Missouri Court Tosses $240M Punitive Award from Smelter Lawsuit

Missouri Court Tosses $240M Punitive Award from Smelter Lawsuit

Source: http://www.insurancejournal.com, June 19, 2014

A Missouri appeals court has thrown out $240 million in punitive damages awarded to 16 eastern Missouri residents who sued over health problems from the Herculaneum lead smelter.

A jury awarded the damages against former smelter owners Fluor Corp., A.T. Massey Coal and Doe Run Investment Holding Co. after a three-month trial in 2011.

The St. Louis Post-Dispatch reported that the Missouri Court of Appeals’ Eastern District ruled that an error in jury instructions requires fresh consideration off Fluor’s portion of the damages award. The St. Louis jury awarded a total of $320 million in punitive damages and another $38 million in compensatory damages.

Those awards came on top of a confidential settlement reached before the trial with the smelter’s current owners, Doe Run Resources Corp. The suit focused on the period of 1986 to 1994, with residents citing the effects of high levels of lead in the blood of local children.

Lead poisoning can lower IQ and cause problems such as attention-deficit hyperactivity disorder. Adults can tolerate higher levels of lead than children but still suffer health problems.

The appeals court upheld the $48 million in punitive damages assessed to Massey Coal and the $32 million award against Doe Run Investment Holdings. Each of the three companies appealed the original verdict. According to the appellate ruling, the $320 million jury verdict was $112 million more than the amount sought by the plaintiff’s lawyers.

The Herculaneum smelter, the nation’s last remaining one, shut down in December. The U.S. Environmental Protection Agency said the smelter’s owner declined to install pollution control technologies needed to reduce sulfur dioxide and lead emissions as required by the federal Clean Air Act.

Doe Run had hoped to build a new plant using a cleaner lead-production technology but dropped the idea in 2012, calling the $100 million project too financially risky.

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