Foam company offers R.I. fire plaintiffs $6.3M

PROVIDENCE, R.I. - A company that sold flammable foam blamed for fueling a Rhode Island nightclub fire that killed 100 people has agreed to pay $6.3 million to settle lawsuits from survivors and victims' relatives.

The agreement filed Thursday by Johnston-based American Foam Corp. brings total settlements offered in the case to roughly $155 million. The settlement must be approved by the hundreds of people suing.

The Feb. 20, 2003, fire at The Station nightclub began when pyrotechnics for rock band Great White ignited the foam, which was used as soundproofing around the stage.

The families sued American Foam, alleging the company did not warn the nightclub owner that the foam was flammable.

A message left for American Foam's lawyers was not immediately returned.

The newest settlement also covers the estate of Aram Dermanouelian, the company's former president who has since died, and Barry Warner, a company salesman who lived near the club and suggested that club owners Jeffrey and Michael Derderian buy soundproofing foam to quell noise complaints.

American Foam sold the club $575 of foam in June 2000, three months after the Derderians became the owners. Experts say the foam burns like gasoline, emits a dense smoke with toxic gases and is not suitable for acoustic insulation.

The Derderians, who pleaded no contest two years ago to involuntary manslaughter charges, have said they never knew the foam was flammable.

Dermanouelian told a state grand jury investigating the fire that his company did not provide technical information on the foam it sold unless customers requested it. Warner said he never told the Derderians the foam was flammable, but also said the brothers never asked.

Many of the dozens of people and companies sued for the fire already have agreed to settle, including Anheuser-Busch Inc., The Home Depot Inc., Clear Channel Broadcasting and a group of foam manufacturers. The lawsuits have been settling in piecemeal fashion since last year, with most defendants choosing not to go to trial.

The remaining defendants include the state of Rhode Island and the town of West Warwick, whose fire marshal never cited the club for the foam even though he did repeated inspections before the fire.

None of the settlements is final, and no money has yet been paid to the victims. Francis McGovern, a Duke University law professor, has been appointed by the judge to craft a formula to determine how much money each person suing should get.

Michael Derderian will be free on parole next year from his four-year prison sentence, while his brother was spared jail time after their pleas to 100 counts of involuntary manslaughter.

Former Great White tour manager Daniel Biechele, who ignited the pyrotechnics, was released on parole in March after serving 22 months of his sentence.