STERIS Announces Outcome of Ethylene Oxide Trial

Rhea-AI Summary

STERIS plc (NYSE: STE) announced that a jury trial against its subsidiary Isomedix Operations ended in a mistrial on January 17, 2025. The trial, which began on December 4, 2024, involved claims that ethylene oxide emissions from a Waukegan, Illinois sterilization facility caused personal injury. Isomedix operated the facility from 2005 to 2008.

The mistrial was declared at the plaintiff's request during jury deliberations when the dismissal of a juror reduced the jury count below twelve. The case, pending in the Circuit Court of Cook County, Illinois, will be scheduled for re-trial. Isomedix maintains its commitment to defending against allegations regarding its ethylene oxide operations and emissions, stating it has invested in facilities and implemented processes that meet or exceed environmental regulatory standards.

Positive

• None.

Negative

• Ongoing legal liability from ethylene oxide emissions claims
• Additional legal costs expected due to required re-trial
• Potential reputational risk related to environmental and safety concerns

Insights

Legal Expert

This mistrial in the ethylene oxide personal injury case represents a significant legal development for STERIS. The outcome, while not definitive, provides important insights into the Company's ongoing litigation risks. The case's core focus on historical operations (2005-2008) suggests potential statute of limitations considerations that could impact future proceedings.

The Company's defensive posture, emphasizing regulatory compliance and best practices, aligns with standard industrial operator defense strategies. However, the broader context of increasing environmental litigation and heightened scrutiny of ethylene oxide emissions poses material risks. Recent similar cases have resulted in substantial settlements, with some reaching into hundreds of millions of dollars.

The declaration of mistrial during jury deliberations, while procedurally based on juror numbers, could indicate a complex jury dynamic that might influence settlement considerations before the retrial. The Company's commitment to "vigorously defend" signals confidence in their position, but also suggests significant ongoing legal expenses.

Environmental Risk Analyst

The ethylene oxide litigation landscape presents material business risks for STERIS. Historical operations, even from over 15 years ago, can carry substantial liability exposure. The industry's evolution in emission controls and growing scientific understanding of health impacts creates retrospective risk for past operational standards.

The Company's emphasis on "rigorous best practices" and regulatory compliance investments indicates proactive risk management, but may not fully shield from historical liability. Similar cases in the industry have led to operational restrictions and costly facility modifications. The broader regulatory environment around ethylene oxide sterilization facilities continues to tighten, potentially affecting future operational costs and requirements.

This case, while focused on a single facility during a specific timeframe, could set precedential implications for other facilities and time periods. The financial impact extends beyond direct legal costs to potential insurance premium increases and heightened compliance expenditures across the Company's sterilization network.

DUBLIN, IRELAND, Jan. 21, 2025 (GLOBE NEWSWIRE) -- STERIS plc (NYSE: STE) (“STERIS” or the “Company”) today announced that a jury trial that had been ongoing since December 4, 2024, against Isomedix Operations, Inc. (“Isomedix”), a subsidiary of the Company, ended in a mistrial on January 17, 2025.

The case is pending in the Circuit Court of Cook County, Illinois, and involves claims by an individual plaintiff that ethylene oxide emissions from a sterilization facility in Waukegan, Illinois, caused personal injury. Isomedix owned and operated the facility from 2005 to 2008.

The Court declared a mistrial at Plaintiff’s request during jury deliberations when dismissal of one of the jurors reduced the jury to fewer than twelve. The Court will schedule the case for re-trial at a later date.

Isomedix intends to continue to vigorously defend against allegations regarding ethylene oxide operations and emissions from the Waukegan, Illinois facility during 2005 to 2008. Deploying its own rigorous best practices, Isomedix has regularly invested in its facilities and has created processes and procedures that meet or exceed the applicable environmental regulatory standards.

About STERIS
STERIS is a leading global provider of products and services that support patient care with an emphasis on infection prevention. WE HELP OUR CUSTOMERS CREATE A HEALTHIER AND SAFER WORLD by providing innovative healthcare and life sciences products and services. For more information, visit www.steris.com.

Company Contact:
Julie Winter, Vice President, Investor Relations and Corporate Communications
Julie_Winter@steris.com

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This release may contain statements concerning certain trends, expectations, forecasts, estimates, or other forward-looking information affecting or relating to STERIS or its industry, products or activities that are intended to qualify for the protections afforded “forward-looking statements” under the Private Securities Litigation Reform Act of 1995 and other laws and regulations. Forward-looking statements speak only as to the date the statement is made and may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “targets,” “forecasts,” “outlook,” “impact,” “potential,” “confidence,” “improve,” “optimistic,” “deliver,” “orders,” “backlog,” “comfortable,” “trend,” and “seeks,” or the negative of such terms or other variations on such terms or comparable terminology. Many important factors could cause actual results to differ materially from those in the forward-looking statements including, without limitation, statements related to the expected benefits of and timing of completion of the Restructuring Plan, disruption of production or supplies, changes in market conditions, political events, pending or future claims or litigation, competitive factors, technology advances, actions of regulatory agencies, and changes in laws, government regulations, labeling or product approvals or the application or interpretation thereof. Many of these important factors are outside of STERIS’s control. No assurances can be provided as to any result or the timing of any outcome regarding matters described in STERIS’s securities filings or otherwise with respect to any regulatory action, administrative proceedings, government investigations, litigation, warning letters, cost reductions, business strategies, earnings or revenue trends or future financial results. References to products are summaries only and should not be considered the specific terms of the product clearance or literature. Unless legally required, STERIS does not undertake to update or revise any forward-looking statements even if events make clear that any projected results, express or implied, will not be realized. Other potential risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, (a) the impact of public health crises on STERIS’s operations, supply chain, material and labor costs, performance, results, prospects, or value, (b) STERIS's ability to achieve the expected benefits regarding the accounting and tax treatments of the redomiciliation to Ireland, (c) operating costs, Customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, Customers, clients or suppliers) being greater than expected, (d) STERIS’s ability to successfully integrate acquired businesses into its existing businesses, including unknown or inestimable liabilities, impairments, or increases in expected integration costs or difficulties in connection with the integration of such businesses, (e) uncertainties related to tax treatments under the TCJA and the IRA, (f) the possibility that Pillar Two Model Rules could increase tax uncertainty and adversely impact STERIS's provision for income taxes and effective tax rate and subject STERIS to additional income tax in jurisdictions who adopt Pillar Two Model Rules, (g) STERIS's ability to continue to qualify for benefits under certain income tax treaties in light of ratification of more strict income tax treaty rules (through the MLI) in many jurisdictions where STERIS has operations, (h) changes in tax laws or interpretations that could increase our consolidated tax liabilities, including changes in tax laws that would result in STERIS being treated as a domestic corporation for United States federal tax purposes, (i) the potential for increased pressure on pricing or costs that leads to erosion of profit margins, including as a result of inflation, (j) the possibility that market demand will not develop for new technologies, products or applications or services, or business initiatives will take longer, cost more or produce lower benefits than anticipated, (k) the possibility that application of or compliance with laws, court rulings, certifications, regulations, or regulatory actions, including without limitation any of the same relating to FDA, EPA or other regulatory authorities, government investigations, the outcome of any pending or threatened FDA, EPA or other regulatory warning notices, actions, requests, inspections or submissions, the outcome of any pending or threatened litigation brought by private parties, including the Isomedix litigation, or other requirements or standards may delay, limit or prevent new product or service introductions, affect the production, supply and/or marketing of existing products or services, result in costs to STERIS that may not be covered by insurance, or otherwise affect STERIS’s performance, results, prospects or value, (l) the potential of international unrest, including the Russia-Ukraine or Israel-Hamas military conflicts, economic downturn or effects of currencies, tax assessments, tariffs and/or other trade barriers, adjustments or anticipated rates, raw material costs or availability, benefit or retirement plan costs, or other regulatory compliance costs, (m) the possibility of reduced demand, or reductions in the rate of growth in demand, for STERIS’s products and services, (n) the possibility of delays in receipt of orders, order cancellations, or delays in the manufacture or shipment of ordered products, due to supply chain issues or otherwise, or in the provision of services, (o) the possibility that anticipated growth, cost savings, new product acceptance, performance or approvals, or other results may not be achieved, or that transition, labor, competition, timing, execution, impairments, regulatory, governmental, or other issues or risks associated with STERIS’s businesses, industry or initiatives including, without limitation, those matters described in STERIS's various securities filings, may adversely impact STERIS’s performance, results, prospects or value, (p) the impact on STERIS and its operations, or tax liabilities, of Brexit or the exit of other member countries from the EU, and the Company’s ability to respond to such impacts, (q) the impact on STERIS and its operations of any legislation, regulations or orders, including but not limited to any new trade or tax legislation (including CAMT and excise tax on stock buybacks), regulations or orders, that may be implemented by the U.S. administration or Congress, or of any responses thereto, (r) the possibility that anticipated financial results or benefits of recent acquisitions, of STERIS’s restructuring efforts, or of recent divestitures, including anticipated revenue, productivity improvement, cost savings, growth synergies and other anticipated benefits, will not be realized or will be other than anticipated, (s) the level of STERIS’s indebtedness limiting financial flexibility or increasing future borrowing costs, (t) rating agency actions or other occurrences that could affect STERIS’s existing debt or future ability to borrow funds at rates favorable to STERIS or at all, (u) the effects of changes in credit availability and pricing, as well as the ability of STERIS’s Customers and suppliers to adequately access the credit markets, on favorable terms or at all, when needed, and (v) the possibility that our expectations about the pre-tax savings resulting from the Restructuring Plan, the number of positions eliminated pursuant to the Restructuring Plan and the costs, charges and cash expenditures associated with the announced restructuring plan may not be realized on the timeline or timelines we expect, or at all.

FAQ

What caused the mistrial in STERIS subsidiary Isomedix's ethylene oxide emissions case?

The mistrial was declared on January 17, 2025, when the dismissal of one juror reduced the jury count below twelve members during deliberations.

What are the allegations against STERIS (STE) subsidiary Isomedix in the Waukegan facility case?

The allegations claim that ethylene oxide emissions from Isomedix's Waukegan, Illinois sterilization facility caused personal injury during its operation from 2005 to 2008.

When will the STERIS (STE) ethylene oxide emissions case be retried?

The case will be rescheduled for re-trial at a later date by the Circuit Court of Cook County, Illinois. No specific date has been announced.

How long did STERIS subsidiary Isomedix operate the Waukegan sterilization facility?

Isomedix owned and operated the Waukegan, Illinois sterilization facility from 2005 to 2008.