Bates Versus Alumina

Running head: BATES VERSUS ALUMINA INC. BUSINESS REGULATION

Bates Versus Alumina Inc. Business Regulation

Alumina Inc. has found itself on the receiving end of a lawsuit alleging that the company has repeatedly contaminated the waters of Lake Dira. A site study report completed by Alumina reveals the polycyclic aromatic hydrocarbons (PHA) levels are lower than the prescribed level of 5 milligrams per liter for all hydrocarbons ( University of Phoenix a , 2004). Although Alumina is not currently contaminating the lake, five years ago, the company was found to be in violation of environmental discharge norm during a routine EPA compliance. During that time, the PHA concentration in test samples was above the prescribe limit. The company performed an EPA mandated clean up, followed by an environmental audit that revealed the violation was corrected (University of Phoenix a, 2004). Unfortunately, for Alumina, the current lawsuit also alleges that Bates daughter’s leukemia is caused by the violation five years ago.

Legal issues and Regulations and Facts

Regulations and laws

Alumina is regulated by the Environmental Protection Agency (EPA). “The EPA coordinates public control of private action as it affects the environment” (Reed, Shedd, Morehead, & Corley, 2004, p. 513). The EPA is the agency that ordered the initial clean up of the lake Dira’s water contamination five years ago. The 1932 Clean Water Act “sets goals and timetables to eliminate water pollution. This act establishes means of enforcement through permits and criminal penalties” (Reed, et al. 2004, p.509). The Clean Water Act falls under the guidance of EPA.

Facts

Five years ago, Alumina .successfully cleaned up the contamination it caused in Lake Dira and has maintained a good overall environment regulation compliance record. (University of Phoenix a, 2004). Currently the latest site study reveals that the PHA levels are lower than the prescribed five milligrams per liter for all hydrocarbons. A recent independent study completed by a leading scientific society has revealed that increased traffic in the heavily industrialized state of Erehwon is poisoning the waters of Lake Dire with PAHs. The PAH concentration are 100 times greater than pre-urban conditions and pose a danger to animal, aquatic and human life (University of Phoenix a, 2004).

Legal Issues

Alumina is being held legally responsible for the medical condition of Bates’ daughter. Although the state has a nuisance law to cover water pollution the law is preempted by federal law under the Clean Water Act. Due to the nature of the injury to Bates’ daughter, the company could likely find itself facing a class action lawsuit if others in the community have similar illnesses.

Stakeholder Perspectives/Ethical Dilemmas

Stakeholders are the parties who are affected by the company’s actions. They have a legitimate interest in the company. The stakeholders of Alumina Inc include the local community, managers, employees, creditors, investors, and the government. The community expects the company to perform its business in a manner that will not result in a negative impact on the community and the environment. . They expect the company to be socially and environmentally responsible to the community. Managers seek the most profit available to the company, while employees seek to earn fair wages and to have ongoing employment. Creditors and investors look to the company to produce a profit. The performance in the stock market is a tool used to determine if the company is performing successfully. The government regulates the company to eliminate or minimize harm to the environment.

The conflicts of the stakeholders are the ability of the company to make a profit while protecting the environment. As it stands, Alumina has been successful in both areas with the exception of the contamination five years ago. . The values of the company include serving the community, striving for quality and excellence; empower citizens with knowledge and to give back to the community. Once again, with the exception of the contamination five years ago, the company has maintained its values.

Handling Regulatory Issue

Now that Alumina has been notified of the intent of Bates to file a lawsuit, the company should conduct a comprehensive investigation to obtain all the facts (University of Phoenix