BIRMINGHAM – Shares in Solutia, Inc. more than tripled in value Thursday after the company settled thousands of claims over PCB pollution in Alabama, but it could be months before victims learn how much they receive under the deal. Stock in the St. Louis-based company surged $3.10 to close at $4.00 a share on news of the agreement, which is valued at $675 million by the company and closer to $800 million by lawyers for about 20,000 landowners.
Shares in Monsanto Co., which also in involved in the settlement rose more than 6 percent, or $1.43, to close at $24.12. Lawyers and a judge involved in the deal said the agreement doesn’t include set payments amounts for residents of Anniston, Alabama, who claim their land and bodies were contaminated by decades of chemical contamination. Instead, court-appointed officers will determine a payment schedule that includes varying amounts for different ailments, health concerns or property damage.
Homeowners will receive amounts based on where they fall on a matrix. Circuit Judge Joel Laird, presiding in a state court trial over PCB claims, said it could be three months before homeowners know how much they will receive. Jurors already have awarded more than $103 million to about 500 plaintiffs in Laird’s trial, and the companies must still pay those judgments. While settlements typically are less than jury awards, Laird said the verdict amounts could be considered as court officials determine settlement payments. Meanwhile, plaintiffs’ attorneys already know what they will get – $240 million total.
Several firms represented landowners, and one alone had $15 million in expenses, said Jere Beasley, homeowners’ attorney. Monsanto, a corporate ancestor of Solutia, made polychlorinated biphenyls in Anniston for about four decades until the early 1970s. The government later cited health concerns in banning the chemical, once a common electrical insulator. Under the agreement, Solutia will pay $50 million and Monsanto will pay $390 million. Insurance will provide $160 million, and $75 million more will be spent over the next 20 years on health programs in Anniston.