LOS ANGELES (Legal Newsline) - Pipemaker JM Eagle, the target of a whistleblower lawsuit in which four states have joined, recently said attorneys for the whistleblower leaked sealed information in a press release.
A federal judge unsealed the complaint, filed in 2006, on Feb. 8, and Phillips & Cohen issued a press release Feb. 11 stating that four states, 39 California municipalities and four water districts had choosen to intervene.
The four intervening states are Nevada, Tennessee, Delaware and Virginia. An attorney for JM Eagle contacted Mary Inman of Phillips & Cohen after reading the release and "stated that he assumed the unsealing of state notices had occurred or that the press release was made in error," JM Eagle's attorneys wrote.
"Ms. Inman responded that neither was the case and that it was the position of Relator's counsel that the press release did not violate the seal."
The suit alleges that JM Eagle's pipes had to be replaced sooner than expected because they were of poor quality.
JM Eagle is also claiming that New York Times reporter Mary Williams Walsh obtained a copy of the complaint before the seal was lifted.
"During an approximately 45-minute phone conversation, Ms. Walsh informed (JM Eagle attorney Eileen O'Connor) she had a copy of the complaint, and that the complaint was so detailed and complex, containing pages of technical information, that it had taken her 'a week' to understand it before she called JM Eagle for a comment on the suit," the company says.
"Ms. Walsh had contacted JM Eagle for a comment midday Feb. 11... (I)f Ms. Walsh had the complaint for 'a week' prior to that contact, she had the complaint at least four days prior to Feb. 8, the date that it was unsealed by the court."
During a second interview, Walsh denied making the comment, the company says.
The company is seeking expedited discovery because of the "recent and apparent leaks." The plaintiffs opposed it in a motion filed Thursday.
Phillips & Cohen says JM Eagle has not stated what harm it will suffer if its motion is not granted.
"While JM's speculative claims are wrong (as discussed below), what is utterly lacking in JM's submission is any serious suggestion of how, even if these allegations were true, the company could possibly have been harmed by eitheractivity," the firm says.
"What appears to vex JM most is that the New York Times published a story on Feb. 12 -- after the case was unsealed -- that portrayed JM in a negative light. Whatever objections JM may have with the New York Times's story, it provides no legal justification for pursuing a sideshow involving the deposition of Relator's counsel."
JM Eagle's attorneys held a media call Feb. 18 to announce the federal government and the state of California had decided not to intervene in the case.
"(A)lthough JM now contends that the intervention decisions of the States remain under seal, JM's counsel revealed at its press conference that the State of California had decided not to intervene in the action," the plaintiffs say.
"When asked for the source of that information, JM's counsel stated that it was 'from a source that I can't reveal.'"
The case began with whistleblower John Hendrix, who was an engineer for J-M Manufacturing's product assurance division in New Jersey. J-M was JM Eagle's corporate predeccessor.
Hendrix was fired less than two weeks after writing a memo that said the pipes tensile strength was substandard, Phillips & Cohen said.
From Legal Newsline: Reach John O'Brien by e-mail at email@example.com.