Months after settling charges over failing to disclose financial information and after laying off 170 employees, another tough hit arrived for smart glass manufacturer View Inc. last week. After pleading guilty, the Milpitas, Calif.-based company has been ordered to pay nearly $5 million in fines, community service payments and civil penalties for unlawfully discharging wastewater into a publicly owned treatment works in Mississippi. The company failed to obtain a valid state permit.

In September and August of 2021, the Mississippi Commission on Environmental Quality, Desoto County Regional Utility Authority and the City of Olive Branch, Miss., each issued notices and orders to View regarding wastewater the company discharges from its Olive Branch facility into a publicly owned treatment works. In August 2021, a Subpoena to Testify Before a Grand Jury was issued by the U.S. District Court for the Northern District of Mississippi requiring company officials to produce to the Environmental Protection Agency (EPA) various related documents. Among the records requested were those for hazardous waste, air emissions, storm water discharge and wastewater disposal.

According to its recent U.S. Securities and Exchange Commission (SEC) filings, the company cooperated fully.

On April 13, 2022, View and the U.S. Attorney’s Office for the United States District Court for the Northern District of Mississippi agreed in principle to the terms of a plea agreement, company officials said. The EPA’s Criminal Investigation Division and the Mississippi Department of Environmental Quality investigated the case, after which U.S. District Judge Sharion Aycock sentenced the company to a three-year term of probation and a fine of $3 million. The court also ordered View to make a community service payment to DeSoto County Regional Utility Authority in the amount of $450,000, to help expand wastewater treatment capacity in DeSoto County. As part of resolving criminal charges, View has also entered into an Agreed Order with the Mississippi Commission on Environmental Quality assessing a civil penalty in the amount of $1.5 million.

“Unpermitted discharges of industrial wastewater can pose a serious threat to our nation’s wastewater treatment systems,” said Charles Carfagno, the special agent in charge of EPA’s Southeast branch. “This prosecution and today’s sentencing demonstrates that EPA and its partner agencies are committed to protecting the environment and pursuing those who chose to ignore environmental laws.”

According to the U.S. Attorney’s Office, Northern District of Mississippi, View’s sole manufacturing facility is located in Olive Branch, Miss. As part of its manufacturing process, the company discharges wastewater from glass cutting, grinding, washing and polishing to two discharge points connected with the city’s sewer system. Discharging approximately 248,000 gallons per day registers the company as a Significant Industrial User, accounting for more than 38% of city’s designed and permitted capacity of 537,000 gallons per day. Starting on or about December 11, 2018, through on or about June 28, 2021, View and through its employees “negligently violated a requirement of a pretreatment program approved under 33 U.S.C. § 1342(b) by discharging without a permit,” the U.S. Attorney’s Office stated.

An announcement for the approximately $5 million in fines and penalties arrives from the U.S. Attorney’s Office days after the company released its Q2 financial results, showing revenue growth of $28 million—a 72% year-over-year increase compared to $16 million in Q2 of last year. Non-GAAP adjusted EBITDA improved from $61 million in Q2 2022 to $31 million in Q2 2023.

The latest news represents a pattern of ups and downs for the company, after disclosing in its 1Q SEC filing in March 2023 that it would lay off 170 employees, while also expressing a need for additional funding. The company has since taken steps to pursue greater efficiency, officials reported, lowering its structural costs, while executing a non-binding term sheet with a lead investor for up to a $150 million secured debt facility.

In July 2023, SEC announced it settled charges against View Inc. for failing to disclose $28 million in projected warranty-related liabilities, charging its former chief financial officer, Vidul Prakash, for failing to tell investors about liabilities before the company went public in 2021.

In its latest financial statements, the company reported approximately $45 million in annualized combined fixed cost of sales and operating expense reductions. Cash, cash equivalents and short-term investments were $80 million as of June 30, 2023, compared to $130 million as of March 31, 2023. At the time of its last reporting, management expected to achieve gross margin positive in Q3 2023.

“We have been laser focused on achieving profitability, and our Q2 results demonstrate that we are making significant strides. We’re equally excited that we expect to achieve gross margin positive in Q3. This is a major financial milestone for the company,” said Dr. Rao Mulpuri, the company’s CEO.

Regarding the recent punitive actions over wastewater, “When companies place profit and convenience above public safety, we will do all we can to punish that behavior and protect the public,” said U.S. Attorney Clay Joyner. “This illegal discharge of wastewater into the public treatment facility demonstrated a blatant disregard for the safety and wellbeing of citizens in our district and we applaud the stiff fines imposed by the court in this case.”

When [DWM] reached out to View, the company declined to comment.