Dow Chemical, Sasol Win Dismissal of Greenpeace Lawsuit

Dow Chemical Co. (DOW) and Sasol North America Inc. won the dismissal of a lawsuit alleging the chemical companies illegally spied on a unit of Greenpeace International, the environmental advocacy group.

Greenpeace Inc. sued under the federal Racketeer Influenced and Corrupt Organizations Act. A federal judge in Washington ruled today that the nonprofit organization failed to establish a direct connection between corporate espionage and civil racketeering allegations and any injury the group suffered.

“The direct victim of this alleged wire fraud was not Greenpeace, but a third party, and, therefore, the link between Greenpeace’s injuries and defendants’ alleged racketeering activity is too attenuated to be actionable under RICO,” U.S. District Judge Rosemary M. Collyer wrote in her ruling.

Greenpeace claimed that Dow, closely held Sasol and two public relations firms conspired from 1998 to 2000 to infiltrate and steal confidential information to thwart its environmental campaigns.

Greenpeace said the spying included breaking into locked trash bins outside its Washington headquarters and infiltrating meetings and electronic communications.

The injured third party the judge referred to was Calcasieu League for Environmental Action Now, or CLEAN, described in the ruling as an ally of Greenpeace.

Ruling Under Study

Molly Dorozenski, a Greenpeace spokeswoman, declined to comment immediately, saying the group’s lawyers were reviewing the ruling.

“As we have said from the beginning, the case totally lacked merit and should have never been filed by Greenpeace,” said Gregory Baldwin, a spokesman for Midland, Michigan-based Dow, the largest U.S. chemical maker, in an e-mail. “No Dow employee did anything improper.”

Matthew Kirtland, a Washington lawyer representing Houston- based Sasol North America Inc., said his client is pleased with the court’s decision. Sasol North America is a unit of Johannesburg-based Sasol Ltd. (SOL), according to the company’s website.

Greenpeace, during the time the group claims the companies were spying upon it, was criticizing Dow for using chlorine in its manufacturing process. Greenpeace also was examining Dow’s sales of products containing genetically modified organisms, according to the complaint.

Chemical Pollutants

Greenpeace, along with CLEAN, also was working with communities it says were threatened by chemical pollutants, including Lake Charles, Louisiana, according to the court’s ruling. Sasol runs a plant at Lake Charles, according to that company’s website.

Also named as defendants were Ketchum Inc., a public relations firm based in New York; Dezenhall Resources Ltd., a Washington-based public relations firm; and four former employees from Beckett Brown International Inc., a private security firm.

The complaint says that Ketchum worked with Dow in its effort to target Greenpeace while Dezenhall worked with Sasol.

Eric Dezenhall, a partner at Dezenhall, didn’t immediately return a telephone message seeking comment on the ruling.

“As we always stated, the allegations were not supported by the facts, or the law, and should be dismissed,” Jackie Burton, a spokeswoman for Ketchum, said in an e-mail. “We are gratified that the court agreed.”

Mother Jones

The spying allegations in the complaint were first reported by Mother Jones magazine in 2008, which said it obtained information and internal documents from a former investor of Beckett Brown.

Greenpeace claims Beckett Brown relied on subcontractors including off-duty police officers from Baltimore and Washington to gain access to internal Greenpeace documents. According to the complaint, the documents included campaign planning data, donor letters, legal papers, financial reports, and credit-card account numbers. The complaint also alleges the defendants stole Social Security numbers and personal bank account statements from its employees.

As part of its racketeering claim, Greenpeace alleges that a Beckett Brown officer infiltrated CLEAN’s board and used e- mail to defraud Greenpeace of proprietary information.

Collyer ruled that “the success or failure of Greenpeace’s environmental campaigns could have been caused by any number of pressure points” beyond the “e-mail escapades.”

The case is Greenpeace Inc. v. Dow Chemical Co., 10-cv- 02037, U.S. District Court, District of Columbia (Washington).

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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