Grace indictments handed down

A federal grand jury in Missoula has indicted W.R. Grace along with seven current and former company executives for knowingly concealing information about adverse health effects of the asbestos mining operation Grace ran here for 27 years.

Company officials tried to conceal information about the health risks of its vermiculite mining and distribution as far back as the 1970s, according to the indictment opened Monday.

William Mercer, U.S. attorney for the District of Montana, called Grace¹s cover-up ³a human and environmental tragedy.²

³This prosecution seeks to hold Grace and its executives responsible for the misconduct alleged,² he said in a press release.

According to the 10-count indictment, about 1,200 Libby-area residents have suffered some kind of asbestos-related abnormality.

Besides covering up the health effects, the defendants also are accused of obstructing the government¹s clean-up efforts as well as with wire fraud.

The indictment names Grace and Alan Stringer, manager of the mine when it closed in 1990, with trying to thwart efforts by the Environmental Protection Agency to investigate asbestos contamination in the Libby area starting in 1999. Also named in the indictment were Henry Eschenbach, former health official for a Grace subsidiary; Jack Wolter, a former executive for Grace¹s construction products division; William McCaig, former general manager of the Libby mine; Robert Bettacchi, a senior vice president of Grace; O. Mario Favorito, chief legal counsel for Grace; and Robert Walsh, former Grace vice president.

They will be arraigned before U.S. Magistrate Judge Leif B. Erickson at the U.S. courthouse in Missoula at a later date. If convicted, the defendants face up to 15 years in prison on each endangerment charge, up to five years in prison on each of the conspiracy and obstruction charges, and 10 years in prison on the wire fraud charge.

Stringer could be sentenced to as many as 70 years in prison, while Wolter and Bettacchi face maximum prison terms of 55 years apiece, the Associated Press reported. Other defendants could draw sentences of up to five years, according to AP.

Grace reportedly could be fined up to $280 million — twice the amount of after-tax profits the government believes Grace realized from the Libby mine, according to the U.S. Department of Justice.

U.S. Sen. Max Baucus (D-Mont.), who has long worked to see that Libby residents receive adequate compensation for risks they undertook, applauded Monday¹s grand jury finding.

²After years of unrelenting effort, I¹m glad to see that we¹re one step closer to holding Grace accountable for what they did,² Baucus said in a press release. ³People are dying up there and I gave them my word I¹d stand shoulder to shoulder with them to see this through. I¹ll continue to do my part in Washington to help get folks in Libby the compensation they need and deserve.²

Lincoln County Commissioner Rita Windom told The Western News the indictment ³has the potential to restore people¹s faith in government, because people felt it was just going to be swept under the rug.²

Les Skramsted, who successfully sued Grace in 199X and has been a vocal advocate for the cleanup as well as criminal charges against the company, said it was a good day to be alive.

³This should be proof beyond any shadow of doubt that this wasn¹t a figment of our imaginations,² Skramsted said. ³This is as real and terrible as it gets.²

He said the scope of the Grace cover-up was amazing.

³I don¹t think we¹ve seen the end of it,² Skramsted said.

Skramsted said the federal courthouse in Missoula was full of reporters from across the country.

³The United States should be shocked,² he continued. ³Our president should be shocked that such a thing was allowed to happen in the United States.²

The Columbia, Md.-based company did not comment on the charges Monday. Calls to a spokesman were not returned. Grace officials acknowledged in October 2004 that the company was under investigation by a federal grand jury for ³possible obstruction of federal agency proceedings, violations of federal environmental laws and conspiring with others to violate federal environmental laws.²

Beth A. Binstock of the U.S. Attorney¹s Office in Missoula said Monday that vermiculite deposits in Libby were contaminated with a form of asbestos called tremolite. Asbestos is regulated under the Clean Air Act as a hazardous air pollutant.

Studies have shown that exposure to asbestos can cause life-threatening diseases, including asbestosis, lung cancer and mesothelioma, Binstock said.

Health studies of Libby-area residents have shown increased incidents of many types of asbestos-related disease, including a rate of lung cancer 30 percent higher than expected when compared with rates elsewhere in Montana and the U.S., she said.

The indictment alleges the defendants, starting in the late 1970s, had knowledge of the toxic nature of tremolite asbestos in its vermiculite through internal epidemiological, medical and toxicological studies, as well as through product testing.

³The indictment further alleges that, despite legal requirements under the Toxic Substances Control Act to turn over to the EPA information they possessed, W.R. Grace and its officials failed to do so on numerous occasions,² Binstock said.

She added that the indictment also alleges the company and its high-level employees obstructed the National Institute of Occupational Safety and Health when it tried to study health conditions at the mine in the 1980s.

Despite their knowledge gained from internal studies, the indictment alleges, W.R. Grace and its officials distributed asbestos-contaminated vermiculite and allowed it to be used throughout the Libby community.

Binstock said contamination was spread in ³several ways,² including allowing workers to leave the mine covered in asbestos dust, allowing residents to take waste vermiculite for use in gardens, and distributing vermiculite ³tailings² to the Libby schools for use as foundations for running tracks and an outdoor ice skating rink.

When the EPA responded to reports of asbestos contamination in and around Libby in 1999, according to the indictment, Grace maintained its policy of deception.

³W.R. Grace and its officials continued to mislead and obstruct the government by not disclosing, as they were required to do by federal law, the true nature and extent of the asbestos contamination,² according to the indictment.

Since the EPA began its investigation, the area has been declared a Superfund site. More than $55 million has been spent so far on cleanup.