Victory for Brazil's Asbestos Victims
A recent landmark decision by a court in São Paulo State has been greeted with overwhelming relief by Brazilian campaigners. Fernanda's Giannasi, a Factory Inspector and founding member of ABREA, the National Association of Asbestos Victims, says:
After nine years, a Brazilian court has finally recognized the negligence of Eternit S/A for exposing its workers to asbestos. For decades, asbestos production and processing in Brazil produced a steady stream of profits for asbestos stakeholders. Throughout this time, the welfare of workers, consumers and the public was of little concern. The Brazilian asbestos legacy can be seen in the lungs of our people and the contamination of our landscape.
ABREA's members, many of whom were loyal Eternit employees, are paying the cost for their employer's behaviour with the loss of their health and even their lives. The decision reached on August 26, 2004 recognizes not only that Eternit is responsible for the damage to these people but also that it is liable to pay equitable compensation and ensure appropriate medical care for the injured.
The legal action was instigated by the Public Ministry of the State of São Paulo against Eternit S/A on behalf of thousands of asbestos victims. Judge Teresa Rodrigues dos Santos of the 18th Civil Court made five basic findings:
1. Injured workers are entitled to compensation from Eternit for occupational exposure to asbestos. The judge specified that claimants should receive a lifetime pension proportional to their financial loss; this could range from US$45-$360 per month.
2. The company is liable to pay "moral damages" from 50-300 times minimum salaries (equivalent to US$4,500-$27,000).
3.-5. The details covered in these sections specify how and when compensation is to be paid and set out guidelines on the medical care which Eternit must provide for the injured.1
The implications of this ruling are significant; it has been estimated the judgment could cost the company US$160 million. Since the legal action was proposed, the media coverage has adversely impacted on Eternit's ordinary share price; another effect of the negative publicity is the refusal of the São Paulo Stock Exchange to include Eternit on a new index of forty socially responsible corporations chosen from Brazil's wealthiest 150. The listed companies enjoy beneficial contracts with the International Financial Corporation of the World Bank.
Brazilian justice, until now, has been notoriously slow in dealing with asbestos-related personal injury claims as well other litigation. According to época magazine, a legal action can take 12 years to work its way through the Brazilian legal system; the Supreme Court has 160,000 legal actions pending. One such case is that of João Batista Momi, a former Eternit worker, who in 1998 was awarded more than 150,000 reais (US$50,000 today but in 1998 equivalent to US$150,000) by Judge Alexandre David Malfatti of the 27th Civil Court of São Paulo for reparations for moral damages and material damages for medical care and a monthly pension of a quarter of his final salary, calculated by his attorney at 1,200 reais (US7$410). Momi has asbestosis contracted from occupational exposure experienced over a period of thirty-two years with Eternit. The company appealed Malfatti's decision; to date Mr. Momi has not received a penny of compensation.
In Switzerland, the Eternit Group is facing compensation claims stemming from operations at its asbestos-cement factory in Casale Monferrato, Italy, and its mines and factories in South Africa.2 Italian victims' representative Bruno Pesce told a Swiss journalist that three meetings with solicitors representing Thomas and Stephen Schmidheiny, Eternit's owners, took place in July, 2004; more discussions are planned this month (September). Although the Italian victims have not yet made their financial demands public, decisions by the Italian judiciary awarding the sum of 500,000 euros (US$601,600) to claimants suffering from asbestos diseases are pertinent to these negotiations. In South Africa, claims are being made by people exposed to asbestos at Eternit's crocidolite (blue asbestos) mines3 and asbestos-cement factories.4 It is alleged that during the asbestos heyday, Eternit exposed over 40,000 employees to significant quantities of crocidolite fibre in their mines and mills. South African lawyer Richard Spoor alleges that hundreds of ex-workers have died of mesothelioma and thousands more have contracted asbestosis. Having been to Switzerland for negotiations earlier this year, Spoor is hopeful that a settlement will be reached in the foreseeable future.
September 13, 2004
1 According to Eternit, medical care is costing the company US$270 per person per month.
2 Italians who worked at Eternit asbestos factories in Switzerland and contracted asbestos-related diseases when they returned to Italy are also seeking compensation.
3 These mines were operational from 1960 until 1981. Eternit was South African's third largest crocidolite miner after Cape PLC and Gencor. Its two crocidolite mining subsidiaries were Kuruman Cape Blue Asbestos (KCB) and Danielskuil Cape Blue Asbestos (DCBA).
4 Eternit's subsidiary, Everite, was South Africa's largest asbestos cement producer from the 1940s until the early 1990s.