BEND OVER WEST VIRGINIA - No Criminal Charges Against Freedom Industry, Company Makes Legal Moves Over Spill, Politicos Rail About Disaster

(01/28/2014)

COMMENT By Bob Weaver

Dozens of reporters and environmental activists have visited West Virginia during the Kanawha County toxic spill contaminating the water of 300,000 customers.

Most have asked the burning question.

Why haven't criminal charges been filed?

They rarely, rarely are.

Fascinatingly, criminal charges are brought against thousands of West Virginia citizens for minor environmental issues, taken to court and fined.

The Centers for Disease Control says that officials could have moved more quickly in issuing an advisory (several days later) that pregnant women drink only bottled water until chemical levels were zero in the West Virginia American Water system.

West Virginian's should be use to the slowness in reporting on such disasters that affect public health and safety.

A new bill has just been introduced in the West Virginia Legislature to lower the clean water standards for aluminum content.

Freedom Industry executives gave $500 to $1000 donations to the campaigns of Gov. Earl Ray Tomblin, Sen. Shelly Moore Capito and former governor and now US Senator Joe Manchin, all on record to lower the standards of the Clean Water Act.

Freedom Industries told a bankruptcy judge the company is in a "death spiral," which could well be interpreted, at least from West Virginia history, that taxpayers and regional businesses will bare the financial brunt of the chemical spill that affected 300,000 West Virginians.

Efforts will be made to minimize Freedoms liability in the toxic spill, a clue being that WV governor Earl Ray Tomblin repeatedly told news media this chemical spill was not related to the coal industry.

But it is related to the coal industry.

The chemical is used to "winterize" stored coal piles and keep them from freezing. Mother Nature, to the best of my knowledge, rains on coal piles, and the rain flows into the state's pristine mountain streams.

Long-leaking doses of toxins are of little concern in the Mountain State, the list is lengthy.

U.S. Bankruptcy Judge Ronald Pearson called the case "one of the most unique Chapter 11 cases I've ever seen."

An interpretation of the judge's statement likely means "bend over West Virginia."

Freedom Industries is variously claiming they are putting up $300,000 or $800,000 for re-mediating the spill, but not yet discussing fault.

One hour after Freedom filed for bankruptcy Friday, the company filed an emergency motion for "debtor-in-possession" (DIP) financing, which would allow it to secure a loan up to $5 million to continue to function in some capacity, according to the Charleston Gazette.

The loan would "provide additional liquidity to [Freedom] in order to allow it to continue as a going concern," the loan to be obtained from a company that was also set up brand-new Friday called Mountaineer Funding.

Mountaineer Funding's one listed member is J. Clifford Forrest, who owns Chemstream Holdings, who owns Freedom Industries.

The Gazette reported, "West Virginia American Water Co. asked the judge to deny Freedom Industries' request for a loan, which the water company said "smells of collusion." They called Freedom's request a "loan to own scheme."

"Freedom seeks to stampede this court into irrevocable and improvident actions which will likely result in the selective dismemberment of the debtor's business to the permanent and immeasurable detriment of its creditors," said the water company.

"The terms of the DIP facility would provide the lender with a lien on all of the Debtor's assets, a superiority claim, and the ability to foreclose selectively on the assets and take away the most valuable assets from the Debtor's estate, leaving behind only the toxic facilities and huge damage claims caused by the Freedom spill," said the water company in legalese.

Freedom already owes $3.6 million to its top 20 unsecured creditors and another $2 million to IRS.

The bankruptcy filing is further complicated.

The judge granted $3 million for Freedom bankruptcy financing, and its created lender, Mountaineer Funding, will not receive top priority among creditors.

Cases like this could take years to play out, long after they've made the news and created a little outrage.

See   WEST VIRGINIANS CLAIM TO LOVE THEIR MOUNTAIN WATER - Decades Of Toxins Ignored, Comes The Outcry, Then Business As Usual


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