Settlement Ends Pollution Trial : W. R. Grace Will Pay $8 Million to Families

W. R. Grace & Co. agreed to pay more than $8 million Monday in an out-of-court settlement in a major environmental trial in Woburn, Mass., involving allegations that chemical pollution of the town’s drinking water had caused six leukemia deaths and other illnesses.

Although details of the settlement were kept secret, a knowledgeable source told The Times that the agreement provides for payments by the New York-based chemical manufacturer of $1 million each to the eight families who filed the suit, and additional money to other affected families in the blue-collar Boston suburb.

The settlement ends a 4-year-old case that legal experts had watched closely as a precedent for dozens of similar suits nationwide involving attempts to prove links between industrial pollution by companies and specific cases of illness and death.

In this case, the suit charged that contamination of two Woburn municipal wells with two toxic chemicals caused the leukemia deaths of at least five children and one adult since l978, and cardiac and neurological problems for 25 other persons.

Before announcing the settlement Monday morning, U.S. District Judge Walter J. Skinner told the six jurors that he had decided to void their previous ruling against Grace, issued on July 27 after a 5-month trial, and order a new trial on the company’s liability. The settlement precludes another trial.

“We are very, very happy,” said Jan R. Schlichtmann, an attorney for the Woburn families, in a telephone interview. “It was a triumph. The whole purpose of the suit was to have them pay for what they did. That was accomplished.”

Kathryn Gamache, whose husband, Roland, died of leukemia seven months ago, said she was glad the case was over. “Money was never an important factor, but for them to settle out of court proves to me that they’re guilty, they know they’re guilty, and they’re willing to pay for it,” she said in a telephone interview.

Grace spokesman Fred Bona said the company did not admit any liability in the settlement.

Firm Maintains Innocence

“We continue to maintain and are now more convinced than ever that we did not pollute the wells and we were in no way responsible for the tragic events . . . in the Woburn community,” Bona said, reading from a statement here. He said the company decided to settle because of “our concern for the additional strain on the families, litigation costs, complexity of the case and the length of the trial.”

“Obviously, we think it’s a fair settlement,” Bona added.

Lawyers involved in the negotiations said the judge told them last Wednesday of his sealed decision to order a new trial and that the decision had pushed both sides to compromise.

“We all said if there is a time to settle, this is the time,” said Michael B. Keating, Grace’s trial attorney in the case.

In the July ruling, the jurors found that Grace had negligently “substantially contributed” to the contamination of two municipal drinking wells in Woburn with trichloroethylene, and tetrachloroethylene. The jury cleared another defendant, Beatrice Cos. of Chicago, of any liability.

The two cleaning solvents were used to make food packaging equipment at Grace’s plant in Woburn, a city of 35,000 about 12 miles north of Boston. The U.S. Environmental Protection Agency classifies both chemicals as “probable” causes of cancer in humans.

A Massachusetts Department of Health study found 19 cases of childhood leukemia in Woburn from 1969 to 1985, and said that statistically, six cases would have been expected.

Technical Questions Cited

Skinner said Monday that he had decided to order a new trial because he found that jurors were confused by technical questions that lawyers had posed for them to consider in their nine days of deliberations.

The settlement came as the jurors prepared to consider the second phase of the trial, in which the medical issues would be addressed. A third trial would then have been held to determine damages.

“There are hundreds of communities grappling with the problem of contaminated water supplies,” said Paul Schneider, another attorney for the Woburn families, in a telephone interview. “This is an instance where a major corporate defendant has recognized at least in part its responsibilities for causing a major water contamination problem.”