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UNDER A CLOUD

Case Hinges on Material Witness

In a high-stakes lawsuit against Union Carbide, Exhibit A is an asbestos the company now says is safe

September 26, 2004|Lisa Girion | Times Staff Writer

To hear Kelly-Moore's lawyer tell it, the Union Carbide salesmen had their mantra down: Don't worry, they'd say, don't worry.

Union Carbide Corp. was one of the companies that supplied Kelly-Moore Paint Co. of San Carlos, Calif., with the asbestos used as a thickening agent in its products. Mined in the Diablo Mountains north of Coalinga in Central California and refined at a mill in the Salinas Valley, Union Carbide's trademarked Calidria was supposed to be different from the asbestos sold by competitors such as the former Johns-Manville Corp.

But Kelly-Moore now claims there was plenty to be worried about.

Union Carbide, it charges, fraudulently promoted Calidria as a uniquely safe alternative to potentially deadly types of asbestos. Kelly-Moore says Union Carbide had evidence linking the product to cancer and asbestosis but withheld it.

In a high-stakes trial underway in state court in Angleton, Texas (not far from Union Carbide's Houston headquarters), Kelly-Moore is asking a jury to order the chemical giant to take responsibility for a huge chunk of the paint company's exposure to 48,000 asbestos injury suits. Kelly-Moore wants actual damages of $1.3 billion -- its anticipated liabilities and legal costs -- plus punitive damages of $3.9 billion.

If Kelly-Moore loses, it could go bankrupt. If Kelly-Moore wins, the verdict could wipe out Union Carbide's insurance coverage and help paint a bull's-eye on the only solvent former asbestos producer in the United States, encouraging other companies that bought Calidria to take Union Carbide to court.

Two other former Union Carbide customers already have sued, saying, basically, what former workers at the company's Calidria mill near the Salinas Valley town of King City recall being told: Don't worry -- it's not the bad stuff.

These corporate customers are a new type of plaintiff in a litigation blame game that has prompted more than 60 companies to seek bankruptcy protection. Until recently, most asbestos suits were product-liability and wrongful-death claims filed by individuals who blamed lung disease and cancer on asbestos fibers they inhaled on the job and in the home.

As the last former asbestos producer standing, Union Carbide, a part of the Dow Chemical Co. empire since 2001, maintains that it has become an expedient target, first for individuals and now for manufacturers who used the mineral in their products.

It denies misleading customers or mill workers and says they were warned of Calidria's potential health hazards. Even so, Union Carbide's lawyers say, Kelly-Moore had a responsibility to determine independently whether ingredients in its paints were toxic. And by the time Union Carbide began selling Calidria to Kelly-Moore in 1964, they contend, there was plenty of publicly available information linking asbestos with lung disease and cancer.

In any event, Union Carbide supplied only a fraction of the asbestos that Kelly-Moore used over the years; a Johns-Manville successor and Celotex Corp., which also sold asbestos to Kelly-Moore, filed for bankruptcy protection years ago. But "Kelly-Moore wants Union Carbide to pay for 100% of the choices it made," Union Carbide lawyer Scott Lassetter said in his opening argument Sept. 13.

"This case is about scapegoating Union Carbide because both Union Carbide and Kelly-Moore are involved in more asbestos lawsuits than we'd like to even think about," Lassetter said. "It's a drain on the budgets of these companies to finance people like me. It's simply something that these companies wish had never happened, but we can't turn the clock back."

Kelly-Moore's lawyer, Mark Lanier, told jurors that they should, in fact, look back in time.

In the 1950s, he noted, Union Carbide was a member of the Industrial Hygiene Foundation, which commissioned a study that linked chrysotile, the type of asbestos sold by the company, to cancer. But then the group publicly reported just the opposite. And in the 1960s, he said, a few years after Union Carbide discovered the world's largest cache of asbestos in California and opened its mill near King City, its own tests indicated that Calidria caused more damage to the lungs of rats than the asbestos sold by Johns-Manville.

"Instead of telling companies and people and stopping the asbestos market right there, they hide it," Lanier told jurors. "They start pushing their asbestos in every product they can because, you see, that disease of asbestosis takes 20 or so years before you get it. The cancer takes 20, 30, 40 years before you get it. And these guys were going to make their killings right then."

In the early 1970s, Lanier contended, Union Carbide began to realize that in a few years, its customers would recognize that what it was selling was a hazard and quit buying.

"So why don't we, quote, 'Make hay while the sun shines'?" Lanier said, referring to a memo in which Union Carbide considered building a larger mill to get asbestos to market more quickly.

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