United States v. Mashni

547 F.Supp.3d 496

UNITED STATES of America, Plaintiff,

v.Paul Edward MASHNI; PEM Residential, LLC; PEM Real Estate Group, LLC; Finish Line Foundation II, Inc. ; Kiawah River Farms, LLC; Kiawah River Excavating & Earthworks, LLC; KRF XSL, LLC; SC Investment Holdings, LLC; and SC Investment Holdins, LLC, Defendants.

No. 2:18-cv-2288-DCN

United States District Court, D. South Carolina, Charleston Division.

Signed July 1, 2021

James C. Leventis, Jr., Johanna Valenzuela, US Attorneys Office, Columbia, SC, Martha Collins Mann, Pro Hac Vice, US Department of Justice (EES) Environmental Enforcement Section, Washington, DC, Sheria Akins Clarke, US Attorneys Office, Greenville, SC, for Plaintiff.

Cheryl D. Shoun, Mary Duncan Shahid, Nexsen Pruet, Charleston, SC, Herbert Beigel, Pro Hac Vice, Herbert Beigel and Associates, Tuscon, AZ, Jeffrey J. Davidson, Pro Hac Vice, Alexander M. Bullock, Kilpatrick Townsend and Stockton LLP, Jeffrey Heath Wood, Pro Hac Vice, Baker Botts LLP, Washington, DC, Matthew Todd Carroll, Womble Bond Dickinson US LLP, Columbia, SC, Stanley Eugene Barnett, Stan Barnett Law Office, Mount Pleasant, SC, for Defendants Paul Edward Mashni, PEM Residential LLC.

Cheryl D. Shoun, Mary Duncan Shahid, Nexsen Pruet, Charleston, SC, Herbert Beigel, Pro Hac Vice, Herbert Beigel and Associates, Tuscon, AZ, Jeffrey J. Davidson, Pro Hac Vice, Kilpatrick Townsend and Stockton LLP, Jeffrey Heath Wood, Pro Hac Vice, Baker Botts LLP, Washington, DC, Matthew Todd Carroll, Womble Bond Dickinson US LLP, Columbia, SC, Stanley Eugene Barnett, Stan Barnett Law Office, Mount Pleasant, SC, for Defendants PEM Real Estate Group LLC, Finish Line Foundation II Inc., Kiawah River Farms LLC, Kiawah River Excavating & Earthworks LLC, KRF XSL LLC, SC Investment Holdings LLC, SC Investment Holdins LLC.

ORDER

DAVID C. NORTON, UNITED STATES DISTRICT JUDGE

The following matter is before the court on defendant Paul Edward Mashni ("Mashni"); PEM Residential, LLC; PEM Real Estate Group, LLC; Finish Line Foundation II, Inc.; Kiawah River Farms, LLC; Kiawah River Excavating & Earthworks, LLC; KRF XSL, LLC; SC Investment Holdings, LLC; and SC Investment Holdins, LLC's (collectively, the "corporate defendants") (together with Mashni, "defendants") motion for partial summary judgment, ECF No. 143, and motion for judgment on the pleadings, ECF No. 167. For the reasons set forth below, the court denies the motions.

I. BACKGROUND

The government brings this civil enforcement action pursuant to the Clean Water Act ("CWA") to obtain injunctive relief and impose civil penalties against Mashni and the corporate defendants. Mashni owns two multi-parcel sites on John's Island, South Carolina, near the Stono and Kiawah Rivers. The complaint refers to these sites as the "Legareville Site" and the "Edenborough Site." ECF No. 1, Compl. According to the government, the corporate defendants are entities involved in the development projects, each of which is owned and operated by Mashni. The government alleges that in preparing the sites for construction, defendants violated the CWA by discharging pollutants into the Kiawah and Stono watersheds and redistributing soil to fill federally protected waters. According to the complaint, defendants’ unlawful conduct began "in or about January 2017," id. ¶ 121, and continued up until the filing of the complaint, id. ¶ 37.

On August 17, 2018, the government filed this enforcement action against defendants, alleging CWA violations with respect to both the Legareville and Edenborough Sites. Id. On September 23, 2019, the government voluntarily dismissed its claim with respect to the Edenborough Site, leaving only the Legareville Site at issue. ECF No. 50. Since November 15, 2019, the government and defendants have jointly filed seven motions to stay the matter while engaging in efforts to resolve the dispute without further litigation. ECF Nos. 67, 70, 72, 76, 84, 87, 89. The court granted each motion. Eventually, however, the parties’ efforts to settle their disputes unraveled. On September 22, 2020, counsel for defendants signed a consent decree prepared by the government, requested to withdraw his signature the next day, then reneged on that withdrawal. Ultimately, on September 26, 2020, Mashni himself contacted counsel for the government, withdrawing his consent from the proposed consent decree once and for all.

On March 19, 2021, defendants filed a motion for partial summary judgment, seeking the court's ruling on a relevant and disputed issue of law. ECF No. 143. On April 9, 2021, the government responded in opposition. ECF No. 154. On April 23, 2021, defendants replied. ECF No. 161. On April 30, 2021, defendants also filed a motion styled as a motion for judgment on the pleadings. ECF No. 167. The government responded in opposition on May 14, 2021, ECF No. 171, to which defendants replied on May 21, 2021, ECF No. 175. Days later, the government sought permission to file a sur-reply, ECF No. 176, which garnered a response, ECF No. 177, and a reply, ECF No. 178. The court held a hearing on the matter on June 22, 2021. As such, these matters have been fully briefed and are ripe for the court's review.

II. STANDARD

A. Summary Judgment

Summary judgment shall be granted if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). "By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Id. at 248, 106 S.Ct. 2505. "[S]ummary judgment will not lie if the dispute about a material fact is ‘genuine,’ that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. "[A]t the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Id. at 249, 106 S.Ct. 2505. In so doing, the court must view the evidence in the light most favorable to the non-moving party and draw all inferences in its favor. Id. at 255, 106 S.Ct. 2505.

"The party seeking summary judgment shoulders the initial burden of demonstrating to the district court that there is no genuine issue of material fact." Major v. Greenville Hous. Auth., 2012 WL 3000680, at *1 (D.S.C. Apr. 11, 2012). Nevertheless, "when a properly supported motion for summary judgment is made, the adverse party ‘must set forth specific facts showing that there is a genuine issue for trial.’ " Id. (quoting Fed. R. Civ. P. 56(e) ). The plain language of Federal Rule of Civil Procedure 56(c) "mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "[C]onclusory allegations or denials, without more, are insufficient to preclude the granting of the summary judgment motion." Major, 2012 WL 3000680, at *1.

B. Judgment on the Pleadings

Federal Rule of Civil Procedure 12(c) provides that "[a]fter the pleadings are closed--but early enough not to delay trial--a party may move for judgment on the pleadings." Courts follow "a fairly restrictive standard" in ruling on 12(c) motions, as "hasty or imprudent use of this summary procedure by the courts violates the policy in favor of ensuring to each litigant a full and fair hearing on the merits of his or her claim or defense." 5C Charles A. Wright and Arthur R. Miller, Federal Practice and Procedure § 1368 (3d ed. 2011). Therefore, "a Rule 12(c) motion for judgment on the pleadings is decided under the same standard as a motion to dismiss under Rule 12(b)(6)." Deutsche Bank Nat'l Trust Co. v. I.R.S., 361 F. App'x 527, 529 (4th Cir. 2010) ; see also Massey v. Ojaniit, 759 F.3d 343, 353 (4th Cir. 2014) ("[W]e are mindful that a Rule 12(c) motion tests only the sufficiency of the complaint and does not resolve the merits of the plaintiff's claims or any disputes of fact."). Although they share a standard, a motion for judgment on the pleadings differs from a motion to dismiss in that the former allows the court to consider matters outside of the complaint, where the latter generally does not. In resolving a motion for judgment on the pleadings, the court may consider the pleadings and exhibits attached thereto, relevant facts obtained from the public record, and exhibits to the motion that are "integral to the complaint and authentic." Massey, 759 F.3d at 347.

When considering a Rule 12(c) motion for judgment on the pleadings, the court must accept the plaintiff's factual allegations as true and draw all reasonable inferences in the plaintiff's favor. E.I. du Pont de Nemours & Co. v. Kolon Indus., 637 F.3d 435, 440 (4th Cir. 2011) ; see also BET Plant Servs., Inc. v. W.D. Robinson Elec. Co., 941 F. Supp. 54, 55 (D.S.C. 1996) ("[A] defendant may not prevail on a motion for judgment on the pleadings if there are pleadings that, if proved, would permit recovery for the plaintiff."). But "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions."

Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). On a motion for judgment on the pleadings, the court's task is limited to determining whether the...