He's out millions of dollars.
Pleas for protective masks have become common in the coronavirus pandemic. A small Delaware medical equipment supplier is calling federal seizures of hundreds of thousands of N95 respirators illegal.
George Gianforcaro, owner of Newark-based Indutex USA, said the Federal Emergency Management Agency did not pay him when it took possession of two imported shipments of masks bound for customers across the United States.
Those customers included Delaware nursing facilities, the state of Michigan and pilots who steer foreign ships through U.S. bays.
He said he does not know where the seized masks are today, or whether they have been distributed to medical facilities or elsewhere.
Importer, FEMA clash
In an emailed statement, FEMA appeared to deny Gianforcaro’s charge without addressing the specific claims. It called reports of its officials commandeering or rerouting supplies of such critical equipment “false.”
Protective equipment “being distributed internally within the United States is not being seized,” FEMA said, while stating also that it is working with U.S. Customs and Border Protection to keep medical equipment from being exported.
The dispute, the latest allegation of a FEMA seizure, occurs as the agency has begun to vigorously counter such claims. On Wednesday, FEMA Administrator Peter Gaynor said his agency needed to “bust myths” about seizures of medical equipment.
But while FEMA says it targets exporters, Gianforcaro’s customers for the N95 masks are domestic companies or governments, according to a list of orders Gianforcaro shared with The Delaware News Journal, part of the USA TODAY Network.
Among them is Cadia Healthcare, an operator of several long-term care facilities in Delaware. Cadia co-founder Steve Silver said his facilities will need additional masks and medical gowns, as more residents are expected to test positive for COVID-19.
To buttress his argument amid FEMA denials, Gianforcaro shared a written order that he says FEMA sent to his company. The document directed Indutex to sell to the federal government “all filtering facepiece respirators, including the N95 respirators contained within shipment number 8994645378 that arrived at JFK Airport” on April 6.
That early April shipment of 100,000 N95 masks was followed by a subsequent April 19 arrival of 300,000 more, also seized, Gianforcaro said.
Citing Defense Production Act authority, the FEMA document further ordered Indutex to “set aside” all N95 or surgical masks it may come to possess during the federal emergency for a potential sale to FEMA.
Gaynor’s signature is along the bottom.
His agency did not respond to follow-up questions about whether their press statement contradicts the order.
Gianforcaro said FEMA sent the written order only after he repeatedly inquired about whether they would pay him for the face masks or release them back to him.
“I kept screaming about it and I got a lawyer involved,” he said. “Then, that’s when I got the letter from them.”
What is FEMA’s role?
The April shipments of N95 masks into New York’s John F. Kennedy Airport were to be the first of several that ultimately would bring nearly a million in-demand respirators into the country, Gianforcaro said.
But after what he said was a second seizure Sunday, Gianforcaro canceled the remainder of the order, noting he likely won’t make additional orders before being paid for the initial shipment.
“Let’s not forget I paid $4 million for this product on March 18,” Gianforcaro said, referring to the million-mask order. “This is getting very, very expensive. I don’t have any money and I don’t have any product and there’s people that are asking for it.”
His dispute with FEMA comes as states, hospitals and nursing homes desperately seek out supplies of equipment to protect against the coronavirus pandemic, which by Tuesday had infected 800,000 people in the United States, according to Johns Hopkins University.
Among the hardest hit are those who live, and work, in nursing homes. During the past week, seven Delaware long-term care officials pointed to several factors contributing to outbreaks, and all but one said they need more gowns and masks to suppress the further spread of the disease.
Some are making their own by sewing pieces of cloth into masks or wearing large button-up shirts backward as gowns.
Meanwhile, bidding wars have erupted among states, medical companies and others for the equipment, particularly the tight-fitting N95 masks, which filter out at least 95% of airborne particles.
President Trump has said the federal government’s role is to be a backup to states’ efforts, but it is not entirely clear what that means for FEMA.
In the order sent to Gianforcaro, the agency said the shipment would be sent to the Strategic National Stockpile.
Operated by the U.S. Department of Health and Human Services, the stockpile has supplied ventilators, masks and other equipment to states, but not always in the quantities requested.
Last month, Delaware requested 10 million masks and more than 100 million gloves for what it expected to be a months-long fight. Days later, the federal government asked the state to pare back the request and submit what it would need for a two-week surge.
As of early April, Delaware had been granted less than 1 percent of what it initially requested, according to leaked federal documents.
On April 1, the administration said the national stockpile had nearly been depleted.
A national supply chain?
As Trump called on the states to take the lead in procuring masks and ventilators, others have said the federal government should direct the flow of medical equipment nationally.
Standing next to Gianforcaro at a press conference March 31, Sen. Chris Coons said he had become “enormously” frustrated that the federal government had not coordinated a centralized medical supply chain.
Coons had spoken with other senators about the possibility of creating “one logistics point of contact,” he said.
Gianforcaro, a longtime friend to Coons, said he would welcome being FEMA’s partner within a national network. The key, he said, is for them to pay for the equipment he supplies.
In discussions with FEMA officials, he said he proposed a solution in which he could deliver masks to health facilities in the United States as directed by FEMA, rather than federal officials carrying out the logistics themselves. They did not appear to accept the proposal, he said.
During a recent caucus call with the vice president and others in the Trump administration, Senate Democrats were told that FEMA seizures were not happening, Coons said.
Rather than contact Coons, Gianforcaro said he elicited help from Sen. Rand Paul of Kentucky. In an email following an apparent phone call with Gianforcaro, Paul staffer Rob Givens said the office will “check with FEMA.”
Follow reporter Karl Baker on Twitter @kbaker6.