Arbitration award ruling in Kerr-McGee suit upheld

WILKES-BARRE – A Luzerne County judge upheld an arbitration award decision made by a federal judge in a lawsuit involving plaintiffs who allege they developed health problems from chemicals released into the air by the former Avoca-based Kerr-McGee Corp.

In a hearing held on Friday, county Judge Peter Paul Olszewski Jr., signed eight orders confirming arbitrator Russell M. Nigro’s original award totaling $943,885.72.

Attorneys for the 3,500 plaintiffs who filed 24 original lawsuits in January 2005 filed court papers last week stating Kerr-McGee breached an arbitration agreement by failing to award damages to plaintiffs from two separate groups because the corporation contested a judge’s decision and didn’t make payments in an agreed-upon time frame, or at all.

Kerr-McGee manufactured railroad ties from 1956 until it closed in 1996. The plaintiffs allege they developed health problems from three highly toxic substances – creosote, arsenic and benzene – that were released into the air from the plant. Plaintiffs allege they or their family members have developed various types of cancer. Approximately 708 plaintiffs have died since the lawsuits were filed.

In an emergency petition to enforce judgment filed last week, attorneys Robert Powell, Stephen Seach and Angel Mae Webby said Kerr-McGee filed a motion for reconsideration regarding one of the nine plaintiffs from one group, and eight plaintiffs from the second group. The first group includes people who allege they had pre-cancerous skin lesions, while the second group alleges they have skin cancer.

According to the arbitration agreement made before hearings in April and August, awards cannot be appealed, the attorneys said.

In a response to the petition filed Friday, attorneys for Kerr-McGee, now owned by Alabama-based Tronox LLC, said the company did not award monies because the arbitration of five plaintiffs was not final until a motion to reconsider was ruled upon on Oct. 30.

“The arbitration agreement does not require payment of those awards until 30 days of its becoming final on Nov. 29,” court papers filed by Scranton attorney Sal Cognetti, and Alabama attorneys John M. Johnson, William S. Cox III and Jacob M. Tubbs say. “Accordingly, the plaintiff’s petition is premature as to those five plaintiffs and must be denied.”