W.R. Grace & Co. has agreed to pay as much as $140 million to settle a class-action lawsuit stemming from its use of an attic-insulating product that contained asbestos.
The specialty chemical maker will pay $30 million into a trust fund, an additional $30 million after three years, and make as many as 10 additional annual payments of $8 million if certain conditions are met, it said in a filing with the Securities and Exchange Commission.
The payouts stem from the company's sale of Zonolite attic insulation, a loose-fill vermiculite product that can contain naturally occurring asbestos. Zonolite was installed in millions of homes throughout the U.S. and Canada. The hundreds of thousands of lawsuits filed against the product pushed Columbia, Md.-based W.R. Grace into bankruptcy protection in 2001.
Much of the Zonolite manufactured in the U.S. came from a vermiculite mine in Libby, Mont. The Libby mine, which was open for more than 70 years and closed in 1990, has been linked to asbestos exposure that has sickened thousands and killed more than 200 people in the Libby area.
The U.S. Environmental Protection Agency arrived there in 1999 and has overseen cleanup under the Superfund program. A PBS documentary based on the town's experience, "Libby, Montana," was nominated for an Emmy this year, bringing additional attention to W.R. Grace and the small community.
The company reached an agreement in August to resolve all asbestos claims against the company, allowing it to emerge from bankruptcy without further obligations for asbestos injury.
The payments will be backed by 50.1% of W.R. Grace's stock.
A company representative declined to comment beyond what was posted in the SEC filing.
W.R. Grace shares fell 11 cents to $3.50.