DuPont 2008 Annual Report Download - page 87

The company does not believe that Benlate»caused the damages alleged in each of these cases and denies the
allegations of fraud and misconduct. The company continues to defend itself in ongoing matters. As of December 31,
2008, the company has incurred costs and expenses of approximately $2,000 associated with these matters, but
does not expect additional significant costs or expenses associated with the remaining 11 cases. The company has
recovered approximately $275 of its costs and expenses through insurance and does not expect additional
insurance recoveries, if any, to be significant. At December 31, 2008, the company does not have any
remaining accruals related to Benlate».
Spelter, West Virginia
In September 2006, a West Virginia state court certified a class action against DuPont that seeks relief including the
provision of remediation services and property value diminution damages for 7,000 residential properties in the
vicinity of a closed zinc smelter in Spelter, West Virginia. The action also seeks medical monitoring for an
undetermined number of residents in the class area. The smelter was owned and operated by at least three
companies between 1910 and 2001, including DuPont between 1928 and 1950. DuPont performed remedial
measures at the request of the EPA in the late 1990s and in 2001 repurchased the site to facilitate and complete the
remediation. The fall 2007 trial was conducted in four phases: liability, medical monitoring, property and punitive
damages. The jury found against DuPont in all four phases awarding $55.5 for property remediation and $196.2 in
punitive damages. In post trial motions, the court adopted the plaintiffs’ forty-year medical monitoring plan estimated
by plaintiffs to cost $130 and granted plaintiffs’ attorneys legal fees of $127 plus $8 in expenses. In June 2008,
DuPont filed its petitions for appeal with the West Virginia Supreme Court seeking review of a number of issues
associated with the trial court’s decisions before, during and after the trial. On September 25, 2008, the Court
decided to accept the case and consider the parties’ appeal on the merits. A decision on the appeal is not expected
until the second half of 2009. Effective with DuPont posting a bond, the execution of judgment against the company is
stayed pending final disposition of DuPont’s appeal to the West Virginia Supreme Court of Appeals. As of
December 31, 2008, the company had recorded accruals of $55, although given the uncertainties inherent in
litigation, there can be no assurance as to the final outcome.
General
The company is subject to various lawsuits and claims arising out of the normal course of its business. These
lawsuits and claims include actions based on alleged exposures to products, intellectual property and environmental
matters and contract and antitrust claims. Management has noted a nationwide trend in purported class actions
against chemical manufacturers generally seeking relief such as medical monitoring, property damages, off-site
remediation and punitive damages arising from alleged environmental torts without claiming present personal
injuries. Such cases may allege contamination from unregulated substances or remediated sites. Although it is not
possible to predict the outcome of these various lawsuits and claims, management does not anticipate they will have
a materially adverse effect on the company’s consolidated financial position or liquidity. However, the ultimate
liabilities may be significant to results of operations in the period recognized. The company accrues for
contingencies when the information available indicates that it is probable that a liability has been incurred and
the amount of the liability can be reasonably estimated.
Environmental
The company is also subject to contingencies pursuant to environmental laws and regulations that in the future may
require the company to take further action to correct the effects on the environment of prior disposal practices or
releases of chemical or petroleum substances by the company or other parties. The company accrues for
environmental remediation activities consistent with the policy set forth in Note 1. Much of this liability results
from the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, often referred to as
Superfund), the Resource Conservation and Recovery Act (RCRA) and similar state laws. These laws require the
company to undertake certain investigative and remedial activities at sites where the company conducts or once
conducted operations or at sites where company-generated waste was disposed. The accrual also includes
estimated costs related to a number of sites identified by the company for which it is probable that
environmental remediation will be required, but which are not currently the subject of CERCLA, RCRA or state
enforcement activities.
F-31
E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements (continued)
(Dollars in millions, except per share)