ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, February 15, 1996 TAG: 9602150095
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
DATELINE: DETROIT
SOURCE: Associated Press
A jury ruled Wednesday that dozens of insurance companies should pay Dow Corning Corp.'s claims for its costly breast-implant litigation. The ruling could cost the insurers as much as $1 billion.
The verdict came after 2 1/2 days of deliberations. The jury of six men and three women heard nearly 3 1/2 months of testimony in Wayne County Circuit Court.
The civil trial involved 43 insurance companies, including some of the nation's largest. The insurers, including Home Insurance Co., Employers Insurance of Wausau and Allstate Insurance Co., sold product-liability policies to Dow Corning from 1962 to 1985.
Dow Corning sued the companies after they refused to pay its claims for settling and defending against a deluge of implant lawsuits that began in 1992. It cited the cost of the litigation and the insurers' refusal to pay when it filed for Chapter 11 reorganization in federal Bankruptcy Court at Bay City last year.
Dow Corning said the money will go toward settling claims filed by thousands of women who allege they suffered a variety of ailments from breast implants. Those claims eventually will be resolved in Bankruptcy Court.
``To the extent that they have legitimate claims, they'll be in a better position to be compensated, because this will allow Dow Corning to access a substantial amount of insurance proceeds,'' said Robert Marsac, a Dow Corning attorney.
However, lawyers for some plaintiffs feared the verdict could hurt their cases if they go to trial, because the jury found Dow Corning did not withhold information on implant risks. That has been a key allegation in most of the lawsuits against Dow Corning and one of its owners, Dow Chemical Co.
The insurers argued that they should not have to pay because Dow Corning misrepresented the risk of litigation that implants posed. They alleged the company withheld information about problems with implants and the doubts some doctors had about the devices' long-term safety. They also argued that the product was put on the market in 1964 with inadequate testing.
Dow Corning said complications caused by implants, such as ruptures and hardening of breast tissue, were widely known long before the insurers balked at paying Dow Corning's claims. The company said it provided the insurers all the information they sought.
The company also argued that its executives did not anticipate the litigation explosion, which occurred after a couple of large verdicts and a moratorium on most implants by the Food and Drug Administration. Those verdicts involved a new allegation, that implants cause immune-related diseases.
Dow Corning attorneys stressed that scientific studies have shown no link between implants and any diseases. The company maintains that the verdicts against it have been based more on emotion than fact.
The insurers' attorneys agreed there was no link, but suggested that the claims filed by more than 440,000 women against all implant manufacturers indicate there is something wrong with the product.
Dow Corning settled out of court with 12 insurers for a total of $375.3 million before the trial began. Several other settlements were pending, including a partial settlement with the largest insurer in the case, American International Group Inc.
LENGTH: Medium: 65 linesby CNB