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Criminal Environmental Convictions for Offshore Drilling Contractor Rowan Companies: Are You Guarding Against Similar Problems At Your Company?

March 6, 2008

In October 2007, offshore drilling contractor Rowan Companies and nine of its supervisors pled guilty to federal environmental felony and misdemeanor charges arising from the discharge to water of airborne sandblasting media and paint chips, releases of waste oil, and the failure to report the illegal discharges.  In addition to commitments to dramatically upgrade its environmental management systems, the plea agreement obligated the company to pay a total of $9 million in fines and supplemental environmental projects.

The violations were discovered by the government when a Rowan employee filed a qui tam action against the company on behalf of the federal government.  After the filing, Special Agents from the Environmental Protection Agency ("EPA") interviewed the employee, who alleged that other employees routinely discharged wastes into US waters.  For his efforts, the United States Attorney and the Department of Justice recommended that the whistleblower-employee receive a reward in the amount of $500,000 for providing information that led to the convictions of the company and his co-workers.

How can you guard against these types of environmental violations?

In our experience, a program of independent environmental compliance audits can help detect and prevent these types of violations and, in the event violations occur in spite of the audit efforts, companies have much better defenses to criminal and civil enforcement actions based on their strong, documented preventative efforts. 

Bracewell & Giuliani's environmental attorneys have extensive experience in designing and implementing environmental audit programs, structuring attorney-client and other privileges for such audits, and effectively and favorably resolving potential enforcement liabilities associated with compliance concerns detected in the course of audits.  Tim Wilkins' recent article from the Houston Business Journal offers greater detail.