Heather Isringhausen Gvillo Oct. 1, 2014, 1:46pm

CHARLOTTE, N.C. (Legal Newsline) – The Official Committee of Asbestos Personal Injury Claimants, or ACC, has requested more than $2.5 million in fees and $175,632 in expenses in response to its work in the Garlock Sealing Technologies bankruptcy case - an amount Garlock has objected to.

In a Sept. 23 memorandum in support of its 12th fee application, Caplin & Drysdale, counsel of the Committee, responded to the debtors’ objection to the “substantial amount” requested.

The committee claims that while this is the sixth time the debtors have objected to a large amount of fees, this objection is unique because the debtors wish to withhold roughly 40 percent of the total requested amount.

“For a debtor to withhold the compensation of opposing professionals on arbitrary grounds is an abuse of the fee objection process, and should not be countenanced by this court,” the committee argued.

The debtors to which the committee are referring include Garlock, Garrison Litigation Management Group and The Anchor Packing Company.

A bankruptcy judge has ruled Garlock's asbestos liability is $125 million, roughly $1 billion less than plaintiffs attorneys sought. In earning the favorable ruling, Garlock introduced evidence that plaintiffs attorneys have been withholding evidence of exposure to other companies' products for years in civil lawsuits against the company.

The judge ruled that was the case, deciding that past settlement and verdict figures are unreliable because of what he called manipulation. Legal Newsline and other companies are seeking access to the evidence Garlock introduced.

A federal judge recently ruled the bankruptcy judge was wrong to seal the evidence in the manner that he did, and now parties are arguing over which evidence should remain sealed.

As for the fee request, this particular interim period stretches from March to June, and the debtors specifically object to the committee’s work with respect to issues of public access addressing sealed materials from the estimation proceeding, among other objections.

“Yet that work was important and necessary for protecting the procedural and substantive rights of the committee’s constituency, and ultimately led to the present protocol process pursuant to which claims of public access are being evaluated,” the committee argued.

“[T]he various positions taken by the Committee were well-grounded in law and were largely sustained by the courts. They have obviated piecemeal access requests and promoted an efficient coordinated protocol for determining which documents should or should not remain sealed, as well in placing reasonable restrictions on further transfer of Rule 2019 exhibits consistent with applicable precedents,” it added.

While the interim period does not include the time period addressing the unsealing process, the committee still made its argument against the debtors’ objections just 12 days after abdicating any responsibility to identifying documents in the unsealing process.

In the ACC’s Sept. 11 motion to seal, it suggested the court should consider any particular interests asserted and arguments advanced by the claimants rather than specify documents it felt should be kept confidential.

“It merits emphasis that, in contemporary life, privacy is not just a matter of maintaining the secrecy of personal matters; it also includes ensuring individuals’ control over the dissemination of sensitive information – even information that is already public to some limited extent,” the committee claimed.

The committee also rejects “any effort by the debtors or others to skew the public record, or the facts surrounding Garlock’s historical verdicts and settlements in asbestos cases, by cherry-picking for continued sealing those documents of record that debtors find unhelpful to their position in the estimation proceeding.”

With that being said, the committee said it had no further objections to unsealing the estimation proceeding.

“Subject to the protection of asbestos victims’ legitimate privacy interests, and without prejudice to any other issues asbestos victims and their counsel may raise, the Committee has no objection to unsealing the record of the estimation proceeding,” it states in its motion.

The ACC did go as far as requesting an order sealing or redacting any information that would invade the legitimate privacy issues of asbestos victims if disclosed, such as medical information and personally identifying information.

However, in his unsealing order, bankruptcy Judge George Hodges specifically required parties to file a motion to seal identifying and describing each document or testimony they believe should be sealed or redacted and the reasons the materials should be kept confidential.

Parties must also explain why no means that are less restrictive than sealing are available and how long the materials should be maintained under seal.

The committee, however, claimed its work in the access litigation was necessary and justified, saying the “vast bulk of the information at stake” is that of the committee’s constituents.

“Thus, when both debtors and strangers to this bankruptcy sought to strip that information of confidentiality protection altogether, it was well within the ACC’s role to protect its constituency’s interests in confidentiality recognized in the protective orders,” the committee argues. “It was also wholly within the ACC’s role to insist on absent claimants’ due process rights to notice and an opportunity to be heard before issue was joined on whether those prior orders should give way to public access.”

Furthermore, the debtors attacked the committee’s requested fees in the access litigation, arguing that various entries are insufficiently detailed.

The committee went on to claim that it incurred the “substantial fees” from responding to various initiatives that the debtors either began or supported, such as motions or appeals filed by the debtors and third parties.

“This court has made clear that the committee need not stand idly by while the rights and interests of its constituency are under attack. Apparently, debtors would prefer a process where their self-serving view of the world is simply accepted without challenge,” the committee states.

The debtors argue that the fees are excessive for the work the committee has done in the access litigation, but the committee asserts that the objections are “merely expressions of their disagreement” with the committee’s proper role in the access litigation.

The debtors’ specific objections are as follows:

-March: Committee requested $453,779 in fees and $26,473 in expenses total. Debtors disputed $241,339 in total fees, specifically $192,648 in fees relating to access litigation;

- April: Committee requested $784,577 in fees and $29,642 in expenses total. Debtors disputed $281,427 in total fees, specifically $276,925 in fees relating to access litigation;

-May: Committee requested $658,714 in fees and $76,835 in expenses total. Debtors disputed $244,622 in total fees, specifically about $177,329 in fees relating to access litigation; and

-June: Committee requested $637,960 in fees and $42,681 in expenses. Debtors disputed $273,465 in total fees, specifically about $213,659 in fees relating to access litigation.

The debtors objected to roughly 50 percent of the amount requested in relation to the access litigation for each month, and the entire amount requested in March.

From Legal Newsline: Reach Heather Isringhausen Gvillo at asbestos@legalnewsline.com

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