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Press Release

Settlement Agreement Reached in Cannery Creek Hatchery Oil Spill

November 3, 2017

(Cordova, Alaska) - The State entered into a global civil settlement agreement with Prince William Sound Aquaculture Corporation (PWSAC) and its employees, Dale Lords, David Reggiani, and Christine Mitchell, resolving criminal charges against the corporation and the individuals. The State charged PWSAC and the individuals for providing false information to Alaska Department of Environmental Conservation (ADEC) regulators, failing to report a hazardous substance discharge, and oil pollution relating to a December 2013 discharge of diesel fuel underneath a housing unit at Cannery Creek Hatchery (CCH).

The State originally filed criminal charges against David Reggiani, Christine Mitchell, and Dale Lords on September 26, 2016, amended on October 25, 2016, and against PWSAC on February 16, 2017. The State alleged that on December 10, 2013, between 350-400 gallons of oil were released from an aboveground fuel tank leading into the crawlspace under a staff housing unit at CCH. An employee of PWSAC reported the spill to Christine Mitchell, Acting CCH Manager, and David Reggiani, PWSAC General Manager. The State alleged that Christine Mitchell and David Reggiani in their individual capacity and as agents of PWSAC failed to report the oil discharge. The State of Alaska further alleged that the spill resulted from negligence on the part of PWSAC through its agents, Christine Mitchell and David Reggiani, due to their failure to maintain fuel lines to prevent corrosion and leaks despite knowledge of past leaks. Finally, the State alleged that Christine Mitchell, David Reggiani, and Dale Lords provided false information to the State when they reported to the State they were unable to confirm the spill.

Two months after the spill, in February of 2014, PWSAC hired an environmental consulting company to complete a site assessment and corrective action plan for CCH. The consultant’s investigation confirmed the presence of oil contamination in the soil under the housing unit. The investigation confirmed that the fuel releases had occurred from multiple locations and were ongoing for extended periods of time. The environmental consulting company performed the remediation and concluded that the discharge was contained to soils in and around the housing unit and did not reach any waters.

Following the filing of criminal charges, PWSAC affirmatively worked to come to a positive resolution. The settlement’s environmental provisions will further enhance the management and sustainability of Alaska’s world class fisheries. The environmental audit and compliance plan PWSAC agreed to undertake will make it a model for all of Alaska’s fish hatcheries.

As part of the civil settlement agreement, the defendants agreed to make a collective civil payment of $55,000 (PWSAC-$30,000; Christine Mitchell-$10,000; David Reggiani-$10,000; and Dale Lords-$5,000). PWSAC also agreed to undertake an Environmental Audit of the operations at all of its hatcheries and implement a comprehensive Environmental Compliance Plan to enhance environmental protection and ensure that such incidents do not occur again. The civil payment will further environmental training and enforcement in Alaska with $30,000 allocated to supporting oil and hazardous substance release prevention and response, and $25,000 geared toward training Alaska Department of Environmental Conservation personnel for investigation and enforcement of environmental violations. This $55,000 civil payment is in addition to the approximately $120,000 PWSAC paid to fully remediate the site to the State’s satisfaction.  As part of the settlement agreement, the State today dismissed the charges against PWSAC and the individuals.

The settlement agreement is the result of an investigation conducted by the Alaska Department of Environmental Conservation’s Environmental Crimes Unit (ECU) and with assistance from the United States Forest Service (Juneau) and the United States Environmental Protection Agency’s Criminal Investigations Division. The ECU is tasked with conducting statewide investigations of criminal violations of Alaska statutes and regulations for the ADEC.  For information about the ECU, or to report an environmental crime the public may contact the ECU by phone, via email, or on ADEC’s website: http://dec.alaska.gov/das/ecu/index.htm.

Any release of oil in excess of 55 gallons must be reported to ADEC as soon as the person has knowledge of the discharge. For further information regarding spill reporting, visit ADEC’s Spill Prevention and Response page at: http://dec.alaska.gov/spar/.

The charging document is enclosed with this press release. For further information regarding this case, contact: Assistant Attorney General Carole Holley at 907.269.6266.

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