THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Saturday, May 11, 1996 TAG: 9605110341
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORT
LENGTH: Long : 121 lines
Hundreds of victims of asbestos exposure in Hampton Roads, mostly shipyard workers and their families, were thrown into uncertainty Friday when a federal appeals court threw out a $1.3 billion class-action settlement.
The court, in Philadelphia, ruled that claims from up to 100,000 victims are so diverse that they cannot be combined under one lawsuit. The plaintiffs included people who already suffer from asbestos-related diseases and others who had been exposed to the material but who had not yet become sick.
The ruling Friday cleared the way for plaintiffs who had joined the settlement to file individual lawsuits.
The settlement was the largest ever reached in asbestos cases, which have clogged federal courts for a decade. It involved the claims of potentially millions of people who have been exposed to asbestos on the job. Although asbestos was banned in the late 1970s, people could continue to become sick because of a latency period of up to 40 years. Each of those people could have been covered by the settlement.
One of the 20 companies involved in the settlement, Norfolk-based C.E. Thurston, was the main supplier of asbestos in Hampton Roads. Hundreds of lawsuits against Thurston have been filed in federal courts in Norfolk and Newport News. Many more continue to be filed every week.
For now, no one knows for sure how the appeals court ruling will affect those cases, but it appears to end any chance for a quick solution.
It raises the possibility that tens of thousands of individual asbestos cases that might have been resolved through the settlement may soon cascade into court.
But the ruling is certain to face a challenge in a higher court. Gene Locks, a Philadelphia lawyer who represented future asbestos plaintiffs, said he would appeal.
The three-judge panel of the 3rd U.S. Circuit Court of Appeals said in its ruling Friday that it was inherently unfair to force people who are not yet sick to accept the same settlement terms as those who already have developed asbestos-related disease.
The decision could have a much broader impact if it is applied to plaintiffs in a range of cases, including those involving the tobacco industry, silicone breast implants, heart valves, pacemakers and other products that allegedly cause debilitating illnesses, legal experts said.
``The ramifications of this decision go well beyond the asbestos conflict,'' said William R. Hanlon, one of the plaintiffs' attorneys in the case.
Harvard Law professor Lawrence Tribe, who argued against the settlement, called the decision ``momentous. This puts a real cap on how far class actions can go. . . . It says it's inconceivable that people who haven't been hurt yet can be represented by the same people as those who are already hurt.''
U.S. Circuit Judge Edward R. Becker, who wrote the decision, said the problem of asbestos litigation cannot be solved in the courts and should be acted on by Congress.
Lawyers said courts around the country are grappling with the question of such class-action lawsuits, and Becker's decision might bring the issue to a head.
Under the settlement that was thrown out, each victim or survivor would have received $2,500 for the least serious medical cases and up to $200,000 for the most serious cancer cases of mesothelioma.
Norfolk lawyer Richard S. Glasser, who has filed most of the Norfolk asbestos claims, said he does not know yet how the ruling will affect his clients.
But Glasser said he was disappointed by the ruling. In 1993, he described the class-action settlement as ``cutting-edge litigation'' - an attempt to resolve massive numbers of claims at once, without having to try each individual case, and without allowing each asbestos company to declare bankruptcy.
The settlement had been administered by the Center for Claims Resolution, an organization in Princeton, N.J., that handles workers' claims for the 20 former asbestos producers involved in the agreement.
``We have been doing business with the CCR for quite a while and we had reached a fragile peace that had been working,'' Glasser said Friday evening. ``We hope that fragile peace can be continued.''
Becker, in his 69-page ruling, canceled the settlement and returned the case to the district court.
``Each individual plaintiff's claim raises radically different factual and legal issues from those of other plaintiffs,'' Becker wrote. ``These differences . . . eclipse any common issues in this case.''
Becker said he realized the decision undermined a complex solution to a large problem. But, he said, ``In doing so, we avoid a serious rend in the garment of the federal judiciary that would result from the court, even with the noblest motives, exercising power that it lacks.''
The settlement marked the first time that defendants and plaintiffs agreed outside of bankruptcy court to settle claims against several companies. The agreement would have cut legal costs, which far exceed payments to victims pursuing individual claims.
Asbestos has been found to cause a wide range of severe and sometimes fatal respiratory problems.
Claims involving asbestos, a heat-resistant mineral used widely for insulation and fireproofing before the 1970s, make up the nation's biggest court crisis. MEMO: This story was compiled from reports by staff writer Marc Davis, The
Washington Post, The Associated Press and The New York Times.
The ruling:
A landmark $1.3 billion class-action settlement for victims of
asbestos exposure was thrown out.
Why:
The court ruled that the settlement forced people who are not yet
sick to accept the same settlement terms as those who already have
developed asbestos-related diseases.
The local connection
Hundreds of victims of asbestos exposure in Hampton Roads - mostly
shipyard workers and their families - are part of the settlement.
Norfolk-based C.E. Thurston was the main supplier of asbestos in
Hampton Roads. Hundreds of lawsuits against Thurston have been filed in
federal courts in Norfolk and Newport News. Many more are filed every
week.
What it means:
The ruling clears the way for plaintiffs to file individual lawsuits.
It also could have a much broader impact if applied to other such
class-action suits, such as those involving silicone breast implants.
KEYWORDS: CLASS ACTION SUIT ASBESTOS by CNB