Reporter in Hot Water

Greg Palast

by Greg Palast

Mmmmm. Ahhhhh.

In a hot tub somewhere just outside New York on a humid summer night, your correspondent sinks down into the bubbles in the mood for a True Life detective story.

Here’s a good one: Four men on a boat, a cruise ship to Bermuda, July 1994. Back on shore they fell ill, one with a fever so fierce his brain was damaged. One died.

By a one-in-a-million happenstance, three of them sought out the same doctor who just happened to have been, 20 years earlier, on the team investigating the hotel in Philadelphia where several members of the American Legion dropped dead from what became known as Legionnaires’ disease.

Suspecting a new outbreak, the doctor alerted the US Center for Disease Control, which dispatched helicopters to scour Barbados looking for the disease’s source. Ultimately, Dr Joseph Plouffe, famed legionella bug-hunter, boarded the fateful cruise ship, stuck his arm into a hot tub filter and pulled out a stinking gob of live killer bacteria.

No obvious problem with the filter’s design: it had its ‘NSF approved’ sticker from the National Sanitation Foundation. Obviously, Holmes, the ship’s owner did not properly clean the filter. Case closed.

Not so fast, Watson! Anyone can print up a label with an official stamp of approval. The label could be a fake, a counterfeit, a cheat. And that’s exactly what it was – a fraud, according to a New York jury’s verdict in the case brought by survivors and victims of the murderous hot tub filter, the Triton-140.

This week lawyers are preparing to argue compensation to be paid. The jury has already hit the manufacturer, Essef Corporation of Ohio and affiliates, with $7 million in punitive damages.

Essef has since been acquired by a large multinational, Pentair Inc of Minneapolis. Essef insists the jury got it wrong and has asked the judge to overturn the verdict.

But here’s what the jury heard. Essef’s model TR-140 when fitted to a hot bubbling spa, doesn’t filter bacteria — it grows bacteria. The TR-140’s internal plumbing could not rinse away the oily gunk that hot tub aficionados lather on to their bodies. And the company knew it. American tort law has a wide open ‘discovery’ process, the right to dive through an accused corporation’s deepest files. In this case, investigators discovered an extraordinary piece of evidence: a movie, starring the filter. Stanley Kubrick it isn’t. In 1986 an Essef engineer filmed red dye running through the filter’s plastic guts to illustrate that the health product didn’t work, couldn’t work. It was designed-in death. Hundreds of thousands have been sold.

Did corporate chiefs see the clip? Yes. They used the film to promote a new device they patented to fix the problem. Unfortunately, their new gizmo failed in the field – and to fix the fix would have sliced a couple of dollars off the profit of each Triton. The company returned to the unmodified version, seeming to forget why they had dropped it.

In 1984, fully 10 years before the deaths in the Caribbean, inspectors caught the company slapping NSF stickers on the filters indicating they could be used in spas. But the company persisted – even when, in 1987, inspectors hit them with a second violation for using misleading labels. When asked why, the company’s former vice-president, ‘Bud’ Fredericks, said, ‘You don’t stop production.’

(Essef, affiliates and lawyers have not returned our several phone calls. Iin court papers they state the product received its safety approvals on the eve of trial – which did not impress the jury.)

Around 1989, the company’s filters also failed a test on the filter’s ‘head’. Rather than toss out the dodgy parts, the company chose the all-American solution: they shipped the parts, all 10,000 units, to Europe.

And in Europe, they made more filters with new ‘NSF approved’ labels in English and French – and instructions indicating their safety for use in hot tubs. The company’s top Belgian executive testified that the NSF stamp made Europeans believe they were buying the ‘Rolls Royce of filters’.

But this isn’t about hot tubs. It is my excuse to talk about Freedom of Information, corporate cover-ups, Railtrack, investigative reporting and Julia Roberts.

There is a common myth that America, land of the free market cowboys, is the unregulated Wild West of commerce. Not so. The US has some of the toughest regulators of corporate malfeasance on the planet. They’re called lawyers. When acting in the public interest they are, as one told the ‘killer filter’ jury, ‘private attorneys general’, enforcers, like Superman, of truth, justice and the American Way.

Often working for huge contingencies or court-granted bounties (not permitted in Britain), they front the millions of dollars for experts, investigators and legal teams needed to decode the harmful secrets in the files of an Essef or a British-American Tobacco Company. In the Legionnaire’s case, the cruiseship line Celebrity funded the huge effort to get at the truth – for which the jury awarded Celebrity $2.8 million of the $7m in punitive damages from Essef and affiliates.

Punitive damages, unknown in Britain, are the way in which Americans issue exemplary civil fines. Imagine if Railtrack had to face, like Exxon in the Exxon Valdez case, a few billion quid in punitive damages for its errors – it might have focused Railtrak’s attention on track repairs before the Paddington rail crash.

Britons sneer at Americans’ predilection for lawsuits, yet cheer Julia Roberts when, as Erin Brockovich, a real-life heroine, she uses tort law to bring Pacific Gas and Electric to justice, a real-life villain.

England’s chattering classes applaud America’s Freedom of Information Act without recognising that US journalists rely far more on documents prised from litigation discovery, a far better way to get the goods than bothering with procedures under our freedom of information law. (The Guardian’s exposing BAT’s tolerance of contraband cigarette sales came courtesy of documents placed in a special repository in the UK by order of an American judge handling a tobacco class action trial.)

The US tort system of open discovery, contingent fees, class action and punitive damages is aimed at making the truth about dangerous products known to the public. There’s no point uncovering the information if Julia Roberts can’t say it or the Washington Post can’t print it.

And that is where US and British law are mirror opposites. Whereas US tort law is designed to punish silence and reward revelation, British libel laws reward silence and punish publication.

As a result, in Britain, I’ve discovered that it is too often the investigators of horrors, not the perpetrators, who end up in hot water.