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Prosecutor: W.R. Grace knew of serious health hazards

Mon., Feb. 23, 2009, 2:37 p.m.

MISSOULA — A federal prosecutor told jurors Monday that W.R. Grace & Co. knew for years that its products posed serious health hazards to residents of Libby, Mont., but the company hid the risks from workers and government regulators.

In opening statements at a major environmental crime trial, Assistant U.S. Attorney Kris McLean said the company and its executives conspired to keep those hazards a secret.

“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,” McLean told a U.S. District Court jury in Missoula. “They endangered the health of hundreds, if not thousands.”

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 said.

“If people are getting sick today, it’s not because of conditions today or recently,” he said.

Grace and five of its former executives are on trial on charges that from 1976 to 1990 they knowingly allowed workers to be exposed to asbestos from the vermiculite mine the company had operated near Libby, in northwestern Montana. The company and some executives also are charged with hampering the federal investigation of contamination.

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 because the diseases can take years to appear.

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.

Kevin Cassidy, a lawyer for the Justice Department in Washington, D.C., 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.

“As a result of that concealment, people in Libby, Mont., including unsuspecting families, were put in danger,” 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.

Bernick ridiculed the notion of a conspiracy by executives to hide existence of asbestos that already was widely known and studied for decades.

“This was a mine that everyone knew had asbestos in the material,” Bernick said. “It was not a secret.”

After the mine closed and was reclaimed, there was a period of quiet until news articles the Seattle Post-Intelligencer published in 1999 raised new concerns, Bernick said.

“Almost all of it was old news,” Bernick said. “You know what papers are like: old news becomes new news.”

The news coverage brought the EPA back to Libby and that investigation led to the charges. The trial is expected to last several months.

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.

A federal indictment unsealed in February 2005 charged Grace and its former executives with violating the federal Clean Air Act and obstructing an EPA investigation into the asbestos contamination.

The case stems from the vermiculite mining on Zonolite Mountain near Libby, mining that began around 1920 and continued until 1990. 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.

The town was declared a Superfund cleanup site in 2002.

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.

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