UPDATE: Three Former Freedom Industries Officials Plead "Not Guilty"

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WV AG Report

Freedom Execs. Indictment

Freedom Company Information

Michael Burdette Information

Robert Reynolds Information

UPDATE 1/8/2015 @ 6:15 p.m.
CHARLESTON, W.Va. (WSAZ) -- Three former Freedom Industries executives pleaded not guilty to charges connected to the January 2014 chemical spill that left 300,000 West Virginians without water.

Former Freedom Industries President, Gary Southern, along with Dennis Farrell and William Tis were in federal court Thursday. All three are facing negligence charges. Southern is also facing several bankruptcy fraud charges.

Farrell and Tis were released on $10,000 unsecured bonds.

Gary Southern had already posted a $100,000 bond in a Florida federal court in December. Prosecutors were asking for a $500,000 bond, but U.S. Magistrate Judge Dwane Tinsley denied that request.

As a condition of his bond, Southern will also have to surrender his private pilot's license. He's also only able to travel in the southern district of West Virginia, the middle district of Florida, and Greenville and Columbia, South Carolina, where part of his legal team is based.

Southern, Farrell, and Tis all had pre-trial dates set for February 18th. Their trials will all begin on March 10th.



UPDATE 1/8/15
CHARLESTON, W.Va. (WSAZ) -- According to an FBI affidavit that was unsealed Wednesday, Freedom Industries' employees knew about the problems that led to a chemical leak that left 300,000 West Virginians without water for years before the spill happened.

According to the affidavit, employees who worked at the Etowah River Terminal were aware of defects in the dike wall before a Freedom subsidiary bought the facility in 2001.

The document also states the tank that the chemical MCHM leaked from was never properly inspected, and was supposed to be taken out of service in 2008. That never happened, and the tank continued to store MCHM, according to the federal document.

Michael Burdette, the former plant manager for the Freedom facility on the Elk River, apparently told an EPA special agent that Freedom never inspected the MCHM tanks because he "had just not gotten around to it," according to the affidavit.

The WV Attorney General's Office released a report with similar findings Thursday.

“This report outlines the significant and troubling deterioration that was allowed to go on at the Barlow Road facility, and highlights how Freedom officials ignored numerous warning signs that should have been addressed,” West Virginia Attorney General Patrick Morrisey said.

“Our Office’s investigation was able to document many red flags that highlighted and described deplorable conditions at this facility as early as 2007,” Morrisey said. “Our investigative team spent countless hours in the cold, mud, and pooled chemicals to inspect the facility immediately after the leak and spent additional weeks and months digging through documents, interviewing pertinent officials, and researching the facility to develop a complex and complete understanding of what happened and why. Our hope is that their work, and the work of so many others in the Office, can help to provide an understanding of what happened so that this type of crisis will never again happen.”

Six former Freedom Industries executives are facing charges related to the January 2014 chemical leak into the Elk River.

To read the full report from the AG's Office, click the link at the top of the story.



UPDATE 1/7/15 @ 1:30 p.m.
CHARLESTON, W.Va. (AP) - Defense lawyers say a former executive charged in a West Virginia chemical spill isn't a flight risk.

Former Freedom Industries President Gary Southern's lawyers are asking a federal judge to dismiss a prosecution request to place Southern on home confinement with electronic monitoring.

Federal prosecutors say the United Kingdom citizen has minimal West Virginia ties and can leave the country on a private plane.

In a motion filed Tuesday, Southern's lawyers say he will surrender his private pilot's license until the case is resolved.

The motion also says Southern has applied for U.S. citizenship and, like many West Virginians, is a descendant of coal miners.

Southern, Freedom and five other ex-Freedom officials and employees face charges for the 2014 spill that tainted 300,000 people's water for days.

Keep clicking the WSAZ app and WSAZ.com for the latest on this story.



UPDATE 12/18/14 @ 2:45 p.m.
CHARLESTON, W.Va. (AP) - Federal prosecutors want a former executive charged in a January chemical spill on home confinement with electronic monitoring.

In federal court Thursday, prosecutors requested tougher release conditions for ex-Freedom Industries President Gary Southern.

The motion lists motives to flee. Southern claimed a $16 million net worth in January, then just over $9 million in August.

It says he's a citizen of the United Kingdom and has minimal West Virginia ties aside from his criminal case. It also says Southern can leave the country on a private plane with his private pilot's license.

Prosecutors want a daily home call from Southern, no private plane travel and a secured bond.

Southern, Freedom and five other ex-Freedom officials and employees face charges for the spill that tainted 300,000 people's water for days.



UPDATE 12/17/14 @ 11:45 p.m.
CHARLESTON, W.Va. (WSAZ) -- In Eric Peebles house, you'll find enough plastic to fill a recycling center.

"I at least get six to eight {water jugs} every time I go to the store," said Peebles.

It's been more than eleven months since thousands of gallons of MCHM spilled into the Elk River, and yet Peebles is still not touching the tap.

"I want justice," said Peebles. "I think that's good, that's what's supposed to be done."

The first step towards justice happened Wednesday. Federal indictments were handed down against Freedom Industries and four of it's former officials. Two others who worked at the facility along Barlow Drive were also charged through an information.

The government stresses negligence in inspecting the tanks, and failing to contain the chemical that forced 300,000 people to be without water for days.

"It's been a long, long hard year," said Sandy Call.

Call, the general manager of Bridge Road Bistro in Charleston says after months of financial struggles and strife, there's finally a sense of relief.

"I don't think happy's the word," said Call. "I think it's settling that someone is held accountable or someone's."

For others, it's a sense of vindication.

"They should go down," said Derek Merrill. "You can't just weasel out of everything."

The spill was an incident that put thousands of people on edge when it came to a basic necessity of life.

"A lot of people are just wanting to move forward, wanting to get over this, and wanting to basically get back to normal; get back to Charleston, West Virginia," said Call.

Some are hopeful this will help put things back on that track.


UPDATE 12/17/14 @ 5:20 p.m.
CHARLESTON, W.Va. (WSAZ) -- West Virginia American Water has issued a statement following the announcement of Freedom Industries, Inc. and several people, charged in connection with the 2014 chemical spill in Charleston.

In a release Wednesday afternoon, WVAW said, "On behalf of our customers, West Virginia American Water appreciates the efforts of the U.S. Attorney's Office, the FBI and the EPA to hold the responsible parties accountable for the Freedom Industries spill. As Mr. Goodwin stated, the indictments brought forward by his office today send a clear and powerful message about the importance of our water supply. We believe that vigorous enforcement of the Clean Water Act and other environmental regulations is imperative to protecting public water supplies and public health and avoiding incidents like the Freedom Industries spill which, as Mr. Goodwin mentions, was completely preventable with proper maintenance and secondary containment."

Keep clicking on the WSAZ app and WSAZ.com for the latest on this story.



UPDATE 12/17/14 @ 5:15 p.m.
CHARLESTON, W.Va. (WSAZ) -- An attorney for two former executives of Freedom Industries has released a statement on behalf of his clients in connection with their federal charges from the January 2014 chemical spill.

Steve Jory, issued the following statement Wednesday for his clients William Tis and Charles Herzing:
“While I cannot speculate as to the motives of the prosecutorial team, we believe today’s indictment to be an example of faulty legal conclusions.”

“Recently, U.S. Attorney Booth Goodwin charged Gary Southern on the basis that he was singularly responsible for Freedom Industries’ operations from the date he became Freedom’s Chief Operating Officer in 2009. Goodwin’s allegations against Southern are, in point of fact, my client’s defense which, by virtue of the charges against Southern, are baseless. He cannot have it both ways.”

“Not only were my clients not the owners of Freedom at the time of the spill, but four and one half years prior to the spill in 2009, Southern was hired as Freedom Industries’ Chief Operating Officer to operate Freedom Industries. In addition to Southern, additional experts were retained by my clients, to ensure compliance with all safety and environmental standards for Freedom Industries. So to say my clients were criminally negligent in their responsibilities simply does not pass legal muster and is not supported by Goodwin’s own charges against Southern,” concluded Jory.

Both men, along with several others, are charged with various federal crimes related to the spill.

Keep clicking on the WSAZ app and WSAZ.com for the latest on this story.

UPDATE 12/17/14 @ 1:40 p.m.
CHARLESTON, W.Va. (WSAZ) -- U.S. Attorney Booth Goodwin announced that Freedom Industries, Inc. and six former Freedom officials have been charged with various federal crimes related to the January 2014 Elk River chemical spill in Charleston.

“Just a mile and a half upstream from Charleston’s primary source of drinking water, the conditions at the Freedom Industries facility were not only grievously unacceptable, but unlawful. They put an entire population needlessly at risk. As these actions make clear, such conduct cannot, and will not, be tolerated," said Attorney General Eric Holder. “These law enforcement actions send an unambiguous message: that compliance with environmental safety standards is an obligation, not a choice. The Department of Justice is committed to vigorously enforcing the Clean Water Act and other natural resource protections. And we will never rest in our efforts to protect the American people – and our environment – from harm."

“It’s hard to overstate the disruption that results when 300,000 people suddenly lose clean water,” said Goodwin. “This is exactly the kind of scenario that the Clean Water Act is designed to prevent. This spill, which was completely preventable, happened to take place in this district, but it could have happened anywhere. If we don’t want it to happen again, we need to make it crystal clear that those who engage in the kind of criminal behavior that led to this crisis will be held accountable.”

Former Freedom President Gary L. Southern, 53, currently of Marco Island, Florida, along with former Freedom owners and officers Dennis P. Farrell,58, of Charleston, William E. Tis,60, of Verona, Pennsylvania,and Charles E. Herzing,63, of McMurray, Pennsylvania,were indicted by a grand jury sitting at Beckley, West Virginia. Freedom environmental consultant Robert J. Reynolds, 63, of Apex, North Carolina, and tank farm plant manager Michael E. Burdette, 60, of Dunbar, West Virginia, were charged by Goodwin in charging documents known as “informations.”Freedom Industries, Inc., was also charged in an information.

Southern is charged with the negligent discharge of a pollutant in violation of the Clean Water Act, negligent discharge of refuse matter in violation of the Refuse Act,and violating an environmental permit. Southern is also charged with wire fraud and various bankruptcy fraud charges. If Southern is convicted of all the charges contained in the indictment, he is exposed to a statutory maximum of 68 years in prison.

Farrell, Tis and Herzing are charged with the negligent discharge of a pollutant in violation of the Clean Water Act, negligent discharge of refuse matter in violation of the Refuse Act,and violating an environmental permit.If Farrell, Tis and Herzing are convicted of all the charges with which they are charged in the indictment, they are each exposed to a statutory maximum of three years in prison.

The misconduct alleged in the indictment includes:

  • Failure to properly maintain the containment area surrounding the tanks at Freedom’s Elk River facility, and to make necessary repairs to ensure the containment area would contain a chemical spill
  • Failure to properly inspect a tank containing the chemical MCHM
  • Failure to develop and implement a spill prevention, control and countermeasures plan
  • Failure to develop and implement a stormwater pollution prevention plan and groundwater protection plan, both requirements of a National Pollutant Discharge Elimination System Permit

During the time they were responsible corporate officers for Freedom, Farrell, Tis, Herzing and Southern allegedly approved funding only for those projects that would result in increased business revenue for Freedom, or that were immediately necessary for required equipment maintenance.

According to the US Attorney's Office, they allegedly failed to take action to fund other repair and upkeep projects for equipment and systems necessary for environmental compliance at the Elk River facility, including repairing defects in a containment wall, addressing drainage problems in the containment area, and developing and implementing proper protection plans.

Information charges were also filed against Freedom itself,as well as Robert J. Reynolds and Michael E. Burdette.

Freedom is charged with the negligent discharge of a pollutant in violation of the Clean Water Act, negligent discharge of refuse matter in violation of the Refuse Act, and violating an environmental permit.

Michael Burdette, the former plant manager for the Freedom facility on the Elk River.

Robert Reynolds, also one of the individuals responsible for environmental compliance at Freedom, have each been charged with violating the Clean Water Act.

Read the full court documents by clicking the links above.

Keep clicking on the WSAZ app and WSAZ.com for the latest on this story.



UPDATE 12/17/14 @ 1:26 p.m.
CHARLESTON, W.Va. (WSAZ) -- A second round of federal charges have been released in connection with the chemical spill in Charleston.

Wednesday three owners of Freedom Industries, and the company's president, were indicted on negligence charges in connection with the January 2014 spill.

President Gary Southern was also indicted on several bankruptcy fraud charges.

A short time later, more charges were released against the company itself, as well as two other individuals. These were in the form of a Federal Information.

According to the information, Freedom Industries, Inc. is charged with negligent discharge of a pollutant, unlawful discharge of refuse matter in navigable waters, and knowing violation of permit condition.

Michael E. Burdette and Robert J. Reynolds were charged with negligent discharge of a pollutant.

According to the documents, Burdette and Reynolds failed to exercise reasonable care and failed to satisfy their duties to operate the Etowah Facility in a safe and environmentally sound manner.

They are accused of failing to develop and maintain a storm water prevention plan, as well as a groundwater protection plan, and failing to implement pollution controls and other practices that those plans would have required.

Investigators say failing to implement those plans, and failing to implement certain reasonable practices at the facility were proximate causes of the leak and discharge of MCHM into the Elk River.

According to the documents from spring 2009 through January 9, 2014, discharged MCHM into the Elk River without a permit authorizing the discharge.

You can read the documents at the top of the page.

Read below for more information on the indictments against the Freedom Industries executives in connection with the case.



ORIGINAL STORY 12/17/14 @ 10:47 a.m.
CHARLESTON, W.Va. (WSAZ) -- Executives with the company at the root of the chemical spill that impacted more than 300,000 residents in West Virginia in January have been charged in connection with the spill.

According to the federal indictment released Wednesday, Freedom Industries executives are charged with negligent discharge of a pollutant, unlawful discharge of refuse matter, and negligent violation of permit condition.

The charges are filed against three of the company's owners, Dennis P. Farrell, William E. Tis, Charles E. Herzing, as well as President Gary Southern.

Also in the indictment, Southern is also charged with five counts of scheme to defraud in a bankruptcy case, one count of scheme to defraud by wire, one count of scheme to defraud in a bankruptcy case, and three counts of false oath and account in a bankruptcy case.

According to the indictment, Farrell, Tis, Herzing and Southern were "responsible corporate officers" of the company, exercising authority and management of Freedom and the Etowah River LLC facility, where the spill happened.

Investigators say Freedom, as well as its officers and agents, failed to exercise reasonable care in its duty to operate the Etowah Facility in a safe and environmentally sound manner. According to the complaint, the company failed to comply with applicable law, regulations, and guidelines, failed to follow its own internal operating procedures and failed to conform to common industry standards for safety and environmental compliance.

According to the indictment, Freedom is negligent of several things, including failure to properly maintain the containment area surrounding the tanks, and making sure necessary repairs were done to ensure the containment area would actually contain a chemical spill. They are also accused of failing to inspect the tank where the leak happened.

Investigators say Freedom failed to train personnel on pollution prevention and failed to have adequate spill prevention equipment and supplies on hand.

They are accused of not having a spill prevention, control and countermeasures plan, which was required at the facility. They also did not have a stormwater prevention plan and groundwater prevention plan, which are both required, according to federal documents.

The four charged in the case are accused of only approving funding that would result in increased business revenue for the company.

Southern is also accused of failing to make repairs, upgrades, and improvements to equipment and systems necessary for environmental compliance.

These new charges were filed two days after Gary Southern's attorney filed a motion to have the US Attorney's Office recused from the case, citing a conflict of interest since everyone in the office were victims of the spill.

That motion comes after charges were filed earlier this month against Southern. Wednesday he was indicted on those charges.

To read more on Southern's charges, click the link to our previous story.

According to the indictment, if convicted, Southern must forfeit an property, real or personal, which constitutes or is derived, directly or indirectly, from proceeds traceable to such violation. This includes nearly $8 million in a number of accounts, a 2012 Bentley, and a property on Marco Island in Florida.

To read the full indictment, click the link at the top of the page.

The US Attorney's Office has scheduled a press conference for 1:30 p.m. Wednesday to discuss the spill. We will have a crew at the press conference.

Keep clicking on the WSAZ app and WSAZ.com for the latest on this story.



 
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