In the nation's first criminal case involving environmental violations and the ship scrapping industry, a federal jury in Baltimore yesterday convicted a local businessman of exposing workers to hazardous asbestos and dumping oil and debris into the Patapsco River while dismantling the historic aircraft carrier USS Coral Sea.
After three weeks of lengthy and often complex testimony in a case that was being closely watched by the U.S. Navy, the four men and eight women took about four hours to return their verdict against Kerry L. Ellis Sr. and his company, Seawitch Salvage Inc.
Ellis, 57, of Pasadena, looked down solemnly and rested his chin in his hands as the verdict was read at 2: 20 p.m. yesterday. Ellis was found guilty of violating federal environmental laws and with making a false statement to a government agency. Seawitch Salvage was found guilty of the same charges.
Evidence presented during the trial showed that though Ellis was not licensed to remove asbestos, he ordered his workers to strip and remove insulation, which was later found to contain asbestos, from the Coral Sea and another ship, the USS Illusive; that the laborers often worked without protective equipment; and that Ellis falsely assured workers that all asbestos insulation had been removed from the ships. The violations occurred between May 1993 and September 1995.
Ellis could be sentenced to 24 years in prison and fined $1.6 million. Under federal sentencing guidelines, he will probably receive less prison time than the maximum but will likely have to serve some time.
U.S. District Judge William M. Nickerson scheduled sentencing for August 22.
Ellis declined to comment after yesterday's verdict.
The Seawitch Salvage yard, on Childs Street in Fairfield, is on an out-of-the-way site once owned by Maryland Shipbuilding and Drydock.
When the 52,000-ton Coral Sea arrived there in July 1993, it was to be the single largest ship-breaking project in American naval history.
The Coral Sea is just one of dozens of U.S. Navy ships that have been designated for scrapping since the Navy began to reduce its fleet in the early 1990s.
Though Ellis is so far the only scrapper to face criminal charges, ++ the program nationwide has been plagued by fines, bankruptcies, environmental and worker-safety violations and protracted legal wrangling.
One theme that both prosecution and defense developed during the Ellis trial was scanty oversight of the Navy ship-breaking program by the Department of Defense agency that is responsible for it -- an outfit now based in Battle Creek, Mich., called the Defense Reutilization and Marketing Service.
In the end, charges against Ellis and Seawitch were pursued by investigators with the Environmental Protection Agency, the Naval Criminal Investigative Service and the Defense Criminal Investigative Service.
Jane Barrett and W. Warren Hamel, the assistant U.S. attorneys who prosecuted Ellis, said the case sends a strong message.
"The jury verdict is a reaffirmation of the laws designed to protect not only the environment but people who work in industries where they are exposed to materials like asbestos," Barrett said.
Added Hamel, "Everyone complains about trash that goes into Baltimore harbor and the Chesapeake Bay.
"Here is a guy who operated an industrial site, and we caught him pumping oil and dumping debris and garbage directly into the harbor. People ought to understand that is criminal conduct."
Workers' health ignored
Jurors said the government presented a convincing case that Ellis and Seawitch disregarded the well-being of its workers.
"Our main concern was the health and welfare of the employees and the rape of the environment," said juror Harry Gorge, a Dundalk tractor-trailer driver.
Enrique Mora, who worked as a supervisor at Seawitch in 1993 and 1994, testified during the trial that workers often cut pipes with insulation still on them, tearing the insulation away with their hands.
Mora said he was worried about asbestos exposure, but he and others continued working at Seawitch because "we needed the job and if we didn't do what he asked us to do, we'd lose the job."
Paul B. Young Jr., another worker, said little care was taken to ensure that pollutants were not washed overboard.
"Every now and then, we'd have problems with oil and other chemicals -- when it rained, or we'd have a fire, and it'd get washed off," he said.
He testified that he would hang over the side of the ship and squirt dishwashing detergent out of a gallon bottle onto the resulting oil sheens on the river.
The detergent emulsified the oil, which then sank unseen to the bottom of the Patapsco.
Ellis' attorney, Richard Karceski, argued that though the criminal investigation of Ellis began in 1994, the government never tried to take the Coral Sea back, though it had the option of doing so.
In fact, he said, the government awarded two additional Navy vessels to Ellis in 1995 and 1996 for scrapping.
Karceski said that Ellis may have made some mistakes but that he is not a criminal.
Yesterday's verdict was the latest in a long series of complications arising from the dismantling of the Coral Sea, a 968-foot aircraft carrier that arrived in Baltimore four years ago for what was supposed to have been a 15-month job.
But the Coral Sea has seen maneuverings by angry creditors, a falling-out among the partners, a serious crane accident, cash-flow shortages, several lawsuits, and on-again, off-again plans to tow it to India for final scrapping.
There is still about two years' work left to go.
It was unclear what impact the verdict would have on the Coral Sea project. The Navy said yesterday that it would have to analyze the verdict before responding.
Salvage rights to the Coral Sea are owned by Andrew A. Levy, a New York lawyer who hired Seawitch to do the scrapping. Levy was out of his office yesterday and could not be reached.
Pub Date: 5/31/97