CNBC "Street Signs", Maria Bartiromo and Scott Cohn
Published December 14, 2005
MARIA BARTIROMO, CNBC ANCHOR: Let`s bring in more voices. Tim Kropp with us, toxicologist at Environmental Working Group, with us today in Washington. Scott, it seems like the missing link here -- Mr. Kropp, let me point this question to you. The missing link here is the exposure. We don`t know how people were actually exposed. And we spoke with the general counsel of DuPont earlier and they said that the exposure came being around the plant site. Tell us specifically how people were exposed to this?
TIM KROPP, TOXICOLOGIST, ENVIRONMENTAL WORKING GROUP: Well, we do know that over 95 percent of the Americans have this in their blood. And, you know, whether you`re living in Alaska or right around the plant, you`re going to have it there. It mainly comes from the products that are coated with precursors, things like food packaging and stain resistance pants and stain resistance carpets, that these products don`t actually contain this Teflon chemical that everyone`s worried about, but it breaks down into that chemical once you ingest it. So that`s how it`s gotten across the United States and into all Americans` blood.
SCOTT COHN, CNBC REPOTER: Mr. Kropp, DuPont has said that despite the animal test results that go back for decades that show impact on animals, that there have to date been no demonstrated impacts on humans, that the very least, the effects are not known to date. How do you react to that?
KROPP: Well, there`s two parts to that. One is that they`ve done their own studies on workers and they found increased cholesterol in their workers. At the same time, they`re calling that not a human health effect. 3M`s done studies that have found increased levels of stroke and some types of cancers. And these things correlate very well with the animal studies. So there is some human evidence but there isn`t all that we should have and that we need. And that`s really what this centers around, is the fact that public health officials aren`t getting the information they need from DuPont to solve this problem. BARTIROMO: So where else might this be? I mean it seems to me, the way you`re talking, that this chemical is really in so many different walks ever life. Where else might we be worried that we could see a problem?
KROPP: Well, one of the main things that scientists are concerned about is the food packaging used -- that`s used to create oil and water resistant, things like microwave popcorn bags and fast-food wrappers so the grease doesn`t get through the packaging. And the FDA has done some recent research showing that a significant amount of this transfers into the food. And internal DuPont documents have shown they have known since the 80`s that these chemicals are transferring into the food at over three times the FDA limit, which is one of the reasons why the FDA is now investigating this problem as well. BARTIROMO: And have we actually seen sickness as a result of any of that?
KROPP: Well, other than the worker studies, which I`ve noted, we haven`t really seen any. But the main reason is because it hasn`t been studied. And one reason it`s very difficult to study this is because there`s no control population. If you have over 96 percent of the Americans having it in their blood, you have no population to compare it to which has the same lifestyle. So it`s very difficult to tell purely from human studies, what the effects are because some of those studies can`t be done in a scientific manner. BARTIROMO: Mr. Kropp, good to have you with us. Thanks very much. KROPP: Thank you. BARTIROMO: Tim Kropp in Washington. And now with a response from the Environmental Protection Agency we`re joined by Granta Nekayama, EPA`s assistant administration for enforcement. Mr. Nekayama, nice to have you with us, welcome. GRANTA NEKAYAMA, ASSISTANT ADMINISTRATION FOR ENFORCEMENT, EPA: Good evening.
BARTIROMO: DuPont was fined because they failed to report information about risk to human health that they obtained as early as 1981. Is that right?
NEKAYAMA: That`s correct. BARTIROMO: Tell us more about that. How it that the fine is coming out now? The chemical has been in use, and in fact, this has been there in existence since 1981.
NEKAYAMA: Under our Toxic Substances Control Act, chemical producers and manufacturers are required to report to the EPA immediately upon their learning that there`s a substantial health risk associated with those chemicals. The agency depends on companies to come forward and report information that they have regarding the toxicity or other health effects that are associated with those chemicals. The agency depends on companies, and when they don`t report, then, obviously, there can be serious ramifications.
BARTIROMO: And how did you learn of it then if you weren`t getting information from the company?
NEKAYAMA: We were provided this information by an attorney who was pursuing a lawsuit against DuPont. And we then followed up and contacted the company to see what information we were not receiving. BARTIROMO: Well, wait a second. I mean you were contacted by a lawyer. Do you have any plans in place that would ensure that the EPA would find out about this? I mean it seems like you just tripped over this, right? Shouldn`t there be guidelines in place where the EPA can check up that, in fact, you`re getting the proper information from companies to ensure the safety of individuals? I mean isn`t that the focus at end of the day of the EPA?
NEKEYAMA: It is our focus. And I think today`s action, with its large -- very large penalty, unprecedented penalty, sends a strong message to companies that they must come forward with information that they have regarding the toxicity or any other negative health effects related to their chemicals under Section 8-E of the Toxic Substances Control Act. And we have seen a large increase in reports from companies regarding reports under Section 8-E.
COHN: Mr. Nekayama, it`s Scott Cohn here. The maximum penalty for this would have been more than $300 million. You settled for 16 1/2. You also allowed DuPont to settle without admitting liability. Are you letting them off too easy?
NEKEYAMA: No. I certainly don`t think we`re letting them off easy in any way. With respect to admitting liability, that`s a common feature in many settlement agreements. The company and EPA want to work for -- work on projects to determine what the human health effects are. We`re moving forward rather than wading through years and years of litigation. With respect to the actual fine, again, it is unprecedented. It is more than 60 percent larger than the previous largest civil administrative penalty ever, ever obtained by the Environmental Protection Agency under any environmental statute. So I think this is a very significant penalty and should be viewed in light of that. Certainly, it`s one that sends a strong message that the agency will treat very seriously failure to report this type of information.
BARTIROMO: Mr. Nekayama, good to have you with us. Thanks for joining us.
NEKEYAMA: Thank you.
BARTIROMO: We appreciate it. Granta Nekayama and Scott Cohn, of course, who's been following the developments quite closely.
