Hiding information about fungicide

DuPont Shareholders for Fair Value (DSFV) — a group of investors concerned with financial impacts of DuPont’s use of C8 (also known as PFOA), a chemical associated with Teflon and with grease and stain repellants — responded today to a decision by a federal appeals court in San Francisco to reinstate racketeering suits that charge DuPont with hiding information about a widely used fungicide, Benlate.

“Another legal case against DuPont on allegations of concealment unfortunately bolsters our claim that shareholders are harmed and undermined by DuPont’s concealment of problems and its failure to disclose critical information,” said Sanford Lewis, an attorney representing DSFV.

Ongoing litigation alleges that DuPont allowed Benlate to become contaminated by sulfonylureas - an herbicide. Later suits suggested that DuPont had "concealed, withheld and lied about" test data confirming the Benlate contamination, according to the appeals court ruling. The decision this week reinstates litigation under the federal Racketeer Influenced and Corrupt Organizations Act — or RICO — alleging unlawful concealment of that data.

“If it turns out that DuPont concealed, hid or lied about Benlate contamination, we wonder what else DuPont is hiding,” said Lewis.

“DuPont shareholders have already borne the brunt of over $1.9 billion in payouts for damages involving Benlate, and the amount continues to grow. We are deeply concerned that DuPont management continues to inflict reputational damage on the company and its share price by failing to inform customers, the public and shareholders of risks. Will C8 be the next Benlate?”

C8 is a chemical intermediate used in the production of certain DuPont products such as Teflon. Earlier this year, DuPont received a criminal subpoena from the U.S. Department of Justice regarding alleged concealment of data from the federal EPA regarding environmental and health risks of C8. In the following months, DuPont stock values dropped as much as 19 percent, some of which may be attributable to the new C8 allegations, according to Lewis.

In correspondence filed with the SEC, DSFV asserts that DuPont has withheld from investors information the management had known regarding toxic and financial risks associated with C8, and that management assertions that C8 is not harmful to human health may be misleading. DuPont has recently acknowledged that $1 billion in annual revenues could be at stake in the event of regulatory restraints on the use of the chemical C8.

Members of the DSFV coalition own at least 438,000 shares of DuPont stock. The coalition includes the United Steelworkers of America, Amalgamated Bank’s Long View Funds, the Sisters of Mercy Merion Regional Community in Merion, Pennsylvania, and institutional investors Green Century Capital Management in Boston.