KATHERINE RIZZO
Associated Press Writer

WASHINGTON (AP) - When ailing workers or their survivors sue federal contractors over exposure to deadly chemicals or radioactive material at weapons plants, taxpayers routinely get the company's legal bill.

The arrangement often frustrates those whom former Energy Secretary Bill Richardson liked to call Cold War veterans.

"It's terrible,'' said Corrilla Kelly, the widow of a 27-year veteran of the Fernald uranium processing plant in southwest Ohio. "How do you fight all the money of the government?''

Her late husband, Herbert Kelly, spent eight years trying to get workers compensation for lung cancer he blamed on his workplace. He was challenged at every turn by government-reimbursed lawyers who suggested his illness was caused by cigarettes he had given up 15 years before getting sick.

David Norgard, who worked at Brush Wellman Corp.'s Elmore, Ohio, plant and is suing the beryllium maker, said "it really did hit hard'' to learn the government reimburses the company for legal fees.

"It's very upsetting,'' he said. "I think the company was responsible and the company ought to pay.''

Workers suing Brush contend the company could have done more to protect them from an incurable lung disease blamed on exposure to beryllium, a metal used in nuclear weapons production.

Brush maintains that, through the years, it tried to protect the health of its workers based on what was known at the time. It also said it has helped employees with confirmed Chronic Beryllium Disease get state workers compensation.

"To our knowledge, there is no current or former Brush Wellman employee with confirmed CBD who have not been successful in establishing a workers' compensation claim,'' said Hugh D. Hanes, the company's vice president for government relations.

Some of the workers suing say that's not enough.

Brush spokesman Patrick Carpenter said it was company policy not to discuss litigation, but that it defends lawsuits aggressively and pursues indemnification from the government whenever allowed by its contracts.

For decades, military contracts have allowed companies that handle dangerous or radioactive material to be reimbursed for responding in court or before state workers compensation boards to employees who blame their illnesses on workplace exposure. Taxpayers also pick up the tab for lawyers to fight claims by weapons plant neighbors.

How much the government has reimbursed Brush, other vendors, and the companies that ran its weapons plants during the Cold War era has not been documented.

The Energy Department has no estimate, and because of the transition to the new administration could not make an official available to discuss the issue.

The last time congressional auditors looked at the issue, in 1994, the General Accounting Office found that reimbursing contractors for the cost of litigation - not including the cost of fighting workers compensation claims - was $40 million in fiscal year 1992.

Documents obtained under the Freedom of Information Act by lawyers for some of the workers showed that in just a handful of large cases, including a class action suit against the former operators of the Hanford Nuclear Reservation in Washington state, the government has paid outside lawyers more than $94 million.

"In a normal lawsuit, the cost of litigation is part of the reasoning that goes into settling,'' said Louise Roselle, a Cincinnati lawyer who represents weapons plant workers and neighbors in lawsuits against the contractors.

"These lawyers have no incentive to settle, and the government doesn't seem to care. We have four cases in this firm that are 10 years old or older. All four involve weapons plants,'' she said. "They could have settled a lot of cases for the money they've already spent.''

"It gives the contractors essentially unlimited resources to fight individual workers,'' agreed David Michaels, the Energy Department's top health official under Richardson.

"But I could make the argument either way. The companies were paid lots of money to do this work, but their specifications were set by the federal government, which assumed a responsibility for what happened,'' he said.

Some of the companies involved in the Manhattan Project, which developed the first atomic bomb, worked for $1 a year but insisted on indemnification from lawsuits.

Subsequent contractors were better paid for the dangerous, secretive work, but also were indemnified.

In recent years, the Energy Department's legal office has reined in reimbursements for fighting workers with illness claims, Michaels said. A new law passed late last year also ordered the government to stop fighting claims from workers with specific illnesses that are easily connected to on-the-job exposure at a weapons plant.

For others, the new law instructs the government to stop fighting the claims if special medical boards rule in the workers' favor. Those boards, have not yet been set up.