Ex-workers plead guilty in West Virginia chemical spill case

AP News
|
Posted: Mar 18, 2015 3:20 PM

CHARLESTON, W.Va. (AP) — Two former employees at Freedom Industries pleaded guilty to a pollution charge Wednesday in last year's chemical spill in West Virginia that fouled a local tap water supply.

Ex-Freedom plant manager Michael Burdette and environmental consultant Robert Reynolds entered the pleas at separate hearings to negligent discharge of a pollutant.

Each faces up to a year in prison and a minimum $2,500 fine when sentenced June 24.

The spill of thousands of gallons of a coal-cleaning agent from Freedom Industries into the Elk River went into West Virginia American Water's intake 2 miles downstream on Jan. 9, 2014. It prompted a tap water ban for 300,000 residents in nine counties for up to 10 days while the water company's system was flushed out.

Former Freedom owners Charles Herzing and William Tis pleaded guilty Monday to causing an unlawful discharge. Ex-Freedom owner Dennis Farrell and former President Gary Southern face trial later this year on charges related to the spill. In addition, Southern faces charges related to Freedom's bankruptcy.

U.S. Attorney Booth Goodwin said Burdette, Reynolds, Tis and Herzing previously entered into plea agreements that require their cooperation in the investigation. But Goodwin wouldn't speculate on whether he'll ask the four to testify against Farrell and Southern.

"I can't say that we will or will not use them in a trial setting," Goodwin said.

An FBI affidavit says Freedom knew about critical flaws at its Charleston plant but never dealt with them. Federal investigators have said holes in a corroded tank's floor and roof likely helped cause the spill.

Prosecutors have said the tank conditions "put an entire population needlessly at risk."

According to health officials, more than 400 people were treated at hospitals for symptoms that matched what's expected from exposure to the chemical, which gave off a licorice odor.

During the tap-water ban, some West Virginians drove more than an hour to shower, fill water jugs or do laundry. Businesses shuttered for days, particularly restaurants.

Freedom Industries filed for bankruptcy protection eight days after the spill.

After entering his plea Monday, Tis initially waffled when asked by U.S. District Judge Thomas Johnston whether he committed the crime.

"No, I don't believe I have committed a crime, but I am pleading guilty," Tis said. But then he added, "I do believe I am guilty of this offense. There are people we had hired ... Their failure results in my failure."

Neither Burdette nor Reynolds elaborated when Johnston posed a similar question, but simply admitted their roles.

Another plea hearing is scheduled March 23 for the company itself. Herzing and Tis are scheduled to be sentenced June 22 and each faces up to a year in prison.

Tis, Herzing and Farrell owned Freedom until December 2013, when they sold it to Pennsylvania-based Chemstream Holdings for $20 million. Southern became president afterward, but he was in charge of Freedom's day-to-day operations for years beforehand, his FBI affidavit states.

Southern is accused of scheming to defraud Freedom's creditors and plaintiffs who sued the company and him after the spill. The alleged scheme included attempting to protect some of his assets from possible verdicts and judgments.

One count, fraud by interstate commerce carrier, alleges that Southern sent a $6.5 million check from a personal bank account around Feb. 7, 2014, to an insurance company to be deposited in an annuity.

Southern also previously was charged with bankruptcy fraud, wire fraud and lying in oath in relation to the bankruptcy case.