For BASF, huge potential liability emerges years after deal

When BASF acquired Engelhard Corp. nine years ago for $5 billion, executives unknowingly inherited a ticking legal time bomb.

It all began decades ago over the seemingly mundane industrial product talc, used in everything from wallboards to handling auto tires on the factory line.

In 1983, Engelhard quietly settled a lawsuit after its officials testified in depositions that talc produced by a company mine contained cancer-causing asbestos. All evidence was sealed and Engelhard and its law firm repeatedly said in subsequent lawsuits spanning more than two decades that the company’s talc was asbestos-free.

It wasn’t until 2009, after BASF assumed Engelhard’s liabilities, that another picture began to emerge. A former Engelhard scientist testifying in a lawsuit filed by his own daughter said he was told that “asbestos in trace amounts was found in talc,” and the company’s legal department “told us to purge our records” relating to the mine. A co-worker testified about test results in the 1970s showing the presence of asbestos in the talc.

[Article continues at original source]

Source: For BASF, huge potential liability emerges years after deal – Chicago Tribune


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