Monsanto tentatively agreed to a $93 million settlement with some residents of Nitro, West Virginia. Nitro is a small town that got its name from manufacturing explosives during WWI. It was also the site of a Monsanto chemical plant that manufactured 2,4,5-T herbicide that was half of the Agent Orange recipe. Herbicide 2,4,5-T was contaminated with the caustic by-product dioxin. This settlement may open the floodgates to successfully suing Monsanto for its poison.
Herbicide 2,4,5-T was phased out in the late 1970′s. Dioxin is the most dangerous chemical known and has a 100 year half-life when leached into soil or embedded in water systems. The Veteran’s Administration recognizes and pays out on Agent Orange injury claims that include cancer, birth defects in children of exposed victims, leukemia, liver disease, heart disease, Parkinson’s Disease, diabetes and chloracne.
Despite an explosion in the Nitro plant in 1949, not a single penny has been paid to residents of Nitro for dioxin injuries, per an attorney that worked on a previous dioxin case. After 7 years of litigation, and on the heels of the EPA releasing part of its dioxin assessment report, Monsanto has made a tentative agreement to settle a class action suit with some Nitro residents for a total of $93 million. Here are the proposed settlement figures:
- Medical Testing: $21 Million
- Additional Screening: $63 Million
- Cleanup of 4500 homes: $9 Million
Bloomberg reports that this settlement will reduce Monsanto’s 2012 net income by 5 cents per share, but Monsanto may face additional lawsuits and fines. There are potentially 80,000 property damage claims alone that could cost Monsanto $3.9 billion in cleanup costs. Dioxin has contaminated soil and has been found in dust in residents’ homes at very high levels.
Nitro Residents vs. Monsanto
Several months ago, the judge in the Nitro case issued a gag order in this case, which was unusual, so details are a bit sketchy. It is unclear whether the following evidence was introduced:
1. Monsanto is alleged to have burned dioxin waste in open pits, spewing dioxin and its ash into the air and polluting land.
2. The EPA recommended that Monsanto be criminally investigated for fraud in covering-up dioxin contamination in its products, including 2,4,5-T herbicide. Monsanto failed to report contamination, substituted false information to show no contamination or sent in “doctored” samples of their products devoid of dioxin to government regulators.
3. The EPA recommended that Monsanto be criminally investigated for fraud in falsifying health studies. These flawed studies that concluded dioxin did not cause cancer and other negative health effects (except chloracne) were used to deny benefits to Viet Nam veterans.
4. Solutia, a Monsanto spin-off company that once owned its Nitro plant, was found by the EPA to have many deteriorating drums of dioxin buried near the Kanawha River. The Nitro plant produced dioxin contaminated 2,4,5-T from 1949 to 1971.
Agent Orange Government Contractor Immunity
Dr. Gerson Smoger’s huge body of evidence in another case appears to point to intentional fraud by Agent Orange manufacturers, but the Supreme Court refused to hear Smoger’s case to allow veterans to sue producers. And Agent Orange producers’ immunity continued. Here are a few examples of reasons why manufacturers should be denied immunity:
1. 2,4,5-T herbicide makers engaged in defective manufacturing of 2,4,5-T by cooking it at a high temperature when they knew that slow cooking would eliminate dioxin.
2. Dioxin contaminated 2,4,5-T was not a new chemical, but had been produced since the 1940′s, so it was not created specifically for government purposes.
3. The US government appears to have had no knowledge dioxin contamination or its hazards in 2,4,5-T, but the manufacturers did.
Spaulding vs. Monsanto | Immunity Denied
In a separate case, the Spauldings, former residents of Nitro, filed a lawsuit in a New York federal court against Monsanto for allegedly burning toxic dioxin waste in open fire pits. In late 2011, Judge Paul Gardephe denied Monsanto’s request for summary judgement for its government contractor immunity defense because Monsanto failed to prove that the government was aware and sanctioned Monsanto’s open pit burning of dioxin waste in Nitro.
This case has some promise because the judge appears to be aware of limits to immunity. Stuart Calwell, the attorney in the Nitro case that was just settled is also representing the plaintiffs in this case.
Property damage from dioxin contamination may be less difficult to prove than dioxin-related medical injuries. For instance, cancer can incubate in the body for decades, so it would be hard to prove that dioxin exposure was the direct cause of the cancer.
However, the judges in the West Virginia court case deemed civil engineer Robert Carr’s testimony inadmissible and blocked it, using the excuse that the cost for cleanup was too speculative as it ranged between $945,000 to $3.9 billion. The wide range is due to factors like how much property would be remedied and the level of cleanup, that may include incinerating contaminated soil in a kiln. The judges should have allowed a jury to determine those facts. Dioxin is not safe at any level, so costs could skyrocket easily.
Additionally, the judges decertified the property damage cases, which means that each plaintiff must sue individually, instead of as a group in a class action suit. Lawsuits of this nature can cost upwards of $200,000, so individuals may be discouraged form suing. However, Monsanto just offered $9 million to clean some houses, so there appears to be merit to the property damage complaint.
People can sue individually under one lawyer (not a class action suit) to defray legal costs. An environmental attorney advised that these people may also sue for negligence, nuisance, trespass and battery. If punitive damages were awarded, 900% over the cost of the damage could be assessed against Monsanto.
The case settled without any finding of wrongdoing by Monsanto. This is appears to be the reason why they agreed to the settlement — to avoid accountability and punitive damage charges. The $93 million is chump change for Monsanto an will barely affect their share prices. Monsanto has now set a precedent for settling claims, and hopefully some good attorneys will seize the opportunity in order to hold Monsanto accountable.