Dow Chemical 2012 Annual Report Download - page 50

24
The Dow Chemical Company and Subsidiaries
PART I, Item 3. Legal Proceedings.
LEGAL PROCEEDINGS
Asbestos-Related Matters of Union Carbide Corporation
Union Carbide Corporation (“Union Carbide”), a wholly owned subsidiary of the Company, is and has been involved in a large
number of asbestos-related suits filed primarily in state courts during the past three decades. These suits principally allege
personal injury resulting from exposure to asbestos-containing products and frequently seek both actual and punitive damages.
The alleged claims primarily relate to products that Union Carbide sold in the past, alleged exposure to asbestos-containing
products located on Union Carbide’s premises, and Union Carbide’s responsibility for asbestos suits filed against a former
Union Carbide subsidiary, Amchem Products, Inc.
It is the opinion of Dow’s management that it is reasonably possible that the cost of Union Carbide disposing of its
asbestos-related claims, including future defense costs, could have a material impact on the Company’s results of operations
and cash flows for a particular period and on the consolidated financial position of the Company.
For additional information, see Part II, Item 7. Other Matters, Asbestos-Related Matters of Union Carbide Corporation in
Management’s Discussion and Analysis of Financial Condition and Results of Operations, and Note 14 to the Consolidated
Financial Statements.
Environmental Matters
Following a 2008 Risk Management Program (“RMP”) inspection by the Environmental Protection Agency ("EPA") at the
Company's Freeport, Texas manufacturing facility, the EPA determined that the facility had two deficiencies in its then-
applicable RMP Plan. Although EPA Region Six officials have confirmed that all corrective actions were made within a
reasonable period of time, the EPA is seeking to collect an administrative penalty slightly in excess of $100,000.
Dow Benelux B.V., a Netherlands-based wholly owned subsidiary of the Company, received a summons dated July 20,
2012 from the Public Prosecutor in The Netherlands to appear before the criminal section of the District Court in Breda, The
Netherlands on January 23, 2013. The allegations contained in the summons relate to seven process safety incidents and
environmental spills that occurred between 2005 and 2008 at Dow Benelux B.V.'s Terneuzen manufacturing facility. The Public
Prosecutor alleges that each of the incidents constitutes a violation of certain Netherlands safety procedures and environmental
regulations, notably Section 5 of the Major Accidents Decree 1999 and/or Section 18.18 of the Environmental Act. In addition,
five of the incidents allegedly also constitute a violation of Section 173a of the Dutch Criminal Code. If convicted, Dow
Benelux B.V. may face sanctions including fines in excess of $100,000 for some of the violations. By letter of December 21,
2012, the Public Prosecutor has canceled the court hearing of January 23, 2013, and has indicated that a new date for a court
hearing will be communicated in due course.