'Proof from Carbide itself'

Published : Jan 03, 2003 00:00 IST

Interview with Himanshu Rajan Sharma, U.S.-based attorney.

Himanshu Rajan Sharma is an attorney specialising in international law and complex litigation in New York. He became involved in the Bhopal gas victims' quest for justice even before he graduated from the Washington College of Law at American University, Washington, in 1996. Since then he has been compiling, with the help of survivors' organisations, evidence for the case against Union Carbide Corporation (UCC). As counsel for five organisations representing survivors and activists and for seven individual victims, Sharma has a stupendous task ahead in convincing the United States District Court for the Southern District of New York, which is rehearing part of the class action suit filed by them against Union Carbide, seeking damages (following an appeal court's decision in 2001) for causing environmental contamination and for the clean-up of the plant, which polluted sub-surface groundwater in at least 10 communities adjacent to it. Excerpts from Sharma's responses to questions sent on e-mail by V. Venkatesan, mainly on the significance of the discovery of documents that point to Union Carbide's complicity in the 1984 gas disaster.

The 1973 documents, obtained through the discovery, show that UCC, in order to retain control of its Indian subsidiary, decided to reduce the amount of its investment in the Bhopal plant from $28 million to $20.6 million, and that this meant the use of unproven technologies. Why was it necessary for UCC to reduce investment in order to retain control of UCIL?

The Indian government had passed the FERA [Foreign Exchange Regulation Act], which required the dilution of foreign equity from 60 per cent to 40 per cent in order to promote import substitution as an economic development strategy. The only way to avoid equity dilution was to back-integrate the formulation unit into a manufacturing plant, that is, to transfer technology for making `sevin' to India (instead of simply formulating it). However, FERA also stipulated that at least 25 per cent of all equity for such back-integration would have to be raised domestically in India, which would have meant a lower equity percentage for Carbide. Carbide wanted to retain at least 51 per cent control; therefore, it decided to reduce the cost of investment overall, so it could retain at least 51 per cent equity in UCIL. The way this was done was to transfer sub-standard technology, use cheap materials and cut corners. Hence the reduction in overall investment from $28 million to $20 million. It also decided to use a process that had only a `limited run' because it was cheaper. Carbide didn't really want to back-integrate the Bhopal plant or transfer additional technology to India, but India's FERA laws required it either to do so or to dilute its ownership; so it transferred sub-standard, inferior and dangerous technology instead.

The development strategy pursued by many countries, such as Brazil and India, and approved by the World Bank in those days before `neoliberalism' and globalisation was the strategy of import substitution.

Basically, the idea was that developing countries would contract with multinational companies from the First World for transfer of technology, training of skills and intellectual property, which would begin initially as imports from the First World companies. The idea then was that Indians would become skilled, acquire the technology, and the participation of the foreign companies could be gradually phased out. Thus, developing countries such as India would be left with their own indigenous technology, skilled people and local companies that could then compete on the global market. In the context of Bhopal, India's goals in seeking the manufacture of pesticides domestically were part of the so-called `Green Revolution', which was supposed to transfer high-yield hybrids, pesticide technology and skilled employment in India. The goal was to increase India's agricultural yields and make it self-sufficient in food production which, given the tragic history of famines during the British period and post-Independence, was a key nationalist objective. The goal was to produce more food cheaply and without disturbing the social structure of agrarian relations in the country. Pesticides played a key role in that; so did fertilizers. India wanted to be self-sufficient in food and that meant import substitution of pesticides. Carbide's goals and interests were, needless to say, quite different.

The 1973 documents show that the sevin pesticide production system at Bhopal had only a limited trial run. What was the ideal trial run that the system should have been exposed to?

Carbide's contract with UCIL and the Indian government required it to transfer `state of the art' technology, which means proven, established and reliable technology that it was using at the American plant to produce MIC [methyl isocyanate] and sevin. It is not a question of how long the trial run should have been. Instead, Carbide lied to the Indian government and transferred technology that was both unproven and a process for producing sevin from MIC, which had only been tried on a limited, probably experimental basis, instead of `state of the art' technology.

Did the Bhopal plant have far more limited emergency equipment than at the Institute, West Virginia? Is there any specific reference to this in the documents recently obtained? Specifically, do the documents show that the runaway reaction at the Bhopal plant on the fateful day could have been contained, had there been sufficient emergency equipment to deal with it?

We were not given an opportunity to conduct a specific discovery on this issue. The amended class action complaint and the other studies of the plant have covered this issue extensively. We have no independent documents to confirm this.

How do the documents establish that UCC was responsible for the design and running of the plant in Bhopal?

I think they clearly show that UCC controlled the nature of the technology that was transferred and that UCIL officials were substantially dependent on Carbide for operational details and other guidance. There is no specific document that shows this, but the overall history submitted in my narrative affidavit to the court establishes the degree of Carbide's domination of UCIL.

Can you tell us about the discovery process in the litigation in the U.S.? What did it involve and how was it achieved? How did the court force the UCC to release internal documents?

I had made initial discovery requests, which were fairly broad and covered both the operational history of the plant, the decision to back-integrate, and post-disaster environmental contamination issues. The court rejected this attempt at discovery, saying it was too broad, but directed the parties to reach an agreement on the scope of the discovery. We attempted to negotiate with Carbide's counsel, but not surprisingly it resisted all but the most minimal discovery. Then Carbide filed its motion for dismissal and/or summary judgment, in which it made certain arguments and asserted certain facts. In response, I filed a motion for additional discovery saying that plaintiffs cannot be expected to contest these issues fairly without any opportunity for documents. The court agreed and allowed us to conduct additional discovery on some limited issues relating to the motion. But it was still far narrower than the original discovery, which I had requested. Nevertheless, the fact that I was able to prevail on having the court allow discovery on back-integration issues is what enabled us to get the `smoking gun' document that shows Carbide's responsibility in causing the Bhopal disaster.

How did UCC retain all these documents, knowing that some of them could contradict its earlier claims?

Corporations always retain documents, sometimes well beyond the time they are required to, for many reasons. First, they cannot be sure which document will have relevance or usefulness to them at what point in the future, so they just keep them all as a safeguard. Second, there are stiff penalties for destroying evidence in the context of litigation in the U.S., including criminal penalties for both the company and the attorneys involved in such activities.

How was waste disposed in UCC's plant in the U.S.? The waste at the Bhopal plant was poured into open lagoons to evaporate, and this caused pollution.

The documents show that the U.S. plant discharged waste into the Kanahwa river in West Virginia. No similar option existed in Bhopal, so it was left open in ponds, although Carbide's engineers at South Charleston expressly warned of the `danger of subsurface water pollution'.

Can UCC be tried for negligence only if the Indian government joins the law suit filed by the survivors' organisations?

In terms of the disaster, yes. Only if the Indian government joins the suit and seeks to reopen the settlement, or seeks that Union Carbide be sent to India for criminal prosecution. For environmental contamination claims, the participation of the Indian government would be most helpful in terms of getting the court to order injunctive relief (clean-up of the polluted site in Bhopal) in India.

Do the documents show that Warren Anderson and other UCC officials knew about the design defects of, and potential safety issues with, the Bhopal factory? If so, can this revelation help in their extradition to India?

Yes and Yes. Warren Anderson was on the management committee of Union Carbide that made the key decision to transfer inferior and sub-standard technology to Bhopal.

Precisely how long will it take for the conclusion of the suit in the U.S.? What are the expectations of the outcome? How will UCC respond to the interpretation of these discoveries?

UCC has tried to minimise the significance of these documents. But it is clearly concerned that the documents have finally proven, to a considerable extent, that its decisions were the determining factor in causing the Bhopal disaster. It is unclear how long the suit will proceed.

The expectations of the outcome are highly uncertain at this point. Without participation of the Indian government or the Government of Madhya Pradesh, it appears that the court may be somewhat hostile to ordering Union Carbide to do anything about Bhopal. The M.P. government can seek compensation for clean-up costs as damages from UCC. The M.P. government can also correctly point out that UCIL has now been sold and hence there is no party in India who can be made to pay for or actually conduct the clean-up.

Do the documents only reiterate what we knew earlier about UCC's role in causing the disaster?

I think the proof that Carbide transferred unproven technology for the manufacture of this highly dangerous and volatile substance is probably the most significant development in the history of the Bhopal litigation. Many groups, studies, and the Indian government have claimed or alleged this. Now, for the first time, we have documentary proof from Carbide itself. These documents go a long way in showing Carbide's control of its subsidiary as well as its role in causing the disaster. In terms of what caused the worst, large-scale industrial disaster in human history, they are of unquestionable importance.

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