Gas can manufacturer folds in Miami, Okla.
BY SHEILA STOGSDILL World Correspondent
Tuesday, July 24, 2012
7/24/12 at 6:46 AM
MIAMI, Okla. - Product liability lawsuits have extinguished an Ottawa County gasoline can manufacturer, says Rocky Flick, owner and chief operating officer of Blitz U.S.A.
Blitz U.S.A./F3 Brands in Miami filed for Chapter 11 bankruptcy Nov. 9. On Monday, the company said it will close its doors July 31 and lay off 117 people.
"This is quite a blow," said Chuck Evans, plant manager. "We hope another plant comes in and takes over."
The 50-year-old company will have its assets sold Sept. 6.
"We were unable to put together a reorganization plan," Flick said.
The lawsuits that doomed Blitz mostly centered on individuals pouring gasoline out of a can onto an open fire, with the vapors igniting and causing injuries.
Three warnings about not mixing gasoline and fire, in addition to other safety precautions, are displayed predominately on the red plastic cans.
"It's never going to be safe to pour gas onto a fire," Flick said. "This is not a design defect - this is consumer abuse."
Flick said once the first lawsuit was settled, the floodgates of litigation were opened.
"The insurance company thought it was best to settle," Flick said. "The first lawsuit settled for around $1 million, the last lawsuit for around $10 million, but most of the lawsuits were between $5 million to $10 million."
The company went to trial in two cases, winning one lawsuit and losing the other, a $4 million verdict involving the death of a 4-year-old girl.
The jury found Blitz 70 percent liable, Flick said.
The child was living in a camper in Utah when her father poured gasoline into a wood stove, which ignited, he said.
The case is on appeal.
Flick said a shortage of gas cans during future natural disasters is likely.
"People use gas for generators," he said.
During hurricane season there is a 30 percent spike in gas cans sales, he said.
Blitz has about 70 percent of the market selling gas cans, Flick said.
"We don't want people to go back to using a milk carton and setting it in the garage," he said.
In 1992, U.S. Metal Container became Blitz U.S.A. For years, U.S. Metal Container sold its gas cans to government agencies for military use. It was the only gas can manufacturer in the nation in 1966, and a year later the can was painted bright red and sold to thousands of customers across the country, according to the company's website.
The plant closure will hit the community hard, said Miriam George, risk management supervisor at Blitz. About 20 employees have been with the company for more than 30 years, she said.
"We have several employees who started here at 18 and are still here at 59," George said. "They thought they would be here until they retired."
George said the company is providing the employees with job-search assistance.
Original Print Headline: Plant bankruptcy idles 117