Regulatory and Tort Risks Plan Essay

Regulatory and Tort Risks Plan

The Alumina Corporation is a company that specializes in mining and refining bauxite and some components of automotive exported to over 8 countries. The company has been found to violate the environmental laws in sample contents of Polynuclear Aromatic Hydrocarbons (PAHs) that exceed standards. Though the environmental violation was corrected, claims by Kerry Bates blame the company for her the leukemic condition of her 10 year old daughter.

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This paper will give the plan to manage and identify regulatory and tort risks through preventive, detective and corrective measures. A tort is defined as an embodiment of law that can deal with legal issues and provide remedy for the wrongs caused by people that do not arise from contractual obligation. The dispute between Kelly Bates and Alumina is founded in torts and commonalities.   With reference to the business regulation simulation for Alumina, there are various environmental violations that Alumina has committed that have an impact on its public image and future growth.

Identifying regulatory and tort risk and the preventive, detective and corrective measures

The tort liability on environmental regulation violation on discharge standards as per the EPA compliance evaluations should be approached with implementation of action plans to resolve such regulation. The Alumina Company should have regulatory changes to properly manage the loss of reputation, and any cost liability for damages to be paid. These changes include reviewing the internal regulations on effluents discharge, the chemical contents and amounts of discharge. It also involves a review of the industry standards where the regulations do not give specific compliance standards while failure to meet these standards is a non-compliance of standards.

 The Alumina regulatory board ought to first take a compliance test within the company  to detect the prescribed levels and confirm that they are not violating the PAH standard levels. In an event that there is noncompliance, the preventive measures should indicate that the company is willing to meet the regulatory standards to any noncompliance. When the violations are detected and confirmed that PAH levels are above limiting standards, the planned measures should involve immediate cleanup that will be within the limits of the EPA (University of Phoenix, 2010).

The tort liability on the personal injury lawsuit threatened by Kelly Bates has weakened Alumina reputation which is as a result of the first violation of effluent discharge regulations. On allegations of Alumina contaminating the water with carcinogenic particles in Lake Dira as a result of noncompliance to EPA standards, the child might have contaminated leukemic condition upon consumption of this water. On the basis of a tort being a wrong, the injured party in this case Kelly’s daughter can take the matter to court which would drag down its reputation. This is the principle on which the resolution for mediation to end the dispute came to a confidential agreement and signed a release.

The Alumina compliance to the federal regulations is the company’s social responsibility which also shields the business from possible violations. The first violation having been detected and corrected was expected to bring hidden consequences which the company should take full responsibility. The preventive measures for such risks is to implement the measures of the first violation and any further detections of violations made to comply to standards to prevent further consequences.  The corrective measures by the company are to take all complaints and have them legally claimed for compensation. Any confidential agreements may keep the company’s reputation intact but may have the company bear in genuine complainants who may require medical settlements and compensations.

The lethal media slander is a wrong which in act the media should take intentional liability especially in using printed materials without any evidence. Further Kelly Bates could face punitive charges for the slander against the company without the evidence that her daughter’s disease is a result of water contamination by Alumina. The confidentiality of business information only under partial release by FOIA accessing the past records of Alumina environmental violations will bring ethical dilemmas that would further expose Alumina to more lawsuits (OPPapers, 2010). As a result, there is need to take a legal method like taking the whole due process of the law that will make Alumina less vulnerable to public manipulation and claims for compensation.

The company has unintentional tort for the violation of the EPA standards therefore Alumina could take preventive measures that minimize the exposure to such a tort liability from noncompliance of regulations. The issue between the Alumina and Kelly Bates amounts to a tort since it’s not a regulation though stemming from the first violation of an irregulation. This means that Alumina has caused an act that bears intentional liability and should remedy the wrong that constitute a tort. Further than legal compensation, in the company’s interest and preventative measures, they should allocate resources to have alternative disposal mechanism that would not further contaminate the water source. Given the risks occur at different stages of development, the various preventative, detective and corrective measures occur at different times. In identifying risks at different stages, it would reduce remedy and risk at later stages.


University of Phoenix. (2010). Legal Environment of Business: Business Regulation Simulation. Retrieved July 19, 2010 from

OPPapers. (2010). Recognizing and Minimizing Tort and Regulatory Risk.  Retrieved July 19, 2010 from