MITCHELL — A Mitchell-based business is facing a wrongful death lawsuit and fines from the Occupational Safety and Health Administration (OSHA) after an employee died of hypothermia due to liquid nitrogen exposure that attorneys say was a result of the company putting profits over safety.
The wrongful death suit, filed in Davison County, alleges that Custom Genetic Solutions (CGS), of rural Mitchell, negligently failed to train employees or provide adequate safety equipment as well as willfully opted not to install proper ventilation systems, resulting in the Nov. 20, 2019 death of Molly Schladweiler.
In court filings, the company admits that Schladweiler, who was 20-years-old at the time of her death, was a longtime employee of CGS whose primary duties included packaging and shipping bull semen with the use of cryogenics, specifically liquid nitrogen, as well as filling bulk storage with liquid nitrogen when levels were low.
“On the evening of November 20, 2019, [Schladweiler] died as a result of working in an oxygen-deficient atmosphere as a result of filling bulk storage tanks with liquid nitrogen,” a May 2020 OSHA violation report regarding CGS reads. “... The employee began topping the bulk tanks off with liquid nitrogen when the room became filled with nitrogen gas causing [Schladweiler] to collapse and eventually succumb to the oxygen-deficient atmosphere created in the room.”
Liquid nitrogen has a boiling point of 320 degrees below-zero. According to Schladweiler's death certificate, Dr. Kenneth Snell determined she died as a result of hypothermia due to liquid nitrogen exposure. Snell noted in the report that he can’t rule out hypoxic injury — a deprivation of oxygen to the brain — prior to the onset of hypothermia.
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Schladweiler's mother, Dixie Schladweiler, who serves as the personal representative to Molly's estate, filed the lawsuit in November 2021 with attorney Zach Flood, seeking general and special damages, compensatory damages beyond medical expenses and compensation for lost wages, permanent injury and for Schladweiler's wrongful death.
Allegations of the case included claims that CGS knowingly and willfully declined to install proper ventilation systems, despite being quoted by a local contractor to install them. The estate claims this was done in an effort to put profits before the safety of their employees.
CGS, however, specifically denies this claim, denying that any employee received a quote or chose to forego the installation of ventilation systems.
Just one month after the initial filing, CGS motioned to court to dismiss the lawsuit entirely, arguing that, without proof that CGS was intentionally negligent, Schladweiler's estate is entitled only to workers compensation under South Dakota law, and added that the lawsuit is based entirely on accusation and not on fact.
“The estate’s complaint is an attempt to use the correct terminology to disguise negligent, or wanton and reckless, actions as intentional actions in order to trigger the intentional tort exception under SDCL 62-3-2,” CGS’s motion to dismiss reads. “The complaint contains no factual allegations that would allow the court to draw a reasonable inference that CGS is liable for an intentional tort.”
In a filing resisting CGS’s motion to dismiss, Flood argued, among other evidence, multiple OSHA violations provide proof of the company’s willful negligence.
In the complaint filed by the U.S. Department of Labor, who oversees OSHA, CGS was issued two citations. One citation contained serious violations for failure to develop, implement and maintain a written hazard communication program; failure to ensure hazardous chemical containers were labeled with hazard warnings; and failure to maintain safety data sheets for each hazardous chemical kept on-site. The second citation included willful violations for failure to provide hazardous chemical trainings and failure to ensure proper ventilation in rooms where liquid nitrogen was handled.
The OSHA report specifically noted Schladweiler was working alone, late at night, in a room with no safety devices to warn her of an oxygen-deficient environment.
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According to an online database of cases curated by OSHA, CGS has contested all violations included in the report and has made no payments toward their fines, which totaled over $122,000. The case remains open to this day, as the U.S. Department of Justice investigates CGS for possible criminal charges.
Following a Jan. 25, 2022 hearing in Davison County regarding CGS’s motion to dismiss the case, Judge Patrick Smith denied the motion, requiring CGS to respond to the estate’s allegations by Feb. 25.
In their latest court filing, submitted on the last day possible, CGS denied any allegation made by the estate that could be interpreted as to place blame on the company for Schladweiler's death — including allegations based off of the contested OSHA reports.
The company only agreed with the estate on basic information, such as acknowledging that Schladweiler was an employee of the company, the date and place of her death, that liquid nitrogen is a hazardous chemical and that Schladweiler handled liquid nitrogen as part of her duties.
Unless Schladweiler's estate and CGS reach a settlement beforehand, the case will eventually be heard before a jury, who will determine if the estate is owed any damages or compensation. That hearing has yet to be scheduled.
