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Asbestos Company Indicted

Into Thin Air: Asbestos Company Indicted

May 9, 2005

W.R. Grace Company Indicted on Federal Criminal Charges

On February 7, 2005, a federal grand jury for the first time ever handed down a multi-count criminal indictment against officials at an asbestos company, W.R. Grace, charging them with withholding numerous studies spelling out the dangers that asbestos posed to its customers, employees and residents of Libby, Montana. This indictment may call into question the $140 billion bail-out plan currently being considered by the United States Senate. Although asbestos litigation has been called "frivolous" by President Bush, who supports the plan, the U.S. Attorney of Montana has found potential criminal wrongdoing on the part of one of the largest asbestos companies in the world. The indictment charges W.R. Grace and seven of its executives with criminal conspiracy, fraud and knowing endangerment in connection with its operation of an asbestos-contaminated mine in Libby, Montana. The prosecutor, William Mercer, called the situation "a human and environmental tragedy." According to the indictment, W.R. Grace's operation of the mine has endangered the health of the 8,000 Libby residents and cost taxpayers over $55 million in environmental clean-up costs alone, an amount which pales in comparison to the corporate profits gained by stockholders in the company, some $140 million between 1976 and 1990.

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W.R. Grace Indictment

The indictment alleges that the company was aware of several studies documenting the dangers of asbestos exposure, but concealed this knowledge from EPA officials. These studies include a 1976 study which revealed a high incidence of asbestos-related lung problems in Libby employees; an animal study finding cancer in hamsters exposed to the asbestos fibers present at the mine; a 1981 health study of employees showing a high rate of asbestos-related lung problems; a 1982 mortality study showing a high incidence of respiratory cancers in Libby employees; and several specific case studies of employees with lung diseases.

The charges in the indictment mirror behavior that has often been cited in the asbestos personal injury litigation. The documentation of the corporate knowledge of the dangers of asbestos is extensive. Many of these documents can be found in the EWG report, "Asbestos: Think Again," at www.ewg.org. Much like the documentation cited in the W.R. Grace indictment, asbestos victims have proven in court that companies knowingly concealed information regarding the hazards associated with asbestos from their workers, marketed and sold products containing asbestos despite these dangers, failed to provide workers with proper protections, and profited enormously from this cover-up.

Although these companies complain that liability for their disturbing acts has led them into financial ruin, their own statements, and a closer assessment of these "bankruptcies," reveal that the companies continue to thrive, and that the "bankruptcies" protect the corporations far more than they help the victims of asbestos injuries.

The plant has had a devastating impact on the health of Libby residents, resulting from hazards, which the indictment alleges W.R. Grace knew of as early as 1976. In the 30-year operation of the mine, in a town of 8,000 people, 200 people have died, and 1,200 are suffering from asbestos-related illnesses, many of whom never worked at the plant. The incidence of asbestos mortality in Libby is up to 80 times higher than in the general population. The rate of lung cancer death in Libby is 30% higher. Because asbestos injuries can have a latency period that lasts 40 years or longer, the situation will likely worsen.

W.R. Grace Indictment