Category: Bankruptcy Trusts

Bankruptcy Trusts / New York
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Claims Against Manville Insurer Permitted to Proceed For Violation of Due Process

NEW YORK — The plaintiff, Salvador Parra, developed asbestosis after working as an insulator in the 1960s and 1970s. He filed suit in 2009 in Mississippi against numerous Manville-related entities, including Marsh USA, Inc., a Manville insurer. In 1986, Marsh contributed $29.75M to the Manville Trust in exchange for a release of all claims “arising out of or relating to services” performed by Marsh for Manville or “in connection with insurance policies issued to” Manville, and an injunction funneling all future such claims into the …

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Bankruptcy / Bankruptcy Trusts / Case Decisions / New York
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Channeling Injunction Prohibits General Motor’s Wrongful Death Suit for Contribution against the Manville Trust

General Motors (GM) filed suit against the Manville Personal Injury Settlement Trust (Manville) seeking a declaratory order that its state suit against Manville was not barred by the longstanding “Channeling Injunction” of the Manville Corporation’s chapter 11 reorganization (the Plan) and subsequent order confirming the same.

Separate from the declaratory complaint, GM filed suit in Ohio state court against the estate of Bobby Bolen and multiple asbestos defendants including Manville. GM alleged the defendants were jointly and severally liable to GM as it had subrogated …

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Bankruptcy Trusts / Delaware
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Bankruptcy Court Grants Asbestos Defendants Limited Access to Bankrupt Trust Exhibits

Honeywell International, Inc. who was joined by Ford Motor Company moved for an order authorizing “any entity . . . to access, inspect, copy and receive copies of … any and all of the 2019 Exhibits filed with the Court in compliance with the 2019 Order or Bankruptcy Rule 2019.” In other words, Honeywell and Ford were seeking an order allowing it access to the statements and exhibits which asbestos claimants submitted in the captioned cases pursuant to Rule 2019 of the Federal Rules …

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Bankruptcy Trusts / Case Decisions / New York / Verdict Reduction
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Appellate Court Grants New Trial Due to Lower Court’s Error on Jury Charge as to “Recklessness Standard”

In the matter of the Estate of Lee Holdsworth, in the Supreme Court of New York, Erie County (Lower Court), judgment was entered against the defendant Crane Co. upon a jury verdict finding that Crane Co. was 35 percent liable for the damages arising from injuries sustained by Lee Holdsworth (the plaintiff’s decedent) as a result of exposure to asbestos-containing products used as component parts with the valves that defendant produced. The jury also determined the defendant acted with reckless disregard for the safety of …

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Bankruptcy Trusts / Case Decisions / Pennsylvania / Summary Judgment
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Two Rulings From MDL Allow Previously Dismissed Asbestos Claims to Proceed Against Various Ship Owners Despite Previous Dismissed Actions Not Listed as Assets in Bankruptcy

In a follow-up to six cases previously reported on in ACT, two more cases were decided in the United States District Court for the Eastern District of Pennsylvania. Both cases had started in the Northern District of Ohio, and were transferred to the MDL 875 in the Eastern District of Pennsylvania. In both cases, the plaintiffs brought claims against various ship owners represented by Thompson Hine LLP, and all alleged asbestos exposure while working on ships. All cases were administratively dismissed; after dismissal, the plaintiffs …

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Bankruptcy Trusts / Case Decisions / Pennsylvania / Summary Judgment
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Chunk of Rulings From MDL Allow Previously Dismissed Asbestos Claims to Proceed Even Though Not Listed As Assets In Bankruptcy

Six cases were decided in the United States District Court for the Eastern District of Pennsylvania; all started in the Northern District of Ohio, and were transferred to the MDL 875 in the Eastern District of Pennsylvania. In all six cases, the plaintiffs brought claims against various shipowners represented by Thompson Hine LLP, and all alleged asbestos exposure while working on ships. All cases were administratively dismissed; after dismissal, the plaintiffs filed for bankruptcy, and did not list their asbestos claims as assets. After bankruptcy …

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Bankruptcy Trusts / Case Decisions
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Claim Representatives For Filing Bankruptcy Trust Claims Have No Standing To Sue Bankruptcy Trusts For Suspending Claims

Plaintiff Mandelbrot Law Firm specialized in preparing and filing asbestos personal injury claims  to various bankruptcy trusts. In 2002, one such trust, the Delaware Trusts, suspended all payment of claims from claimants who the plaintiff represented, due to proceedings in California regarding allegedly fraudulent claims filed by the plaintiff.  The plaintiff then filed this declaratory judgment, arguing that this decision was unauthorized and in violation of the Trusts’ distribution procedures, and that he lost fees. The district court granted defendants’ motion to dismiss for lack …

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Bankruptcy Trusts / Case Decisions
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Court Refuses to Dismiss Garlock’s RICO Complaints Against Plaintiff Law Firms

Following the well-publicized decision in the Garlock bankruptcy, Garlock commenced a number of actions in federal court against asbestos plaintiffs’ law firms that allegedly engaged in fraud in the settlement of their clients’ mesothelioma claims against Garlock. In two of these actions, the defendant plaintiffs’ firms moved to dismiss the complaint under Federal Rule of Civil Procedure 12(b)(6) on a variety of grounds, including that the claims were time-barred. One of the arguments was that Garlock knew of the alleged misrepresentations so long ago that …

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Bankruptcy Trusts / Case Decisions / Damages / New York
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NYCAL Court Denies Post-Verdict Disclosure of Settlement Amounts and Agreements

In this NYCAL case, defendants Cleaver Brooks, Inc. and Burnham LLC brought post-verdict motions on a variety of issues, including disclosure of settlements for the purpose of molding the judgment. By the time the motion was heard, the remaining issues were if “plaintiffs failed to disclose settlements in a timely fashion, and, if so, whether such failure affected defendants ability to present evidence with respect to Article 16 entities, and whether defendants are entitled to disclosure of the settlement agreements, including the amounts of settlement …

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Bankruptcy Trusts / Case Decisions / Pennsylvania
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Pennsylvania Superior Court Rules, Inter Alia, No Right to Offset for Bankruptcy Trust Claims

The Superior Court of Pennsylvania recently reviewed on appeal a variety of post-trial issues in two mesothelioma cases that went to trial in the Philadelphia Court of Common Pleas. Of particular interest is the court’s refusal to permit defendants to offset payments received from settling non-party tort feasors, which included bankruptcy claim payments. The basis for the court’s decision is that the jury did not find that the other parties were joint tort feasors. The court described a defendants’ burden on this issue as follows: …

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