EPA agreed to reduce penalties to 20 misdemeanors.
Ocean Spray avoided any felony conviction and saved $150 million in potential loss in annual sales to the federal government.
Ocean Spray paid $400,000 in fines for 20 misdemeanors.
Ocean Spray built new wastewater treatment facility to store and process waste stream to avoid future pH violations and add urea to waste stream to solve BOD problem at POTW.
Compliance Management designed a comprehensive regulatory management system to assure that Ocean Spray knew the status of regulatory compliance at every moment in time so that plant manager could pro-actively manage compliance to avoid future violations.

Metals Manufacturer

Situation: Fire in a drum filled with liquid sodium caught fire. 11 local firemen injured when leaking sodium interacted with water in drain pipe. The Massachusetts Attorney General investigated with threats of criminal sanctions.

Strategy: Compliance Management worked with client to:

Document full compliance with applicable regulations and due diligence in its safety programs.
Installed a compliance management information system that was designed to facilitate rapid documentation of compliance activities for inspectors and exceptional due diligence to safety programs.
Negotiate a settlement with local community to pay damages to injured firemen.

Outcome: As a result of the combined efforts of Compliance Management with the client environmental, health and safety staff, the outcome allowed the business to continue operations at the facility at an affordable cost, including:

The Attorney General did not indict firm for negligence.
Firm reimbursed local community for damages and injuries to local firefighters.
Firm continued to operate in the community, to generate local tax revenues, to grow in profitability and to resume aggressive acquisition strategy.
Today, the company's most recent inspection by EPA (2006) led to compliments from inspectors for a "model system for documenting compliance."

Fidelity Publishing

Situation: Firm ordered and installed a new printing press without required pre-approval and permit from environmental regulator. There was an urgent need to begin operations as soon as possible.

Strategy: CMI helped client to obtain the permit. With advice from CMI, client:

Removed pipe connecting press to vent stack so press not fully installed for operation;
Sent a low level facility manager to regulators to inquire about needed permits so that regulators would empathize with ignorance and provide assistance.

Outcome: Fidelity received a modest fine for failing to obtain permit in advance of ordering and installing press. The necessary permit was received and the press was able to begin operating quickly.

Eminent Domain Taking - Boston

Situation: The Central Artery project in Boston ("Big Dig") required land along the Haul Road for truck use into South Boston during construction. The Project offered client $8 million for land worth much more and refused to negotiate. Client's law firm hired Compliance Management to review Environmental Impact documents for flaws

Technical Analysis: Compliance Management spent 6 months in detailed review of documents, found five major violations of federal and state laws that could have delayed the project for years and would have required an Act of Congress to fix.

Outcome: The client's attorney presented the Central Artery project management with the analysis and gave the project the option to settle or sue. Project settled for over $90 million.