Criminal Behaviour in Montana? 

by Laurie Kazan-Allen



On February 7, 2005, a Montana federal grand jury handed down a 49 page indictment against the U.S. multinational W.R Grace & Co.; the charges were linked to the operations of Grace's vermiculite mining and milling facility in Libby, Montana during the period 1963-1990. Ten counts of conspiracy, clean-air act violations, wire fraud and obstruction of justice were brought against the company and Alan Stringer, Henry Eschenbach, Jack Wolter, William McCaig, Robert Bettacchi, O. Mario Favorito and Robert Walsh, current or former Grace executives who, it is alleged, engaged in a “conspiracy to increase profits and avoid liability by misleading the government and preventing the government from using its authorities to protect against risks to human health and the environment.”

The alleged conspiracy took place between 1976-2002 when Grace's tremolite-contaminated vermiculite was used throughout Libby at venues such as an outdoor ice-skating rink, school running tracks and baseball fields. The company also sold or leased contaminated premises to the town and local residents for domestic or commercial use. Officials at the Environmental Protection Agency (EPA) believe that hundreds of vermiculite miners, family members and townspeople in Libby have died from asbestos-related diseases and hundreds more have contracted asbestosis and lung cancer. The ore, which was shipped all over the country, put the health of millions of American citizens at risk.

The indictment alleges that from 1970 on, the defendants were aware of the toxicity of tremolite through internal epidemiological, medical and toxicological studies and product testing; this knowledge was not shared with the EPA or the National Institute of Occupational Safety and Health. As late as 1999, the indictment says, “W. 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.”

The EPA and the Justice Department appear determined to get a result on this case. Lori Hanson, Head of the EPA's Environmental Crime Section in Denver, Colorado said: “This is one of the most significant criminal indictments for environmental crime in our history.” Thomas V. Skinner, EPA's acting Assistant Administrator for Enforcement and Compliance Assurance, added: “This criminal indictment is intended to send a clear message: we will pursue corporations and senior managers who knowingly disregard environmental laws and jeopardize the health and welfare of the workers and the public. Thomas L. Sansonetti, Assistant Attorney General for the Justice Department's Environment and Natural Resources Division, has pledged his department's support: “We look forward to working with the District of Montana's U.S. Attorney's Office to prosecute this case.” Meanwhile, U.S. Attorney Bill Mercer reaffirmed his commitment: “A human and environmental tragedy has occurred. This prosecution seeks to hold Grace and its executives responsible.” A five year statute of limitation, timed from the arrival of the first federal team in Libby, put the prosecutors under pressure; investigators and lawyers from the EPA, Internal Revenue, the Justice Department and the U.S. Attorney's offices in Montana worked over-time to prepare the case.

If convicted the company could be fined up to $280 million. While some of the Grace executives could get jailed for 5 years, others face prison terms of 50-70 years. A Grace spokesperson denied the charges stating: “We are surprised by the government's methods and disappointed by its determination to bring these allegations… We look forward to setting the record straight in a court of law.”


February 11, 2005



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