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Volume 87 Issue 20 | p. 7 | News of The Week
Issue Date: May 18, 2009

Jury Acquits W.R. Grace In Asbestos Case

After a three-month trial, firm and executives are cleared on all 10 counts
Department: Business
Libby, Mont.
Credit: Newscom
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Libby, Mont.
Credit: Newscom

A federal jury cleared W.R. Grace and three former executives on all charges of knowingly exposing residents of Libby, Mont., to asbestos and concealing the danger. After a three-month trial and two days of deliberation, the jury effectively repudiated the government's criminal case, filed in 2005.

Between 1963 and 1990, Grace operated a mine in Libby processing vermiculite, a mineral used as a fireproofing agent and soil conditioner. The vermiculite was contaminated with asbestos. At the time Grace and the executives were indicted, the Department of Justice said 1,200 area residents suffered from asbestosis, a progressive disorder in which asbestos fibers damage the lungs and make breathing more and more difficult.

Grace CEO Fred E. Festa insists that Grace and its executives never conspired to either hurt people or skirt the law. "We always believed that Grace and its former executives had acted properly and that a jury would come to the same conclusion," he says.

However, federal prosecutors depicted Grace and its executives as avaricious mine operators who conspired to frustrate government efforts to protect public health and safety. A conviction could have exposed the firm to millions of dollars in fines, and the executives named in the indictment could have faced up to 15 years in jail on the most serious charges.

The Libby trial is only one of Grace's asbestos problems. In 2008, the firm agreed to pay the federal government $250 million for cleanup costs in the Montana town. And it has been under court supervision since it filed for bankruptcy reorganization in 2001 under the weight of about 118,000 personal injury claims related to asbestos-containing products.

 
Chemical & Engineering News
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