Canadian Manufacturing

6 charged in Elk River chemical spill

Four executives and two lower-level employees of Freedom Industries charged in January 2014 spill that rendered drinking water unusable

CHARLESTON, W.Va.—Four former chemical company executives and two lower-level employees have been charged in a January spill that contaminated a river and left 300,000 residents around West Virginia’s capital without usable water for drinking and bathing for days.

A federal indictment unsealed Wednesday charged ex-Freedom Industries presidents Gary Southern and Dennis P. Farrell and two others with failing to ensure that the company operated in a reasonable and environmentally sound manner the steel tank that leaked the coal-cleaning chemical.

Southern also faces federal fraud charges related to the company’s bankruptcy case. Freedom filed for the protection eight days after the Jan. 9 leak into the Elk River in Charleston. West Virginia American Water uses the river for its water supply less than 2 miles downstream.

U.S. Attorney General Eric Holder said in a statement that the tank conditions at Freedom Industries “were not only grievously unacceptable, but unlawful. They put an entire population needlessly at risk. As these actions make clear, such conduct cannot, and will not, be tolerated.”

The others charged are William E. Tis and Charles E. Herzing, who along with Farrell owned Freedom until December 2013. They sold it to Pennsylvania-based Chemstream Holdings for $20 million, after which Southern became president.

Farrell, 58, was Freedom’s president from October 2001 until the sale, after which he continued to work at the terminal in a management role. Herzing, 63, also was Freedom’s vice-president and Tis, 60, was secretary. All four are accused of violating the federal Clean Water Act.

In addition, U.S. Attorney Booth Goodwin said the company, Freedom environmental consultant Robert J. Reynolds and tank farm plant manager Michael E. Burdette were charged in federal informations with Clean Water Act violations. A federal information typically signals a defendant’s willingness to co-operate in the investigation.

“It’s hard to overstate the disruption that results when 300,000 people suddenly lose clean water,” Goodwin said at a news conference. “This is exactly the kind of scenario that the Clean Water Act is designed to prevent.

“This spill was completely preventable. And this spill happened to take place in my district, but it could have happened anywhere. If we don’t want it to happen again, then we have to make it crystal clear that those who will commit violations like this are held accountable.”

During their time as Freedom corporate officers, Farrell, Tis, Herzing and Southern “approved funding only for those projects that would result in increased business revenue for Freedom or that were necessary to make immediate repairs to equipment that was broken or about to break,” the indictment said.

The men ignored or failed to fund other projects to repair, maintain and improve equipment and systems needed for compliance with environmental regulations, including addressing drainage problems in the containment area.

Southern’s attorney, Robert Allen, said Wednesday that his client plans to plead not guilty and “vigorously fight the charges.”

Steve Jory, an attorney for Tis and Herzing, said the indictment is “an example of faulty legal conclusions” and the charges against his clients are “baseless.”

Farrell referred questions to his attorney, who didn’t immediately return a telephone message.

More than a dozen aboveground storage tanks at the facility were removed. The World War II-era tank that leaked had two holes, just a few millimeters each, and had subpar last-resort containment walls.

According to health officials, after the spill, more than 400 people were treated at hospitals for symptoms that patients said came from exposure to the chemical, known as MCHM. Despite lifting the ban on drinking tap water days later, people still said they could smell the slightly sweet, slightly bitter odour of the chemical.

“It’s hard not to have hard feelings against these people,” Rebecca McComas of Marmet said as she shopped at a mall a few blocks from the water plant’s intake.

Southern, 53, was arrested last week, accused in a criminal complaint of lying about his role with the company in bankruptcy court hearings and meetings to protect his personal wealth of nearly $8 million from lawsuits. Goodwin said those charges of bankruptcy fraud, wire fraud and lying under oath were included in the indictment.

If convicted of all charges, Southern faces up to 68 years in prison, Farrell, Herzing and Tis face up to three years apiece and Burdette and Reynolds would face up to a year each. Freedom could face unspecified fines if convicted.

“We’re sending a strong message here that if you cut corners at the expense of the health of American communities, you will be held accountable,” said Cynthia Giles, the EPA’s assistant administrator for enforcement and compliance.

Associated Press writers Pam Ramsey and Jonathan Mattise contributed to this report.

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