http://www.forbes.com/work/feeds/ap/2004/09/09/ap1537872.html
Forbes.com
September 9, 2004
Associated Press 04:36 PM
DuPont Agrees to Settle
in Teflon Suit
DuPont agreed on Thursday to
pay as much as $343 million to settle a class-action lawsuit alleging the
chemical giant contaminated drinking water supplies in West Virginia and
Ohio with a key ingredient of its Teflon product.
A circuit judge must still approve
the terms reached between DuPont and lawyers for as many as 60,000 residents
in the area around its Washington Works plant on the Ohio River near Parkersburg.
The residents sued over exposure to the chemical C8, also known as ammonium
perfluorooctanoate or PFOA.
If approved,
the settlement would fund a $5 million study into whether C8 causes disease
in humans. If
a scientific panel finds such a link, DuPont would pay up to $235 million
__ the bulk of the potential settlement __ on medical tests of residents
to monitor their health.
DuPont
would spend another $10 million to remove as much C8 from the area's water
supply as possible by building state-of-the-art water treatment plants in
two West Virginia and four Ohio water districts.
"We want to make very clear
that settling this lawsuit in no way implies any admission of liability
on DuPont's part," general counsel Stacey J. Mobley said. "Nevertheless,
a settlement at this time provides benefit to both parties by taking reasonable
steps based on science and, at the same time, contributing to the community."
The
proposed settlement also
includes $70 million that DuPont would pay into a fund to be overseen by
a court-appointed administrator. At least $20 million of that would pay
for health and education projects. Another $22.6 million of the potential
settlement is earmarked for lawyers' fees and expenses.
"We strongly believe that
this settlement is in the best interests of the class," said Harry
Deitzler, one of the lawyers for the residents. "Had it been litigated,
we wouldn't be at this point for another two years."
DuPont shares closed up 14 cents
at $42.90 in trading Thursday on the New York Stock Exchange.
DuPont told investors in July
that it had set aside $45 million to defend against the lawsuit.
The proposed settlement follows
a report that month by the U.S. Environmental Protection Agency alleging
DuPont failed to properly report the discovery of C8 in drinking water adjacent
to the Washington Works facility and in the blood of pregnant employees
at plant.
The EPA is seeking millions of
dollars in fines from DuPont for two alleged violations of the Toxic Substances
Control Act and one violation of the Resource Conservation and Recovery
Act.
DuPont has said it had no legal
obligation to provide information to the EPA about C8 releases.
Teflon is one of DuPont's most
popular products. The nonstick substance can be found in everything from
cookware and clothing to car parts and flooring.
Though used since World War II,
C8 is unregulated by either federal or state agencies and its long-term
effects on humans are unknown. In early 2002, air and water samples taken
by the state Department of Environmental Protection found concentrations
of C8 upstream of the plant, apparently released by its stacks and carried
by prevailing winds.
Residents of both Ohio and West
Virginia filed the lawsuit in 2001. Trial had been set for Oct. 11 in Wood
County Circuit Court. Circuit Judge George Hill had ordered DuPont last
year to pay for blood tests of residents, but was later overturned by the
state Supreme Court.
