Five years after a New Castle chemical plant leaked a flammable and carcinogenic gas into surrounding communities, Delaware Supreme Court justices said residents in those areas can’t successfully sue the facility’s operator, Croda Inc. – unless they already have cancer.
Published last month, the high court’s opinion sets a legal precedent that frees Delaware companies — a list that includes two-thirds of the Fortune 500 — from being held strictly liable in state courts for pollution that increases a person’s risk of disease
The opinion also likely means the end of a federal class action lawsuit brought against Croda in 2020 by New Castle resident Catherine Baker, who says decades of toxic emissions from the company’s Atlas Point plant exposed neighbors to “mutagenic, and carcinogenic ethylene oxide.”
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The lawsuit sought to force Croda to pay the costs of regular cancer screenings for people living within a cluster of modest neighborhoods surrounding the Atlas Point facility.
Those residents are up to four times more likely to develop cancer than the average American, according to the U.S. Environmental Protection Agency.
Last year, federal appeals judges overseeing the residents’ class action lawsuit asked the Delaware Supreme Court to address the “unsettled” legal question of whether, under state law, a polluter could be held liable for increasing a person’s risk for a disease, even if the illness has not yet appeared.
The state court’s answer would have “far-reaching implications," federal judges said – a likely reference to Delaware’s role as the legal home of more than a million companies, including many big chemical producers.
A flammable gas that causes cancer
Baker filed her lawsuit two years after a disastrous leak at Croda’s Atlas Point plant, where nearly 3,000 pounds of ethylene oxide gas seeped past a damaged gasket and into the surrounding area.
The leak prompted government officials to close Interstate 295 across the Delaware Memorial Bridge, and to issue a shelter-in-place alert to more than 3,000 residents.
It all occurred just one year after Croda opened its ethylene oxide production plant at Atlas Point, and two years after the EPA determined the chemical to be 30 times more cancerous than previously believed.
Today, the EPA describes ethylene oxide as a flammable, colorless gas linked to breast cancer and cancers of the white blood cells, including nonHodgkin lymphoma, myeloma, and lymphocytic leukemia.
Though Delaware regulators fined Croda nearly $250,000 following the 2018 leak, its Atlas Point facility continued to release high levels of the toxic gas in subsequent years, with emissions topping 4,000 pounds in 2020, according to EPA data.
In an infosheet published online, Delaware regulators said the 2020 emissions would not “cause immediate health effects” for neighbors, because they occurred over several months and were dispersed into the air from the top of a 110-foot stack – rather than at ground level, as was the case during the 2018 leak.
Left unsaid by the regulators is that ethylene oxide is too heavy to waft high up into the atmosphere – a point that federal judges overseeing Baker’s lawsuit did note.
“The gas is heavier than air, allowing it to linger at breathing level in the communities surrounding the chemical plant,” the federal appeals judges said in their brief asking the Delaware Supreme Court to interpret state law.
Though the EPA says Croda has increased New Castle residents’ chance of developing cancer, regulators have not set limits on ethylene oxide pollution at Atlas Point.
When asked about such pollution limits, EPA spokesman Shaun Eagan said regulators restrict emissions at Atlas Point to 40,000 pounds annually for all volatile organic compounds – a group of chemicals that include ethylene oxide.
They also set a 20,000-pound limit for “any of the individual hazardous air pollutants per year,” he said.
Pressed whether there should be a maximum allowable limit for ethylene oxide at Atlas Point, Eagan deferred to state regulators who are currently “working on a plant-wide air permit renewal.”
When asked the same question, a spokesman for the Delaware Department of Natural Resources and Environmental Control said the agency “does not intend to include a facility-wide limit” for ethylene oxide at Atlas Point.
A spokesperson for Croda Inc. did not respond to an emailed request for comment.
In May, the company’s British parent company, Croda International PLC, reported annual sales in 2022 of over £2 billion ($2.6 billion) with a profit before taxes of nearly half-a-billion pounds.
‘Not a cognizable injury under Delaware law’
In their ruling last month, Delaware Supreme Court justices acknowledged that ethylene oxide is a known carcinogen, and that Croda’s Delaware plant “regularly releases ethylene oxide gas into the air.”
But, the increased risk of cancer – without the clinical onset of the disease – is not a “cognizable injury under Delaware law,” the justices said.
In the opinion, they also warned that an “endless and limitless” flood of lawsuits would result, if they ruled that a polluter could be sued for increasing a person’s risk of cancer, or other disease.
Still, the justices also highlighted what they called competing public policy concerns, noting that lawsuits that could retrieve health care costs of monitoring for a disease would “promote early diagnosis and treatment.”
“And, they can help to ameliorate the injustice of having economically disadvantaged persons pay for diagnostic testing,” the Supreme Court justices stated.
The justices concluded that if Delaware is to recognize such medical monitoring damages, the law would have to be amended by legislators, and not the courts.
But a change in the law is doubtful because Delaware lawmakers are wary of tinkering with the state’s corporate code. Generally, they only do so when the change is first proposed by the Delaware Corporation Law Council — a group of private attorneys who meet in secret to write new bills.
How the plant came to Delaware
State lawmakers last acted with respect to Croda in 2015, when they stripped New Castle County of its authority to regulate certain permitting issues at the Atlas Point facility.
The lawmakers’ action followed a fight between then-County Executive Tom Gordon and then-Delaware Economic Development Director Alan Levin over what was then a still-proposed ethylene oxide plant at Atlas Point.
At the time, Croda shipped in from other states the ethylene oxide it used as an ingredient in its production of plastic polymers, antifreeze, and various consumer products,
In its proposal, Croda said a Delaware production plant would be environmentally beneficial because it would do away with the need to ship chemicals over long distances.
Despite such assurances, Gordon balked at the plan, questioning the wisdom of placing the proposed plant “under the bridge and near two developments.”
“This isn’t 7-11,” he told the News Journal at the time. “This is something serious.”
But Delaware officials saw Gordon’s caution as an unnecessary delay.
In response, state lawmakers inserted language into the footnotes of a 2015 capital funding bill that handed permitting authority for the parcels of land on which Atlas Point sat to state officials at the Delaware Office of State Planning.
Following the change, Delaware promptly permitted Croda’s $170 million construction plans.
Two years later, the new facility officially opened with a ribbon cutting ceremony attended by Delaware Gov. John Carney.
At the event, Carney celebrated what he called Delaware’s “tax and regulatory environment that’s conducive to businesses wanting to locate here,” according to a news report from WHYY.
“I can’t think of a better facility to have now at the base of the Delaware Memorial Bridge, which is really a gateway to Delaware,” Carney said, according to the news report.
Contact Karl Baker at kbaker6@protonmail.com or on Signal at 206-595-0057.
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