CHARLESTON – District Judge John Copenhaver Jr. has approved a $151 million settlement in the class action lawsuit between West Virginia American Water, Eastman Chemical and residents and businesses affected by the 2014 chemical spill into the Elk River.
West Virginia American Water has agreed to pay $126 million and Eastman has agreed to pay $25 million.
Each qualifying residential class member may receive a single uniform payment, in an amount to be negotiated; and each qualifying business customer may receive a single uniform payment in an amount to be negotiated that will be treated as compensation for all claims or potential claims by that business customer, according to the settlement fact sheet filed Oct. 31 in the U.S. District Court for the Southern District of West Virginia.
Of the $126 million from WVAW, $50 million will be dedicated to claims-based payments for class members that wish to forego the standard payment, as well as wage earners who were not WVAW customers that assert they lost wages due to the closure of business customers.
There are more than 230,000 residents and business owners included in the class action lawsuit.
The class claimed that West Virginia American Water did not adequately prepare for or respond to the spill and that Eastman, the company who manufactured MCHM, did not properly warn Freedom Industries of the dangers of the chemical.
In an earlier hearing Monday, Copenhaver called language in the proposed settlement unacceptable, stating it would have left the door open for WVAW to recover the cost of the settlement from its customers in a rate case with the state Public Service Commission.
The language was changed and WVAW has agreed not to seek rate recovery for the $4 million cost of the water emergency or the $126 settlement amount.
A hearing is scheduled for Nov. 14 to finalize the settlement.
Nine counties in West Virginia—almost 300,000 residents—were affected by the water contamination when the spill occurred in January 2014. A tank at Freedom Industries had leaked MCHM into the river.
The plaintiffs are represented by Kevin W. Thompson and David R. Barney Jr. of Thompson Barney; Van Bunch of Bonnett Fairbourn Friedman & Balint PC; Stuart Calwell, Alex McLaughlin and D. Christopher Hedges of The Calwell Practice LC.
U.S. District Court for the Southern District of West Virginia case number: 2:14-cv-01374
