New Orleans, LA – Elaine Chiu, 60, of San Francisco, California, and her company, Cheery Way, Inc., were sentenced in July 2016 for knowingly violating the Clean Air Act during the demolition of the Mississippi Queen riverboat in Louisiana. The case highlights a deliberate disregard for worker safety and environmental regulations concerning hazardous materials.
According to court documents, Chiu and Cheery Way, Inc. failed to notify the Louisiana Department of Environmental Quality (LDEQ) prior to the demolition that the riverboat contained asbestos – a known carcinogen – in its wall and ceiling tiles. Despite prior sampling confirming the presence of asbestos, the company only informed the demolition contractor that the vessel “might” contain the dangerous substance. This misleading information led the contractor to believe no asbestos precautions were necessary, putting workers at significant risk of exposure.
The LDEQ discovered the violation after receiving a tip, issuing a Notice of Deficiency and halting work. Subsequent remediation efforts, carried out by another company owned by Chiu, cost $245,248.23. The failure to properly handle the asbestos posed a direct threat to both the workers involved in the demolition and potentially the surrounding public.
Legal Ramifications
Chiu and Cheery Way, Inc. both pleaded guilty to violating 42 U.S.C. 7413(c)(2)(B) and 42 U.S.C. 7413(c)(2)(A) of the Clean Air Act, specifically the regulations concerning asbestos notification and proper handling during demolition. The penalties imposed included five years of probation for both the individual and the company. Cheery Way, Inc. was also ordered to pay a substantial $500,000 fine and $162,520 in restitution to cover medical monitoring costs for the exposed workers.
Restrictions Imposed
As part of the sentencing, Chiu is prohibited from participating in any capacity – including ownership or operation – in the construction, demolition, or renovation business anywhere in the United States for the duration of her five-year probation. The same restriction applies to Cheery Way, Inc., effectively barring the company from operating in these sectors.
Official Statements
“Unsafe handling of asbestos endangers human health and can seriously harm the environment,” stated Ted Stanich, Acting Director for the U.S. EPA-Criminal Investigation Division. “The defendants knowingly put unsuspecting workers at great risk and threatened the health and safety of the general public.” Dr. Chuck Carr Brown, DEQ Secretary, added, “Any business that breaks the law…in order to pollute our soil, air and water does so with a blatant disregard for our health and environment.”
Key Facts
- Defendant: Elaine Chiu and Cheery Way, Inc.
- Location: Eastern District of Louisiana
- Crime: Clean Air Act violation – failure to notify authorities of asbestos presence during demolition.
- Date of Sentencing: July 13, 2016
- Penalties: 5 years probation (both), $500,000 fine (Cheery Way, Inc.), $162,520 restitution (Cheery Way, Inc.).
- Restrictions: Prohibition from participating in construction, demolition, or renovation businesses.
- Laws Violated: 42 U.S.C. 7413(c)(2)(B), 42 U.S.C. 7413(c)(2)(A)
Source: EPA ECHO Enforcement Case Database
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