World's biggest asbestos trial sees two billionaires sentenced to prison

Published by MAC on 2012-02-20
Source: France 24, ABC, statement, Montreal Gazette

But will they ever go to jail?

Turin trial marks watershed in battle to ban asbestos

The conviction of two billionaire investors by a court in Italy marks a turning point in the battle to eradicate asbestos, one of the most efficient - and lethal - components used in the construction industry throughout the world.

By Benjamin Dodman

France 24 International News

14 February 2012

A court in Turin has sentenced the main shareholders of building firm Eternit to 16 years in jail in what has been hailed as the biggest-ever trial on asbestos-related deaths - and the first involving criminal charges brought against the company's owners.

A woman holds a sign reading "Stephan Schmidheiny your place is in jail" during the trial. Source: AFP: Giuseppe Cacace

Swiss tycoon Stephan Schmidheiny, 64, and Belgian baron Jean-Louis de Cartier, 89, were accused of causing a "permanent health and environmental catastrophe" at their company's Italian plants, the effects of which are still being felt 28 years after they shut down.

In the northern town of Casale Monferrato, home to the largest of Eternit's four plants, 1,800 people have died of asbestos-related diseases, including some 800 who never even worked for the company.

Every week in the small town of 35,000, doctors discover a new case of pleural mesothelioma, a rare form of cancer caused by exposure to asbestos.

"Throughout my career I have never witnessed such an appalling tragedy," said prosecutor Rafaelle Guariniello in his closing speech.

For the more than 6,000 people who had joined the class-action suit, many of whom greeted the verdict with tears of joy, Monday's ruling marked the end of gruelling battle for recognition.

"This is the first time a guilty verdict falls on Eternit's owners, those who made a profit from their deadly factories and who had previously pinned the blame on the negligence of individual factory managers," said Silvana Mossano, a journalist at local daily La Stampa who has written about the plight of Casale's inhabitants for close to three decades.

Over the past two years, thousands of people from Italy and abroad have flocked to the Turin courthouse to attend the trial's 66 hearings, many crammed into separate rooms to follow the proceedings on closed-circuit television.

On Monday some 160 people made the trip from France, most of them members of Andeva, an association of French victims of asbestos. "Hopefully the example set by magistrates in Turin will inspire their counterparts around the world," said the association's spokesman, Alain Bobbio.

A deadly mineral

Eternit, a secretive international firm named after a construction material mixing asbestos and cement, opened its Casale plant in 1907. At the time, asbestos was known as the "magical mineral" because of its remarkable resistance.

Soon, Eternit's fibre slates were being used across Italy to build homes, schools, hospitals and cinemas.

Waste material at the Casale plant was crushed in the open, ensuring the poisonous dust was blown all over town. And when it wasn't disposed of, it was simply gifted to workers' families so they could use it at home.

The children of Casale even used to play on "white beaches" made of powder blown over from the Eternit plant.

"We knew people got sick working for Eternit, but we didn't expect them to die of it," said Nicola Pondrano, who joined the company in 1974 at the age of 24.

Pondrano said he first realised what lay in store when funeral notices began covering the factory's outside wall.

"Employees who were passing away one after another had barely reached their fifties," said the former engineer, who soon joined a trade union to call for improved safety at the plant.

His efforts drew a mixed response. "Some managers made a genuine effort to improve our working conditions, but others told me to keep quiet and clean the toilets instead," he recalled.

According to Bruno Pesce, who heads Casale's association of families of the victims, Eternit's owners knew all the while what was going on.

"The top brass made repeated attempts to conceal the evidence, despite being fully aware of the health hazard," he said. "They could have saved many lives, but they decided it was cheaper for them not to look for alternative materials."

A powerful industry

Governments have been just as slow to act on research into the effects of asbestos, some of which dates back to the start of the 20th century.

Nazi Germany - of all regimes - was the first to offer workers compensation in 1943 based on scientific evidence of a link between lung cancer and exposure to asbestos.

Italy decided to ban asbestos in 1992, but it wasn't until 2005 that a Europe-wide ban on it came into force.

Today the deadly fibre is illegal in 55 countries, including most modern industrialised nations with the notable exception of Canada, which was until recently the world's largest producer of asbestos.

While Canadian asbestos miners were banned from selling their product on the domestic market, they remained free to export it to fast-growing countries such as India and Brazil.

La Stampa's Mossano says companies working with asbestos have been instrumental in delaying or watering down legislation.

"The industry is still financing research to convince Canadian authorities to reopen asbestos mines; and when the results are unfavourable, they are simply modified or abandoned," said Mossano.

The jury in Turin heard that for decades the Schmidheiny and Cartier families had played a key role in the asbestos cartels that lobbied in favour of the industry.

Investigators searching the offices of a Milanese communications agency hired by Eternit also came across detailed instructions about how to deal with journalists, trade unions and lawyers, and ensure the company's top brass were cleared of all blame.

A message for the world

Campaigners around the world are hoping the Eternit trial in Italy will mark a turning point in the fortunes of the asbestos industry.

"No one expects Schmidheiny and Cartier to actually go to jail - the inevitable appeals could take years and both defendants may already be too old," said Mossano. "What is really at stake here is raising awareness of the dangers of asbestos and of the heavy sentences industry barons will incur if their companies continue using it."

Her view was echoed by many of the plaintiffs at the trial. "We need the industry to understand that, in the long run, they cannot make a profit from asbestos," said Pondrano.

Judging by the endless list of reparations included in Monday's sentence, the asbestos industry may have cause for alarm.

The Turin court ordered Eternit's owners to pay a total of €95 million in compensation to the families of the victims, as well as significant sums to the town of Casale, the Piedmont region, trade unions, and a host of other parties.

"Hopefully this will make companies around the world think twice before seeking to cut costs at the expense of workers' safety," said Bruno Pesce, ruing the lack of legal frameworks to protect workers from unscrupulous international corporations.

After Monday's verdict, Andeva's Alain Bobbio said he wished France had at least Italy's legal tools, claiming the French legal system was ill-equipped to handle cases relating to the environment and public health.

"We need to adapt our penal code so that they can tackle this sort of catastrophe," he said, pointing to past attempts to convict former Eternit executives in France that were either dropped or quashed on appeal. "At stake here is the very notion of a safe environment for workers and the rest of society."

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Italian court sentences two in asbestos trial

Billionaire, baron get 16 years for asbestos deaths

by Matt Peacock

ABC

14 February 2012

A Swiss billionaire and a Belgian baron have been found guilty and sentenced to 16 years each in prison by an Italian court in a groundbreaking trial over 3,000 alleged asbestos-related deaths.

Stephan Schmidheiny, the former owner of a company making Eternit fibre cement, and Jean-Louis Marie Ghislain de Cartier de Marchienne, a major shareholder, were sentenced in absentia after being found guilty of causing an environmental disaster and failing to comply with safety regulations.

The verdict, handed down overnight after a two-year trial, was greeted with jubilation by anti-asbestos campaigners around the world.

Through a network of subsidiaries and affiliates, Eternit became the largest manufacturer of asbestos cement products in the world.

But along with the tremendous fortunes the companies generated for their owners came death and disease for thousands of employees, families and neighbours.

The company was founded more than a century ago by an ancestor of de Cartier.

Its Swiss offshoot was owned by the Schmidheiny family whose heir, Stephan, was also sentenced.

But unlike Australia's James Hardie and the US and British members of the global asbestos cartel, the Eternit companies had managed to avoid the sort of litigation that sent many of its competitors bankrupt.

But a decade ago a charismatic Italian prosecutor began a criminal investigation that resulted in today's verdict, accusing the two men of deliberate and wilful failure to protect their employees and nearby residents from exposure to asbestos, a substance they knew could kill but concealed the fact.

The defendants were also ordered to pay 30,000 euros ($39,000) in damages to relatives of people killed by asbestos-related diseases, and 35,000 euros for every sick person, as well as other payouts set to total hundreds of millions of euros.

Barry Castleman is a US medical and legal expert who gave evidence for the prosecution.

"It's enormous in that it's holding personally responsible wealthy individuals who were the owners and directors of asbestos enterprises, [holding them] personally responsible for criminal acts for a wilful, negligent disaster causing thousands of deaths. This has never happened before," he told AM.

"We're talking about stuff that went on long after it was well known in the asbestos industry that asbestos was deadly, mainly stuff that went on in the 1950s and 60s and 70s and 80s. There's no question that the companies knew about the hazards of asbestos.

"There were documents back in 1950 showing that Eternit Enterprises and the Schmidheiny family were aware of asbestos being a lethal material, and yet they went on selling these products without warnings and covering up the hazards as much as they could."

Neither of the defendants attended the trial.

Lawyers for Schmidheiny, who was the founder of the Business Council for Sustainable Development at the 1992 Earth Summit in Rio, argued that his philanthropy more than made up for any past misdeeds.

They also offered secret multi-million dollar out-of-court settlements to the local government authorities involved, some of which were accepted.

The two men are now likely to appeal.

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Recent decisions in asbestos cases point to need for alternative solution

By David Miller

CBP Lawyers statement

6 February 2012

Cases involving exposure to asbestos continue to attract appellate court attention. Following a review of expert evidence available to a trial judge in the Dust Diseases Tribunal (DDT) of NSW, on 14 December 2011 the High Court handed down its decision in Amaca v Booth. The majority found that such evidence supported a conclusion that all material exposures to asbestos may be deemed a cause of mesothelioma.

The decision will impact the way such cases are run at trial and also the question of insurance cover for mesothelioma claims in general. With estimates that asbestos claims will total $8 billion over time, governments and the community need to consider whether there are alternatives available to the cost-intensive common law system.

Booth exposed to asbestos at work

John Booth was a mechanic. He worked with brake linings containing asbestos. Like all Australians he was exposed to ambient asbestos. He also had minor additional exposure to asbestos in home renovation and cartage work.

Mr Booth contracted mesothelioma. He sued the manufacturers of the brake linings with which he worked, Amaca (formerly James Hardie) and Amaba Pty Limited (formerly Hardie-Ferodo).

At trial various medical experts for Mr Booth expressed a view that all asbestos exposures above the ambient background contribute to the cause of mesothelioma. Based on that evidence the trial judge found in favour of Mr Booth and awarded him damages of $326,640.

NSW Court of Appeal dismisses appeal of brake lining manufacturers

Amaca and Amaba appealed to the NSW Court of Appeal. They argued that the evidence of the relevant experts did no more than express a view that exposure to asbestos added to the risk of contracting mesothelioma - not that all exposures were a legal cause of injury.

The NSW Court of Appeal dismissed the manufacturers' appeal. They obtained Special Leave to Appeal to the High Court.

The High Court found that the expert evidence before the trial judge at the Dust Diseases Tribunal supported the finding that cumulative exposure to asbestos was the cause of Mr Booth's injury. That factual finding was unimpeachable given the nature of appeal rights from the DDT, which are limited to questions of law.

Implications for future asbestos cases

• Defendants in mesothelioma litigation should assume that in the absence of compelling expert evidence of their own, each incremental negligently-caused exposure to asbestos will be deemed a cause of the illness.
• While a causation defence is available in litigation, it will be easier to make out where there is a competing risk factor, for example smoking.
• The decision raises an interesting issue as to the trigger for any insurance which might meet the claim. If all exposure is deemed causal, then will all policies of insurance that cover the relevant exposure period and respond to such a claim be triggered?

Record award for damages in Victorian asbestos case

Since the Booth decision was handed down, the Victorian Court of Appeal considered the case Amaca v King and awarded a record sum of $730,000 in damages for pain and suffering to Eric King, who contracted mesothelioma 40 years after being exposed to asbestos for six hours in the course of his employment.

This result is likely to lead to upward pressure in plaintiff claims for damages in asbestos cases around Australia.

Compelling argument for a legislative solution

Mesothelioma claims will continue to be part of the Australian litigation landscape for a number of years. As one of the High Court justices in the Booth case stated, "the extent of exposure to asbestos amongst those now living, the likely exposure amongst those yet to be born, and the likelihood of further injury taking place when asbestos is removed from the many places where is it now found, mean that problems of the kind thrown up in these appeals will remain for decades to come. Perhaps a social-medical problem of this size requires a legislative solution."

These words raise an important issue for discussion. We can only hope that self interest and inertia do not lead to the issue being overlooked and that our lawmakers will have the vision and courage to craft a legislative solution which is balanced, sustainable and fair.

David Miller is a partner at CBP Lawyers.

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Quebec's anti asbestos movement continues to grow

By Michelle Lalonde, Gazette Environment Reporter

Montreal Gazette

23 January 2012

A descendant of one of the earliest pioneers of Quebec's storied asbestos industry has publicly joined the movement to stop Canadian production and export of the deadly mineral.

MONTREAL - A descendant of one of the earliest pioneers of Quebec's storied asbestos industry has publicly joined the movement to stop Canadian production and export of the deadly mineral.

Susan Henry of Vancouver is the great-great niece of Andrew Stuart Johnson, a farmer who in 1878 founded the Johnson Mine Company in Thetford Mines, the first asbestos mine to operate in Canada.

After opening his mine, Johnson served as mayor of Thetford Mines and then as a Conservative member of the Quebec legislature until 1892, no doubt promoting his industry as vigorously as politicians from the region continue to do today.

Despite her family's history, Henry has now put her name to a letter-writing campaign, launched by the David Suzuki Foundation in November, calling for an end to Canada's involvement in the asbestos trade. In a message sent out to foundation members last week, Susan Henry writes:

"Although my great-great uncle, Andrew S. Johnson, founded his mine ... in good faith, the intervening years have revealed the very dangerous nature of asbestos. It is deeply disturbing to me that we are now poised to ramp up exports to developing countries, when we are fully aware of how lethal this mineral can be."

She goes on to urge other Canadians to help the foundation reach its goal of sending 10,000 messages to Prime Minister Stephen Harper and Quebec Premier Jean Charest opposing the reopening of the Jeffrey Mine. The site was reporting 8,977 messages had been sent as of Saturday afternoon.

The Quebec government has promised to provide a $58 million loan guarantee to Westmount-based Balcorp Ltd. to expand the exhausted open pit mine into an underground operation. The expansion would enable the mine to produce 200,000 tonnes of asbestos per year for the next 20 years. But the government's offer is conditional on the company first proving it has a firm commitment for $25 million in private investments for the project.

Quebec's economic development minister has established several deadlines for Balcorp to prove its financing over the past year and a half, but continues to extend them.

Jean-Pierre D'Auteuil, a spokesperson for the ministry, told The Gazette on Friday that Balcorp Ltd. is still negotiating with investors and has not yet proven to the government that it has the private financing required.

D'Auteuil also defended the government's position, noting Balcorp must demonstrate to the government that clients of the Jeffrey Mine intend to use the product safely as a condition of the loan guarantee.

"Thanks to technological advances, it is possible to use chrysotile asbestos with negligible risk to health when it is selected, handled and installed respecting strict standards," D'Auteuil wrote in an emailed statement. "On the other hand, asbestos can indeed present health risks to workers and the public when its use is poorly regulated and does not satisfy high safety standards."

Asbestos was an economic dream for Quebec for more than a century; the towns of Thetford and Asbestos grew around the mines rather than vice versa. Quebec companies also produced brake pads, textiles, paper and cement pipes made with asbestos, employing thousands of workers.

But the dream began to morph into a nightmare in the 1960s when medical science revealed much higher cancer rates among mine workers in Thetford Mines than in the general population. The world learned that when asbestos dust is breathed in, the tiny fibres become lodged in lung tissues and other internal organs, where they remain. Then decades later, those fibres can cause fatal diseases, like asbestosis, mesothelioma, lung cancer and other forms of cancer.

Today, exposure to asbestos is the single biggest cause of work-related deaths in Quebec.

In 2009, more than half of the deaths compensated by the Quebec Workers' Compensation Board - 102 of 185 - were due to asbestos exposure. Higher death tolls are expected in the future since it can take decades (after exposure) for fatal asbestos-related diseases such as asbestosis and mesothelioma to develop.

While rules for protection of asbestos miners are much more stringent now, workers here and abroad continue to be exposed to asbestos dust when buildings are demolished or renovated, or when work is done on roads, water pipes and other infrastructure that has been reinforced with asbestos, or when natural disasters or terrorist attacks cause buildings to collapse.

All of this has all but killed the North American market for Quebec asbestos, and the product is banned in more than 50 countries worldwide, and heavily regulated in others. But because of its low cost, strength and fire-preventing properties, the mineral is still in demand in developing countries, such as India and China, where protection for workers is generally inadequate.

Quebec's only two remaining asbestos mines have suspended operations. The LAB Chrysotile mine in Thetford Mines declared bankruptcy earlier this month, but is hoping for government financial aid to restructure and reopen. And the Jeffrey Mine in Asbestos ceased operations last fall.

Henry told The Gazette on Friday she decided to join the anti-asbestos movement partly because she has an aunt who grew up in Thetford Mines and died a painful death from an asbestos-related disease, and partly because of the asbestos-related deaths now being reported due to exposure during the Sept. 11, 2001 terrorist attack in New York.

"It's kind of horrifying that I come from a family responsible for the deaths of thousands and thousands of people (even though they didn't know it at the time)," she wrote.

But Henry seems optimistic public pressure can persuade politicians to stop Canadian asbestos production. "Our letters are making a difference," she writes. "Still no decision has been announced. The government seems to be stalling on confirming the deal - and with good reason. Health authorities have determined that all kinds of asbestos cause cancer and there is mounting opposition at home and abroad to Canadian asbestos exports."

The letter-writing campaign, launched in early November, asks the Quebec government to refuse the loan guarantee. The campaign (action.davidsuzuki.org/asbestos) also asks the federal government to help asbestos mining communities transition to other economic activities and to support international restrictions on the asbestos trade. (Canada continues to oppose efforts to include Chrysotile asbestos in the United Nation's Rotterdam Convention, which lists hazardous products and requires exporting companies to inform importing companies of dangers and precautions required).

"I find it inspiring that so many passionate individuals, like Susan Henry, have joined our campaign," said Lisa Gue, a spokesperson for the David Suzuki Foundation. "We're all hoping Premier Charest gets the message and refuses the loan guarantee."

mlalonde@montrealgazette.com

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Asbestos research may be skewed, group says

The Canadian Press

12 February 2012

MONTREAL - A group of 30 physicians and academics wants McGill University to conduct an independent investigation into allegations that a researcher skewed study results on behalf of the asbestos industry.

The group includes experts from Canada and around the world.

The experts have filed a complaint with the school saying research conducted by a former professor lacks transparency and contains manipulated data.

J. Corbett McDonald, who is now retired, began studying mortality rates associated with asbestos in 1966 by looking at about 11,000 Quebec miners and asbestos fibres.

McDonald and his research team published a series of studies between 1971 to 1998 funded in part by a branch of the Quebec Mining Association, something which McDonald acknowledged.

McGill said last week it would conduct its own, internal probe after a CBC report alleged several decades of research could have been influenced by the asbestos industry.

David Eidelman, McGill's dean of medicine, said last week that while McDonald drew different conclusions about the safe use of asbestos from some current-day authorities, he also showed that asbestos is a carcinogen associated with lung cancer.

Eidelman said the university's researchers perform their work to the highest ethical standards and the university isn't currently getting funding from the asbestos industry.