Amid Teflon Problems, DuPont Still Deals with Legacy of Benlate

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March 21, 2006 — By Randall Chase, Associated Press

DOVER, Del. — While the DuPont Co. faces lawsuits in several states regarding

the potential health risks of a key ingredient in producing Teflon, the company

has yet to rid itself of the legal legacy of another controversial chemical.

 

The Wilmington-based company last year resolved 30 lawsuits involving Benlate, a

fungicide that has been the source of hundreds of lawsuits alleging plant damage

and birth defects, according to a recent securities filing.

 

DuPont's experience with Benlate cases thus far could lead it to take a hard

line against quick settlements of pending litigation involving Benlate and those

involving perfluorooctanoic acid, or PFOA, a processing aid used in the

manufacturing of fluoropolymers, which have a variety of product applications,

including Teflon-coated cookware.

 

Despite last year's case resolutions, DuPont has scores of Benlate cases

pending, including a crop damage trial that began last week in Miami. In

Delaware, attorneys are submitting briefs to the state Supreme Court in one of

three cases alleging that Benlate causes birth defects.

 

" This is the third time we're up before the Supreme Court, " said Wilmington

attorney Robert Jacobs, who is helping represent the families of eight children

from the United Kingdom and New Zealand who were born without eyes or with

abnormally small eyes, defects also noted in the offspring of laboratory rats

exposed to Benlate. " You cannot say we're not tenacious. "

 

Legal maneuvering also continues in Hawaii, where plant growers who settled

product liability cases against DuPont in 1994 before learning that the company

withheld evidence of widespread contamination of Benlate have brought

racketeering and fraud charges against DuPont.

 

" It's been an up-and-down judicial roller coaster, but we still have our day in

court, " said David Matsuura, 43, a former orchid grower who said the Hawaii case

could go to trial in November. " This time, we hope we actually get to go to

trial. "

 

Drawing on its experience in the Benlate cases, DuPont has adopted a more

deliberate approach to multiple lawsuits. The company now uses a holistic

strategy that attacks litigation by broadening its legal approach to include

such factors as the science involved, the cost to the company, and internal and

external communications. The new method is expected to influence how DuPont

confronts the rest of the Benlate cases and its Teflon litigation.

 

" When we first experienced the Benlate claims and litigation, we had never dealt

with a mass tort litigation before, " said DuPont vice president and assistant

general counsel Tom Sager.

 

As a result, Sager said, DuPont in the early stages of the Benlate litigation

tended to give growers the benefit of the doubt and was perhaps too willing to

settle cases too early, encouraging more lawsuits.

 

" It wasn't an open checkbook, but there was not the kind of discipline and

oversight we should have had in place, " Sager said.

 

DuPont has since developed a 10-step planning process for complex litigation

that encompasses everything from making sure the attorneys representing the

company are well-versed in product liability to centralizing decision-making and

keeping an eye on costs.

 

" This is clearly application of lessons learned, " said DuPont spokesman Clif

Webb.

 

DuPont, which last year won a case filed by a Costa Rican fruit grower who had

sought more than $170 million in damages, maintains Benlate is safe. It says it

decided to halt production in 2001 for practical reasons, chiefly the cost of

litigation.

 

Now, the company is facing potentially costly litigation involving PFOA. Federal

lawsuits filed in more than a dozen states allege that DuPont failed to disclose

to consumers that Teflon-coated cookware can give off harmful gases.

 

DuPont officials maintain that PFOA does not pose a risk to human health, and

that Teflon cookware is safe.

 

" If you look at the company's stance around Benlate, for years they asserted

that this doesn't cause any harm ... but yet they've paid $1.9 billion dollars

in litigation costs, " said Sanford Lewis, an attorney representing DuPont

Shareholders for Fair Value, an investors coalition critical of the handling of

concerns about PFOA.

 

" When you look at the PFOA issue, you see them making the same kinds of

assertions, " Lewis said. " If anything, it looks an awful lot like part of that

history repeating. "

 

Another issue shared in litigation surrounding the two products is concern over

how forthcoming DuPont is in sharing information.

 

DuPont agreed in December to pay $10.25 million in fines and $6.25 million for

environmental projects to settle allegations by the Environmental Protection

Agency that the company kept information about PFOA from government regulators.

 

During the course of the Benlate litigation, at least three judges took the

company to task for withholding evidence from plaintiffs. One judge called the

practice " willful, deliberate, conscious, purposeful, deceitful, and in bad

faith, " and DuPont was ordered to pay millions in court sanctions.

 

DuPont officials maintain the information the company allegedly withheld in the

Benlate cases was available to plaintiffs. Webb also noted that while DuPont has

about 4,200 lawsuits pending against it, there have been fewer than 10 instances

in the past 13 years in which it has been subject to court sanctions or claims

about not producing documents.

 

While DuPont lays the groundwork for the Teflon litigation, Sager said the

company plans to " aggressively " defend the remaining Benlate cases because the

plaintiffs do not have science on their side, or because they are making

allegations or settlement demands " that we could not possibly agree to or

accept. "

 

" I don't look for any quick settlements of the remaining docket, " he said.

 

Source: Associated Press

 

 

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