Click here to load reader

Asbestos: State Solutions Phil Goldberg Shook, Hardy & Bacon L.L.P. Phil Goldberg Shook, Hardy & Bacon L.L.P

  • View
    221

  • Download
    0

Embed Size (px)

Text of Asbestos: State Solutions Phil Goldberg Shook, Hardy & Bacon L.L.P. Phil Goldberg Shook, Hardy...

  • Slide 1
  • Asbestos: State Solutions Phil Goldberg Shook, Hardy & Bacon L.L.P. Phil Goldberg Shook, Hardy & Bacon L.L.P.
  • Slide 2
  • Where We Are Today US Supreme Court: asbestos-litigation crisis. 300,000 pending claims. $70B spent on claims through 2002. Future costs: $130B-$195B (RAND, 2005). 73 bankruptcies and counting. US Supreme Court: asbestos-litigation crisis. 300,000 pending claims. $70B spent on claims through 2002. Future costs: $130B-$195B (RAND, 2005). 73 bankruptcies and counting.
  • Slide 3
  • Snowball effect from piling on nature of liabilities. 37 filings in 1970s, 1980s & 1990s. 36 filings from 2000 to mid-2004. Nobel Prize economist Joseph Stiglitz (2003) Bankruptcies = 60,000 layoffs between 1997 and 2000. 25% reduction in employee retirement assets. Natl Economic Research Associates (2003) Workers, communities, and taxpayers will bear costs. Snowball effect from piling on nature of liabilities. 37 filings in 1970s, 1980s & 1990s. 36 filings from 2000 to mid-2004. Nobel Prize economist Joseph Stiglitz (2003) Bankruptcies = 60,000 layoffs between 1997 and 2000. 25% reduction in employee retirement assets. Natl Economic Research Associates (2003) Workers, communities, and taxpayers will bear costs. Asbestos Bankruptcies
  • Slide 4
  • 1982 = 300 defendants 2005 = 8,500 defendants Richard Scruggs: endless search for a solvent bystander. W.S. Journal: companies far removed from the scene of any putative wrongdoing. 1982 = 300 defendants 2005 = 8,500 defendants Richard Scruggs: endless search for a solvent bystander. W.S. Journal: companies far removed from the scene of any putative wrongdoing. Peripheral Defendants
  • Slide 5
  • Asbestos Litigation Phases Establish Litigation (1970s-early 1980s) Focus on cancer cases (mid 1980s-mid 1990s) Recruit Unimpaireds (mid 1990s-2005) Back to the Future? Establish Litigation (1970s-early 1980s) Focus on cancer cases (mid 1980s-mid 1990s) Recruit Unimpaireds (mid 1990s-2005) Back to the Future?
  • Slide 6
  • Hallmarks of the Unimpaired Phase
  • Slide 7
  • Up to 90% of claimants have little/no impairment. Claimants with nonmalignant conditions account for most of the growth in claims in recent years. Mass Screenings: Find out if YOU have MILLION DOLLAR LUNGS! A.G. Bell: driving claims by healthy plaintiffs. Up to 90% of claimants have little/no impairment. Claimants with nonmalignant conditions account for most of the growth in claims in recent years. Mass Screenings: Find out if YOU have MILLION DOLLAR LUNGS! A.G. Bell: driving claims by healthy plaintiffs. Most Claimants Are Not Sick
  • Slide 8
  • Dr. Lawrence Martin: [C]hest x-rays are not read blindly, but always with the knowledge that the lawyer wants to file litigation on the worker s behalf. Dr. Gitlin/Johns Hopkins Study: plaintiffs x-ray readers found abnormalities in 95.9% of films used to support legal claims; independent radiologists found abnormalities in only 4.5% of the cases (2004). Scholarship by Judy Pendell, AEI-Brookings Joint Center. Dr. Lawrence Martin: [C]hest x-rays are not read blindly, but always with the knowledge that the lawyer wants to file litigation on the worker s behalf. Dr. Gitlin/Johns Hopkins Study: plaintiffs x-ray readers found abnormalities in 95.9% of films used to support legal claims; independent radiologists found abnormalities in only 4.5% of the cases (2004). Scholarship by Judy Pendell, AEI-Brookings Joint Center. Mass Screenings = Unreliable Claims
  • Slide 9
  • Manager of the federal asbestos docket: Only a very small percentage of the cases filed have serious asbestos-related afflictions, but they are prone to be lost in the shuffle with pleural and other nonmalignant cases. Steven Hantler, DaimlerChrysler: The tragedy is that as plaintiffs lawyers enroll the healthy into their lawsuits in order to line their own pockets, less money is available for those who are actually sick and dying. Manville Trust is paying just five cents on the dollar to asbestos claimants; Celotex and Eagle- Picher trusts have reduced payments, too. Manager of the federal asbestos docket: Only a very small percentage of the cases filed have serious asbestos-related afflictions, but they are prone to be lost in the shuffle with pleural and other nonmalignant cases. Steven Hantler, DaimlerChrysler: The tragedy is that as plaintiffs lawyers enroll the healthy into their lawsuits in order to line their own pockets, less money is available for those who are actually sick and dying. Manville Trust is paying just five cents on the dollar to asbestos claimants; Celotex and Eagle- Picher trusts have reduced payments, too. Non-Sick Take From Sick
  • Slide 10
  • Matthew Bergman, Seattle: the genuinely sick and dying are often deprived of adequate compensation as more and more funds are diverted into settlements of the non-impaired claims. Peter Kraus, Dallas: Non-sick are sucking the money away from the truly impaired. Randy Bono, Madison County: Getting people who arent sick out of the system, thats a good idea. Terrence Lavin, IL State Bar President: Members of the asbestos bar have made a mockery of our civil justice system and have inflicted financial ruin on corporate America by representing people with nothing more than an arguable finding on an x-ray. Matthew Bergman, Seattle: the genuinely sick and dying are often deprived of adequate compensation as more and more funds are diverted into settlements of the non-impaired claims. Peter Kraus, Dallas: Non-sick are sucking the money away from the truly impaired. Randy Bono, Madison County: Getting people who arent sick out of the system, thats a good idea. Terrence Lavin, IL State Bar President: Members of the asbestos bar have made a mockery of our civil justice system and have inflicted financial ruin on corporate America by representing people with nothing more than an arguable finding on an x-ray. Lawyers for Cancer Victims Agree
  • Slide 11
  • Asbestos Litigation Rulings & Other Reforms
  • Slide 12
  • No Cause of Action for Unimpaireds Maine (1986) Arizona (1987) Hawaii (1990) Delaware (1994) Pennsylvania (1996) NJ, CT, NC?
  • Slide 13
  • Inactive Dockets RAND (2005): one of the most significant developments in asbestos processing has been the reemergence of deferred dockets as a popular court management tool. Minnesota (2005) (coordinated litigation) St. Clair Co., IL (2005) Portsmouth, VA (2004) Madison Co., IL. (2004) Syracuse, NY (2003) Minnesota (2005) (coordinated litigation) St. Clair Co., IL (2005) Portsmouth, VA (2004) Madison Co., IL. (2004) Syracuse, NY (2003) Massachusetts (1986) (coordinated litigation) Cook Co./Chicago (1991) Baltimore City (1992) New York City (2002) Seattle, WA (2002)
  • Slide 14
  • Medical Criteria Legislation 3 fundamental parts (1)Work history (2)X-ray (3)Pulmonary Function Test States enacted Ohio (2004) Georgia (2005) Florida (2005) Texas (2005) Other factors (4)Latency (5)Causation (6)Doctor-Patient Relationship
  • Slide 15
  • Addressing Unimpaired Asbestos Claimant Filings
  • Slide 16
  • Mass Screenings: On Way Out Federal Silica MDL Litigation: Judge Janis Graham Jack dismissed nearly 10,000 claims due to fraud. Manville and Eagle-Picher Trusts: will no longer accept screenings by doctors/ facilities in the Jack opinion. Federal prosecutors in Manhattan are considering criminal charges and may be investigating plaintiffs asbestos firms involved in G-1 Holdings (GAF Corp.) bankruptcy case. Congressional investigation (2005). Federal Silica MDL Litigation: Judge Janis Graham Jack dismissed nearly 10,000 claims due to fraud. Manville and Eagle-Picher Trusts: will no longer accept screenings by doctors/ facilities in the Jack opinion. Federal prosecutors in Manhattan are considering criminal charges and may be investigating plaintiffs asbestos firms involved in G-1 Holdings (GAF Corp.) bankruptcy case. Congressional investigation (2005).
  • Slide 17
  • Other Tort Reforms Joint Liability Reform Noneconomic Damages Reform Punitive Damages Reform Innocent Seller Reform Appeal Bond Reform Venue Reform Trial Consolidation Reform
  • Slide 18
  • Compare with State Court Filings
  • Slide 19
  • Future Direction of Asbestos Litigation (1)Tort system: hostile to unimpaired claims (2)Bankruptcy courts: too long, failure of pre-packs (3)Congress: still no action (4)State legislation: creating solutions (Medical criteria bills in Mississippi & California?)
  • Slide 20
  • Future Direction of Asbestos Litigation Back to the Future: Focus on cancer cases Number of claims ; Value of claims Have lawsuit will travel to ___ (DE, CA?) Searching for the next asbestos? Silica (unlikely after Judge Jacks opinion) Welding rods; Benzene; Pharmaceuticals But next asbestos is probably asbestos Back to the Future: Focus on cancer cases Number of claims ; Value of claims Have lawsuit will travel to ___ (DE, CA?) Searching for the next asbestos? Silica (unlikely after Judge Jacks opinion) Welding rods; Benzene; Pharmaceuticals But next asbestos is probably asbestos
  • Slide 21
  • Asbestos: State Solutions Phil Goldberg Shook, Hardy & Bacon L.L.P. Phil Goldberg Shook, Hardy & Bacon L.L.P.
  • Slide 22
  • Addendum: Solutions Joint Liability Reform Noneconomic Damages Reform Punitive Damages Reform Innocent Seller Reform Appeal Bond Reform Venue Ref