Press Release August 08, 2007

Powers Fasteners Indicted For Manslaughter In Connection With Big Dig Tunnel Ceiling Collapse

Boston¬†— As the result of an ongoing criminal probe, Powers Fasteners, Inc. (Powers), the Brewster, NY-based company that marketed and distributed the epoxy anchor bolt system used in portions of the I-90 Connector Tunnel, has been indicted in connection with the July 10, 2006, ceiling panel collapse that killed Milena Del Valle, age 38, of Jamaica Plain. A Suffolk Grand Jury returned an indictment today charging Powers with one count of involuntary manslaughter.

At approximately 11:00 p.m. on July 10, 2006, Milena Del Valle and her husband, Angel Del Valle were traveling through the I-90 Connector Tunnel in East Boston toward Logan International Airport when a suspended concrete ceiling panel collapsed on the vehicle, killing Ms. Del Valle and injuring her husband. Immediately following the collapse, the Attorney General's Office, in collaboration with the U.S. Attorney's Office, the Massachusetts State Police, the National Transportation Safety Board (NTSB), the U.S. Department of Transportation Office of the Inspector General, and the Federal Bureau of Investigation (FBI), began a criminal investigation into Ms. Del Valle's death.

Over the course of the 13-month ongoing joint investigation, authorities learned that Powers' epoxy was used to suspend the concrete ceiling in the section of the Connector Tunnel where the collapse occurred. Investigators further learned that the epoxy anchor system used was marketed and distributed by Powers Fasteners, Inc.

Working with federal authorities, including the U.S. Attorney's Office, U.S. Department of Transportation Office of the Inspector General, the FBI, and the NTSB, investigators determined that the cause of the ceiling collapse was the use of Power-Fast Fast Set epoxy product in the anchor system. Specifically, the type of epoxy used was found to be unsuitable for sustained loads as it is susceptible to "creep"—a phenomenon whereby the anchors pull away from the ceiling over time.

As the investigation continued, investigators learned that Powers marketed two epoxy products, Power-Fast Fast Set epoxy, and Power-Fast Standard Set epoxy. Investigators found that Powers has known since at least 1991, when it first began marketing its Power-Fast Fast Set epoxy, that the Fast Set product was unsuitable for sustained loads based upon the corporation's own "creep" testing. However, consistently since 1991, Powers' marketing materials did not differentiate clearly between the two Power-Fast products, nor did they mention the Fast Set product's susceptibility to "creep."

Authorities determined that these materials were provided to tunnel project managers and engineers. In addition, investigators found that Powers did not make Bechtel/Parsons Brinkerhoff, Gannett Fleming, or Modern Continental aware of the difference between the Power-Fast Fast Set and Power-Fast Standard Set with respect to "creep" resistance, and therefore with respect to the suitability of the Fast Set epoxy for heavy ceiling panels. The investigation also uncovered that Powers was aware, as early as 1999, that its Fast Set product was being used for a sustained overhead load in the ceiling tunnel, yet the corporation did not take any steps to caution the Project managers against use of the Fast Set product for that application.

Based upon the findings of this investigation, authorities now allege that Powers knew that its epoxy product was being used in the tunnel, and when provided with the opportunity, failed to differentiate to project managers between its Fast Set and Standard Set products. Authorities further allege that Powers failed to reveal this fact in either its marketing material, or when it was specifically asked. Today's indictment charges that Powers had the necessary knowledge and the opportunity to prevent the fatal ceiling collapse but failed to do so, and that this wanton or reckless conduct resulted in the death of Milena Del Valle.

"The investigation into the death of Milena Del Valle and the tunnel ceiling collapse is extraordinarily complicated and involves a number of different parties," said Attorney General Coakley. "Today's indictment represents one of several phases in reaching a just result for both the Commonwealth and the family of Milena Del Valle. We continue to work diligently on both our criminal and civil investigations, and as they proceed to additional phases and the conclusion of those phases, we are committed to transparency with the public as we reach additional results."

Powers Fasteners is a global company specializing in manufacturing and marketing anchoring and fastening products for concrete, masonry, and steel. In its report issued last month, the NTSB concluded that one of the probable cause of the ceiling collapse was the use of an epoxy anchor adhesive with poor creep resistance. The NTSB further concluded that Powers failed to provide the project with accurate information about the suitability of its Fast Set epoxy for sustained loads and also failed to identify creep as the cause of the anchor displacement that was observed in 1999 and contributed to the accident.

Last month, Attorney General Coakley and U.S. Attorney Michael Sullivan announced that Aggregate Industries NE, Inc. (Aggregate), the largest asphalt and concrete supply company in the New England region, pled guilty to federal charges in connection with the corporation's participation in a scheme to defraud state and federal authorities related to their work on the CAT Project. Following a joint state and federal investigation, Aggregate waived indictment and pled guilty in federal court to a charge of conspiracy to defraud the government with respect to claims. In conjunction with the guilty plea, the Attorney General and the U.S. Attorney entered into a settlement whereby Aggregate agreed to make a payment of $50 million, which includes funds to establish a trust fund for future repairs to the Central Artery Tunnel, a criminal fine, and false claims recovery funds to both the state and the federal governments.

Also, in May 2007, the Attorney General's Office reached a $58.5 million settlement with American International Group (AIG), the workers' compensation carrier for the CAT Project. A review by the Attorney General's Office found that the company failed to pay certain surplus funds to the Commonwealth as required under its contract. The $58.5 million settlement includes $26 million in losses to the state, plus interest. The recovered money, which represents 15 years of unpaid surplus funds, was returned to the CAT Project.

The Grand Jury returned the indictment against Powers this morning. A Superior Court arraignment date has been scheduled for September 5, 2007 in Suffolk Superior Court. Special Assistant Attorney General Paul F. Ware, Jr., Chairman of the Litigation Department at the Boston firm Goodwin Procter LLP, is overseeing the prosecution team for this case.