The Times West Virginian

June 28, 2014

Judge defends secrecy in spill company bankruptcy


Associated Press

CHARLESTON — A judge has defended his decision to let the company that spilled chemicals into West Virginia’s biggest drinking water supply file some financial statements out of public view.

According to The Charleston Gazette, Bankruptcy Judge Ronald Pearson in Charleston wrote Thursday that Freedom Industries should provide periodic updates on the Charleston spill site cleanup.

“Given the public nature of this case, the court feels a responsibility to ensure the public that the environmental issues are being dealt with responsibly and that the bankruptcy process continue with full recognition and compliance with laws that protect the environment and public safety, all of which are to be adhered to in this and any bankruptcy case,” Pearson wrote.

In April, Pearson signed an order requiring periodic future budget plans, but letting them remain shielded from disclosure from the public. The spending plans give the court an idea of what Freedom expects to spend, how much cash they could have and what will be available for environmental cleanup.

In his defense, Pearson said it’s an unusual requirement for Freedom to have to file forecast budgets.

Pearson wrote that the shielded budgets help ensure a competitive bid process for various contractors Freedom hires.

“The debtor must be able to seek bids without having to disclose to potential bidders what the debtor is forecasting for assets on a competitive and commercially reasonable basis,” Pearson wrote.

Freedom’s January spill caused a tap-water ban for 300,000 people for four to 10 days.

Freedom will have limited resources to disburse to those owed money. That includes businesses and people who sued for money lost during the ban.

The company needs financial resources to strip remaining contamination from its spill site, which is about 1.5 miles upstream from the water treatment plant.