A jury has found SKM Services guilty over the 2017 fire at its Coolaroo recycling facility that burned for more than a week, forcing the evacuation of homes in Dallas.
Following a criminal trial in the County Court, the company was found guilty of aggravated pollution by negligently causing or permitting an environmental hazard which resulted in a substantial risk of a serious threat to public health.
The jury also found the company guilty of three charges of polluting the atmosphere.
The company and its sole director, Robert Leo Italiano, now face possible fines in excess of $1.5 million in relation to the incident.
Mr Italiano had earlier entered a plea of guilty to a charge of polluting the atmosphere as a result of the fire.
The case will return to court on 12 December for sentencing.
The July 2017 fire started in a pile of waste at the SKM plant and spread to stockpiles of cardboard and other recyclables.
It burned out of control for two days and spread smoke and ash over nearby suburbs. Continuing to burn for more than a week, it triggered a state-wide emergency management response.
Dallas residents needed to be evacuated, with witnesses at the time feeling unwell, describing a disgusting and acrid and chemical smell.
Some residents were not able to return to their homes for several days and nearby businesses were also affected.
The clean-up that followed took weeks to complete and involved the removal of 30,000 tonnes of burnt waste and the diversion of 140 million litres of contaminated water into the sewerage system from Merlynston Creek.
While the site had operated under planning permission from local government rather than an EPA licence, EPA officers immediately launched an investigation into possible breaches of the Environment Protection Act 1970, which was in effect at the time.
The verdict follows charges which were originally laid by EPA Victoria under the Environment Protection Act 1970.
In the wake of the Coolaroo fire, EPA initiated a statewide Fire Prevention Program that involved nearly 1,000 proactive inspections at hundreds of industrial sites around the state, issuing more than 1,300 notices requiring fire prevention actions and more than 60 legal sanctions.
