West Virginia American Water to pay up to $126 million, Eastman Chemical $25 million to release civil claims without admitting fault for 2014 leak

A water company and a chemical manufacturer agreed to pay up to a total of $151 million to settle a civil lawsuit brought on behalf of more than 200,000 West Virginia residents whose water was contaminated by a chemical spill in early 2014.

On Jan. 9, 2014, an estimated 10,000 gallons of a chemical mixture used to process coal leaked from a storage tank into the Elk River and entered Charleston’s drinking water system, operated by West Virginia American Water Co. Eastman Chemical Co. manufactured the chemical, known as Crude MCHM.

Residents were unable to use their tap water for up to nine days, before the chemical was flushed from distribution pipes, and many complained of physical symptoms and financial losses. The case also exposed gaps in federal regulation.

Attorneys for a class of 224,000 individuals and 7,900 businesses alleged in a federal lawsuit that the water company failed to adequately prepare for and respond to the spill, and they claimed that Eastman failed to fully warn the storage company about the hazards of the chemical.

According to settlement terms made public Monday, West Virginia American Water agreed to pay up to $126 million, while Eastman Chemical agreed to pay $25 million to resolve the lawsuit and all claims stemming from the 2014 spill. The companies, which have denied the allegations, admitted no fault in settlements they reached separately with the plaintiffs.

West Virginia American Water said in a statement that the settlement will allow it to move forward without the distraction of ongoing litigation, and it noted that government investigations into the chemical spill have never found that the company violated any law during the water crisis.