http://www.epa.gov/region8/superfund/libby/background.html
Libby History
Gold miners discovered vermiculite in Libby in 1881; in the 1920s the Zonolite Company formed and began mining the vermiculite. In 1963, W.R. Grace bought the Zonolite mining operations. The mine closed in 1990.
a little background on asbestos and vermiculite.
http://www.epa.gov/asbestos/pubs/insulation.html
Is vermiculite insulation a problem?
Prior to its close in 1990, much of the world’s supply of vermiculite came from a mine near Libby, Montana. This mine had a natural deposit of asbestos which resulted in the vermiculite being contaminated with asbestos. Attic insulation produced using vermiculite ore, particularly ore that originated from the Libby mine, may contain asbestos fibers. Today, vermiculite is mined at three US Facilities and in other countries which have low levels of contamination in the finished material.
And another interesting bit followed what you copied from the EPA site:
While in operation, the Libby mine may have produced 80% of the world's supply of vermiculite. Vermiculite has been used in building insulation and as a soil conditioner. Unfortunately, the vermiculite from the Libby mine was contaminated with a toxic form of naturally-occurring asbestos called tremolite-actinolite asbestiform mineral fibers.
That being said - one also has to ponder on the dangers of asbestos in general.. and the many law school grads who have made personal fortunes off of asbestos lawsuits.
What I always wonder in such cases as this - did the mining company that shut down in 1990 not know that all that vermiculite also had this apparently "bad" form of asbestos? If they did know, then exactly why did they not do anything about it at the time?