Breaking News
  GAWDA Intervenes
  in Welding Fume
  Insurance Litigation

Quality Nickel and Stainless Welding Wires and Electrodes

BREAKING NEWS

GAWDA To Intervene in Welding Fume Insurance Litigation

GAWDA will ask a federal court for leave to intervene in a case that could determine whether insurers must cover potential liability from welding fume claims. The case is U.S. Fire Insurance Co. v. Clendenin Brothers, Inc., No. 1:03-cv-03308 (U.S. District Court, Baltimore, MD).

Clendenin Brothers is commonly owned and insured with Gulf Wire and Nichols Wire, manufacturers of welding wire and other consumable products. Gulf Wire is a GAWDA member. Both have been sued by upwards of 2,000 individual plaintiffs in welding fume lawsuits in Louisiana and elsewhere. As a result, one of the company's insurers, U.S. Fire Insurance Co., denied coverage under the general "pollution exclusion" in the liability insurance policy. Rather than waiting for the insureds to file suit to require coverage, U.S. Fire filed suit in federal court in Baltimore for a declaratory order stating it was not obliged to cover the defendants in the welding fume cases.

The pollution exclusion in both the primary and umbrella U.S. Fire policies is standard industry language that excludes coverage for bodily injury and property damage "which would not have occurred in whole or in part but for the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants at any time." The policies define "pollutants" to mean "any solid, liquid, gaseous, or thermal irritant or contaminant including smoke, vapor, soot, fumes, acid, alkalis, chemicals and waste."

This case could set a precedent that could affect coverage for the entire industry. Most likely, U.S. Fire understands this and carefully chose Maryland as its venue because the case law in the Fourth Judicial Circuit, which includes Maryland, is generally favorable to insurers. Although courts in other jurisdictions will not be bound to follow the decision from the federal court in Maryland, the Clendenin Brothers decision could be used as a "persuasive authority" in other cases on the same issue.

The case largely involves a single point of law—whether the pollution exclusion exempts U.S. Fire from coverage for welding fume liability. Based on each side filing a motion for summary judgment, the court will decide, as matter of law, whether or not U.S. Fire must provide coverage. A trial is probably not necessary because there are not any facts in dispute.

GAWDA has retained the Washington, D.C., office of the law firm of Dickstein, Shapiro, Morin & Oshinsky to represent all GAWDA members, and the entire welding distribution industry, in this case. GAWDA's attorneys will assist attorneys for Clendenin Brothers in preparing their motion for summary judgment and accompanying brief. GAWDA will ask the court for leave to intervene as a party and file its own motion for summary judgment and brief.

GAWDA believes that it is critical to protect its members' interests and to preserve coverage and defense obligations for underlying welding fume claims. Without this coverage, many GAWDA members would not be able to defend themselves against plaintiffs' claims and would not be able to meet any liabilities.

The summary judgment motions and briefs will be filed by the end of December and the court will likely schedule an oral argument on the motions in early 2005. GAWDA will keep its members apprised of any new developments in the case.

SAFETY & COMPLIANCE NEWS

Bar Code Update • Effective January 1, 2005, distributors who scan UPC bar codes for point-of-sale or warehouse shipping and receiving will need to be capable of reading a 13-digit, and preferably a 14-digit, bar code. Most current scanning equipment is capable of reading these bar codes, though distributors should verify this with their vendors. Some distributor data systems may be limited to a 12-character field for a UPC code, which will require a software upgrade to add the two additional characters. Distributors should check with their software providers to ensure a 14-digit UPC field is available or will be available by January 1, 2005.

New Hazmat Incident Reporting Form • DOT has revised the hazardous materials incident reporting form. The new form must be used to report incidents that happen on or after January 1, 2005. The old version must be used for all incidents that happen prior to January 1, 2005. GAWDA DOT & Security Consultant Mike Dodd has written a Traffic Bulletin on this topic. Obtain a copy of the new incident reporting form here. There is also a new guideline for help in completing the new report, which is available here. If you have any questions, please contact Dodd at 573-785-5111 or MLDSafety @hotmail.com.

GAWDA Releases Safety Document • The GAWDA Safety Committee released a new document entitled "New Employee Safety, Health and Environmental Orientation/Training Checklist." The checklist was developed to help ensure that new employees receive the proper and necessary orientation and training in a timely manner. The checklist can be accessed here or from the GAWDA Web site under Safety and Compliance Update.

GAWDA OSHA Manual Updated • The GAWDA Safety Committee guidance document for "OSHA PSM and EPA RMP Coverage of Flammable and Toxic Substances in the Compressed Gas Industry" has been added to the GAWDA OSHA Manual behind Tab 36. The document can also be viewed from GAWDA's Web site here.

MAKING THE SALE

Keen and CryoVation Solve Accounting Problem for Customer

When a large Delaware-based research center was experiencing an accounting problem, they knew just whom to turn to. Keen Compressed Gas Co. (Wilmington, DE) has a bulk liquid nitrogen station on the center's campus and serves as its gases supplier, consistently providing excellent service. Personnel from two research center departments were filling 160-liter liquid cylinders for projects funded through federal grants. The amount of nitrogen issued per use needed to be recorded to verify actual money spent, but it was difficult because the departments were working with different grants.

The customer needed a system that would record what each user used, be secure with passwords, be simple enough for those not familiar with cryogenic filling to use, and would store, sort and report usage by person, department, etc.

Tom Bruno, Keen's account manager for Newark, DE, and Jon Keen, Keen microbulk/bulk coordinator, did their homework. "We searched high and low and looked at different options," Bruno says. Having worked in the past with Jim West, sales engineer at CryoVation, Bruno contacted him for help.

CryoVation custom designed a package that included a Sponsler Flow Meter with a control box. The system prompts a user to enter a user ID and password to start the fill process. The system automatically fills the cylinder and shuts off the fill valve. The total standard cubic feet filled is recorded in non-volatile memory. Each department has an administration ID and password to print monthly reports on the fills, as well as add, remove and edit users.

Keen Compressed Gas and CryoVation took customer service a step further, enhancing the system with additional features. "We know that this customer is extremely safety conscious," Bruno says, "and we looked at how we could prevent any possible dangers that could arise." They automated the fill process to stop filling when the vent temperature sensor detects liquid nitrogen and installed a flash loss minimizer that controls the differential pressure between the bulk tank and liquid cylinder to an optimum 30%. The customer's flash losses before this system ran at least 15%, which has been reduced and controlled to less than 5%. An intricate alarm system monitors the oxygen levels in the room.

For about $20,000, the customer has an accurate accounting system and is saving more than 15% in transfill losses per year. Says Bruno, "We paid close attention to the customer's needs and worked together to exceed their expectations."

INDUSTRY BEAT
(what people are talking about)

(l-r) Frank Barker, ETOX VP Sales/Marketing, Linda Edwards and Major Hathorne of the Salvation Army, and John Whiting, ETOX CEO/President, with gifts for the Angel Tree Toy Drive.

ETOX Event Benefits Charity (Tyler, TX) • ETOX and Miller Electric joined forces December 15 to support the Salvation Army's Angel Tree Toy Drive project using the 75th Anniversary Chopper from Orange County Choppers. Over 5,000 people came by Tyler's convention center to view the bike and donate holiday gifts for needy children. Over 2,000 gifts and $4,000 were collected. "This was a huge success for the community," says ETOX CEO/ President John Whiting. "Our guys did a fantastic job in putting everything together."

Indiana Oxygen Wins Award (Indianapolis, IN) • Indiana Oxygen Company was one of ten Indiana companies to receive the 2004 Blue Chip Business Award. The award is given to a for-profit company that has been in continuous operation for at least three years, employs at least five people and has $500,000 or more in annual sales volume. "Through perseverance, dedication, creativity and resourcefulness, the winners have proven that they are true Indiana business leaders," said Paul DeCoursey of Indianapolis Financial Group, which organizes the award. "Companies like Indiana Oxygen have overcome numerous challenges and turned those challenges into opportunities."

Indiana Oxygen manufactures and distributes industrial, medical and laboratory gases and welding equipment through its ten locations in Indiana and Ohio. Faced with an eroding manufacturing base in the Midwest, the 89-year-old business turned to a global electronic market, which has resulted in a 30% annual growth and a market serving all 50 states plus a dozen foreign countries.

Waters Resigns from NuCO2 Board (Stuart, FL) • NuCO2 Inc. announced the resignation of Richard D. Waters Jr., a partner of JPMorgan Partners, as a member of its Board of Directors. NuCO2 is currently developing a plan to add to its board independent directors who will bring backgrounds and expertise in marketing, business development and operations excellence to support the company's core growth strategy.

Companies Consolidate Under Thermacut (Claremont, NH) • Effective January, Thermacut, Inc. will become the new corporate name for Zap Plasmatherm, the direct division of Tatras, Inc. This name change only places Zap Plasmatherm and Thermacut brand names under the Thermacut, Inc. umbrella. Thermacut, Inc. will continue with market segmentation for distributors, wholesalers and end-users with a strong focus on growth within distribution and wholesale channels. Under the Thermacut banner, all packaging, literature, advertising and correspondence will feature the Thermacut, Inc. corporate name and/or Thermacut brand name. A new corporate identity and logo will be introduced this spring to clearly communicate the structure of the new Thermacut name and its position within the industry.

James Morton and BesseyTools Consolidate (Batavia, NY) • Bessey & Sohn purchased its North American distributor James Morton/American Clamping. As of January 1, 2005, both companies will be consolidated under the brand name of BesseyTools North America. Hugh McKeown has been named CEO. McKeown joined James Morton/American Clamping as sales manager for Canada in 1999 and more recently was promoted to vice president of sales for North America in 2002.

Henshaw Resigns from OSHA (Washington, D.C.) • John Henshaw, head of the Occupational Safety and Health Administration (OSHA), is departing his post at the Department of Labor on December 31, 2004. His replacement has not been named.

In Sympathy Past President Bill Sturgeon Leaves Strong Legacy Bill and Jane Sturgeon (center) visited with friends Bob and Paula McEniry last summer. GAWDA sends it condolences to the family and friends of Bill Sturgeon, who passed away peacefully on December 20 at his home in Edmonton, Alberta, Canada, following a battle with Lou Gehrig’s Disease. Mr. Sturgeon served as NWSA’s first Canadian President in 1979-1980 while at Consumers Welding Supplies. He was instrumental in extending the association’s reach into Canada, which led to the creation of the Canadian Zone. Following his retirement, he maintained an interest in our industry and enjoyed spending time with the friends he made through NWSA. Mr. Sturgeon is described as a dynamic and masterful leader in his business and the gases and welding industry. Many consider him a dear friend whose sense of humor, uplifting spirit and love for life were unparalleled. A memorial service will be held December 28. Mr. Sturgeon is survived by his wife, Jane, and their children. Frank Finn Francis H. "Frank" Finn, 74, owner of FIBA Technologies, Inc., passed away November 28 after injuries received from a fall on November 20. Mr. Finn served in the U.S. Army in the Korean War as corporal, receiving the Korean Service Medal. In 1962, he founded FIBA Technologies, Inc., which is headquartered in Westborough, MA, and operates corporations in four states and a retest center in Brazil. Mr. Finn was dedicated to his company and worked until the time of his death. Under his guidance, FIBA earned a reputation as being an innovative company, often leading the industry with its equipment designs and testing technology. GAWDA extends condolences to his wife of 47 years, Dorothy; three sons, John, Frank and Stephen; two daughters, Maureen and Susan; and 15 grandchildren.

GAWDA NEWS

Leading Your Company • The demands of the marketplace are constantly changing. What leadership skills will it take to grow your business in 2005? In the Winter issue of Welding & Gases Today, GAWDA Distributors, Manufacturers and Suppliers share the skills they will rely on in the new year. Learn lessons from Past Presidents of GAWDA, living legends of leadership, who share their knowledge and experience of the industry. Also in this issue, meet GAWDA's new Board of Directors, read a profile of Commonwealth Supply Company and recap this year's Annual Convention in Las Vegas. Read the entire issue online here.

Members who do not receive complimentary copies of Welding & Gases Today can subscribe for $40/year by completing the order form in GAWDA's Online Store. Contact Headquarters at 215-564-3484 for volume discounts.

HR Report Available • Is your documentation in order? It should be to ensure a legally secure termination. Be sure you have written records of performance and communication to warrant a termination. Read the January issues of the HR Manager's Legal Reporter and QuikStep Trainer here at GAWDA's Web site.

Holiday Economics • If you think buying your sweetheart a new Jaguar for the holidays is too steep, think again. According to Pittsburgh-based bank PNC Financial Services Group Inc., the car would cost as much as all the gifts listed in "The Twelve Days of Christmas." Read the story here to find out what it would cost to buy the gifts on each of the 12 days.

To All GAWDA Members • During the Holiday Season, President Bob Thornton, the Board of Directors, and Rick Doyle and the Fernley & Fernley staff gratefully turn their thoughts to GAWDA's members for your many contributions to GAWDA and the gases and welding industry. Best wishes to you and your families for a joyous holiday season, and a healthy and prosperous New Year!

GAWDA Industry Statistics When making decisions that affect your bottom line, it's important to know what is going on in your industry. GAWDA is your resource for accurate and timely industry statistical data. We currently offer three unique reports to help you find the information you are looking for. The GAWDA Profit Report provides detailed financial results from welding and industrial gases firms. Results profiled report income statement, balance sheet and operating data provided by participating firms. The 2004 Profit Report is available through GAWDA at the special member price of $250 ($200 for PDF version). The Industry Benchmarks Report (also known as the Trends Report) is a brief analysis of recent sales trends submitted by GAWDA members designed to keep senior management abreast of current industry trends. The quarterly reports can be viewed online by all members free of charge. To participate in the Industry Benchmarks Report, please see the contact information below. The GAWDA Compensation Survey is compiled every two years. Volume 1 contains information only for GAWDA firms taking part in the survey. Volume 2 is a cross-industry survey using a large sample of firms in various markets so you can identify with the compensation issues in your own area. The GAWDA 2004 Compensation Survey is now available to members through GAWDA for $195. In addition to the reports, you also will find links to related topics. All three reports are compiled by the Profit Planning Group, a Colorado-based firm that helps small to mid-sized businesses understand the financial side of their operations. To order the 2004 Profit Report or the 2004 Compensation Survey, you can obtain an order form at the GAWDA Online Store. To sign up for the quarterly Industry Benchmarks Report, please contact the Profit Planning Group at 303-444-6212 or GAWDA Headquarters at 215-564-3484.