MAC/20: Mines and Communities

US prosecutor threatens no grace for abestos miner

Published by MAC on 2009-03-03

The Mines and Communities website has published many articles on the legacy of bankrupted company, WR Grace, relating to alleged massive exposure of workers and residents around its closed-down Libby vermiculite mine in Montana.

Grace continues to claim that, while asbestos contamination and related deaths certainly occurred, none of the responsibility should be laid at its door.

Now, a federal prosecution against the company has finally opened.


Trial opens on Montana asbestos contamination

By NICHOLAS K. GERANIOS

Associated Press

23rd February 2009-03-02

A federal prosecutor told jurors Monday that W.R. Grace & Co. knew for years that a Montana mine it operated posed serious health hazards, but the company hid the risks from workers and government regulators. "The company and individual executives chose profits at the expense of people's health and chose avoiding liability over disclosing health hazards to the government," attorney Kris McLean told a U.S. District Court jury in Missoula.

"They endangered the health of hundreds, if not thousands," McLean said in an opening statement to jurors hearing a case alleging that from 1976 to 1990 Grace and five former executives knowingly exposed workers to asbestos from the vermiculite mine the company once operated near Libby, in northwestern Montana. The company and some executives also are charged with hampering the federal investigation of contamination.

Attorney David Bernick of Chicago, who is representing Grace, sought to blunt the emotional nature of the prosecution's presentation. Grace did not conspire to hide an asbestos contamination problem that was already widely known in the community and to regulators, he said.

Grace, which bought the mine in 1963, will contend that asbestos contamination was much worse under its predecessor, Zonolite. Asbestos-related disease can take decades to appear after exposure, Bernick noted.

"If people are getting sick today, it's not because of conditions today or recently," he said.

Lawyers for residents of the Libby area say asbestos exposure has killed more than 200 people and sickened some 2,000, and the toll is rising.

McLean contended the company did its own research and learned decades ago that even low levels of asbestos in the vermiculite became dangerous when disturbed. Even so, Grace donated dangerous mine waste for Libby schools to use in building tracks for runners, he said.

McLean said Libby suffers 40 to 80 times the national average in its rate of death from asbestosis, and lung-cancer mortality is 30 percent higher than health officials would expect the town to experience. Bernick said the figures are based on flawed studies.

Libby is a town of about 2,600 people in a forested valley of the Cabinet Mountains, about 100 miles northwest of Missoula. It was declared a Superfund cleanup site in 2002.

Kevin Cassidy, a Justice Department lawyer, focused his opening statements on the individual executives, some of whom were in the courtroom. He said many were long aware of dangers, but took active steps to conceal them from workers and regulators. Even when the mine was closed and the land was being sold, executives did not disclose the dangers to the buyers, who included small-business people, Cassidy said.

Bernick said allegations of public endangerment and conspiracy to defraud the government relate not to the time when the mine was operating, but to the period after 1999 when the U.S. Environmental Protection Agency arrived for cleanup. The mine closed in 1990.

"There is no charge in this case that the defendants, Grace or the individuals, acted criminally to cause injury to miners and their families," Bernick said.

No one disputes that miners were exposed to asbestos dust and then carried it home on their clothes, he said.

"There is no question that miners and their families suffered tragic losses as a consequence of the operation of this mine," Bernick said. But he noted that Grace took active steps that reduced asbestos exposure after the company bought the mine.

In addition to Grace, a chemical company based in Columbia, Md., the defendants include former executives Henry A. Eschenbach, Jack W. Wolter, William J. McCaig, Robert J. Bettacchi and Robert C. Walsh.

The five retired executives, who are free on recognizance, face up to 15 years in prison and fines totaling millions of dollars if they are convicted. A verdict against Grace could lead to millions in fines against the company. The trial is expected to last several months.

The case stems from the vermiculite mining on Zonolite Mountain near Libby, where mining began around 1920. Vermiculite could be processed into products used for plumbing insulation, fireproofing and gardening. Zonolite brand insulation is in some 35 million homes in the United States.

Vermiculite from the Libby mine was contaminated with naturally occurring asbestos mineral fibers, which can be inhaled and can cause mesothelioma, asbestosis and lung cancer.

Particles of the ore entered the homes of miners because it clung to their clothes. Ore also was taken to processing plants in Libby, where a smokestack released up to 24,000 pounds of dust a day. Asbestos-contaminated mine tailings were used to build running tracks at local junior high and high schools, and lined an elementary school skating rink.


W.R. Grace Kept Montana Asbestos Danger Secret, U.S. Claims

By Bob Van Voris and Amy Linn

Bloomberg

24th February 2009-03-02

W.R. Grace & Co., the bankrupt chemical and construction materials company, illegally released asbestos from its vermiculite mine in Libby, Montana, and harmed "hundreds if not thousands" of people, a U.S. prosecutor said.

"This case is about a company that mined and manufactured a hazardous product and individual executives that chose profits at the expense of people's health and chose avoiding liability over disclosing the health hazards to the government," Assistant U.S. Attorney Kris McLean said yesterday at the opening of a federal court trial in Missoula, Montana.

The company and five former executives are charged with conspiring to contaminate the northwestern Montana town, where Grace mined and processed vermiculite from 1963 to 1990, and obstructing government investigations.

About 200 people in and around the town have died from asbestos exposure, and 1,200 were harmed, according to the government. Vermiculite is a mineral used in fireproofing, insulation and potting soil.

If convicted, Grace may be fined $280 million or more, the company said in a securities filing. Individuals face as long as five to 15 years in prison. The defendants all pleaded not guilty.

Grace fell 99 cents, or 14 percent, to $5.71 in New York Stock Exchange composite trading yesterday.

Illness From Asbestos

The government claims many workers and residents of the town are dead or dying from asbestos-related diseases, including asbestosis, a scarring of the lungs, and mesothelioma, a fatal cancer. Libby residents die from asbestosis at a rate 40 to 80 times normal, McLean told jurors.

Because of the way the vermiculite was formed in Libby, it is contaminated with asbestos fibers. Prosecutors claim the defendants covered up scientific studies and company information showing the dangers.

Grace sought protection in 2001 in U.S. Bankruptcy Court in Wilmington, Delaware, in response to more than 100,000 asbestos claims, most of them not related to the Libby mining.

Grace mined and processed vermiculite, a mineral used in fireproofing, insulation and potting soil, in and around Libby.

"The secret of this case, the secret the defendants kept from the government, is that their product, even when it contains a small amount of asbestos, released hazardous levels of asbestos into the air when disturbed," McLean said. "That is the secret that the defendants knew but the government did not."

Asbestos on Clothes

Prosecutors said workers brought asbestos into their homes on their clothing. Other people were exposed to asbestos when they used vermiculite for gardens. Grace distributed mill tailings to schools for running tracks and an ice skating rink.

McLean told jurors that children swung on a rope and dropped into piles of asbestos-tainted material at the Grace mine's export plant.

A grand jury in 2005 indicted Grace and seven current and former executives for allegedly conspiring to release asbestos- tainted vermiculite in Libby and then covering up the dangers.

Grace lawyer David Bernick said the company understands that miners and their families in Libby have suffered tragic losses that "cast a dark shadow over Grace, over Libby and over this courtroom."

Bernick told jurors the criminal charges are related to claims that Grace exposed Libby residents, not workers, to asbestos.

Miners' Exposure

The inflated number of asbestos-related deaths in Libby can be accounted for by occupational exposures of mineworkers and their families, not to the alleged contamination of the town, the attorney said.

The scientific evidence of asbestos-related death and disease in Libby was based on workers' much higher exposures, Bernick said.

He told jurors charges in the case under the Clean Air Act are based on an amendment of the statute in 1990, the year the mine was closed. And the statute of limitations bars conviction based on actions that occurred before 1999.

Most of the criminal allegations relate to events that took place "long after the mine was shut down -- long after the mine had been reclaimed," Bernick said.

The individual defendants are William McCaig, former manager of operations at the Libby mine; Robert Walsh and Robert Bettacchi, former presidents of Grace's construction products division; Jack Wolter, ex-general manager of the construction products division; and Henry Eschenbach, Grace's former director of health and safety.

Additional Trial

Former Grace legal counsel Mario Favorito will be tried separately. A seventh man charged in the case, Alan Stringer, a former general manager of operations in Libby, died in 2007.

U.S. District Judge Donald Molloy, who is overseeing the case, has said the trial may take as long as five months.

The prosecution has generated interest throughout western Montana. Molloy's courtroom was remodeled to accommodate the more than two dozen lawyers and defendants. The one bankruptcy courtroom in the federal courthouse was set up with a video feed for spectators who can't fit into Molloy's courtroom.

Yesterday, Mike Crill, a 54-year-old former Grace worker and activist, set up a chair and card table outside the courthouse. Crill, dressed in a jacket and University of Montana Grizzlies ski cap, said he wanted to stop people from moving into Libby until the town is cleaned up.

Crill, a former Libby resident who lives in Missoula, said he used to fill railroad boxcars with vermiculite. He said he has been diagnosed with scarring of the lungs related to asbestos exposure.

"Libby's a great place to grow up," said Crill. "But it's a hell of a place to die."

The case is U.S. v. Grace, 05-cr-00007, U.S. District Court, District of Montana (Missoula).

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