A chemical company, Power Equipment Company and Tower Manufacturing Company, without a hazardous waste business permit, agreed that the Chemical Company would sell hydrochloric acid to the Power Equipment Company and Tower Manufacturing Company and dispose of their waste hydrochloric acid. The Chemical Company then illegally discharged at least 717.14 tons of waste hydrochloric acid, causing pollution of the Tiaodeng River. Following this, the Power Equipment Company and Tower Manufacturing Company invested in environmental protection measures.

The Fifth Branch of Chongqing Municipal People's Procuratorate filed a lawsuit with the Fifth Intermediate People's Court of Chongqing Municipality, which held that the Chemical Company, the Power Equipment Company and the Tower Manufacturing Company should bear the ecology and environment damage compensation and appraisal fees, and apologize to the public.

The Power Equipment Company and Tower Manufacturing Company appealed, bringing application for payment in installments and the technical renovation costs to be deducted. The High People's Court of Chongqing Municipality affirmed the first and third items of the judgment, and abrogated the second item. It held that the Power Equipment Company and Tower Manufacturing Company should pay the compensation in 3 installments of 25%, 25%, 50%. It also held that if the two Companies implemented the technical renovations and were not punished for environmental violations, the technical renovation costs could be deducted from the third installment.