The US Environmental Protection Agency, Region 4 (EPA) proposed initial penalty of over $300,000 for alleged violation of lead based paint (LBP) regulations threatened the economic survival of our client, the owner of a medium-sized apartment complex in Tennessee. Specifically, EPA alleged that the complex failed to disclose to resident lessees and leasing agents the presence of LBP; failed to provide lessees with an EPA-approved LBP hazard information pamphlet; failed to include in leases a statement disclosing the presence of LBP; failed to provide a list of records and reports regarding LBP in leases; failed to provide a lease statement confirming receipt of that information; failed to provide a lease statement that the leasing agent informed the lessee of the lessors obligations with regard to LBP; and failed to certify in the lease the accuracy of the statements.
Sweetnam and Schwartz devised a plan to assuage the situation. We immediately prepared and implemented a strategy to obtain substantial reduction of the penalties. This consisted of a comprehensive evaluation of the factual basis of the EPA claims and application of the regulations and penalty policy. Based on this review, we made substantive challenges to the alleged violations, recalculation of the proposed penalty, implementation of compliance measures where appropriate, and negotiation of a revised penalty based on relevant equitable and legal factors. Ultimately, the strategy was successful, resulting in a reduction of the penalty to only $6,000.00. This result allowed the client to continue in business with only minor impact to its financial condition.