The plaintiffs claimed that the manufacturer, International Flavoring & Fragrances (IFF), knew about the dangers of the butter flavoring used in the popcorn factory but failed to give a warning. Exposure to diacetyl, a chemical used in the butter flavoring of popcorn, can cause bronchiolitis obliterans.
The defendants however insisted that they were unaware of the risk and suggested there was not enough evidence to prove their product had caused the disease.
The ruling was announced Tuesday by New York-based IFF and Fragrances and its subsidiary, Bush Boake Allen. The settlements do not affect jury verdicts awarding almost $53 million to four workers whose cases, now on appeal, were tried earlier, or settlements reached with six other workers out of court or during their trials.
It has certainly been a difficult time for the company, and this latest ruling represents a clear warning to flavor firms that safety procedures in factories must be tightened. IFF, the second largest flavour player in the world, faced potentially massive fines last year following a string of charges from 30 plaintiffs claiming they had contracted lung disease from mixing flavouring oils.
After the first ruling in early 2004, jurors decided IFF and its subsidiary, Bush Boake Allen, had to pay $20 million in damages.
The defendants have had significant scientific research on their side. In January this year, the National Institute of Occupational Safety and Health (NIOSH), a body that falls under the US Department of Health and Human Services, recommended that employers take measures to limit employees 'occupational respiratory exposures to food flavorings and flavoring ingredients in workplaces where flavorings are made or used'.
Reporting in the journal Chest, the team concluded that workers exposed to flavoring agents were nearly four times more likely to develop airway inflammation, a sign people were breathing in harmful agents.
The alert stemmed from a series of NIOSH health hazard evaluations that began in 2000 when NIOSH learned of the occurrence of bronchiolitis obliterans in workers at a microwave popcorn packaging plant.
"Results of the health hazard evaluations to date suggest that adverse effects may result from occupational inhalation exposures to high, airborne concentrations of some flavorings or their ingredients in the form of vapors, dusts, or sprays," said NIOSH said in a statement.
These rulings could also have implications for the lucrative butter flavoring oils market in the US, tipped to hit $4.4 billion (€3.4bn) by 2007. Butter flavoring oils are used in biscuit and confectionery manufacturing, as well as in margarines and soft spreads.
From now on, popcorn factory safety is likely to be a high priority.