## Facts

- The United States (through EPA) brought a civil enforcement action under the Resource Conservation and Recovery Act (RCRA) against Envirite Corporation, a hazardous-waste treatment facility operator.
- EPA sampling and laboratory analysis indicated the relevant samples substantially exceeded regulatory limits for four metals.
- Envirite disputed EPA’s results and had testing that reportedly showed limits were not exceeded.
- During settlement negotiations, EPA obtained independent laboratory retesting of the same samples after developing concerns about the accuracy of its original laboratory results.
- The independent retesting reportedly showed lesser exceedances and involved only one metal, and internal EPA memoranda questioned the reliability of the original testing and the testing method.
- EPA did not disclose the independent retesting results or the internal memoranda to Envirite before the parties executed a consent decree.
- The consent decree required Envirite to pay a $60,000 civil penalty and implement a more stringent and more expensive waste-treatment method.
- After entry of the consent decree as a final judgment, Envirite obtained the independent retesting results and internal memorandum through a FOIA request and sought relief from judgment.

## Issues

1. Whether EPA’s failure to disclose independent retesting results and internal memoranda during consent-decree negotiations constituted “fraud, misrepresentation, or other misconduct” warranting relief under Federal Rule of Civil Procedure 60(b)(3).
2. Whether Envirite proved by clear and convincing evidence that the nondisclosure substantially interfered with its ability to fully and fairly present its case (including its ability to make an informed settlement decision).

## Decision

- The court held that a consent decree, once entered, is a final judgment subject to Rule 60(b).
- The court found by clear and convincing evidence that EPA’s nondisclosure of the independent retesting results and internal memoranda constituted “misconduct” under Rule 60(b)(3).
- The court concluded the nondisclosure materially affected the fairness of the settlement process and substantially interfered with Envirite’s ability to evaluate and present its position.
- The court granted Envirite’s Rule 60(b)(3) motion, vacated the consent decree, and reopened the enforcement action for litigation on the merits.

## Legal Principles

- A consent decree is a judicial judgment and may be set aside under Federal Rule of Civil Procedure 60(b) on an appropriate showing.
- Under Rule 60(b)(3), the movant must prove by clear and convincing evidence that the adverse party engaged in fraud, misrepresentation, or other misconduct and that the misconduct substantially interfered with the movant’s ability to fully and fairly present its case.
- Material nondisclosure of information within a party’s control can constitute “misconduct” under Rule 60(b)(3) when it directly bears on liability or remedy and affects the integrity of the consent-judgment process.
- Rule 60(b) relief is exceptional, but may be warranted where nondisclosure undermines the fairness of a settlement incorporated into a final judgment.

## Conclusion

The court vacated a RCRA enforcement consent decree after finding that EPA’s material nondisclosure of independent retesting and internal doubts about its original testing constituted Rule 60(b)(3) misconduct that impaired Envirite’s ability to fairly assess and present its case during settlement.


United States v. Envirite Corp., 143 F.R.D. 27 (D. Conn. 1991)