The government of India is "not a party" to a tentative settlement reached last week by Union Carbide Corp. and U.S. lawyers over the December 1984 poison-gas leak in Bhopal, India, and is likely to oppose it vigorously in federal court, a lawyer for the government said yesterday.
A Carbide spokesman yesterday confirmed that the firm has agreed to pay $350 million into a special Bhopal fund that he said would produce between $500 million and $600 million "over a period of time" for the tens of thousands of victims of the disaster.
One lawyer who negotiated the agreement said it calls for Carbide to pay out the money over a period of eight to 10 years with the payments to victims administered by U.S. Judge John F. Keenan in New York.
But the tentative agreement, reached late last week after months of negotiations in New York City, ran into fierce criticism yesterday that some lawyers said could torpedo the proposal even before the key parties have signed off. At the same time, lawyers in the case engaged in a new round of bickering over who had the legal authority to represent the Bhopal victims -- an issue that never has been resolved by Judge Keenan.
"The government of India has neither agreed to nor is a party to any settlement," said Bruce Finzen, a lawyer with the Minneapolis law firm of Robins, Zelle, Larson & Kaplan. "We are the only valid legal representatives of the victims."
But Stanley Chesley, a Cincinnati plaintiff's lawyer who negotiated the agreement with Carbide, said the Indian government has no valid legal claims in the Bhopal litigation, other than reimbursement for property damage and medical expenses it already has provided.
"They don't represent the individual victims," Chesley said of the Indian government. "The only people who can do that are their lawyers."
Finzen, in turn, challenged the legal authority of Chesley and his colleagues. He also said the Indian government will continue to oppose any pact that does not provide "full and fair compensation for each and every victim."
"It has been our position from day one that there won't be any settlement without the government's participation," he said.
Finzen declined to discuss the specifics of the proposed settlement. But in the past, the government has sought compensation from Carbide of about $1 billion -- an amount far in excess of the amount agreed to by Carbide.
Chesley emphasized that "there is no piece of paper" that has been signed by the parties and that some key issues remain unresolved.
The agreement, which must be approved by Keenan, also ran into other obstacles yesterday. Carbide said it would sign off only if the agreement "settles all claims with finality." And Rob Hager, a Washington lawyer appointed by Keenan to represent public-interest groups involved in the case, said the $350 million figure was "ludicrous" and would provide only about $7,000 in medical and other expenses for each of the victims.
"By American jury standards, this is laughably low," said Hager. "What's happened here is that the American lawyers have cut a separate deal so they can protect their attorneys' fees. . . . We will oppose this, no question about it."
The Bhopal accident generally has been considered the world's worst industrial disaster. About 2,000 people were killed and tens of thousands of others were injured when a cloud of highly toxic methyl isocyanate leaked from a Union Carbide plant and spread over the city of Bhopal on Dec. 3, 1984.
The issue of who represents the victims has been central to the Bhopal case since immediately after the disaster. Some U.S. lawyers, led by San Francisco attorney Melvin Belli, flew to India and signed up tens of thousands of victims on retainer forms containing standard U.S. contingency-fee clauses calling for the lawyers to get one third of any settlement.
The lawyers' actions were widely condemned in India and prompted the Indian Parliament last year to pass special legislation giving it exclusive rights to represent the victims. The government then hired the Robins, Zelle firm and filed its own lawsuit against Union Carbide in the United States.
But Judge Keenan, who has jurisdiction over all the Bhopal claims, never has specifically ruled on the issue or even whether the case should be tried in his courtroom or shipped back to India, as Carbide has requested.
Instead, he has urged the parties to settle the case and appointed a three-member executive committee to represent the victims' interests. This panel included two victims' lawyers -- Chesley and F. Lee Bailey -- and Michael Ciresi, a member of the Robins, Zelle firm.
According to sources familiar with the case, Chesley and Bailey negotiated the tentative agreement with Carbide's lawyers without Ciresi's participation or knowledge.
While the $350 million figure is significantly higher than what Carbide has offered in the past, critics noted yesterday that it could end up costing the company virtually nothing.
About $200 million is covered by the company's insurance, and because the rest of the payments would be stretched out over 10 years, "it's really trivial in terms of what they would end up paying," said one lawyer who asked not to be identified.