TPC Explosion and Fire - Update 09/28/2022
Update 07/06/2022
Q3 2022 Update
The TPC facility in Port Neches Texas sustained major explosions and fires on November 27, 2019, and essentially the entire facility burned to the ground. It caused extensive damage to the surrounding neighborhoods, serious damage to homes, buildings, and businesses in the area, and disrupting and harming the lives of innocent neighbors. A mandatory evacuation was in place for several days. The company maintained that they had intensions to rebuild the plant with insurance coverage, but we now believe that those funds were used mostly for other purposes and that the TPC plant will not be reconstructed.
Now, after two years of intensive litigation, TPC is seeking relief with the bankruptcy courts and have filed for that relief in Delaware. We have found out that TPC had limited liability coverage, and spent most of it very early on in an attempt to settle some claims outside of litigation and pay something as reimbursement for evacuation costs. We have also found out through the litigation that TPC had business interruption coverage and property damage insurance coverage to get paid back for their own losses, and they spent the majority of those recoveries on repairs and upgrades to their plant in Houston, to cover operational losses, and to pay monthly notes owed to their bondholder financiers so they did not go into default on their mortgage payments.
As stated before, The Texas Multidistrict Litigation Panel (MDLP), under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants and several dozen other plaintiff firms involved.
What we were able to find out in the litigation is not only was TPC underinsured for this tragic incident, but that there were several “investor groups” that were created as part of the TPC acquisition and we believe they may have contingent liability so we included them in the litigation. Presently they too are trying to obtain protections from the bankruptcy court. We will supplement the status of these fast developing issues as soon as we know more by separate communications directly to all TPC clients.
While the bankruptcy filing will derail our efforts to pin TPC down in the trial court, we were able to determine in this litigation that there were other parties who we believe were also at fault for this incident and we included them as additional defendants. They are not likely to obtain any relief as a result of TPC filing for bankruptcy protection and we plan to continue to pursue those other defendants in our MDL court. As stated in the last newsletter, one of these added defendants is an engineering firm and the other was a company, Nalco, we believe to have been in charge of the “mix” used to make the butadiene at the plant. While we also believe that TPC is actually owned and operated to some degree by the “shell corporations” mentioned before that may try to shield TPC assets, we may be prohibited from continuing to pursue resolution of their role due to the “related to” claims they will make with TPC in bankruptcy court. Our MDL court has already overruled their objections to being a party to the lawsuits and those defendants are concurrently to the bankruptcy filing also appealing those rulings to our appellate court.
We have had several meetings with the bondholders who own the notes that TPC was not able to pay back. That failure will basically result in the bondholders taking over the company, but as “secured creditors” to TPC, their claims take precedence over our claims. Nonetheless, we are cautiously optimistic that we will be able to negotiate at least some value out of a formal settlement package directly with them in exchange for avoiding a protracted legal debate in the bankruptcy court.
Again, with over 5,000 cases involved in this litigation these issues take some time to work through, but at least we are finally in some stage of formal discussions with some of these parties. In the meantime, while we completed our preliminary damage evaluation information on all of our cases, our office may still need some information a few of our clients, so if our office has inquired of additional information in that regard, please try to timely respond.
Now, after two years of intensive litigation, TPC is seeking relief with the bankruptcy courts and have filed for that relief in Delaware. We have found out that TPC had limited liability coverage, and spent most of it very early on in an attempt to settle some claims outside of litigation and pay something as reimbursement for evacuation costs. We have also found out through the litigation that TPC had business interruption coverage and property damage insurance coverage to get paid back for their own losses, and they spent the majority of those recoveries on repairs and upgrades to their plant in Houston, to cover operational losses, and to pay monthly notes owed to their bondholder financiers so they did not go into default on their mortgage payments.
As stated before, The Texas Multidistrict Litigation Panel (MDLP), under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants and several dozen other plaintiff firms involved.
What we were able to find out in the litigation is not only was TPC underinsured for this tragic incident, but that there were several “investor groups” that were created as part of the TPC acquisition and we believe they may have contingent liability so we included them in the litigation. Presently they too are trying to obtain protections from the bankruptcy court. We will supplement the status of these fast developing issues as soon as we know more by separate communications directly to all TPC clients.
While the bankruptcy filing will derail our efforts to pin TPC down in the trial court, we were able to determine in this litigation that there were other parties who we believe were also at fault for this incident and we included them as additional defendants. They are not likely to obtain any relief as a result of TPC filing for bankruptcy protection and we plan to continue to pursue those other defendants in our MDL court. As stated in the last newsletter, one of these added defendants is an engineering firm and the other was a company, Nalco, we believe to have been in charge of the “mix” used to make the butadiene at the plant. While we also believe that TPC is actually owned and operated to some degree by the “shell corporations” mentioned before that may try to shield TPC assets, we may be prohibited from continuing to pursue resolution of their role due to the “related to” claims they will make with TPC in bankruptcy court. Our MDL court has already overruled their objections to being a party to the lawsuits and those defendants are concurrently to the bankruptcy filing also appealing those rulings to our appellate court.
We have had several meetings with the bondholders who own the notes that TPC was not able to pay back. That failure will basically result in the bondholders taking over the company, but as “secured creditors” to TPC, their claims take precedence over our claims. Nonetheless, we are cautiously optimistic that we will be able to negotiate at least some value out of a formal settlement package directly with them in exchange for avoiding a protracted legal debate in the bankruptcy court.
Again, with over 5,000 cases involved in this litigation these issues take some time to work through, but at least we are finally in some stage of formal discussions with some of these parties. In the meantime, while we completed our preliminary damage evaluation information on all of our cases, our office may still need some information a few of our clients, so if our office has inquired of additional information in that regard, please try to timely respond.
Q1 2022 Update
The TPC facility suffered a terrible explosion, two in fact, on November 27, 2019, causing serious damage to homes, buildings, and businesses in the surrounding area, and disrupting lives of innocent neighbors. The plant was essentially destroyed. A mandatory evacuation was in place for several days. To date, the company has not committed to any formal plan to rebuild the facility although they did have insurance coverage for such damage.
As stated before, The Texas Multidistrict Litigation Panel (MDLP), under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there last fall appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants and several dozen other plaintiff firms involved. As also mentioned before, we retained highly qualified experts and have reviewed thousands of corporate documents. We continue to have a monthly status conference with the Court on case development issues and meet with all of the co-counsel regularly through the month and co-ordinate case development issues with the 50 other law firms involved on both sides of the case. This MDL will remain in the discovery process through 2022 as we complete the discovery and document review process with continued investigations into the causes of the explosion. We have also initiated the “fact sheet” forms completion process with our 1000 clients in the case. Concurrently, a special master has been retained with the Court’s approval to start looking at mechanisms to create a “master settlement”.
Most recently, we have uncovered conduct of other parties working for TPC that we believe contributed to the incident. Accordingly, we have added them as parties to the litigation. One was an engineering firm and the other was a company, Nalco, we believe to have been in charge of the “mix” used to make the butadiene at the plant. In addition, we believe that TPC is actually owned and operated to some degree by “shell corporations” that may try to shield TPC assets, so we have added them as defendants to the case as well. This has already generated a great deal of additional motion and discovery practice and numerous disputes between the lawyers on both sides, but our Court is still setting hearings every month to resolve these disputes and keep the cases headed towards an ultimate resolution.
The issue of whether the shell companies can be named as additional defendants is a hotly contested legal issue and will result in some additional interlocutory appeals once we have final rulings from the MDL court. TPC delayed any willingness and/or ability to entertain serious settlement discussions the last two years but as also stated before we have a special master approved by the court working on that situation. All of that is starting to come to a head and we hope to be meeting with the bond holders of the company and other investors in TPC to see if we can work out some formal settlement package. Again, with over 5,000 cases involved in this litigation these issues take some time to work through, but at least we are finally in some stage of formal discussions. In the meantime, we completed our damage evaluation information to TPC on all of our cases. Our office may still need some information a few of our clients, so if our office has inquired of additional information in that regard, please try to timely respond.
As stated before, The Texas Multidistrict Litigation Panel (MDLP), under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there last fall appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants and several dozen other plaintiff firms involved. As also mentioned before, we retained highly qualified experts and have reviewed thousands of corporate documents. We continue to have a monthly status conference with the Court on case development issues and meet with all of the co-counsel regularly through the month and co-ordinate case development issues with the 50 other law firms involved on both sides of the case. This MDL will remain in the discovery process through 2022 as we complete the discovery and document review process with continued investigations into the causes of the explosion. We have also initiated the “fact sheet” forms completion process with our 1000 clients in the case. Concurrently, a special master has been retained with the Court’s approval to start looking at mechanisms to create a “master settlement”.
Most recently, we have uncovered conduct of other parties working for TPC that we believe contributed to the incident. Accordingly, we have added them as parties to the litigation. One was an engineering firm and the other was a company, Nalco, we believe to have been in charge of the “mix” used to make the butadiene at the plant. In addition, we believe that TPC is actually owned and operated to some degree by “shell corporations” that may try to shield TPC assets, so we have added them as defendants to the case as well. This has already generated a great deal of additional motion and discovery practice and numerous disputes between the lawyers on both sides, but our Court is still setting hearings every month to resolve these disputes and keep the cases headed towards an ultimate resolution.
The issue of whether the shell companies can be named as additional defendants is a hotly contested legal issue and will result in some additional interlocutory appeals once we have final rulings from the MDL court. TPC delayed any willingness and/or ability to entertain serious settlement discussions the last two years but as also stated before we have a special master approved by the court working on that situation. All of that is starting to come to a head and we hope to be meeting with the bond holders of the company and other investors in TPC to see if we can work out some formal settlement package. Again, with over 5,000 cases involved in this litigation these issues take some time to work through, but at least we are finally in some stage of formal discussions. In the meantime, we completed our damage evaluation information to TPC on all of our cases. Our office may still need some information a few of our clients, so if our office has inquired of additional information in that regard, please try to timely respond.
Q4 2021 Update
The TPC facility suffered a terrible explosion, two in fact, on November 27, 2019, causing serious damage to homes, buildings, and businesses in the surrounding area, and disrupting lives of innocent neighbors. The plant was essentially destroyed. A mandatory evacuation was in place for several days.
The Texas Multidistrict Litigation Panel, under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there last fall appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants involved. As mentioned before, we retained highly qualified experts and have reviewed thousands of corporate documents. We have a monthly status conference with the Court on case development issues and meet with all of the co-counsel regularly through the month and co-ordinate case development issues with the 50 other law firms involved on both sides of the case. This MDL will remain in the discovery process for most of this year as we complete the discovery and document review process with continued investigations into the causes of the explosion. We have also initiated the “fact sheet” forms completion process with our 1000 clients in the case. Concurrently, a special master has been retained with the Court’s approval to start looking at mechanisms to create a “master settlement”.
Most recently, we have uncovered conduct of other parties working for TPC that we believe contributed to the incident. Accordingly, we have added them as parties to the litigation. One was an engineering firm and the other was a company in charge of the “mix” used to make the butadiene at the plant. In addition, we believe that TPC is actually owned and operated to some degree by “shell corporations” that may try to shield TPC assets, so we have added them as defendants to the case as well. This has already generated a great deal of additional motion and discovery practice and numerous disputes between the lawyers on both sides, but our Court is still setting hearings every month to resolve these disputes and keep the cases headed towards an ultimate resolution. TPC has not yet indicated a willingness and/or ability to entertain serious settlement discussions but as also stated before we have a special master approved by the court working on that situation and hope to have better news in the next few months. In the meantime, we are still submitting damage evaluation information to TPC on all of our cases, so if our office has inquired of additional information in that regard, please try to timely respond.
IMPORTANT: The deadline for filing a TPC claim may be looming later this year so it will be important for anyone else you know to retain counsel by that time. We are happy to answer their questions.
The Texas Multidistrict Litigation Panel, under orders from the Texas Supreme Court, consolidated all cases involving the explosion into the 128th District Court in Orange County and the trial judge there last fall appointed Brent Coon as one of 3 liaison lawyers for the Plaintiffs to work up the case on behalf of the more than 5,000 claimants involved. As mentioned before, we retained highly qualified experts and have reviewed thousands of corporate documents. We have a monthly status conference with the Court on case development issues and meet with all of the co-counsel regularly through the month and co-ordinate case development issues with the 50 other law firms involved on both sides of the case. This MDL will remain in the discovery process for most of this year as we complete the discovery and document review process with continued investigations into the causes of the explosion. We have also initiated the “fact sheet” forms completion process with our 1000 clients in the case. Concurrently, a special master has been retained with the Court’s approval to start looking at mechanisms to create a “master settlement”.
Most recently, we have uncovered conduct of other parties working for TPC that we believe contributed to the incident. Accordingly, we have added them as parties to the litigation. One was an engineering firm and the other was a company in charge of the “mix” used to make the butadiene at the plant. In addition, we believe that TPC is actually owned and operated to some degree by “shell corporations” that may try to shield TPC assets, so we have added them as defendants to the case as well. This has already generated a great deal of additional motion and discovery practice and numerous disputes between the lawyers on both sides, but our Court is still setting hearings every month to resolve these disputes and keep the cases headed towards an ultimate resolution. TPC has not yet indicated a willingness and/or ability to entertain serious settlement discussions but as also stated before we have a special master approved by the court working on that situation and hope to have better news in the next few months. In the meantime, we are still submitting damage evaluation information to TPC on all of our cases, so if our office has inquired of additional information in that regard, please try to timely respond.
IMPORTANT: The deadline for filing a TPC claim may be looming later this year so it will be important for anyone else you know to retain counsel by that time. We are happy to answer their questions.