Asbestos lawyer, insurer settle defense dispute

Steve Korris Sep. 6, 2011, 9:00am


CLARKSBURG, W.Va. (Legal Newsline) - Pittsburgh asbestos lawyer Robert Peirce and Lumbermens Mutual Casualty Company settled a dispute over payment for his defense against the fraud and racketeering claims of CSX Transportation.

On Aug. 18, U.S. Senior Judge Frederick Stamp granted a joint motion to dismiss their claims and counterclaims.

The motion stated, "Lumbermens and the Peirce parties recently met and conferred regarding the disputes they had, have and may have with one another arising from or related to the underlying action, and they have reached a confidential settlement agreement and mutual release."

Stamp continues to preside over the underlying case, in which CSX claims Peirce and radiologist Ray Harron of Bridgeport fabricated evidence for asbestos suits.

Lumbermens sued Peirce and his firm in federal court at Pittsburgh in 2008, seeking a declaration that Peirce's policy didn't cover the CSX action.

The policy relieved Lumbermens of any obligation to pay a court judgment establishing that Peirce committed an illegal, dishonest, fraudulent, criminal or malicious act.

District Judge Donetta Ambrose transferred the case to Stamp.

Peirce filed a counterclaim, alleging Lumbermens provided inadequate counsel.

He argued that the insurer's choice, Robert Lockhart of Pittsburgh, worked in a firm of two lawyers.

Peirce claimed he provided a defense for employee Robert Gilkison because Lumbermens refused to provide it.

Stamp granted summary judgment against CSX in the underlying case in 2009, and CSX appealed to the Fourth Circuit in Richmond, Virginia.

Stamp stayed the Lumbermens action pending Fourth Circuit review.

Last year, the Fourth Circuit ordered Stamp to reopen the CSX case and allow the railroad to amend its complaint.

Stamp has not granted leave for the new complaint, which won't include Gilkison.

The Lumbermens action resumed, and Peirce renewed his counterclaim this March.

"Simply put, the Peirce firm did not receive what it had paid for and is asserting claims based on Lumbermens breach of the contract between it and Lumbermens," wrote Louis Khourey and Jonathan Turak of Moundsville. "Proof of inadequacy of counsel awaits trial."

For Lumbermens, Louis Long and Jeanette Ho of Pittsburgh responded that Peirce had no complaint about Lockhart's abilities or the services he provided.

"Notably, the Peirce defendants do not point to any adverse effects the size of Mr. Lockhart's firm had on the defense of the underlying action," they wrote in April.

They wrote that Peirce voluntarily paid for Gilkison's defense.

The case then turned quiet, as Peirce and Lumbermens resolved it on their own.

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