Cook County Record

Tuesday, February 18, 2020

EtO plaintiffs: Even before 1st lawsuit filed, Sterigenics moved to put $1.3B 'out of reach' of personal injury lawsuits

State Court

By Jonathan Bilyk | Feb 4, 2020

Sterigenics

A group of lawyers leading dozens of lawsuits over claims emissions from a Willowbrook facility caused cancer have now accused medical device sterilization company Sterigenics of taking action, even years before the first lawsuit was filed, to reduce the potential pot of money the plaintiffs lawyers think their claims should be worth.

Sterigenics, however, says those claims are “false,” and the pilloried financial maneuvers represent instead steps taken by Sterigenics’ owners to strengthen the company’s finances “for the benefit of all stakeholders.”

On Feb. 3, lawyers from several high-profile Chicago personal injury firms announced they had amended their lawsuits against Sterigenics to include the allegations over Sterigenics’ “dividend recapitalizations” and other actions taken by the company regarding its funds.


Antonio Romanucci Romanucci & Blandin | uwalumni.com

“By these actions,” the lawsuit said, Sterigenics and its corporate parent “admit culpability for the toxic exposure suffered by Plaintiffs, but intend never to be held accountable for it.”

Sterigenics, which formerly sterilized medical devices at its now-shuttered plant in suburban Willowbrook, is facing more than 75 personal injury lawsuits in Cook County Circuit Court. The lawsuits have been filed by a group of lawyers, led by attorney Antonio Romanucci, of the firm of Romanucci & Blandin; Todd Smith, of Power Rogers & Smith; Patrick Salvi II, of Salvi Schostok & Pritchard; Steven Hart, of Hart McLaughlin & Eldridge; and Shannon McNulty, of the Clifford Law Offices, all of Chicago.

The lawsuits center on claims Sterigenics should be made to pay for emissions of the chemical compound known as ethylene oxide (EtO), which the lawsuits blame for causing cancer and other medical conditions in people who lived and worked in and around Sterigenics’ Willowbrook facility.

That plant has been closed for nearly a year. It first closed in February 2019 when the Illinois Environmental Protection Agency, under Gov. JB Pritzker, issued a so-called “seal order,” forbidding the company from using its stores of EtO, a compound essential to Sterigenics’ sterilization operations.

Sterigenics announced in the fall of 2019 that it would not seek to reopen the facility.

Pritzker’s EPA order, which Sterigenics argued in court was unconstitutional and illegal, came shortly after Pritzker was inaugurated after defeating Republican Gov. Bruce Rauner in 2018 – in part, thanks to Pritzker’s use of controversy surrounding the Sterigenics facility during the campaign.

The controversy had erupted in mid-2018, following the release of a report from the federal Agency for Toxic Substances and Disease Registry, which blamed Sterigenics’ alleged emissions for a heightened cancer risk in the region around Willowbrook. That report, in turn, was seized upon by personal injury lawyers to launch an initial round of lawsuits against Sterigenics and then by activists seeking to shut down the Sterigenics facility.

In the fall of 2018, the state of Illinois joined the fray, suing to secure a court order essentially ordering Sterigenics closed. At no point has the state or any other plaintiff argued Sterigenics violated clean air laws or the emissions limits set by the state or federal governments. Rather, the lawsuits have argued Sterigenics has caused a “public nuisance” by emitting EtO at all.

Sterigenics has consistently maintained all of the litigation has represented an attempt to improperly use the courts to circumvent and rewrite emissions regulations.

Amid the court fights, Illinois lawmakers passed legislation enacting what was called the strictest regulations of EtO in the U.S.

The state and Sterigenics eventually settled their court actions, under a “consent decree,” in which the state agreed to allow Sterigenics the chance to obtain a new permit in exchange for an agreement by Sterigenics to abide by emissions and inspection regulations even stricter than those in the state law.

In the face of continued efforts by activists in Springfield and elsewhere to force them out of business, Sterigenics opted not reopen its Willowbrook facility.

In the latest filing, however, the personal injury lawyers suing Sterigenics said the company made that decision as part of an alleged strategy to try to deny plaintiffs the chance to collect in court.

According to the new allegations in the amended complaint, the plaintiffs assert Sterigenics opted not to invest in new emissions controls at the Willowbrook plant because it had already shuttled the funds needed to complete the work to shareholders, or locked the money up as pledges to banks to finance debt.

The amended lawsuit accused Sterigenics and its corporate parents of a “carefully orchestrated” effort, dating back to 2016, to limit the amount the company may need to pay out under the lawsuits in damages to plaintiffs and fees to plaintiffs’ lawyers.

In all, the plaintiffs now accuse Sterigenics of “funneling” $1.3 billion in a series of payments to shareholders and other financing actions.

The plaintiffs assert these alleged maneuvers began in 2016, two years before the first lawsuits were filed and even before the U.S. EPA moved to formally reclassify EtO as a “known human carcinogen” later that year.

The actions, said the plaintiffs in their amended lawsuit, “has effectively placed the companies’ cash and other assets out of Plaintiffs’ reach, prevented Sterigenics from investing in emission control equipment, and dangerously de-stabilized the Sterigenics companies, thereby jeopardizing the companies’ viability and the likelihood that Plaintiffs will receive just compensation for their injuries.”

Typically, in such personal injury lawsuits, plaintiffs’ lawyers received a large share of whatever judgments or settlements a plaintiff may receive.

The amended complaint, however, does not include any new formal counts under the law against Sterigenics connected to the finance-related allegations. Rather, the allegations are added to the section of the complaint dedicated to explaining the case.

The complaint also does not seek any kind of injunctions related to Sterigenics’ funds. 

In reply, Sterigenics said the plaintiffs’ account concerning its use of the money is “inaccurate and misleading.”

“Sterigenics and its parent Sotera Health are vibrant and growing companies and the recent claims to the contrary are inaccurate and misleading,” Sterigenics said in an emailed statement. “ The companies regularly take actions to maintain and enhance their financial strength for the benefit of all stakeholders as they invest for the future and continue to deliver vital services and products to customers. Assertions that the companies took actions with respect to capital structure in response to ongoing litigation are false.

“While we empathize with anyone dealing with cancer, we are confident that operations at our Willowbrook facility are not responsible for causing the illnesses alleged in any lawsuit. We look forward to continuing to present our case in court to defend against the plaintiffs’ baseless charges.”

Sterigenics is represented by attorneys with the firm of Sidley Austin, of Chicago.

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Organizations in this Story

Sidley Austin LLPRomanucci & BlandinPower, Rogers and SmithHart McLaughlin & Eldridge, LLCSalvi, Schostok, & Pritchard PC.SterigenicsCLIFFORD LAW OFFICES, P.C.

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