W.R. Grace asbestos trial opens

The Baltimore Sun

W.R. Grace & Co. and five former managers go on trial today, accused of exposing a Montana community for decades to a particularly lethal form of asbestos and concealing what the company knew about the dangers.

The Columbia-based chemical manufacturer has denied the allegations. Officials at the global company, which employs more than 1,100 in Maryland, say that managers worked continually to improve safety at the vermiculite mine and mill that it bought near Libby, Mont., in 1963 and operated until 1990.

The contamination, which the U.S. Environmental Protection Agency called "the most horrific environmental disaster in this country's history," is believed to have killed at least 250 people and sickened more than 2,000. W.R. Grace, which is working through a Chapter 11 reorganization, agreed last year to pay $250 million - the most ever for a Superfund site - for the cleanup.

Opening statements in what is expected to be a three-month trial are scheduled for today in U.S. District Court in Missoula, 100 miles from Libby.

Gayla Benefield, whose parents died of asbestos-related disease, plans to attend for the duration.

"Grace never has owned up to what has happened here," said Benefield, whose father worked at the mine for 19 years before his death at age 62 in 1974. She says that she and her husband, neither of whom worked for Grace, have been diagnosed with asbestos-related diseases, as have more than 40 members of their extended family.

"There's a moral responsibility for what they did to the workers, their families and then to the community," Benefield said by telephone from Libby.

For decades, W.R. Grace was among the biggest employers in Libby, a town of fewer than 3,000 about 40 miles from the Canadian border. Once, the mine at Vermiculite Mountain produced 80 percent of the world's supply of the ore, which has been used in such consumer products as insulation, potting soil and cat litter. The company gave residents vermiculite to use as fill for the high school ball fields, as the foundation for an outdoor skating rink, and as a growth medium for vegetable and flower gardens.

But the material was laced with asbestos, a naturally occurring magnesium silicate that can cause asbestosis, a scarring of the lungs; mesothelioma, a tumor of the lining of the chest and abdominal cavities; and lung cancer. Asbestos has been banned from most products since 1989.

The form found in Libby is particularly harmful; its long, slender fibers are able to penetrate deep into the human body and stay for decades. As the vermiculite was mined and processed, the deadly asbestos spread through the community - carried in the clothes that workers wore home and in the dust that spewed from the plant and settled over the town.

In an indictment issued in 2005, the federal government alleges that W.R. Grace commissioned a series of studies in the 1970s and 1980s that revealed the hazards to which it was exposing workers and neighbors, but kept them quiet. When a local physician, Dr. Richard Irons, proposed in 1979 that the company study mineworkers' health, according to the indictment, company health and safety official Henry A. Eschenbach wrote in an internal memo that "Irons is turning the screw. ... We either play the game his way or he's going to blow the whistle."

In a 1982 memo written in response to a mortality study, Eschenbach wrote, "Our major problem is death from respiratory cancer. This is no surprise."

Company spokesman Greg Euston declined last week to comment on the trial, noting a request by federal District Judge Donald Molloy.

W.R. Grace devotes several pages on its corporate Web site to "Libby Issues and Answers," including a timeline showing steps that the company says it took to protect workers as it learned of the dangers posed by asbestos. The company says it has spent more than $10 million on health care for Libby residents and has donated more than $2.1 million to a local hospital.

"As a company and as individuals, we believe that one serious illness or lost life is one too many," the company said in a statement after the indictment was issued. "That is why we have taken so seriously our commitment to our Libby employees and the people of Libby. ... Though court rules prohibit us from commenting on the merits of the government's charges, we look forward to setting the record straight in a court of law."

The indictment named the company and seven former employees as co-defendants. Each was charged with conspiracy, violations of the Clean Air Act, wire fraud and obstruction of justice, charges that together carry prison sentences of up to 70 years and fines totaling millions of dollars. W.R. Grace could face hundreds of millions of dollars in fines.

Jury selection began last week in the trial of W.R. Grace and five of the co-defendants: Robert Walsh, a former senior vice president; Jack W. Wolter, a former vice president; Eschenbach, a former director of health, safety and toxicology; Robert J. Bettacchi, who headed the division that ran the mine; and William J. McCaig, a former general manager in Libby.

Co-defendant O. Mario Favorito, a former company lawyer, is to be tried separately. Co-defendant Alan R. Stringer, a former general manager, died in 2007.

W.R. Grace, which employs 6,500 workers in 40 countries, filed for Chapter 11 bankruptcy protection in 2001. Company officials blamed more than 110,000 asbestos-related lawsuits, most of which were unrelated to the Libby operation. The company agreed last year to a deal that could lead to $3 billion in settlements to people sickened by exposure to its products.

The Libby contamination is one in a series of environmental disasters linked to Grace. The company paid $8 million in 1986 to settle claims that it had contaminated groundwater in the Boston suburb of Woburn, Mass., during the 1970s with chemicals that caused the deaths of five children and one adult, the case at the center of the book and film A Civil Action.

The company agreed last year to pay 40 percent of the cost - a share estimated at $41 million - to clean up contamination at Curtis Bay in Baltimore, where it extracted radioactive thorium in the 1950s under a contract with the U.S. Atomic Energy Commission. Radiological tests performed in the 1980s found "significant levels of radiation" in several spots, according to a report prepared for the Department of Energy, but most areas were clear and the report concluded that the danger to employees and the public was relatively minimal.

W.R. Grace, which traces its origins to the founding of Davison, Kettlewell & Co. in Baltimore in 1832, employs about 500 workers at its world headquarters in Columbia and about 600 at a chemical plant at Curtis Bay. Ten people work in a sales office in Severna Park. W.R. Grace reported net income last year of $121.5 million, up 37 percent from 2007, on sales of $3.32 billion.

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