CSX given discovery orders in racketeering case against firm

John O'Brien Apr. 19, 2012, 7:44am


WHEELING, W.Va. (Legal Newsline) - CSX Transportation will need to supply the asbestos firm it is suing with files from 10,000 cases that don't involve the firm.

U.S. District Judge Frederick Stamp, of West Virginia's northern district, ruled Wednesday that CSX must comply with a discovery request made by Peirce, Raimond & Coulter, a Pittsburgh firm accused of conspiring with a radiologist to fabricate asbestos claims.

Stamp's ruling upheld an earlier decision by Magistrate Judge James Seibert.

"Even though CSX stated that it will not attempt to prove frauds other than the 11 claimants at issue, it also argued that the Peirce firm's general asbestos practice and the settlement of claims other than the 11 currently at issue could be very compelling evidence of a conspiracy," Stamp wrote.

"Counsel for CSX went on to confirm that CSX's position is that it 'can use other relevant evidence that shows what was going on that goes beyond the 11 people.' Considering the broad nature of the allegations in this case, this court finds no clear error in the magistrate judge's determination that there is no unreasonable burden in ordering the requested discovery."

CSX was seeking a stay against Seibert's order until the company's objections could be sorted out. The order required CSX to provide information contained in its outside counsels' files from 10,000 non-Peirce firm cases.

CSX claimed Seibert failed to conduct a proportionality analysis and failed to realize his order would result in a wasteful discovery undertaking.

Earlier this month, the company claimed it needed more depositions in the case after the firm agreed to let CSX take only 20 depositions.

In January, Seibert ordered the Peirce firm to hand over documents about radiologist Ray Harron, a defendant in the suit who is alleged to have produced false diagnoses.

"The recently produced documents... make clear that other Peirce Firm employees... communicated with Harron and the Lawyer Defendants concerning the Peirce Firm's asbestos practice or otherwise had regular involvement in the claims at issue," CSX's attorneys wrote.

"Fairness dictates that CSXT be permitted to depose these and other similarly situated individuals so that it can develop evidence in support of its claims that can be used at the summary judgment stage and in preparation for trial."

Currently, CSX has 10 depositions available. The company calls them "insufficient."

Instead, the company would like to depose:

-The four defendants (Robert Peirce, Louis Raimond, Mark Coulter and Harron);

-Nine plaintiffs in the 11 asbestos cases at issue;

-Nine doctors, in addition to Harron, from which the firm obtained asbestos-related opinions in the 11 cases at issue;

-Other fact witnesses, such as Peirce Firm employees; and

-Defendants' experts in CSX's case.

CSX says the first three categories will require 22 depositions. Seibert has scheduled an evidentiary hearing and argument on CSX's request for April 27 in Wheeling.

CSX sued the Peirce firm in 2005. U.S. District Judge Frederick Stamp granted summary judgment to the defendants in 2009, finding a statute of limitations had run out.

In late 2010, judges of the U.S. Court of Appeals for the Fourth Circuit in Richmond remanded the case to Stamp with instructions to let CSX amend the complaint.

CSX amended the complaint in 2011. Stamp referred the case to Seibert.

In 2005, federal court judge Janis Graham Jack made national headlines when she uncovered duplicate and fraudulent silica diagnoses in her Texas courtroom. Many of those diagnoses were made by Harron and were made on plaintiffs who had already brought asbestos claims.

In Jack's opinion dismissing the claims, she said "These diagnoses were driven by neither health nor justice - they were manufactured for money."

Following Harron's admission that he did not even make the diagnoses of the patients whose x-rays he read, Jack noted that most of "these diagnoses are more the creation of lawyers than doctors."

From Legal Newsline: Reach John O'Brien by e-mail at jobrienwv@gmail.com.

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