Rouse sued for $65M in blast

Published 12:00 am Thursday, December 26, 2002

The family of an industrial manager who died after a May explosion has filed suit against the Vicksburg rubber-recycling plant where he worked and others, claiming fraud and negligence.

Teddy Smith, 40, was one of five who died from several hours to 14 days after the May 16 explosion and fire at Rouse Polymerics International on U.S. 61 South. Seven other employees were injured.

The suit was filed Monday in Warren County Circuit Court and asks for $65 million in damages, claiming the company; its principal, Michael Rouse; maintenance vendors and individual employees of it were negligent in Smith’s death.

The Smith family is represented by Vicksburg attorney Paul Kelly Loyacono. The complaint, which tells one side of events, claims that after the explosions, defendants destroyed documents relevant to the official investigation and made misleading statements to investigators. It also claims the company’s process was known to be unsafe and that the company was therefore negligent in Smith’s death.

“The individual defendants were all members of and participants in a conspiracy to obstruct justice, both criminal and civil,” the suit says.

The plaintiffs also claim Rouse fraudulently diverted assets to himself, his wife and children and other entities following the explosion.

It claims at least $40 million in compensatory damages, including $20 million to Smith’s estate; $10 million to his widow, Audra; and $5 million to each of their two children. It also claims punitive damages of at least $25 million.

Defendants have 30 days to answer.

Local, state and federal investigations into the cause of the explosions began soon after the fire. The plant was essentially idle for about six months while the federal Occupational Safety and Health Administration completed its investigation which, Michael Rouse has said, did not identify any defect as having caused the explosion.

OSHA found the company had committed two willful and 22 serious safety violations and proposed $210,600 in fines. Nine days later, a compromise was announced, with OSHA removing the willful characterizations of the violations and reducing the penalty to $187,680.

The suit is the second. The first was filed May 28 by the wife of Roy Deaton, 50, five days after he died of his injuries. It did not name defendants but, under Mississippi law, a civil suit can be amended at any time. It requested a jury trial to determine damages, but did not specify amounts.

Rouse has said he intends to rebuild on the company’s current site. Production was to increase in the past several weeks in the part of the plant that remained operable and, by January, removal of the burned building and construction of a new facility were to be complete.

As it rebuilds, a low-interest loan tentatively OK’d by the Mississippi Development Authority and sought with the City of Vicksburg’s approval in October will have a role. The loan expected to provide Rouse with up to $1 million in cash, and with a potential subsidy from federal taxpayers of at least $320,000 over the life of the loan.