|July 07, 2016|
Dupont, Chemours Handed Another Loss in Teflon Chemical Case
|DuPont Co. was found liable for a man's testicular cancer in the second lawsuit to go to trial in 3,500 lawsuits over a toxic Teflon chemical found in Ohio and West Virginia waters, for which spinoff Chemours Co. had agreed to bear the cost.|
A jury in Columbus, Ohio, returned its verdict Wednesday after less than a day of deliberation, finding DuPont responsible for negligence and $5.1 million in associated damages. It also found actual malice, meaning the company will face punitive damages.
In October, a jury awarded $1.6 million to a woman who sued over the contamination. DuPont is appealing that verdict. Chemours had agreed to cover any damages awarded in the trials. A second case settled on undisclosed terms.
"This type of litigation typically takes place over many years and interim results do not predict the final outcome of cases," Cynthia Salitsky, a Chemours spokesperson said in a statement.
Stalitsky also said Chemours might challenge its responsibility for damages. "DuPont is the named defendant in each of the cases and is directly liable for any judgment. In the event DuPont claims that it is entitled to indemnification from Chemours as to some or all of the judgment, Chemours retains its defenses to such claims," Stalitsky said.
DuPont spokesman Dan Turner declined to comment.
Chemours plunged more than 22 percent to $5.93 in New York, the biggest decline in more than a year. DuPont declined 1.8 percent to $61.9.
In the most recent trial, which began May 31, David Freeman, who lived near the company's Washington Works plant since 1993, claimed DuPont knowingly dumped toxic C-8 into local waterways. The chemical, used to make Teflon at a plant in Parkersburg, West Virginia, got into Freeman's drinking water.
"Their goal was to protect the Teflon brand at the expense of the community," Freeman's lawyer Mike Papantonio said of DuPont in closing arguments Tuesday. "They know it caused cancer. They aren't interested in keeping people healthy. They're interested in how much it's going to cost them after 57 years of doing it."
DuPont lawyer Damond Mace said the evidence showed the company wasn't expecting any injuries noting that high-level supervisors at the plant drank the same water as Freeman. C-8 "is not some skull and crossbones chemical," Mace told the jury. "Salt, sugar, caffeine, these are all chemicals we're around every day. It's about dose," he said.
DuPont knew since at least 1961 that C-8 is toxic and didn't disclose to regulators or the public the results of an in-house study that found birth defects among its own workers' children, Freeman alleged. The company faces about 3,500 suits from people who claim they got sick or lost family members because of C-8 in public water or private wells in Ohio and West Virginia.
DuPont was fined $16.5 million in 2005 for failing to report the birth-defect findings and other data to the Environmental Protection Agency.
C-8, or perfluorooctanoic acid -- also known as PFOA -- is a soap-like substance that once gave Teflon its nonstick quality. 3M Co. originally made the chemical and sold it to DuPont. When 3M phased the chemical out in 2000, DuPont started making its own. Neither company uses it anymore. A reformulated version is used in products such as fabrics, small appliances and components used in food processing.
In the first trial, the plaintiff's lawyers argued that DuPont knew the chemical was getting into drinking water as early as 1984, when the company tested tap water it told employees living near the plant to secretly collect.
At the earlier trial, lawyers for DuPont said C-8 isn't harmful, isn't regulated and isn't on the EPA's National Primary Drinking Water Regulations list of contaminants. 3M also said there were no adverse health effects, according to defense lawyers. DuPont took precautions because 3M had told them C-8 was persistent in blood.
The company set an acceptable concentration of 50 parts per billion in drinking water when other groups deemed 500 parts per billion acceptable, the defense said. Since then, in May, the EPA lowered the recommended exposure to the chemical in drinking water.
Under the new lifetime health advisory, drinking water exposure to PFOA and a chemical known as PFOS should not exceed 70 parts per trillion combined. DuPont said independent studies over the past 10 to 15 years show C-8 is present in low levels in just about everyone's blood.
Thousands of cases have been consolidated in Ohio federal court to streamline the litigation process. Any damages from the lawsuits should be borne by Chemours, which was spun off in July 2015. It has carried on the Teflon business and agreed to take on many of DuPont's legal obligations.
"We believe $5.1 million in damages awarded were in excess of investor expectations," Citibank Inc. analysts led by James P Finnerty wrote in a note today.
Brandon Barnes, a litigation analyst at Bloomberg Intelligence, said it's an "open question" whether that agreement would extend to punitive damages, or whether DuPont might have to bear those costs. Around $800 million to $1.5 billion is at risk in the litigation, Barnes estimated.
A trial to determine punitive damages is scheduled to begin Thursday.
The case is In re Du Pont de Nemours and Company C-8 Personal Injury Litigation, 13-md-2433, U.S. District Court, Southern District of Ohio (Columbus).