[EPA Says DuPont Held Hazard Data - Wall Street Journal 9jul04]
In a proposed settlement of a class-action lawsuit that could involve payouts of more than $300 million, DuPont Co. is betting that science is on its side.
The nation's No. 2 chemical maker yesterday agreed to settle allegations that it contaminated water supplies with a toxic chemical used to make Teflon, a slippery substance that can be found in everything from cookware to clothing. It requires the company to pay plaintiffs $85 million, plus other expenditures, as well as pay attorneys' fees and expenses of $22.6 million.
But its payments could rise by another $235 million depending on whether a $5 million study the company will fund finds a probable link between exposure to the chemical and any diseases.
The controversy over the chemical known as perfluorooctanoic acid, or PFOA, has emerged as one of the most pressing environmental problems facing DuPont, which hasn't budged on its position that the chemical is harmless to humans.
Earlier this month, DuPont declined to seek an out-of-court settlement of an Environmental Protection Agency complaint accusing the company of failing to report possible health and environmental risks related to the chemical. The EPA has threatened to impose millions of dollars in penalties.
The settlement doesn't include any admission of liability by DuPont. "A settlement at this time provides benefit to both parties by taking reasonable steps based on science and, at the same time, contributing to the community," said Stacey J. Mobley, DuPont general counsel.
A circuit judge in West Virginia must still approve the terms of DuPont's agreement with lawyers representing as many as 60,000 residents of West Virginia and Ohio who sued over exposure to the synthetic chemical.
Lawyers for the residents said the agreement was in their best interest since litigation would have taken years. The class-action lawsuit was filed in 2001. Trial had been set for Oct. 11 in Wood County Circuit Court.
Between 1981 and 2001, the EPA says DuPont found PFOA in water supplies near its West Virginia plant that exceeded its own exposure guidelines. The EPA also says the company found PFOA in pregnant employees, at least one of whom had transferred the chemical to her fetus.
PFOA isn't yet known to be harmful to humans or the environment, but studies indicate it may present a significant risk. Under the Toxic Substances Control Act, companies are required to disclose information about such substances.
In 4 p.m. composite trading yesterday, DuPont shares were up 14 cents at $42.90 on the New York Stock Exchange.
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