Parent Company Liability Under the Clean Air Act: Federal District Court Applies Bestfoods and Imposes $100 Million Penalty and $20 Million in Mitigation

In an article published in Pratt's Energy Law Report, Sidley lawyers Jack Raffetto, Samuel B. Boxerman and Timothy K. Webster analyze a federal district court decision applying the U.S. Supreme Court's United States v. Bestfoods framework to hold a parent company and two affiliates liable as operators under the Clean Air Act for New Source Review violations at a subsidiary's facility, resulting in a $100 million civil penalty and $20 million in community mitigation. The article examines the decision's implications for parent company liability, environmental compliance, corporate oversight and permitting strategies, and outlines practical considerations for companies evaluating New Source Review risks and potential enforcement exposure.