Gary Strauss, USA TODAY
Freedom Industries, the chemical company behind the toxic leak that tainted West Virginia's Elk River and forced 300,000 state residents and businesses to go without water for several days, filed for bankruptcy protection Friday.
The Chapter 11 bankruptcy filing will allow the company - facing at least two dozen class-action lawsuits, state and federal probes - to reorganize and continue operating.
Freedom, which was ordered shut down last week by state officials, declined comment Friday. A 35,000 gallon storage tank operated by the company leaked thousands of gallons of the coal processing chemical 4-methylcyclohexane methanol (MCHM), into the Elk River Jan. 9, affecting residences, businesses and schools in nine counties. MCHM can cause skin irritation, vomiting and diarrhea.
Freedom owes $3.66 million to its top unsecured creditors, according to bankruptcy documents, Charleston Gazette reported.
The company has been in hunker-down mode since last Friday, when company co-founder Gary Southern gave a brief press conference, dodging questions about the company's monitoring and preventive measures in the 7,500-gallon spill.
The company, initially launched in the mid-1980s, formed under a new entity in December when it merged with Etowah River Terminal, which operated the site, a former oil and gas terminal owned by Pennzoil-Quaker State. Other Freedom partners include chemical processor Poca Blending and Crete Technologies, a Delaware limited partnership, according to reports by the Charleston Gazette and the Wall Street Journal. The companies share many of the same executives, while Southern has ties to five Florida-based mining and chemical companies, the Journal reported.
An inch-wide hole in the storage tank caused the leak.
Freedom owes $3.66 million to its top 20 unsecured creditors, according to bankruptcy documents.