April 26, 2012 in City

Spokane’s secret deal with Dow AgroSciences wasn’t legal

By The Spokesman-Review
 
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Spokane city leaders last year agreed to keep a settlement with a chemical company secret even though state law prevents them from doing so.

The 2011 settlement with Dow AgroSciences was released this month in response to a public records request filed by The Spokesman-Review. City attorneys acknowledge that they should not have agreed to the confidentiality clause because state public records law prevents them from keeping such settlements private.

Dow AgroSciences, an Indianapolis-based subsidiary of Dow Chemical Co., agreed to pay the city $23,000 in a settlement signed in December 2010. The agreement resolved a dispute about an herbicide that city officials alleged forced them to shut down the city’s composting operations a decade ago. Dow did not admit any wrongdoing in the deal.

It’s unclear if the city will have to return the money as a result of disclosing the settlement.

Garry Hamlin, Dow AgroSciences spokesman, said the company is considering how to respond to the release of the document.

The settlement gives permission to release the document for three reasons, but complying with open records law doesn’t appear to be one of them.

Dow stated forcefully in the document that the company wanted the terms to remain secret.

The city “acknowledges and agrees that this confidentiality clause is and was a substantial inducement to Dow AgroSciences to participate in this settlement,” the deal says.

Hamlin said a confidentiality clause is standard in settlements.

Assistant City Attorney Pat Dalton said that before making the document publicly available, the city notified Dow to give company officials time to object and file a court challenge to the settlement’s release.

“They didn’t take any action to stop it,” Dalton said.

The city-run Spokane Regional Solid Waste System owned a composting site in Colbert for yard waste collected within the county. But the site closed in 2002 after compost made at the site was found to be hurting certain crops. Scientists determined that the problem was clopyralid, a weed killer widely used in Spokane at the time that takes longer than many other herbicides to break down in compost.

The city blamed clopyralid when it closed the facility and said it suffered $4 million in damages. It joined a class-action lawsuit, Pioneer Southern vs. Dow AgroSciences, filed in Illinois.

Last year’s settlement put an end to the city’s involvement in the case.

Clopyralid is an active ingredient in Dow’s herbicide Confront, which is no longer allowed for residential uses.

City attorneys in recent years have tried to avoid confidentiality agreements within settlements, Dalton said. He said it was likely an oversight that the city agreed in the Dow case because the deal mostly was crafted by an outside attorney in the class-action suit. Scott Summy, of the firm Baron and Budd, of Dallas, represented the city, which did not pay the firm for its work in the case.

“I don’t think anybody thought anything about it at all,” Dalton said.

The deal was signed by former City Administrator Ted Danek, who declined to comment on the deal Tuesday.

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