If DuPont does not address the issue to his satisfaction, U.S. District Judge Edmund Sargus Jr. said he will order a “very high-level person” from DuPont be forced to testify in a closed-door hearing. Sargus did not identify the executive, except saying it would have to be someone with “great knowledge” of the liabilities. He added that the individual must bring documentation to support their testimony.
“I am going to order a very high-level person, someone who is intimately familiar and was at the table in making this deal is at the table in guiding how the new corporation will be formed,” Sargus said in a telephone conference call with attorneys on both sides.
The News Journal obtained a transcript of Sargus’ hearings.
DuPont spokesman Dan Turner declined to comment on Sargus’ decision. Rob Bilott, an attorney representing C8 plaintiffs also declined to comment.
Attorneys representing more than 3,500 plaintiffs who have filed lawsuits against the Wilmington-based chemical company have demanded to know which post-merger company will inherit the more than $1 billion in liability DuPont estimates it could pay in the C8 cases. DuPont and Dow expect to complete the merger later this year and will then work to separate into three publicly-traded companies. Two of the businesses, with focuses on agriculture and specialty products, will be based in Delaware, a while the third company specializing in material sciences, will be headquartered in Dow’s hometown of Midland, Michigan.
STORY: Taking on DuPont
Last week, both Dow and DuPont shareholders approved the merger. Regulatory reviews are the last remaining hurdle before the merger is complete.
The plaintiffs allege DuPont improperly dumped C8, a chemical used in Teflon manufacturing, near its Washington Works plant near Parkersburg, West Virginia in the region known as the Mid-Ohio Valley. Also known as perfluorooctanoic acid, or PFOA,C8 is linked to kidney and testicular cancers, heart disease, high cholesterol and other illnesses.
Earlier this month, a federal jury in Ohio ordered DuPont to pay $5.6 million in punitive and compensatory damages to David Freeman, a plaintiff who alleged C8 exposure caused his cancer. That decision followed a different Ohio jury awarding Ohio residentClara Bartlett $1.6 million after finding a link between C8 exposure and her kidney cancer.
Another case, brought by West Virginia plaintiff John M. Wolf was settled earlier this year for an undisclosed amount.
DuPont attorneys told Sargus it has not yet been determined how the post-merger liability will be assigned.
“There has been no determination whatsoever in terms of where the liabilities that currently are held by DuPont will go if they ultimately go into any of three contemplated spinoff transactions,” said John Burlingame, an attorney with Squire Patton Boggs who is representing DuPont, during the conference call with Sargus.
Sargus was unmoved by their claims and expressing concern the liability information was not already provided to the court.
“The longer this takes and the more difficult it becomes to get this information, truthfully, the more I’m determined that there is something that needs to be fretted out here,” Sargus said.”I hope it turns out to be the big nothing. But I can tell you from experience in this job, the more things aren’t disclosed, the more suspicious everybody becomes, and I think that’s the situation were are in right now.”
If DuPont does not answer the court’s questions, Sargus said he could order the unidentified DuPont executive to testify as soon as Thursday.