Ex-Freedom President Gets 1 Month in Prison for West Virginia Chemical Spill

By John Raby | February 18, 2016

An executive who appeared unsympathetic when he spoke to the public after a chemical spill sullied tap water for 300,000 people in West Virginia was sentenced to one month in federal prison Wednesday.

Ex-Freedom Industries President Gary Southern, who told reporters a day after the January 2014 spill that he had had a “long day” and tried to leave a news conference multiple times, also was fined $20,000 in U.S. District Court.

Southern, the last of six ex-Freedom Industries officials to be sentenced on pollution charges, told the court Wednesday that he accepted responsibility “for my shortcomings and oversights” and that he was “not the person that I was painted on television.”

Southern was a co-founder of Freedom Industries and had direct oversight of the Elk River facility. He was Freedom Industries’ chief operating officer starting in May 2009, a member of its board from March 2010 to October 2013 and became president when it was sold in December 2013.

The following month, a corroded Freedom tank in Charleston leaked thousands of gallons of coal-cleaning chemicals into the water supply for nine counties, spurring a ban on tap water for up to 10 days. Residents immediately cleared store shelves of bottled water, and many restaurants were forced to close or cut back services temporarily.

According to an FBI affidavit, officials had been aware of critical deficiencies at the Freedom site for more than a decade, including a cracked containment wall that let chemicals seep down a bank into the Elk River. But improvements to the wall weren’t made.

Four others were sentenced to probation in the criminal case; a fifth also received a one-month prison term. Freedom Industries, which filed for bankruptcy eight days after the spill, was fined $900,000, although Judge Thomas Johnston said the fine was symbolic due to the company’s liquidation in the other case.

Southern pleaded guilty to three pollution charges and could have been sentenced to up to three years. Prosecutors dropped 12 other counts related to bankruptcy fraud.

However, federal prosecutors said Southern should get a more severe punishment than the other defendants because he tried to mislead a bankruptcy court about his role with Freedom to avoid potential financial consequences of the spill.

Johnston said in imposing the sentence that he put an emphasis on Southern’s missteps in federal bankruptcy court and to send a message “to the other Gary Southerns out there to get it right” in complying with environmental laws.

During a Jan. 10, 2014 news conference, Southern occasionally drank from a bottle of water and said “Look guys. It has been an extremely long day. I have trouble talking at the moment. I would appreciate if we could wrap this thing up.”

The defense team said Southern had pneumonia and had not slept in the days after the spill.

Johnston said the news conference was “a public relations disaster” for Freedom Industries but had nothing to do with the federal court case.

The government had seized $7.3 million and a Bentley from Southern and put a lien on his Florida house, but his plea deal enabled him to get those assets back.

Johnston granted a defense request to allow Southern to be flown on a friend’s private jet later Wednesday to his Florida home and to allow Southern to be assigned to a minimum-security facility in Pensacola, Florida.

A trial in a federal class-action lawsuit is set for July, pitting affected residents and businesses against West Virginia American Water, its parent company and chemical manufacturer Eastman Chemical. In a related proposed settlement, Southern would pay $350,000.

Karan Ireland, a Charleston City Council member, asked the court for the maximum-possible punishment for Southern and was disappointed by the sentence.

“At the same time, I have to respect the rule of law,” Ireland said. “I have to believe in our judicial system. I have to believe in democracy. I don’t think it’s a waste of time. Maybe we’ll see justice through the civil proceedings.”

 

Related:

Get Insurance Journal Every Day

Add a Comment

Your email address will not be published. Required fields are marked *

*

More News
More News Features