March 24, 2018

Insurer Claims Asbestos Fraud Tainted Pittsburgh Corning Bankruptcy

An insurer that was required to help fund the $3 billion bankruptcy of Pittsburgh Corning Corning has filed court papers seeking the case to be reopened, saying “pervasive fraudulent conduct” by asbestos plaintiff lawyers tainted the proceedings.

The filing by Everest Re and its Mt. McKinley Insurance unit follows the opening of millions of pages of documents in the Garlock Sealing Technologies bankruptcy, which revealed how lawyers representing asbestos plaintiffs deliberately delayed filing claims against bankrupt companies until they had completed cases against solvent ones, in order to avoid cluttering the record with potential evidence of exposure to other firms’ products.

Everest is among the insurers ordered to pay $1.7 billion into the bankruptcy trust formed to settle claims against Pittsburgh Corning, a joint venture of PPG Industries PPG Industries and Corning that made asbestos insulation widely used in ships, refineries and other industrial settings. A judge approved the bankruptcy plan in 2013 and last year a federal district court judge rejected Everest’s challenge to the plan.

Everest’s claims mirror the findings of the bankruptcy judge who slashed Garlock’s estimated asbestos liability from $1.3 billion to $125 million last year after a detailed examination of 15 claims by several different law firms revealed every single one had withheld information about alternative exposures in order to mount a stronger case against Garlock. In that case, Judge George R. Hodges said the evidence suggested a process “infected by the manipulation of exposure evidence by plaintiffs and their lawyers.”

In its filing, Everest accuses several law firms by name of manipulating or hiding evidence including Waters Waters & Kraus of Dallas, New York’s Belluck & Fox Fox, and Motley Rice, the South Carolina firm most famous for helping to engineer the $200 billion master tobacco settlement with state attorneys general in 1998. Some of those same firms are being sued by Garlock for civil racketeering for allegedly withholding evidence to drive up settlement values.

The lawyers say the accusations against them are baseless. Under the terms of most bankruptcy trusts, which are set up and overseen by plaintiff lawyers, evidence of asbestos exposure can be as simple as a work history at a site where asbestos was known to be used. They say companies like Garlock made a business decision to settle lawsuits, frequently in bulk, in order to avoid the cost of litigation. It’s not the job of plaintiff lawyers to help them obtain evidence to reduce the value of those claims, those lawyers say; if manufacturers wanted evidence of other exposures, they could have questioned coworkers or used shipping records and other documents to show the presence of insulation, for example, which most independent medical experts say is far more dangerous than other forms of the mineral.

Garlock was able to question some of the lawyers under oath, however, and got revealing admissions about how lawyers delayed filing trust claims until after they’d concluded cases against solvent companies. In its filing, Everest cites a few examples, including that of Robert Treggett, a Waters & Kraus client who won a $24 million jury verdict against Garlock after a trial in which his attorneys repeatedly deflected questions about whether Treggett had been exposed to dangerous Unibestos insulation.

Garlock “didn’t bring proof that there was Unibestos on that ship. They couldn’t. It’s not true,” Treggett’s attorney said in closing arguments, and he was able to keep Unibestos off the jury form. Yet Treggett filed a claim in the PPG bankruptcy, attesting to the same exposure he’d denied at trial.

See the article here – 

Insurer Claims Asbestos Fraud Tainted Pittsburgh Corning Bankruptcy

Asbestos: How the Law Can Endanger Human Health

A recent sentence of the Italian Supreme Court on asbestos crimes stimulates a reflection on the state of the law in our technological era, with implications well beyond the tragedy of asbestos.

In 2012 the Swiss industrialist Stephan Schmidheiny was sentenced in Italy to 16 years imprisonment for having culpably caused sickness or death of hundreds of persons between 1966 and 1986 through easily preventable exposure to asbestos, within and outside his Eternit factory in Casale Monferrato, Italy. Following an appeal in 2013, his sentence was extended to 18 years. Yet on November 21st 2014 the Italian Supreme Court ruled that Mr. Schmidheiny is guilty but not punishable, because the Eternit factory in Casale Monferrato was closed in 1986 and those crimes are subject to a twelve-year statute of limitation. This is a very short-term especially considering, that the frequency of illnesses and deaths caused by Eternit in Casale is still increasing and is expected to do so for a long time.

The Supreme Court sentence illustrates that the Italian legal system — together with many others — have no eyes and no hands to deal with long-term health damage, and more broadly that industrial civilization is unable to deal with the long-term adverse effects of its technologies. Quite often novel technologies were applied for short-term benefit, without ability or concern for examining the health risks they may pose. A common sequence in the recent history of technology development and product responsibility goes: don’t know, deny the new knowledge, deny responsibility, fight in the court and succeed.

The harm of asbestos has been known at least since 1924. We knew that deadly diseases caused by asbestos only come to light decades after exposure. Thence there are no “victims of asbestos,” only victims of asbestos producers. Yet, for many of the 100,000 deaths every year that are traceable to asbestos, nobody is formally guilty. Even when declared guilty, most offenders are not prosecutable. Furthermore, quite often in cases of long-term health risks, dishonest behaviour delays action: manufacturers successfully use all means to delay by decades any restriction, prohibition or prosecution of their harmful activities. This is a common pattern in many similar industrial interests, including tobacco, fossil fuels, and pharmaceuticals such as thalidomide, the sleeping pill that caused the births of 100,000 deformed babies and 5000 to 7000 deaths during the 1950s.

Our culture applauds and thirsts for scientific discoveries that foster an ever-faster transformation into new products and profits. Yet, on the other side of that coin, when new scientific discoveries of risks demand the urgent restriction or ban of a product or technology, decades pass before meaningful action. In the case of asbestos this negligent delay has caused and continues to cause millions of easily avoidable deaths. Many governments banned asbestos and an international campaign calls for a worldwide ban. Yet 2 millions tons asbestos were still mined 2009 in Russia (50%), China (14%), Brazil (13%), Kazakhstan (11%), Canada (9%).

Among long-term health damage, asbestos-related crimes are a rare case in which prosecution is even possible, because the deadly mesothelioma tumour, a virtual “fingerprint of the killer” is almost exclusively traced to asbestos. With most other technologies, the relationship between cause and noxious effect is established on statistical basis, thence not always incontrovertible in court — especially if one can pay the best lawyers.

Many cases similar to that of asbestos are described in Late lessons from early warnings, two reports issued by the European Environment Agency in 2001 and 2013. The same factors always emerge: unwillingness or incapability to prevent, along with culpable delay of action.

But what if this same pattern will apply also to new man-made global risks? Humankind has always altered the local environment. But only recently has the reach of adverse effects caused by certain human activities been traceable across the entirety of humankind and the planet. Paul Crutzen, winner of the 1995 Nobel prize for chemistry, coined the term anthropocene for the novel geological era in which actions of humans transform the face of the Earth as significantly as its natural geological and biological forces.

Good luck and a lengthy international consensus-building allowed the restriction or ban of a few globally noxious substances and activities, such as some ozone-layer-depleting chemicals (e.g. CFCs), some chlorinated pesticides (e.g. DDT) and few industrial chemicals (e.g. PCB). Yet, this did not happen with other harmful activities.

The emission of greenhouse gases — mostly CO2 and methane — continues unrestrained with expectable dramatic negative effects. Likewise, each year we disperse 10 million of tons of plastics into the sea. In the middle of the oceans, floating islands of plastic waste were discovered covering millions of square kilometres. The pulverised portion of these plastics is already diffused throughout the oceans, with unknown consequences. This cannot be undone. We cannot filter the entire ocean.

This new human condition needs a new ethics of responsibility towards the future generations, as argued by the philosopher Hans Jonas in his book The Responsibility Principle — Ethics for the technical society in 1979. The same holds for the law. For thousands of years, law has penalized offences committed by the few individuals harming those mostly physically close to them, with evidence of immediate detriment. Yet, present laws are not sufficient to address long-term risks from new technologies.

Our capacity to foresee is less than our novel capacity of doing, argued philosopher Günther Anders in The Outdatedness of Human Beings. On the Soul in the Era of the Second Industrial Revolution (1956). This is why ‘law is out-dated’ as well. The recent Eternit finding by the Supreme Court in Italy confirms this. Ironically, the honorary deputy presidents of this court, Judge Amedeo Postiglione, is the founder of the International Court of the Environment Foundation, which promotes an extension into time and space for the prosecution of offences against the environment. Yet the court found as it did, not because they failed to understand the issue, but because the law prevented any other finding.

The abhorrence for the lack of punishment of the Eternit crimes in Casale Monferrato should stimulate us to learn the bitter lesson of asbestos and to urgently apply this lesson to the legal treatment of long-term effects of noxious technologies. This is the best way to honour the past and future millions of victims of asbestos and of other fully preventable disasters, perpetrated by producers who technically and legally avoid justice.