what happened
Sotera Health (CS -33.27%) The stock took a massive tumble on Monday, making it one of the worst-performing health care stocks. Investors sold the company after a jury ruled against it in an ongoing lawsuit in Illinois. As a result, Sotera’s share price fell by more than 33% on the day.
And what
That morning, a jury convened in the state’s Cook County determined that Sotera, Sterigenics and private company Griffith Foods must pay plaintiff Susan Kamuda a total of $363 million. Kamuda claimed that ethylene oxide emissions from a Sterigenics plant in the state caused her breast cancer and her son’s non-Hodgkin’s lymphoma.
Sterigenics is a subsidiary of Sotera that specializes in health care equipment sterilization. Griffith Foods is a successor company to the entity that originally built and operated the plant.
The jury’s award was higher than the $346 million Kamuda’s lawyers sought during the trial.
A 2018 Environmental Protection Agency study showed that residents living near the plant were affected by cancer nine times more than the US average. The state ordered the facility closed the following year.
Now what
Kamuda is just one of more than 700 people who have sued Sterigenics over cancer claims. Kamuda’s lawsuit is the first to be filed and as such is likely to provide somewhat of a model for subsequent cases. Sterigenics/Sotera’s legal troubles, then, may not be over.
On Monday, Sterigenics released a statement that said in part: “We do not believe the jury’s verdict in this case reflects the evidence presented in court. Sterigenics is evaluating the verdict and plans to challenge this verdict through all due process, including the appeal.”
“As we have consistently done throughout our history, we will continue to operate in compliance with applicable rules and regulations to ensure the safety of our employees, the communities in which we operate and patients around the world,” he added.
Eric Volkmann has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has one disclosure policy.
