The state of California has filed a lawsuit against Gallo Glass Company, the wine company's bottle manufacturer, alleging it illegally used hazardous waste materials in the production of its wine bottles, among other charges. Gallo rejects the allegations, arguing that it safely recycles materials. Both parties stressed that the issue is a legal one—the bottles pose no risk to consumers.
The 27-page complaint, filed by the California Attorney General's Office on behalf of the Department of Toxic Substances Control (DTSC) on Feb. 27, brings 15 "causes of action" against Gallo, including "intentional or negligent disposal of hazardous waste," failure to properly label waste storage containers, failure to adequately train staff in waste management and failure to "adequately notify" the DTSC about six fires and explosions at the facility between 2006 and 2011. Each cause of action could lead to a fine of up to $25,000 per day.
Gallo rejects the charges. "We actually feel that what we're doing with the material that was identified is being handled correctly, in compliance with the law," said Chris Savage, Gallo's senior director of global environmental affairs. The plant, located in Modesto, manufactures all the bottles used by E.&J. Gallo wines, plus other companies.
The complaint's primary allegation is that during three inspections in 2009 and 2011 Gallo was found to be illegally adding the byproduct of an air-pollution control device called an electrostatic precipitator—defined by the state as EP "sludge" containing lead, arsenic, cadmium and selenium—to a mix then made into wine bottles. DTSC spokeswoman Tamma Adamek described it as, "putting hazardous waste … into a consumer product to avoid having to pay hazardous management and disposal fees."
Gallo sees it differently. "There's no question that reutilizing raw materials back into the manufacturing process is far better than taking it to a landfill somewhere else. That's not a good environmental practice. It's not at all sustainable," said Savage. "We had ongoing dialogue for several years and then we stopped using it in 2014 at the DTSC's behest, which thus requires us to send it to a landfill."
Though Gallo agreed to stop repurposing its EP sludge, the DTSC failed to resolve all waste-management concerns with Gallo, and with the statute of limitations approaching, the state filed suit.
"It wasn't just that they were 'sham recycling,'" said Adamek. Of the 15 causes, "most of them are related to the fact that they just are not managing hazardous waste correctly." The complaint alleges that EP sludge was all over the facility: "On the ground, on the walls, on the air-pollution control equipment, and near the EP sludge storage silo tank."
The complaint also alleges that the tank was not properly certified or assessed, nor were others for used oil, another hazardous material Gallo is accused of mismanaging. "The process discovered by DTSC is concerning because their mismanagement of hazardous waste resulted in releases that may cause a threat to public health and the environment," said Adamek.
Much of the dispute, such as the failure to disclose the fires to the DTSC, stems from the definition of a hazardous material. "Because we don't believe we're out of compliance with the use of the electrostatic precipitator material, we also would disagree with the need to have to notify the agency during a fire event," said Savage.
A court date has not been set. Both sides told Wine Spectator they'd much rather settle outside of a trial. "We've had that same desire since the first day we engaged them in the conversation," said Savage.