Industry danger prompts DOJ, OSHA to take action

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By Daniel I. Small

In recent years, when we hear about an explosion, we’re likely to think it is an intended act. But in this case, there was no terrorism, no high explosives, no intent to kill and maim when the Farmers Export grain elevator at the Port of Galveston exploded Dec. 27, 1977. The blast killed 18 people and blew the roof off the 20-story reinforced concrete tower.

It was an accident pure and simple. But as Oscar Wilde famously said, “The truth is rarely pure and never simple.” If an accident was predictable, even arguably foreseeable, was it really an accident?

Murder is wrong. Everybody knows that. It’s one of the Ten Commandments. It’s a crime and always has been. But other things that might be wrong have not always been so clearly viewed as criminal. White-collar crime is a relatively recent vintage. Until fairly recently, the common view was that “criminals” were ruffians, not men in suits and ties. Nonviolent or victimless actions were hard for many to accept as crimes.

Health and safety were two of the slower areas to change. Traditionally, if a health-and-safety case made it to court at all, it was as a civil lawsuit by the government or injured victims and was brought against the corporate entity responsible. In most instances, that meant it was brought against the entity’s insurance company. After all, it was just about money.

One result was that the managers on the ground, the people who were more likely to have seen, ignored or even directed the problem and who were most likely to be able to keep it from happening again, were several layers away from the litigation. In the months or years it takes a case to wind through the system, the managers had been back hard at work, and the incident or issue was a distant memory. As a force for change, it often was too remote.

In 1970, there was a major shift. Congress passed the Occupational Safety and Health Act, which included criminal penalties against individuals for serious violations that caused death. That meant jail for a real person, not just payments from a distant insurer. As with many new laws, there were few cases brought, and most federal prosecutors didn’t even know the law existed. It was too new, too different.

Ten years later, the Department of Justice decided that the law was on the books for a reason, and it should be used in appropriately serious cases. But how does the department convince busy prosecutors around the country to add this new law and concept to their burdens?

To do that, the department’s Criminal Division decided to create a unit of attorneys specializing in health and safety cases. Based in Washington, its lawyers travelled everywhere to offer support and encouragement to local prosecutors to bring criminal health-and-safety cases. One year out of law school, I became a part of the unit.

Almost every case we brought was a shock to the defendants and people in similar positions elsewhere. That’s not the way it had worked. Criminal? OK, maybe someone screwed up. Maybe they could have been more careful. It was a shame that someone (or many “someones”) died as a result. But no one intended to kill them; is that really criminal? The DOJ wanted to get people’s attention. In many cases, it worked.

So, when 54 people died within five days in December 1977 in grain dust explosions at Farmers Export and another grain elevator, the Occupational Safety and Health Administration came to the department and essentially said, “We have a problem in the grain elevator business, and whatever we’re doing isn’t enough.”

The DOJ and the U.S. Attorney’s Office in Houston agreed to open a grand jury investigation, with my unit providing support. Dick Tallman, a fellow member of the unit, started the ball rolling, then passed it to me when he left.

The investigation itself was a shock to the industry. Grain elevator company employees, managers and executives and government regulators were summoned to testify before a federal grand jury and questioned by DOJ attorneys. But the real shock came when the two top managers of the Farmers Export grain elevator were individually indicted for violations of the Occupational Safety and Health Act, with potential penalties including fines and jail on each count.

The world had changed. It was time — long past time for the 54 dead — to look at health and safety in the grain industry in a whole new light, and maybe far beyond the grain industry as well. The law looks at each case individually, as it should. But sometimes the law, and all those involved in it, can and should be a force for change.

Change was clearly needed. Maybe — just maybe — litigation could be an answer.

Daniel I. Small is a litigation partner in the Boston and Miami offices of Holland & Knight and the author of “Lessons Learned From a Life on Trial: Landmark Cases from a Veteran Litigator and What They Can Teach Trial Lawyers” published by the American Bar Association. This commentary is adapted from the book with permission of the ABA.