(MENAFN- Investor Ideas) Investorideas, a global news source and leading investor resource covering cleantech stocks issues a new edition of the Cleantech and Climate Change Podcast .
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Cleantech Podcast - Forever Chemicals and the DuPont (NYSE: DD) Handbook - Spin, Deny, Delay
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Good morning and welcome to today's podcast. Today I would like to pose the question, 'What happens when a company contaminates us with chemicals that last forever, poisoning our water and soil for generations to come?' Well, if you are DuPont (NYSE: DD ), you have a readymade handbook to create spin-offs, delay court proceedings, deny any wrongdoing and pay settlement fines, only if necessary and just go about your business as always.
To explain in simple terms what these forever chemicals are and the massive problems they represent, NRDC (the Natural Resources Defense Council) one of the organizations attempting to holding polluters accountable, explain :
"Nonstick cookware, grease-resistant food packaging, and waterproof clothing are all products that make our daily lives less messy, but that convenience comes at a cost.
A class of manmade chemicals known as PFAS-which stands for per- and polyfluoroalkyl substances-is part of what makes these consumer goods water-, stain-, and grease-resistant. PFAS are also toxic at extremely low levels (i.e. parts per quadrillion), posing significant risks to our health. And if you're wondering why they're called "forever chemicals," it's because they are nearly indestructible.
Unfortunately, PFAS are almost impossible to avoid. They are found in our homes, our offices, our supermarkets-practically everywhere."
If you spend a few moments online searching for PFAS litigation against Dupont, you will find a very long historical list of litigation that has been in court for years. Dupont and other large corporations like them play the long game and are willing to pay the big legal bills while they create corporate spin-offs, change the name of their products and keep generating profits.
Violation tracker reports a penalty total since 2000 of $1,287,936,396 and number of records: at 241, of which environmental violation penalties were $648,481,945 with 177 records.
In June of this year , The Chemours Company (NYSE: CC ), DuPont de Nemours, Inc. (NYSE: DD ) and Corteva, Inc. (NYSE: CTVA ) announced they reached an agreement in principle to comprehensively resolve all PFAS-related drinking water claims of a defined class of public water systems that serve the vast majority of the United States population.
Continued from their news: The class includes water systems with a current detection of PFAS1 at any level and those that are currently required to monitor for the presence of PFAS under EPA monitoring rules2 or other applicable laws. This includes but is not limited to systems in the South Carolina aqueous film-forming foam multi-district litigation.
The companies will collectively establish and contribute a total of $1.185 billion to a settlement fund ("water district settlement fund"). Contribution rates will be consistent with the binding Memorandum of Understanding between the companies reached in January 2021, with Chemours contributing 50 percent (about $592 million), and DuPont (about $400 million) and Corteva (about $193 million) collectively contributing the remaining 50 percent. The settlement amounts will be funded by the companies in full and deposited into the water district settlement fund within ten business days following preliminary approval of the settlement by the Court.
DuPont generated over 13 billion U.S. dollars of revenue in 2022. Corteva's revenue for the twelve months ending September 30, 2023 was $17.344 billion. Chemours 2022 Net Sales were
Just to clarity, this incestuous pool of players are all spin-offs of the same company. The Chemours Company is an American chemical company that was founded in July 2015 as a spin-off from DuPont.
And then you have to look at the Dow (NYSE: DOW )/Dupont (NYSE: DD ) merger (Aug. 31, 2017) that later changed again. The dissolution of DowDuPont was completed on June 1, 2019, splitting the company into three different segments; Dow, Dupont, and Corteva.
Dupont explains to shareholders: "When our company was created through the merger of equals transaction between The Dow Chemical Company and E. I. du Pont de Nemours and Company, we announced our intention to separate into three independent, publicly traded companies - one for each of our agriculture, materials science and specialty products businesses. On April 1, 2019, we completed the separation of the materials science business through the spin-off of Dow Inc. and our stockholders received one (1) share of Dow stock for every three (3) shares of DowDuPont common stock held on that date. This is what we refer to as the Dow Distribution.
On June 1, 2019, we completed the separation of the agriculture business, through the spin-off of Corteva, Inc. and our stockholders received one (1) share of Corteva common stock for every three (3) shares of DowDuPont common stock they held on that date. This is what we refer to as the Corteva Distribution. In both cases, DowDuPont stockholders received or will receive cash in lieu of any fractional shares of the common stock of Dow Inc. or Corteva, Inc."
This is clearly a gameplay that they took from Abbott and Costello - Who's on First .
So why so many spin-offs? An article from Promarket entitled "How Companies Spin off Environmental Liabilities to Avoid Legal Obligations " gives some insight.
"In 2015, DuPont spun off specialty chemicals businesses into a separate company called Chemours. Chemours produced fluoroproducts, the most famous of which was Teflon, and other performance chemicals.
Within a year, Chemours lost three consecutive cases finding perfluorooctanoic acid (otherwise known as PFOA or C-8, an input in the production of Teflon) was responsible for a range of diseases, including cancer. While the individual awards were small, amounting to several hundred thousand dollars to a few million each, the number of cases exceeded 3,400.
In 2017, the company, jointly with DuPont, agreed to pay $671 million to settle certain claims involving PFOA-with each company responsible for half.
This settlement did not put Chemours' legacy liabilities behind it. In 2019, the company sued its former parent alleging its environmental liabilities greatly exceeded those reported at spin: $2.5 billion, or five times the amount accrued. Liabilities included those unrelated to performance chemicals, including DuPont's legacy exposure to explosives, asbestos, and benzene. Chemours received two-thirds of DuPont's environmental liabilities but only 19 percent of revenue-in addition to $4 billion in debt.
The judge dismissed the lawsuit-ruling no jurisdiction-and sent the matter to arbitration. A settlement has not been reached."
So did Dupont know what was happening all along?
UCSF has reported "According to a 1970 internal memo, DuPont-funded Haskell Laboratory found C8 (one of thousands of PFAS) to be "highly toxic when inhaled and moderately toxic when ingested." And in a 1979 private report for DuPont, Haskell labs found that dogs who were exposed to a single dose of PFOA 'died two days after ingestion."
What you invest in is ultimately up to you. All I ask is that you become informed, awake and discerning. It is one thing to lose or make money; I love the possibility of making money in the stock market. Companies succeed and some fail - that's the risk.
It is a whole other game to invest in a company that poisons a planet.
About podcast host: - Dawn Van Zant - founder of Investorideas
Dawn Van Zant is a female pioneer in the financial markets sitting in every seat as a trader, a broker, IR and PR before finally starting Investorideas. She has been featured in interviews in Business Week, CNN Financial TV, CBS Market watch radio and other financial publications online, radio and print, talking about renewable energy, water and homeland defense stocks.
If you are a small company doing big things to benefit our water and our environment I would love to hear from you and tell your story.
Thanks, that's it for today. Do something good for this beautiful planet each and every day.
If you would like to be a guest on this podcast and tell your story please call me at 800 665 0411
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