Flint residents sue investment banks over water crisis

Photo of author

By admin

Prior lawsuits regarding the Flint water crisis have been ongoing for years against various government officials and environmental engineering companies that were involved in the decision to switch the water source in Flint.
This complaint alleges JPMorgan Chase (JPM), Wells Fargo (CBEAX) and Stifel, Nicolaus & Company in 2014 “underwrote the bond sale that financed and enabled Flint’s participation in the Karegnondi Water Authority” pipeline. The bond sale “aided and abetted the perpetration of the violation of Plaintiffs’ firmly established constitutional right to bodily integrity,” the complaint says.

The complaint, filed at the US District Court for the Eastern District of Michigan, alleges that without the bond backed by the three investment banks, Flint would not have been able to pay for the KWA pipeline. According to the complaint, “J.P. Morgan Chase, Wells Fargo, and Stifel agreed to underwrite the bond financing … and facilitated a plan for Flint to leave the Detroit Water and Sewerage Department (“DWSD”) and enter the KWA, and they knew that a necessary element of the plan was the use of raw, untreated Flint River water as an interim drinking water source, which would expose Flint’s residents and water users to lead-poisoning and legionella bacteria.”

The three banks “each engaged in conscience shocking behavior by underwriting Flint’s participation in the KWA—and thus the poisoning of Flint’s children, residents, and other users—knowing full well there would be drastic and dire health consequences to the children of Flint,” the complaint states.

JPMorgan Chase, Wells Fargo and Stifel, Nicolaus & Company declined to comment to CNN.

“The whole time these entities knew that by pressing the ‘go’ button, kids would get very sick and their lives would be forever changed. But the potential profits seemingly outweighed the known risks, and greed, money and power won out,” Plaintiffs’ Attorney Corey Stern tells CNN. Stern also told CNN the city of “Flint was under emergency financial management, needing $85 million to make the switch,” and questioned the motivation of the banking institutions to give money to a city that likely could not afford to pay back.

Stern tells CNN the plaintiffs are seeking damages that he estimates to be around $2 billion. There are more than 2,000 kids under the age of 18 that are plaintiffs, he said.

In August, the state of Michigan and other defendants reached a $600 million settlement in the Flint water crisis lawsuit that will provide hundreds of millions in payments to city residents.

In June 2019, nearly four years since the city of Flint declared a state of emergency over its water — and three years after the first criminal charges were filed against government officials — prosecutors dismissed all pending criminal cases, pledging to start the investigation from scratch.

Source link

Leave a Comment