By Matt Bewig
United States - Giant chemical corporation Monsanto
has agreed to a tentative settlement requiring it to pay nearly $100
million to settle claims that its factory in Nitro, West Virginia,
contaminated the small town and its residents with the toxic chemical
dioxin, a cancer-causing waste byproduct of the manufacture of the
herbicide 2,4,5-T.
For about 75 years, between 1929 and 2004, the Monsanto plant
churned out herbicides, rubber products and other chemicals, although it
made 2,4,5-T only from 1949 to 1971. Monsanto sold 2,4,5-T (later found
to be contaminated with dioxin) to the Army for use in making Agent Orange, which it sprayed
on Vietnamese jungles and farms. The dioxin is estimated to have killed
and maimed an estimated 400,000 people and caused 500,000 birth defects
in Vietnam, but federal courts dismissed a case brought by Vietnamese victims of Agent Orange.
Shortly after the Monsanto plant closed in 2004, a class-action
lawsuit was filed on behalf of tens of thousands of people who lived,
worked and went to school in Nitro after 1949. The suit alleged that
Monsanto spread toxic substances, including dioxins, all over the town,
exposing residents to dioxin levels 100,000 times higher than
acceptable. The lawsuit demands medical monitoring for at least
5,000—and as many as 80,000—current and former Nitro residents. Under
the tentative agreement announced on February 24, 2012, Monsanto will
pay for a 30-year medical monitoring program with a primary fund of $21
million for testing, and up to $63 million in additional funding, if
needed; $9 million to clean the homes of class members of dioxin; and
court-approved legal fees incurred during seven years of litigation.
Before the agreement is finalized, however, a fairness hearing must
be held to give class members a chance to object to its terms. That
hearing is scheduled for June 18, when expert testimony must be
presented to prove the settlement is appropriate. Already Charleston,
West Virginia, lawyer Thomas Urban, who represents some Nitro residents,
has filed a motion objecting to the $9 million cap on cleanup costs,
(an expert for the residents estimated the cost at between $945 million
and $3.8 billion), and also the fact that only 3,000 to 5,000 class
members would receive any medical monitoring, when there are potentially
80,000 class members.
Despite the seemingly large dollar amount of the settlement,
Monsanto, which in 2010 earned a profit of $1.1 billion on revenues of
$10.5 billion, announced that the settlement would not affect ongoing
earnings per share, but that the one-time expense would reduce
previously reported earnings per share by .05 percent.
