Imperial execs mulled over implications of 1996 sugar plant blast, CFO says

Oct 18, 2009 (Savannah Morning News - McClatchy-Tribune Information Services via COMTEX) -- IPSU | Quote | Chart | News | PowerRating -- Imperial Sugar Co. executives more than a decade ago discussed the significance of a fatal 1996 sugar plant blast in Nebraska, a company official has testified.

His testimony stems from lawsuits against Imperial after its Port Went-worth plant blew up Feb. 7, 2008, killing 14 people and injuring many more.

In testimony, Imperial Chief Financial Officer Hal Mechler described talks that followed a July 20, 1996, explosion at the Western Sugar Co. plant in Scottsbluff, Neb.

Mechler said that explosion, which killed one worker and injured 15, made him aware for the first time that sugar dust is combustible. Federal investigators have said sugar dust fueled the Port Wentworth explosion.

Twelve years later, a federal agency accused Imperial of violating some of the same safety standards it found Western Sugar flouted.

Asked for comment, Imperial spokesman Steve Behm issued a statement almost identical to five others he's offered recently on other topics.

"Imperial will not comment on stories concerning either the litigation process or ones derived to undermine the tremendous progress that we've made," Behm said.

Plaintiffs' lawyers say Mechler's testimony fattens the file of evidence showing company officials long knew about the risks of sugar dust.

Willful misconduct alleged

That helps establish that the company was not only negligent, but willfully negligent, the lawyers say.

Alleged willful negligence is a key issue in the lawsuits.

It also could be central to a criminal prosecution of the company or its officials -- an option the government has not ruled out.

Mechler said in an April 2 sworn statement the 1996 talks involved a group that "would have included the CEO and other managers at the senior level."

He said the managers talked about "what occurred in that accident and... steps appropriate... to make sure we weren't susceptible to the same issue."

Mechler said he recalled only that the meeting and the Scottsbluff explosion were in the "mid '90s."

He also said he didn't know whether, "based on that meeting," any action was taken.

He did not return two phone calls seeking additional comment.

Imperial acquired the Port Wentworth plant when it bought Savannah Foods in December 1997.

Mechler's testimony adds to the list of other explosions company officials discussed or that happened at Imperial plants.

Among those described or cited in sworn testimony by company officials:

--A 1998 sugar dust explosion at the company's refinery in Sugar Land, Texas, which injured two workers. A dust collector in the blast area was stopped up with sugar and powdered sugar had accumulated nearby, investigators said.

--A 2007 sugar dust explosion at the Domino Sugar refinery in Baltimore. Imperial President John Sheptor testified he didn't know sugar could explode until the Port Wentworth inferno but has also said he earlier talked with another company executive about the Domino incident.

--A 2006 explosion that hurt a worker at a mill in Louisiana. Imperial Human Resources Director Deborah Haban testified a company executive described the blast as "another example of why we needed to be diligent in safety."

Following the Sugar Land accident, Mechler testified, safety improvements were added at the Texas plant. But he said he didn't know whether similar actions were taken at Port Wentworth or other company sites.

The company also has received several consulting and maintenance reports -- dated at least as long ago as 2006 -- warning of dust problems.

The U.S. Chemical Safety Board recently cited memos dating back decades that show Port Wentworth managers knew sugar dust could explode.

The incident at the Western Sugar plant, which refined sugar beets, was investigated by the U.S. Occupational Safety and Health Administration.

In 1997, OSHA and the company negotiated a settlement on 13 violations and levied fines totaling $86,775.

The Western Sugar violations involved three of the safety standards OSHA cited when it looked into the incident at Port Wentworth.

The agency said it found more than 200 safety violations there and at Imperial's refinery in Gramercy, La. It is seeking to fine the company $8.8 million for the alleged violations. Imperial is contesting the fines.

Lawyers for victims of the disaster and their families say the discussion Mechler describes is important.

"I think this, combined with the Sugar Land explosion, shows they had even more prior knowledge of the risks," Brent Savage said. "The Scottsbluff incident was more than 12 years before Port Wentworth. They had plenty of time to do something about the hazards."

Attorney Mark Tate agreed, saying conditions that will cause explosions at one plant will cause them at another.

"It solidifies the evidence for what we've been saying all along," Tate said. "They knew conditions at Port Wentworth were dangerous and didn't fix them."

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