The encyclopedia · Engineering & Operations · Operational decision · 1990–2014
W.R. Grace knew its mine was killing a town — and hid it for decades
W.R. Grace's Libby mine was laced with asbestos. The company hid the danger for decades — 200+ died, 1,200 sickened, Grace spent 13 years in bankruptcy.
W. R. Grace and Company · 2001-04-02
What happened
W.R. Grace was founded in 1854 and grew into a global chemical and materials company. In 1963, it acquired a vermiculite mine in Libby, Montana, that it operated until 1990. The vermiculite from Libby was contaminated with a highly toxic form of asbestos. Grace sold the contaminated ore as attic insulation under the brand Zonolite, used in millions of American homes. The company knew about the health risks for decades but did not disclose them to workers, residents, or regulators.
The health consequences were catastrophic. Over 200 people in Libby died from asbestos-related diseases including mesothelioma, asbestosis, and lung cancer. More than 1,200 residents were sickened. The contamination was so severe that the EPA eventually declared Libby a public health emergency — the first such declaration in US history. Grace was charged in 2005 with knowingly releasing asbestos and obstructing justice, though a federal jury acquitted the company and three former executives in 2009.
The financial fallout was enormous. Facing over 65,000 asbestos-related personal injury lawsuits involving 129,000 individual claims, Grace filed for Chapter 11 bankruptcy protection on April 2, 2001. It remained in bankruptcy for nearly 13 years, emerging on February 3, 2014, as a reorganized company with a trust to compensate victims. Libby's asbestos contamination became one of the longest-running environmental disaster cases in US history, and Grace's prolonged bankruptcy was one of the most complex mass-tort restructurings ever.
Why it happened
- W.R. Grace knew its Libby vermiculite mine was releasing deadly asbestos fibers for decades — internal documents showed it was aware of the danger but chose not to warn workers or the community.
- Grace sold contaminated Zonolite insulation to millions of American homes without disclosing the asbestos risk — the product exposed not just miners but homeowners across the country.
- The company fought disclosure at every turn, delaying cleanup and regulation — it was charged with Clean Air Act violations in 2005, though acquitted in 2009.
- Over 200 died and 1,200 sickened in Libby alone — the EPA declared a public health emergency, the first in US history, and Grace spent 13 years in bankruptcy.
The lesson
A company that hides a deadly risk for decades is not making a business calculation — it is committing slow-motion homicide. Grace knew its mine was killing and chose profit over disclosure.
Aftermath
W.R. Grace emerged from Chapter 11 in February 2014 after nearly 13 years, with a trust to compensate asbestos victims. The EPA spent hundreds of millions on cleanup in Libby, which remains a Superfund site. The Libby case changed how the US government responds to environmental contamination — the first-ever such emergency declaration. Grace continues to operate as a chemicals company, but its name is permanently linked to one of the worst corporate environmental cover-ups in American history.
Sources
- W. R. Grace and Company — Wikipedia (asbestos liability, Libby mine, bankruptcy)
- Libby, Montana asbestos contamination — Wikipedia
- W.R. Grace Charged in Asbestos Exposure Cases — NPR (2005 criminal charges)
- A Town Suffering for Generations: Decades of Asbestos Exposure by W.R. Grace — Democracy Now! (2009 trial coverage)
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