Running head: Business Regulation
University of Phoenix
March 16, 2008
Alumina is a $4 billion aluminum maker operating around the world with 70% of its business in the U.S. They operate a plant next to Lake Dira in the state of Erehwon. The companyâ€™s reputation and environmental record is being threatened by Kelly Bates, a resident alleging the company has repeatedly contaminated the waters of the lake with carcinogenic agents. Furthermore, the resident alleges consumption of the waters is the proximate cause of her daughterâ€™s leukemia.
This paper provides a concise journey throughout the case starting with key ...view middle of the document...
The act sets goals to eliminate water pollution and issues permits allowing companies to discharge specific levels of pollutants into waterways (Reed, 2004). Another environmental regulation important to this case is The Safe Drinking Water Act of 1974. The Act sets maximum drinking water contaminant levels for certain organic and inorganic chemicals (Reed, 2004).
In 1992, the EPA announced new standards adding 23 contaminants to be monitored on our drinking water (EPA, 1992). One of the 23 contaminants and a potential carcinogen was PAH, the chemical Alumina was cited for on their violation five years ago. The evidence showing PAH as a carcinogen along with the fact Alumina was found to have discharged higher levels of it provided valuable data for Ms. Bates to make her case. To that end she requested copy of the environmental report filed with the EPA documenting Aluminaâ€™s violation of the Clean Water Act. This was allowed through the Freedom of Information Act, a law giving citizens the right to request access to U.S. government records (GWU, 2009).
A number of legal issues are to be considered as the case unfolds. First, while Alumina allegedly had a good environment record, what this fact or perhaps they had not being caught before? Second, had Aluminaâ€™s violation of environmental laws gone back longer than five years covering the time Ms. Batesâ€™ daughter was born as referred to on the accusations? Alumina needs to be concerned if there is objective data connecting the dots between PAH and cancer development along with the fact they violated laws limiting the amount of PAHâ€™s to be discharged on the lake. Is there enough evidence showing Aluminaâ€™s actions were the proximate cause of the Leukemia?
Proximate cause is defined as an act from which an injury results as a natural, direct, uninterrupted consequence and without which the injury would not have occurred (Free Dictionary, 2009). Another consideration is that proximate cause brings the issue of negligence, which could impact Alumina significantly if the case goes to court.
The main consideration for Ms. Bates and Alumina was the financial benefits both parties would incur. However, Aluminaâ€™s senior leadership understood that â€œlitigation is not the best way to settle a dispute due to its expense and time consuming natureâ€ (Reed, 2004). This appears to have been a key consideration on how Alumina approached the problem. Once their direct negotiations with Ms. Bates failed, they sought the intervention of a mediator, a third party with no ties to the case able to bring a fresh outlook. By doing so, the parties were able to settle the dispute and both were winners. Ms. Bates received relief for her daughterâ€™s past and future medical expenses as well as an education fund for her daughter. Alumina was pleased with the confidential nature of the settlement ending potential litigation and negative publicity. In addition, the cost of the settlement...