Zoo Med Laboratories, Inc.

Plain-English summary

EPA brought a FIFRA enforcement case against Zoo Med Laboratories involving alleged sales of unregistered and adulterated pesticides and an alleged failure to register a pesticide-producing facility. An ALJ had dismissed four counts under res judicata, and EPA sought immediate EAB review of that ruling. The Board held that exceptional circumstances were not present because a later appeal could be resolved on an adequate record and would not necessarily require another hearing. The Board denied interlocutory review without deciding the merits of the ALJ's ruling.

Decision snapshot

• Cited authorities: 7 U.S.C. § 136; 40 C.F.R. § 22.29(a), (c).
• Outcome: EPA's motion for interlocutory review was denied, and the underlying res judicata ruling was left undecided.
• Key point: Interlocutory review requires exceptional circumstances and a showing that delaying review would be contrary to the public interest.

Full text (EPA EAB public release)

          BEFORE THE ENVIRONMENTAL APPEALS BOARD
      UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                     WASHINGTON, D.C.

                               )

In re: )
)
Zoo Med Laboratories, Inc. ) FIFRA Appeal No. 99-10
)
Docket No. FIFRA-09-0886-C-98-11 )
_________ )

       ORDER DENYING MOTION FOR INTERLOCUTORY REVIEW


On September 13, 1999, the United States Environmental

Protection Agency Region IX ("Complainant") filed a motion for

interlocutory appeal with the Environmental Appeals Board

("Board") from the July 28, 1999 ruling of Administrative Law

Judge William B. Moran ("Presiding Officer") in the above-

referenced matter. Zoo Med Laboratories, Inc. ("Zoo Med") filed

its opposition to EPA’s motion for interlocutory appeal on

September 28, 1999.

The Presiding Officer ruled, upon consideration of

Complainant’s Motion for Accelerated Decision and Zoo Med’s

Cross-Motion for Accelerated Decision, that Counts XI, XII, XIII

and XIV of Complainant’s second amended Complaint should be

dismissed under the doctrine of res judicata. See Orders on

Motions, at 9-13 (ALJ, July 28, 1999) ("July 1999 Order"). On

August 9, 1999, Complainant filed a motion, pursuant to 40 C.F.R.
 2

§ 22.29(a), seeking "Certification of Interlocutory Appeal" from

the Presiding Officer’s July 1999 Order. Zoo Med filed its

Opposition to Complainant’s Motion on August 24, 1999. On August

27, 1999, the Presiding Officer denied Complainant’s motion and

ruled that an immediate appeal would not materially advance the

ultimate termination of the proceeding. See Order Denying

Complainant’s Motion for Interlocutory Appeal, at 3 (ALJ,

Aug. 27, 1999) ("August 1999 Order").

Because certification was denied by the Presiding Officer,

Complainant seeks review of the July 1999 Order and August 1999

Order under 40 C.F.R. § 22.29(c). Pursuant to 40 C.F.R.

§ 22.29(c), when the Presiding Officer declines to certify an

order or ruling for review, interlocutory appeal will be granted

by the Board only "in exceptional circumstances," and where the

Board determines "that to delay review would be contrary to the

public interest." Id.; In re Microban Prods. Co., FIFRA Appeal

No. 99-1, at 2 (EAB, May 10, 1999) (Order Denying Motion for

Interlocutory Review). Complainant has asserted that the Board

should take review now because the issue on appeal is one of

first impression and concerns an important issue of law and

policy.

In this case, Complainant filed a complaint against Zoo Med

involving fifteen counts under the Federal Insecticide, Fungicide

and Rodenticide Act ("FIFRA"), 7 U.S.C. § 136 et seq. As
 3

reflected in Complainant’s second amended Complaint, Complainant

alleged twelve sales of unregistered pesticides, two sales of

adulterated pesticides, and one failure to register a facility as

a pesticide-producing facility. See July 1999 Order, at 1. Of

the fifteen counts, four (Counts XI, XII, XIII, and XIV) involve

the sale of unregistered pesticides at pet supply stores in New

York. Id. at 3-4. In his July 1999 Order, the Presiding Officer

dismissed Counts XI - XIV, "under the doctrine of res judicata by

virtue of the FIFRA statutory provisions discussed above, and the

cooperative agreement between EPA and the State of New York which

emanated from those provisions." Id. at 13.

Complainant now seeks review of the issue of whether

Sections 23, 26 and 27 of FIFRA, and a cooperative agreement

between Complainant and the New York Department of Environmental

Conservation ("NYDEC") for fiscal year 1997 can serve as the

legal basis for the dismissal of Counts XI - XIV of the second

amended Complaint. See Memorandum in Support of Complainant’s

Motion for Interlocutory Review, at 4 (Sept. 13, 1999)

("Complainant’s Motion"). Complainant’s showing of extraordinary

circumstances relies primarily on the contention that an

additional hearing would be required if the Board were to deny

review now and the Presiding Officer’s preliminary decision were

reversed in a subsequent appeal to the Board. See Complainant’s

Motion, at 16. Zoo Med contends that no additional hearing would
 4

be required because the record on appeal, if any, would be

adequate for the Board to address the issue dispositively.

Motion in Opposition to Complainant’s Motion, at 7

(Sept. 28, 1999) ("Motion in Opposition").

We are not persuaded that exceptional circumstances, as

contemplated by 40 C.F.R. § 22.29(c), exist here. First, as the

Presiding Officer observed, Zoo Med, while arguing against

liability on res judicata grounds, has not denied the allegations

in the complaint underlying these Counts. Thus, if we were to

later set aside the Presiding Officer’s res judicata ruling, it

does not appear that a hearing would be necessary to determine

Zoo Med’s liability. See July 1999 Order, at 2-3; August 1999

Order, at 2.

The Presiding Officer further concluded, and we agree, that

the Board generally possesses the authority to assess an

appropriate penalty on appeal, "without the necessity for

remand." See August 1999 Order, at 2, citing In re Roger

Antkiewicz & Pest Elimination Prods. of America, Inc., FIFRA

Appeal Nos. 97-11 & 97-12, slip op. at 27, 8 E.A.D. __ (EAB,

March 26, 1999) (Presiding Officer’s dismissal of a Count

reversed, and appropriate penalty applied by the Board). Here,

Zoo Med has expressed the intent to "present evidence concerning

its distribution in New York of the products that are at issue

and the penalty paid by Zoo Med to the NYDEC" in challenging the
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penalty assessments for the Counts that were not dismissed. See

Motion in Opposition at 7. Given this scenario, it appears that

an ample record will exist to not only establish liability, but

also to determine an appropriate penalty for the dismissed Counts

should the Board review the Presiding Officer’s July 1999 Order

on appeal.

In sum, the Board is not convinced that exceptional

circumstances exist to grant Complainant’s request for

interlocutory review. Complainant’s Motion for Interlocutory

Appeal is therefore denied. This order does not, nor should it

be construed to, rule on the merits of the Presiding Officer’s

July 1999 Order.

So ordered.

Dated: 11/23/99 ENVIRONMENTAL APPEALS BOARD

                          By:         /s/
                                 Scott C. Fulton
                          Environmental Appeals Judge

CERTIFICATE OF SERVICE

 I hereby certify that copies of the foregoing Order in the

matter of Zoo Med Laboratories, Inc., FIFRA Appeal No. 99-10,
were sent to the following persons in the manner indicated:

By Certified Mail
Return Receipt Requested:

     Michael R. Neilson, Esq.
     Lynn L. Bergeson
     Bergeson & Campbell, P.C.
     1300 Eye Street, N.W.
     Suite 1000 West
     Washington, DC 20005


     David M. Jones, Esq.
     Office of Regional Counsel
     U.S. Environmental Protection Agency
     Region IX
     75 Hawthorne Street
     Mail Code ORC-2
     San Francisco, CA 94105-3901

Dated: 11/23/99 /s/
Annette Duncan
Secretary