Judge summons Dow US to appear in criminal trial in Bhopal

BHOPAL SURVIVORS WARNED DOW IT WOULD INHERIT CARBIDE’S LIABILITY

And not just the survivors. A group of Dow shareholders felt so strongly that the merger of Dow Chemical and Union Carbide would be a disaster for their company that they took out a class-action suit against their own management to try to prevent the deal. The suit failed, but today it looks as if the warnings were right.

Dow Chemical (US) has been summoned to appear in the Chief Magistrate’s Court, Bhopal, to explain why it has not produced its 100% subsidiary Union Carbide Corporation for trial before the court, where it is charged with the culpable homicide of 20,000 human beings.

Union Carbide and its former Chairman Warren Anderson have been thumbing their noses at the court for 13 years, claiming that it has no jurisdiction. They were declared absconders and all Carbide’s assets in India were attached by the court and later sold at the direction of the Indian Supreme Court to finance a hospital for victims of the disaster.

Survivors warned Dow that in acquiring Carbide’s plants, products, people, patents and profits, it would also acquire its liabilities. And Dow did indeed pay out on Carbide’s US asbestos liabilities, a $800 million blow that sent its share price reeling. Dow has however always refused to accept that it has inherited Carbide’s outstanding Indian liabilities and indeed, until recently, even refused to acknowledge that any existed.

In 2003 Dow CEO William Stavropoulos told his company’s AGM that there were no criminal charges outstanding against Carbide in India, a statement he was later forced to retract (he claimed he “mis-spoke”) but the misspeaking has since often been repeated and accepted at face value by American media too lazy, biased or incompetent to question it.

Now the criminal case has risen up to bite Dow’s unlovely arse. Major Dow shareholders, already worried about the extent of the company’s Bhopal exposure, must now be concerned that if Union Carbide continues to snub the court, its unwilling parent must be dragged there or place all its Indian holdings at risk of seizure.

Dow will seek refuge behind a series of corporate veils, and struggle to maintain the uncomfortable fiction that Union Carbide remains an independent and major chemical company in its own right. How little Dow itself believes this, however, is shown by its panicky creation of a separate Union Carbide website the night before the original plea was tabled before the court in Bhopal. See our report from the time.

A further ploy to make Carbide appear separate from Dow was the rehiring of Tomm F Sprick, a Carbide spokesman from yesteryear, to replace Dow’s John Musser. See “Sprick Up Your Ears” Both of these rather desperate acts demonstrate how foolish the Dow company was to regard Bhopal merely as a PR problem. It is rapidly becoming something far more threatening.

Read the Bhopal judge’s order here.