Wednesday, March 23, 2005

McWane Admits to "Environmental Crimes": $4.5 million Fine

Our old friend McWane Corporation has pleaded guilty to "environmental crimes," fined $4.5 million, placed on probation for five years and required to spend an estimated $12 million on plant upgrades.

McWane was the focus of a 2003 NY Times/Frontline series about the high number of workplace injuries and fatalities at that company's facilities.

The plea is a significant development for McWane, which is facing a sweeping federal criminal investigation of its plants in several states. Based in Birmingham, Ala., McWane already faces federal indictments in Alabama and New Jersey, accused of conspiring to violate environmental and workplace safety laws.

"This is the third criminal prosecution of McWane in the last 16 months, and the first time that McWane has pleaded guilty and accepted responsibility for criminal conduct," said David M. Uhlmann, chief of the environmental crimes section of the Justice Department.

At a court hearing in Tyler, the company admitted two felony offenses. It said it knowingly violated the Clear Air Act by making major modifications at Tyler Pipe without installing the necessary air pollution controls. The company also acknowledged that it knowingly made false statements to environmental regulators.
The company is also facing indictments in New Jersey and Alabama, but is fighting those. The Alabama case should be interesting as a former McWane manager admitted that the company had flooded a creek with millions of gallons of water poisoned by heavy metals over a period of years.

The NY Times/Frontline series revealed the company as a corporate criminal for it high number of injuries and fatalities, and OSHA's failure to bring criminal charges:

From 1995 to 2002, at least 4,600 injuries were recorded in McWane foundries. In that same period, the company was cited for more than 400 safety violations and 450 environmental violations.
In 2002, the company paid a $250,000 fine for a willful violation of workplace safety standards that resulted in the death of a worker.

$4.5 million penalty, plus $12 million in upgrades versus $250,000 for a workplace death. Once again we see the difference in penalties assessed for environmental crimes versus crimes that kill workers.

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