Things Are Looking Good at W.R. Grace

W.R. Grace was collectively found not guilty of conspiracy, violating the Clean Air Act and obstruction of justice in the contamination of the town of Libby, Montana. They can now exit from an eight year bankruptcy.

A conviction in the case would have meant more than $280 million in fines and restitution, and a delay in exit from bankruptcy. Not surprisingly, Grace stock went up 36 percent in New York Stock Exchange composite trading.

One former Libby resident reacted angrily to the verdict. Mike Crill, 54, yelled inside the courthouse, “What did they die for? Who’s guilty for killing me? They’re guilty of killing Mike Crill and his family and everybody.”

Crill said his parents, uncle and father-in-law all died of asbestos-related diseases. Crill, who used to fill railroad boxcars with vermiculite at work, said he and his wife have both been diagnosed with scarring of the lungs.

Grace filed bankruptcy in 2001 in U.S. Bankruptcy Court in Wilmington, Delaware, seeking protection from more than 100,000 claims for damages related to asbestosis, most of them unrelated to Libby.

Prosecutors alleged that the company and seven former executives conspired for decades to expose Libby residents to asbestos-contaminated vermiculite.

Asbestos-related diseases, including asbestosis and and mesothelioma, have killed more than 200 people in the Libby area and sickened more than 1,200. Libby residents die from asbestosis at a rate 40 to 80 times normal, the government said.

During the trial, Judge Molloy frequently criticized the prosecution’s case outside the presence of the jury, and limited the evidence the government was permitted to present. Several of his pretrial rulings were reversed by the U.S. Court of Appeals in San Francisco before the start of the trial. Despite the roadblocks, W.R. Grace prevailed.