West Virginia Still Has Chemical Spills: Same Company, Different Name

By Karen Graham, Digital Journal

24 January 15

all it what you will, but a chemical company has succeeded in pulling a fast one on West Virginians. After Freedom Industries poisoned 300,000 peoples drinking water last year, the company changed names and is still up to its old tricks.

The name-changing fiasco apparently never made the national news to any extent because, after all, Freedom Industries ended up filing for bankruptcy after it was determined they were at fault for the leaking tank of chemicals in a tank farm along the Elk River in Charleston, West Virginia in early January, 2014.

Many people assumed this was the end of the story. But you needn't fool yourselves because the company's executives quickly figured out how to get out of the mess. They filed for Chapter 11 Bankruptcy on January 17, 2014, citing the demands of creditors and a pile of lawsuits. Actually, they also knew that the bankruptcy code forbids anyone from filing a lawsuit against someone who has filed for bankruptcy.

In Freedom Industries filing, they listed a maximum of $10 million in debts. The amount was questionable because they already owed $6 million to the IRS and a few other creditors. The real owner of Freedom Industries was revealed in the bankruptcy filing to be J. Clifford Forrest, a Pennsylvania coal baron. He had purchased the company about three weeks before the spill for around $20 million.

The real owner of Freedom Industries revealed

Pay attention now, because this gets interesting. Freedom Industries claimed they were owned by Chemstream Holdings in Kittanning, the same address as Forrest's Rosebud Mining, the third largest coal producer in Pennsylvania. Freedom's filing also showed that VF Funding and Mountaineer Funding was willing to lend them as much as $5.0 million to help in the company's reorganization.

Mountaineer Funding was incorporated one week before the bankruptcy filing, and guess who's name is listed as the only member? If you said Forrester, you win the Grand Prize. So in other words, Forrester was asking to lend his own money to himself to get his new business out of hot water. The conflicting reports of just who really did own Freedom points to a huge fault in American business dealings, and it centers around holding companies and roll-ups, making it hard to determine who owns what.

The formation of Lexycon LLC

While the bankruptcy filing was going on, on April 3, 2014, a chemical company, Lexycon LLC registered as a business in West Virginia. The new company had the same address and telephone number as Freedom Industries. When the W. Va. Gazette investigated, they found the executives for the new company were the same as Freedom's.

Lexycon was started in Florida on March 24, 2014, and listed an address on North Collier Boulevard on Marco Island, Florida. Gary Southern, who is listed as president of Freedom, owned a home on Marco Island. But the address on the West Virginia registration gave Lexycon's address as a place in Naples, Fla. To add to the mystery, Southern sold that property in July 2014 to Cascadia, a company with the same mailing address as Lexycon. I won't go into the changing of the president of the company's name. It's just too unbelievable to think about.

Lexycon LLC cited for eight violations over the past five months

Today the Associated Press is reporting that Lexycon LLC has been cited by state regulators for a number of violations since August 2014. These include pouring chemicals without a permit, the lack of containment walls around chemical storage tanks, and having tanker-trailers on the premises with unknown chemicals.

Dennis Farrell, a former Freedom Industries executive and consultant for Lexycon is facing a three-year prison term for his part in the chemical spill in 2014. Kevin Skiles, Lexycon president, owned 5.0 percent of Freedom's shares and was a research and technology specialist. Both Farrell and Skiles were listed as "technical" consultants when the W.Va. Gazette investigated Lexycon in May of last year. At that time, after emailing the company about the men, the paper found that both men's names had been removed from Lexycon's website.

What amazes this writer is the obvious under-the-table tactics employed by these executives in avoiding any fault in what was a blatant abuse of their company's place in the industry. Further reading into the details of the men in question's backgrounds will show numerous jail and prison sentences for everything from narcotics to corruption. If the people of West Virginia let this corrupt company continue to do business in their state, who's to say what will happen next.