Trustee: Alcoa partly to blame for 'travesty'
Thursday, November 6, 2003 8:04 AM PST
By Pat Forgey
Printable version
E-mail this articleLongview Aluminum workers who have long blamed company owner Michael Lynch for the demise of their smelter should also be blaming aluminum giant Alcoa, which sold the smelter to Lynch, said Bill Brandt, bankruptcy trustee for Longview Aluminum.
"I think what's happened here is a travesty," he said.
Brandt was appointed as trustee in August after the company filed for bankruptcy protection in March. He asked the bankruptcy court this week for permission to liquidate the company and sell its assets, after being unable to find a buyer.
A bankruptcy court judge is scheduled to decide that request next week.
Reuters reported Thursday that Glencore International AG, a Switzerland-based metals company and owner of Columbia Falls Aluminum in Montana, has bid on some company assets, including the casthouse, while New York-based metals trader Marco International has bid on the plant's metals stocks.
Brandt told The Daily News that the plant's assets may not cover all the claims against the company, and he's likely to go after Alcoa for additional money.
Alcoa took over Reynolds Metals Corp. in 2000, but due to competitor complaints was forced by anti-trust regulators to sell off the smelter. Lynch formed Longview Aluminum and bought the plant from Alcoa during the West Coast power crisis, and immediately shut it down to sell its valuable power allocation back to the Bonneville Power Administration.
Brandt said he was investigating that deal, and Alcoa's responsibility.
"Alcoa walked off with $160 million and left the rest of us holding the bag," he said.
Alcoa officials did not return phone calls for comment this week.
Brandt said he recently sought out Alcoa as a possible purchaser for the plant, but Alcoa rebuffed the offer to take back the plant. Brandt called that decision "sheer and utter stupidity," saying that Alcoa would likely wind up paying more in environmental cleanup costs and claims than if it bought the plant and resumed operation.
"My expectation is by the time all is said and done, they'll pay many times more in actual dollars out than if they had taken a more cooperative route," Brandt said
During that time representatives of the United Steelworkers of America, the plant's largest union, met with Alcoa to pledge to work with the company to reopen the plant, he said.
Reynolds has an obligation to its workers for health and retirement benefits that doesn't go away because it was taken over by Alcoa or sold to Lynch, said Gaylan Prescott, staff representative for the United Steelworkers in Longview. If the Longview Aluminum estate can't pay for that, the workers will expect Alcoa to do so, he said.
"Alcoa's position in this is kind of puzzling," Prescott said. "I believe Alcoa has made a mistake in walking away."
Alcoa's actions are "not something that bespeaks of a good corporate citizen," Brandt said.
Prescott said the workers have not yet given up on the plant, and are still trying to pressure the bankruptcy court, or Alcoa, or some other party into finding a way to save the plant. They've planned a rally for Saturday to call attention the looming threat of permanent loss of the plant, he said.
"We think community support is a key element in bringing to light the injustice that's about to be perpetrated to the workers," Prescott said.
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