Doe Run wants Missouri lawmakers to override veto
Sunday, August 18, 2013
A Missouri lead company has launched an aggressive effort to persuade lawmakers to override a gubernatorial veto of a bill that would shield it from large punitive damages in liability lawsuits.
The Doe Run Co. contends nothing less is at stake than its very existence, hundreds of jobs and even national security.
Doe Run faces an uphill battle. The bill passed the Missouri House in May by a 94-63 vote with six people absent. That means supporters need 15 more “yes” votes to override Gov. Jay Nixon’s veto when lawmakers reconvene Sept. 11. The required two-thirds majority is less questionable in the Senate.
Despite long odds, bill backers are confident they will prevail once colleagues hear their dire warnings.
“If this does not pass, Doe Run will be out of business in a short period of time — that’s roughly a couple thousand jobs,” said Rep. Robert Ross, R-Yukon, the bill sponsor.
Yet the consequences are not quite that certain.
Doe Run touts itself as the largest integrated lead producer in the Western Hemisphere. It mines and smelts ore and recycles lead for new uses at eastern Missouri facilities that employ about 1,600 people.
At issue are numerous liability lawsuits pending against Doe Run, including one scheduled for trial in October that seeks damages for mental and behavioral health problems that children allegedly suffered because of lead contamination in St. Francois County.
Officials at Doe Run fear costly court judgments. They cite $320 million in punitive damages awarded by a St. Louis jury in 2011 against Flour Corp., from which Doe Run acquired old mining properties in 1997.
A 2005 Missouri law caps punitive damages at $500,000 or five times the amount of actual damages, whichever is higher. But many of the lawsuits against Doe Run were filed before those limits took effect.
The bill vetoed by Nixon would create a specific law intended to shield Doe Run. It would bar any punitive damages related to mining sites that ceased operating before 1975, so long as the owners are making “good faith efforts to remediate such sites.” If not, then punitive damages would be capped at $2.5 million, with half that money paid into a state fund for lead-abatement efforts.
In his veto message, Nixon said the bill violated the state constitution by retroactively limiting legal damages and by creating a special law benefiting only particular legal defendants.
Lawmakers who opposed the bill cited similar concerns.
“It’s carving out legislation for a single company and retroactively tying the hands of people who have been damaged,” said Rep. Sheila Solon, of Blue Springs, one of 19 House Republicans who voted against the bill.
“If we don’t get this bill passed, these lawsuits that are filed in St. Louis city are enough to put us out of business potentially,” said Matthew Wohl, Doe Run’s vice president of law.
Some legislative supporters have taken the warnings even further, linking the veto override to Doe Run’s ability to build a new lead production facility after its Herculaneum smelter closes at the end of this year. The current facility is the nation’s only primary smelter capable of extracting lead from raw ore for use in such things as car batteries, computer screens, X-ray shields and ammunition.
“Unless we give them some financial certainty, they’re not going to be able to get the financing to build this state-of-the-art lead production facility in Missouri,” said Rep. Jeff Roorda, D-Barnhart. “We lose jobs, we close mines and our entire nation is at the mercy of the Chinese.”
China is a major producer of lead. Wohl said “it’s absolutely fundamentally a security issue.” But even if the veto is overridden, he said there is no guarantee Doe Run will build a new lead production facility in the U.S. because of uncertainty over federal environmental regulations.
The Missouri Association of Trial Attorneys, which wants legislators to sustain the veto, doubts the dire predictions.
“Anytime a company has wanted to take away people’s rights and reduce their liability, they always come to the Legislature with one of two arguments — either we create jobs and therefore you should give us special treatment, or the sky is falling and if you don’t want us to leave the state or the country, you have to give us special treatment,” said the association’s deputy director, Sharon Jones.
Few lawmakers have publicly confirmed whether they will switch votes.
Rep. Dave Hinson, R-St. Clair, said he originally voted “no” because he had limited information. But he plans to vote “yes” on an override because he has learned that lead is naturally abundant in the area and he considers it odd that many of the lawsuits were filed in St. Louis instead of St. Francois County.
Several others who voted “no” now are undecided.
Rep. John McCaherty, R-High Ridge, said he toured Doe Run’s facilities last Monday and brought back a rock containing lead. McCaherty said he originally voted “no” because “those people deserve their day in court.” Now he’s reconsidering.
“It’s a whole different scenario when you start looking at the financial impact to our state,” McCaherty said.
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