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Lawsuit: C8 in Water Scuttled $36m Parkersburg Plant Deal

May 13, 2005 | AP

A $36 million deal to build a frozen food plant in Parkersburg and employ up to 600 people fell apart because the plant's proposed water supply is possibly contaminated by a chemical used to make Teflon, a lawsuit contends.

Luigino's Inc. has sued the West Virginia Economic Development Authority over the scuttled 2002 agreement that would have landed a 180,000 square foot processing and distribution facility at the Parkersburg Business Park.

The Minnestota-based frozen food maker contends the agency breached the agreement by failing to reveal that a class-action lawsuit had raised warnings over the presence of perfluorooctanoic acid, known as PFOA or C8, in the local water supply.

C8 causes cancer in laboratory animals and lingers in the environment. Intensive government and industry studies are under way to determine if exposure increases human cancers, reproductive problems or other health disorders.

After discovering the allegations on its own, the "stigma of significant contamination" forced Luigino's to cancel its plans, the lawsuit said.

"Luigino's would have been using hundreds of thousands of gallons of potentially contaminated water each day for the production of frozen food," the lawsuit said. "Given the contamination and litigation associated with the area, distributors and retailers would have been justified in refusing to carry Luigino's food products."

WVEDA Executive Director David Warner was not available for comment Thursday. Luigino's lawsuit was filed in Monongalia County Circuit Court late last month, and alleges breach of contract, negligent and fraudulent omissions and professional negligence among its causes of action. It alleges it spent $2.5 million before backing out of the agreement, and seeks additional damages as well.

The class-action targeting C8, filed in 2001, blamed DuPont for the possible contamination. C8 is a key ingredient in Teflon, and DuPont produces the nonstick coating at its Washington Works plant.

Without admitting any liability, DuPont agreed to settle the class-action in September. Approved by a judge in February, the agreement has DuPont providing $10 million in new treatment equipment to six local water utilities and funding a $5 million independent study on C8's effect on people. DuPont could spend another $235 million on a program to monitor the health of residents exposed to the chemical.

Last month, DuPont agreed to resolve a complaint by the U.S. Environmental Protection Agency alleging the company failed to disclose health data about C8. Some of the EPA charges focused on the company's handling of a finding in 1981 that the chemical had jumped from the blood of a pregnant female employee to her unborn child.

When it nixed its agreement with the WVEDA in March 2003, Luigino's said it "has sufficient capacity while this project remains on hold to meet its current and anticipated production needs." It later reported flat sales for 2002, after several years of strong growth.

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