[Cite as State ex rel. Cordray v. Massarelli, 2013-Ohio-3321.]
COURT OF APPEALS
TUSCARAWAS COUNTY, OHIO
FIFTH APPELLATE DISTRICT
STATE OF OHIO, EX REL, JUDGES:
ATTORNEY GENERAL Hon. William B. Hoffman, P.J.
RICHARD CORDRAY Hon. John W. Wise, J.
Hon. Patricia A. Delaney, J.
Plaintiff-Appellee
Case No. 2012 AP 08 0045
-vs-
SHIRLEY A. MASSARELLI OPINION
Defendant-Appellant
CHARACTER OF PROCEEDING: Appeal from the Tuscarawas County
Common Pleas Court, Case No.
2010 CV 04 0541
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: July 24, 2013
APPEARANCES:
For Plaintiff-Appellee For Defendant-Appellant
RICHARD CORDRAY EUGENE H. NEMITZ, JR.
OHIO ATTORNEY GENERAL 136 2nd Street NE
New Philadephia, Ohio 44663
CASEY L. CHAPMAN
L. SCOTT HELKOWSKI
ALANA R. SHOCKEY
Assistant Attorneys General
Envirnonmental Enforcement Section
30 East Broad Street, 25th Floor
Columbus, Ohio 43215
Tuscarawas County, Case No. 2012 AP 08 0045 2
Hoffman, P.J.
{¶1} Defendant-appellant Shirley A. Massarelli appeals the July 10, 2012
Judgment Entry entered by the Tuscarawas County Court of Common Pleas, which
found her in violation of R.C. 6109.31, and imposed a civil penalty of $144,450.00.
Plaintiff-appellee is State of Ohio, ex rel. Attorney General Richard Cordray (“the
State”).
STATEMENT OF THE FACTS AND CASE
{¶2} Appellant owned and operated The Red Onion Bar (“the Bar”) and The
Red Onion Party Center (“the Party Center”). Pursuant to R.C. 6109.21 and Ohio Adm.
Code 3745-84-02(A), these establishments were public water systems; therefore,
Appellant was required to obtain licenses to operate (“LTOs”) from the Ohio EPA, and
follow certain regulations for providing drinking water to the public. Appellant was also
required to complete applications and pay fees to renew the LTOs.
{¶3} Appellant did not obtain or apply for LTOs for the Bar in 2005, 2006, 2007,
or 2008. Appellant was late in submitting the LTO applications in 2009, and 2010.
Appellant, nonetheless, continued to operate the Bar and serve drinking water to the
public. In addition, throughout substantial periods of her ownership of the Bar,
Appellant failed to properly complete the required bacteriological sampling of the water
served to the public. Appellant failed to sample the drinking water at the Bar for total
coliform during 3 quarters of each year between 2005, and 2009. Appellant failed to
monitor the drinking water at the Bar for nitrate in 2004, 2005, and 2008, and for nitrite
in 2005. Appellant did not post public notifications for her failures to monitor these
chemicals.
Tuscarawas County, Case No. 2012 AP 08 0045 3
{¶4} With respect to the Party Center, Appellant failed to apply for LTOs in
2005, 2006, and 2007, and applied late in 2008, and 2009. Appellant submitted a late
application in 2010. Appellant, nonetheless, continued to operate the Party Center and
serve drinking water to the public. In addition, throughout substantial periods of her
ownership of the Party Center, Appellant failed to properly complete the required
bacteriological sampling of the water served to the public. Appellant failed to sample the
drinking water at the Party Center for total coliform during 3 quarters of each year
between 2005, and 2009. Appellant failed to monitor the drinking water at the Party
Center for nitrate in 2004, 2005, and 2008, and for nitrite in 2005. Appellant did not post
public notifications for her failures to monitor these chemicals.
{¶5} Ohio EPA made on-going attempts to bring Appellant to compliance.
Appellant received her first violation for failure to monitor in 1991. Ohio EPA sent
Appellant courtesy reminders, monitoring schedules, notifications, and notice of
violation letters. Ohio EPA also made phone calls and conducted on-site visits in an
attempt to achieve compliance from Appellant.
{¶6} After these attempts proved unsuccessful, Ohio EPA moved to the next
level of enforcement - a bilateral compliance agreement. The bilateral compliance
agreement identified the violations and the actions Appellant agreed to undertake to
return to compliance. The document was signed by Appellant as well as the Chief of
the Division of Drinking and Ground Water. Appellant signed the bilateral compliance
agreement in 1999, but did not perform the necessary actions. In 2001, Ohio EPA
moved to the next level of enforcement with the Director issuing Final Findings and
Tuscarawas County, Case No. 2012 AP 08 0045 4
Orders, and Appellant agreeing to comply with the safe drinking water laws and
monitoring schedules. Nonetheless, Appellant’s violations continued.
{¶7} In 2010, Appellant submitted an application for the LTOs eight months
late. The application was denied due to her noncompliance. Appellant’s case was
referred to the Ohio Attorney General’s Office in September, 2009.
{¶8} On April 30, 2010, the State filed a complaint, seeking injunctive relief and
civil penalty against Appellant. The complaint alleged Appellant served drinking water
to the public without having the proper licenses; Appellant failed to routinely test the
drinking water to ensure its safety for human consumption; and Appellant failed to
inform the public of the violations. The State also sought a preliminary injunction. On
May 28, 2010, the trial court ordered Appellant to cease operation of the Bar and Party
Center until she obtained the necessary licenses.
{¶9} The State filed a motion for partial summary judgment on the issue of
liability relative to Counts One through Ten of the complaint. Via Decision filed April 6,
2011, the trial court found Appellant liable for the ten violations. The trial court
determined Appellant had not monitored for total coliform, nitrate, and nitrite; had not
given public notice of the failure to monitor; and had not timely obtained LTOs before
providing drinking water to the public.
{¶10} The trial court conducted a hearing to determine the civil penalties on April
5, 2012. Holly Kaloz, an enforcement coordinator with Ohio EPA, testified regarding
Appellant’s history of noncompliance, the number of violations Appellant committed, the
risk of harm posed by those violations, the economic benefit Appellant received
Tuscarawas County, Case No. 2012 AP 08 0045 5
because of the violations, the recalcitrance Appellant exhibited, and the cost of the
enforcement since the referral to the Ohio Attorney General’s Office.
{¶11} The State filed its Civil Penalty Post-Hearing Briefs on April 13, 2012.
Appellant filed her Post-Trial Memorandum on May 4, 2012. Therein, Appellant raised,
for the first time, the State’s failure to present evidence the Attorney General’s Office
received a written referral letter from the Director of Ohio EPA. The State filed a Reply
opposing Appellant’s assertion and attaching a copy of the authenticated referral letter.
Appellant filed a motion to strike the letter as untimely introduced, to which the State
filed a memorandum contra.
{¶12} Via Decision filed July 10, 2012, the trial court assessed a civil penalty
against Appellant in the amount of $144,450.00, which represented a fine of $10 per
each of the 14,445 separate violations.
{¶13} It is from this decision Appellant appeals, raising the following
assignments of error:
{¶14} “I. THE ATTORNEY GENERAL OF OHIO FAILED TO PROVE BY ANY
SUBMISSION OF EVIDENCE THAT HE HAD BEEN REQUESTED BY THE OHIO
DIRECTOR OF THE ENVIRONMENTAL PROTECTION AGENCY TO TAKE ACTION
AGAINST DEFENDANT AS IS REQUIRED BY OHIO REVISED CODE §6109.32 TO
AUTHORIZED SUCH ACTION AND THE TRIAL COURT ERRED IN FAILING TO
DISMISS THE COMPLAINT.
{¶15} “II. THE STATE’S DELAY IN ENFORCEMENT CAUSED THE NUMBER
OF DAYS TO BE AN EXCESSIVELY HIGH NUMBER OF DAYS OF VIOLATION AND
POTENTIALLY (AND IN FACT DID) CAUSE A GREATER PENALTY AS THE COURT
Tuscarawas County, Case No. 2012 AP 08 0045 6
USED A MULTIPLE OF WHAT HE CONSIDERED THE NUMBER OF DAYS OF
VIOLATION TO CALCULATE THE PENALTY AND THE COURT ERRED IN
COUNTING ALL OF THE DAYS CLAIMED BY THE STATE AS VIOLATIONS.
{¶16} “III. THE TRIAL COURT ERRED IN FINDING THAT THE DEFENDANT
WAS IN VIOLATION OF OHIO SAFE WATER DRINKING LAWS FOR 14,445 DAYS.
{¶17} “IV. THE TRIAL COURT’S FINDING THAT DEFENDANT GAINED AN
ECONOMIC BENEFIT FROM HER VIOLATION OF THE SAFE DRINKING WATER
LAWS ‘WAS NOT IN EXCESS OF $144,450.00’ IS SERIOUSLY MISLEADING AND
AN ABUSE OF DISCRETION. THE COSTS OF THE WATER TESTING WAS A
QUARTERLY EXPENSE EACH YEAR FROM 2005 TO 2099 [SIC] – A FEW
HUNDRED DOLLARS AT MOST.
{¶18} “V. THE TRIAL COURT ABUSED ITS DISCRETION AND FAILED TO
TAKE INTO ACCOUNT THAT THE AMOUNT OF THE CIVIL PENALTY IMPOSED BY
THE COURT WOULD BE RUINOUS OR OTHERWISE DISABLING AS INDICATED BY
THE TESTIMONY OF DEFENDANT.
{¶19} “VI. THE TRIAL COURT ABUSED ITS DISCRETION IN IMPOSING A
CIVIL PENALTY PURSUANT TO OHIO REVISED CODE §6109.31.”
I
{¶20} In her first assignment of error, Appellant contends the trial court erred by
not dismissing the complaint as the State failed to present evidence the Attorney
General had received a written request from the Director of Ohio EPA to take action
against her as required by R.C. 6109.32.
Tuscarawas County, Case No. 2012 AP 08 0045 7
{¶21} Chapter 6109 of the Ohio Revised Code addresses safe drinking water.
Under Section 6109.32, “[t]he attorney general, upon written request by the director [of
environmental protection], shall bring an action for injunction or other appropriate action
against any person violating or threatening to violate [this chapter].”
{¶22} In her post-trial memorandum, Appellant asserted, for the first time, the
trial court lacked jurisdiction as the State failed to present evidence the Director of Ohio
EPA sent a written request to the Attorney General to bring an action. The State filed a
Reply and attached a copy of the written request. Appellant moved to strike the exhibit
as untimely. The trial court found the documentation regarding the referral from the
Director of Ohio EPA to the Attorney General was not a filing requirement, and that the
State was not required to prove a written referral was properly made before a judgment
can be issued. The trial court relied upon the decision of the Ninth District Court of
Appeals in State ex rel. Cordray v. Helms, 192 Ohio App.3d 426, 2011-Ohio-569,
{¶23} In Helms, the attorney general filed complaints against the Helms, who
were the operators of an apartment complex, alleging, inter alia, violations of safe
drinking water and wastewater treatment laws. Id. at para 1. The Helms challenged the
trial court’s jurisdiction, arguing the Ohio Environmental Protection Agency did not
properly authorize the lawsuit; therefore, the attorney general did not have authority to
file a complaint. Id. at para 10. The trial court permitted the State to provide a copy of
the referral letter after the hearing. Id. at para 12. On appeal, the Ninth District upheld
the trial court’s decision to admit the referral letter into evidence after the conclusion of
the hearing. Id.
Tuscarawas County, Case No. 2012 AP 08 0045 8
{¶24} We note a trial court has authority to consider any pertinent evidentiary
materials when determining its own jurisdiction. Southgate Develop. Corp. v. Columbia
Gas Transmission Corp., 48 Ohio St.2d 211 (1976). Accordingly, we find the trial court
did not abuse its discretion in accepting the referral letter into evidence post-hearing.1
{¶25} Appellant’s first assignment of error is overruled.
II
{¶26} In her second assignment of error, Appellant argues the State’s delay in
enforcement caused the number of days of violation to be excessive, resulting in a
greater penalty as the trial court used a multiple of the number of days violation in
determining the civil penalty. Appellant concludes the State acquiesced to Appellant’s
violations and should be barred from seeking civil penalties against her.
{¶27} The State brought the action against Appellant in 2010, for violations
occurring between 2005, through 2009. As set forth in our Statement of the Case and
Facts, Ohio EPA made repeated attempts to bring Appellant into compliance. Appellant
signed compliance agreements consenting to comply with the safe drinking water laws
and monitoring schedules. Appellant repeatedly breach those agreements.
{¶28} We do not find an unreasonable or unfair delay in the State’s initiating the
action. Ohio EPA tried to work with Appellant to bring her into compliance. She was
able to effectively avoid her obligations for years on end.
{¶29} Appellant’s second assignment of error is overruled.
1
While unnecessary for our disposition of this assigned error, we question whether the
absence of a written referral letter would prohibit the Attorney General from seeking
enforcement action on his or her own initiative. We do not interpret the statute as one
of limitation of authority, but rather when authority must be exercised.
Tuscarawas County, Case No. 2012 AP 08 0045 9
III
{¶30} In her third assignment of error, Appellant maintains the trial court erred in
finding she was in violation of Ohio drinking water laws for 14,455 days. Appellant
submits the trial court simply accepted the total number of alleged violations as testified
to by the State’s witness.
{¶31} We find Appellant has waived any argument as to the appropriateness of
the trial court’s finding relative to the number of days of violations. Appellant did not
oppose the State’s motion for summary judgment on the issue of liability.
{¶32} Appellant’s third assignment of error is overruled.
IV
{¶33} In her fourth assignment of error, Appellant submits the trial court’s finding
the economic benefit she gained from her violations of the safe drinking laws was an
abuse of discretion. Appellant claims any economic benefit she gained was, at most,
several hundred dollars per year, which represents the cost of performing the required
testing.
{¶34} In State v. ex rel. Brown v. Dayton Malleable, 1 Ohio St.3d 151, 153, 438
N.E.2d 120 (1982), the Ohio Supreme Court discussed the factors a trial court should
consider when determining the appropriate amount of a civil penalty. Those factors are:
1) the harm or threat of harm posed to the environment by the violations 2) the level of
recalcitrance, defiance, or indifference demonstrated by the violator of the law (the
defendant's good or bad faith); 3) the economic benefit gained by the violation; and, 4)
the extraordinary costs incurred in enforcement. Id.
Tuscarawas County, Case No. 2012 AP 08 0045 10
{¶35} In its July 10, 2012 Decision, the trial court addressed these factors and
concluded the civil penalty was not in excess of Appellant’s economic benefit. We find
the trial court did not abuse its discretion in making this finding.
{¶36} Appellant’s fourth assignment of error is overruled.
V, VI
{¶37} Because Appellant argued her fifth and sixth assignments of error
together, we shall likewise address them together. In her fifth assignment of error,
Appellant asserts the trial court abused its discretion in failing to take into account how
the civil penalty would be ruinous and otherwise disabling to her. In her sixth
assignment of error, Appellant contends the trial court abused its discretion in imposing
a civil penalty in the amount of $144,450.
{¶38} “Civil penalties can be used as a tool to implement a regulatory program.”
State ex rel. Brown v. Howard (1981), 3 Ohio App.3d 189, 191, 3 OBR 216, 444 N.E.2d
469, citing United States ex rel. Marcus v. Hess (1943), 317 U.S. 537, 63 S.Ct. 379, 87
L.Ed. 443. Substantial penalties are used as a mechanism to deter conduct contrary to
the regulatory program. Id. (Citation omitted); Dayton Malleable, supra. In order to be an
effective deterrent to violations, civil penalties should be large enough to hurt the
offender but not cause bankruptcy. Howard; Dayton Malleable.
{¶39} The assessment of an appropriate civil penalty lies within the sound
discretion of the trial court and will not be reversed upon appeal absent evidence that
the trial court abused its discretion in imposing the penalty. Dayton Malleable, Inc.,
supra at 157. In making this determination, the court should consider evidence relating
to defendant's recalcitrance, defiance, or indifference to the law; the financial gain that
Tuscarawas County, Case No. 2012 AP 08 0045 11
accrued to defendant; the environmental harm that resulted; and the extraordinary costs
incurred in enforcement of the law. See State ex rel. LG Dev. Corp. 187 Ohio App.3d
211, 219, 931 N.E.2d 642, 648. See also Howard; State ex rel. Celebrezze v. Thermal–
Tron, Inc. (1992), 71 Ohio App.3d 11, 592 N.E.2d 912.
{¶40} We find the trial court did not abuse its discretion in its application of the
Dayton Malleable factors in the instant action.
{¶41} First, the trial court found Appellant’s violations “posed a moderate threat
to the consuming public at her places of business.” Kaloz testified the monitoring of
total coliform is necessary as it is an indicator of whether microbial organisms such al E.
Coli and Fecal Coliform are present in drinking water. Kaloz explained such organisms
could cause the public to become ill. Appellant served untested drinking water to the
public 15 out of the last 21 monitoring periods. Likewise, the monitoring of nitrates and
nitrites is necessary as such contaminants could also result in illness. In addition to
failing to monitor, Appellant failed to provide notice to the public of the lack of
monitoring. We find the trial court did not abuse its discretion when it determined
Appellant’s violations posed a moderate threat.
{¶42} Next, the trial court concluded Appellant’s “indifference to the potential
threat caused by her violations was significant.” The evidence in the record supports
this conclusion. Appellant’s recalcitrance and indifference is exhibit by her years of
violating the safe drinking water laws which placed her customers’ health in jeopardy.
Ohio EPA attempted to work with Appellant to bring the water systems into compliance.
Appellant repeatedly failed to remedy the violations. Appellant blamed Ohio EPA for the
violations, claiming the department failed to send courtesy reminders to her correct
Tuscarawas County, Case No. 2012 AP 08 0045 12
mailing address. Appellant acknowledged she provided Ohio EPA with the address
and had, in fact, received mail from the department which she did not open. We find the
trial court did not abuse its discretion in finding Appellant’s indifference was significant.
{¶43} The trial court also found Appellant gained an economic benefit from the
violations. A court may presume an economic benefit from environmental violations.
State ex rel. Petro v. Tri-State Group, Inc., 7th Dist. No. 03BE61, 2004-Ohio-4441. By
violating the safe drinking water laws, Appellant avoided the costs incurred in sampling
the water as well as the fees associated with the LTOs. In addition, any profit earned by
the Bar and the Party Center while Appellant operated the businesses without LTOs
and without sample monitoring would be an economic benefit. It is impossible for either
the trial court or this Court to calculate the precise amount of economic benefit
Appellant gained by her non-compliance. Had Appellant complied, she may have
incurred costs to resolve any non-compliance problems and such may have included
periods of having to shut down operations. Although an exact dollar figure cannot be
calculated, we find the trial court did not abuse its discretion in finding Appellant gained
an economic benefit.
{¶44} The trial court considered the fourth factor – extraordinary costs incurred
in enforcement – and concluded the enforcement costs incurred by the State were
“relatively minimal”. Although Ohio EPA spent a number of years working with
Appellant to bring her into compliance, we find the trial court did not abuse its discretion
in reaching this conclusion.
Tuscarawas County, Case No. 2012 AP 08 0045 13
{¶45} Appellant’s fifth and sixth assignments of error are overruled.
{¶46} The judgment of the Tuscarawas County Court of Common Pleas is
affirmed.
By: Hoffman, P.J.
Wise, J. and
Delaney, J. concur
___________________________________
HON. WILLIAM B. HOFFMAN
___________________________________
HON. JOHN W. WISE
___________________________________
HON. PATRICIA A. DELANEY
Tuscarawas County, Case No. 2012 AP 08 0045 14
IN THE COURT OF APPEALS FOR TUSCARAWAS COUNTY, OHIO
FIFTH APPELLATE DISTRICT
STATE OF OHIO, EX REL, :
ATTORNEY GENERAL :
RICHARD CORDRAY :
:
Plaintiff-Appellee :
:
-vs- : JUDGMENT ENTRY
:
SHIRLEY A. MASSARELLI :
:
Defendant-Appellant : Case No. 2012 AP 08 0045
For the reasons stated in our accompanying Opinion, the judgment of the
Tuscarawas County Court of Common Pleas is affirmed. Costs to Appellant.
___________________________________
HON. WILLIAM B. HOFFMAN
___________________________________
HON. JOHN W. WISE
___________________________________
HON. PATRICIA A. DELANEY