American Companies Warned about Buying Improperly Labeled Asbestos Products
After purchasing products from a European manufacturer, some American companies may have unknowingly put their employees and customers at risk of asbestos exposure.
A recent news story reports that Wolseley, a European heating and plumbing products company, sold gaskets to American companies that were mislabeled as “non-asbestos-containing” when in fact they did contain asbestos.
The products were found to have significantly more than 1 percent asbestos in them, which is more than the safety threshold allowed by law. Because exposure to asbestos has been linked to various cancers and diseases, this news may prove disconcerting to those who are handlers or end-users of these tainted products.
One such cancer that is caused by asbestos exposure is malignant mesothelioma, which claims the lives of 2,000 to 3,000 people per year.
No cure exists for this disease and the average life expectancy after diagnosis is between four and eighteen months.
According to the company’s quarterly report, “independent expert advisers have conducted tests and consulted published scientific studies to confirm that no health or safety risk arises from the handling, installation and use of the gaskets.”
Exposure to asbestos-containing products becomes dangerous once the product is disturbed and the toxic asbestos fibers become airborne, where they can be inhaled or ingested. As long as the products are not damaged or disturbed in a way that causes the asbestos fibers to be released, they should remain safe.
The news of this mislabeling error comes days after the company’s shares rose sharply on better than expected North American sales numbers. Revenue in the United States accounts for nearly 40 percent of Wolseley’s total earnings. Listed at $3 to $4 each, these asbestos-tainted gaskets used as plumbing seals were originally manufactured by Canadian supplier Lortech Rubber, which were then purchased by Wolseley between 2006 and 2009.
Chief executive of Wolseley, Ian Meakin, said that the company will sue the supplier, and also noting that they might be sued by their own customers. Lawsuits will likely arise as more information is discovered and disclosed.
The names of the American companies that purchased these potentially dangerous supplies were not released. Wolseley has been in communication with them about this issue since asbestos was first discovered.
The company’s integration into the American construction, plumbing and heating sectors is deep. Its brands include some well known American companies, such as Ferguson, Build.com, Cal-Steam, Stock Market and others. Asbestos has been historically known to be contained within the products of these industries.
The affect of this issue on the company’s stock price is still unknown. Some who follow Wolseley’s stock speculate on where the revelation of asbestos-tainted products will leave the price.
“Its US operations are doing well while European performance is mixed. The trading outlook is expected to get tougher, which keeps a lid on forecast changes. It has identified a mislabelled product issue, containing asbestos, which will hang over the share price,” said Andy Brown, analyst at an investment banking firm.
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3 Cited Article Sources
Wolseley PLC. (2011, December 6). Interim Management Statement for the 3 months to 31 October 2011.
Retrieved from: http://www.fergusonplc.com/content/dam/ferguson/corporate/investors_and_media/results-and-reports/2011/Q1/IMS_release_061211.pdf.downloadasset.pdf
Fletcher, N. (2011, December 6). Wolseley builds up 2% rise despite US asbestos problem, as FTSE drifts lower.
Retrieved from: https://www.theguardian.com/business/marketforceslive/2011/dec/06/wolseley-profits-up-asbestos-problem
- Plimmer, G., & Jones, A. (2011, December 6). Wolseley warns customers on asbestos gaskets. Retrieved from: https://www.ft.com/content/3e56e462-1fe0-11e1-8462-00144feabdc0