Hess Blocking USVI Asbestos Cases With Bankruptcy, Creditors Say
Creditors of a Hess subsidiary have asked a federal judge to lift the oil giant’s bankruptcy filing, claiming its true purpose was to shield the company from lawsuits in the U.S. Virgin Islands, court documents revealed.
2022-09-26 20:14:37 - VI News Staff
The legal filing also lists nearly 60 years of environmental and social ills allegedly caused by the refinery.
The petition filed Thursday asked Judge Marvin Isgur, of the Southern District of Texas bankruptcy court, to either void Chapter 11 bankruptcy for HONX, a Hess subsidiary, or convert it to Chapter 7. Either way, the former owners of St. Croix’s long-troubled oil refinery would have to answer hundreds of lawsuits from Virgin Islanders allegedly hurt by the gas plants’ toxins, according to the court records.
“The debtor did not file this case for its own protection,” wrote lawyers representing a committee of creditors seeking to get the bankruptcy dropped. “Instead, the debtor seeks to protect Hess. But Hess is not subject to the kind of financial distress that would justify even its own bankruptcy filing. To be sure, hundreds of plaintiffs in the USVI have valuable claims against Hess, including direct premises and supplier liability claims that are not derived from the debtor’s liability.”
The HONX bankruptcy, the creditors wrote, is protecting $37 billion from potential exposure to the asbestos suits. The filing claimed Hess settled out of court approximately 1,100 asbestos suits over the last 23 years.
Hess is especially scared of the suit going to trial in the USVI because of a 2021 change in laws, allowing older or sick people to have their cases expedited, the creditors claimed.
“Hess, like every other asbestos defendant in the USVI, has been terrified of having its liability determined by members of the community that it devastated through its reckless and rapacious conduct — and no defendant has permitted an asbestos case to go to trial there,” the creditors wrote. “Every day that goes by in this case, and every day the USVI actions remain enjoined, Hess continues to generate millions in free cash flow, while asbestos claimants suffer, witness memories fade, and evidence grows stale. Like most defendants, Hess would prefer litigation and judgments years into the future to litigation and judgments right now.”
Hess ran the refinery on St. Croix’s south shore from 1965 to 1998, allegedly exposing a generation of Crucians to unchecked toxins in their workplace. Hess sold the refinery to Hovensa, which in turn sold it to Limetree Bay. Who exactly owns the massive refinery now has been a matter of debate since it was sold at a bankruptcy auction early this year, but Hamilton Refining and Transportation claims to be the sole owner.