March 20, 2018

Sheldon Silver-linked law firm has hand in asbestos funds

Weitz & Luxenberg, the law firm accused of exploiting its connection to Sheldon Silver in New York City’s asbestos court, has come under fire in another lucrative arena — multibillion-dollar bankruptcy trusts.

The East Village firm, which gained more than 100 mesothelioma clients in an alleged kickback scheme by the disgraced assemblyman, sits on 15 advisory committees for trusts set up by bankrupt companies to compensate victims — including Weitz’s own clients.

The loose system fosters a “fox guarding the hen house” culture, says a article published last month by Measley’s Asbestos Bankruptcy Report.

Assembly speaker Sheldon Silver

The 15 trusts guided by Weitz have paid out $12.2 billion between 2006 and 2013. Other trusts, which may also pay Weitz clients, have doled out $51.6 billion, the report says. Lawyers typically get at least 25 percent of the payments.

It’s unknown how many Weitz clients got payments — or whether any were funneled through Silver.

Perry Weitz, a partner in the firm, helped set up trusts for major companies such as Owens Corning, USG, and Kaiser Aluminum, his Web site boasts.

Trusts for asbestos-injured workers — who can file claims and also take active companies to court — still hold about $30 billion.

The system is rife with double-dipping abuse. Lawyers file trust claims blaming a client’s asbestos illness on bankrupt companies, but often hide those claims in lawsuits blaming active companies for the same illness.

For instance, Weitz & Luxenberg won a $25 million verdict against DaimlerChrysler in 2006 in a special Manhattan asbestos court where the firm files 50 to 70 percent of the cases.

At trial, Weitz shot down defense arguments that bankrupt Johns Manville, which made insulation and roofing, shared some blame for the worker’s exposure. “How should they be responsible?” the firm asked.

But a year after the trial, Weitz filed trust claims for the same client seeking payments from Johns Manville.

A Weitz spokesman said the firm had no comment.

In 2011, Weitz asked Manhattan Supreme Court Justice Sherry Klein Heitler to drop a requirement that plaintiffs disclose before trial any trust claims they had filed or intended to file.

Heitler, who was replaced as chief asbestos judge last week, denied the motion, but tweaked the rule, saying lawyers did not have to reveal trust claims “they may or may not anticipate filing.”

Her wording left wiggle room for potential fraud, Cardozo Law School professor Lester Brickman told The Post. Brickman, a leading expert on asbestos litigation, testified before Congress lastmonth in favor of a bill to curb the double dealing.

After Silver’s indictment last month, Weitz & Luxenberg claimed it was “shocked” that the former Assembly speaker had steered $500,000 in state grants to Columbia-Presbyterian mesothelioma researcher Dr. Robert Taub, who in turn referred the 100-plus patients.

See the article here – 

Sheldon Silver-linked law firm has hand in asbestos funds

Ex-congresswoman could get payout from court tied to Silver

Judges have helped turn Manhattan’s special asbestos court into a gold mine for Sheldon Silver’s law firm — and a former Long Island congresswoman could also reap the rewards.

In a 2011 case brought by the ex-speaker’s firm, Weitz & Luxenberg, Justice Martin Shulman, Silver’s Lower East Side neighbor and fellow synagogue member, opened the floodgates for heavy smokers to win huge sums by blaming their lung cancer on asbestos. They include former Long Island Rep. Carolyn McCarthy, 71.

The retired lawmaker claims in a $100 million-plus lawsuit that she was exposed to the toxic chemical as a child when her father and brothers unwittingly brought asbestos fibers home from their shipyard jobs. The Democrat had smoked for 40 years. Silver’s firm filed her suit in 2013.

Silver, the disgraced Democratic kingmaker booted last week from the Assembly-speaker post he held for two decades, raked in $5.3 million in salary and referral fees from Weitz & Luxenberg despite doing no legal work.

In indicting Silver, US Attorney Preet Bharara called the cash bribes and kickbacks.

But those payments are peanuts next to the hundreds of millions the East Village firm netted while Silver, hired in 2002 for his “prestige and perceived power,” wielded huge influence over the state judiciary.

“Silver was gold. That’s why they hired Shelly,” said a source familiar with the firm.

A series of rulings by judges in New York City Asbestos Litigation, a special Supreme Court section known as NYCAL, have enriched the firm and paved the way for bigger settlements and verdicts, critics and experts say. The firm files more than half the NYCAL cases — and collects most of the winnings.

In a 2011 case, Shulman set high damages for two steamfitters — both smokers for more than 25 years — who worked with gaskets containing asbestos and later died of lung cancer. The jury found Goodyear Tire and Rubber and Goodyear Canada partially responsible. Shulman let stand an $8.5 million verdict for one man and cut another’s $13.5 million verdict to $6 million.

“There is no bigger gift he [Shulman] could have given to Weitz and Silver,” said an asbestos defense lawyer, who fears it set a precedent.

Phil Singer, a Weitz & Luxenberg spokesman, said smokers have a higher risk of cancer when exposed to asbestos, and that Shulman upheld the high award because of the workers’ “horrific pain and suffering.”

The average award for a NYCAL asbestos case — nearly $16 million per plaintiff between 2010 and 2014 — is two to three times larger than those in other courts nationwide, data show.

Weitz & Luxenberg could win millions more from a ruling by chief asbestos Justice Sherry Klein Heitler last year. At the firm’s urging, she lifted NYCAL’s 20-year moratorium on punitive damages.

NYCAL’s prior chief judge, Helen Freedman, had imposed the ban as “the fair thing to do” because wrongs were committed 20 or 30 years before, often by a predecessor company.

In lifting NYCAL’s ban, Heitler said punitive damages should be sought only in rare cases of egregious conduct. But Weitz & Luxenberg has since indicated it may seek the extra payments in every case.

The firm defended its victories. “The verdicts we’ve achieved are a direct result of these corporations’ outrageous misconduct and wanton disregard for their victims. They had nothing to do with Sheldon Silver,” Singer said.


Ex-congresswoman could get payout from court tied to Silver