ERIE, Pa. (Legal Newsline) – A bankruptcy judge expressed sympathy for insurance companies that say the names of asbestos claimants should be made public in an upcoming trial over whether a bankruptcy trust funded by Honeywell is paying out on fraudulent and inconsistent injury claims.
At a brief hearing Thursday morning, Judge Tom Agresti questioned the arguments of plaintiff lawyers who say claimant names should be retracted from any trial records to protect their privacy. Lawyers for several insurance companies that provide funding for the North American Refractories Company Trust have asked for the names of claimants so they can be cross-checked against statements they submitted in other asbestos litigation.
“In this particular case, the insurance companies can be identified as wearing the white hats,” said Judge Agresti at the end of the hearing, citing federal rules that make most filings in bankruptcy proceedings public.
NARCO’s former owner Honeywell and its insurers have agreed to pay claims submitted to the trust, as is typical in cases where asbestos claims have driven a company into bankruptcy. Most such trusts are run by plaintiff lawyers, opening them to criticism they ignore trust distribution procedures to rubber-stamp claims submitted by their clients.
Honeywell says that despite an agreement not to do so years ago, it has only required simple form affidavits from asbestos lawyers.
“Boilerplate ‘form’ affidavits are not competent or credible evidence of exposure sufficient to meet the criteria set forth in the TDP,” the company said in a brief submitted before the trial over NARCO trust’s policies scheduled for later this month.
At Thursday’s hearing, plaintiff attorney James Wehner said the trial is between Honeywell and the trust managers and asbestos claimants aren’t parties to the action. If their names are made public, he said, they could become victims of identity theft or harassment from insurance companies and investment advisors.
“The identities of past claimants are just irrelevant to the matters being decided,” said Wehner. “These are old people, sick people, dying people and they’re on their last days trying to get some money to help their loved ones care for them.”
George Calhoun, representing four insurance companies that fund trust payments, said the names of trust claimants “is a matter of significant public interest.” He criticized plaintiff lawyers for citing unfounded speculation about identity theft as a reason for redacting claimant names.
Both sides are well aware of a similar battle several years ago over claim records in the Garlock bankruptcy case in North Carolina. The judge there sided with Legal Newsline and ordered the release of those records, which showed a pattern of misrepresentation and suppression of evidence by plaintiff attorneys who submitted asbestos claims to multiple bankruptcy trusts making often inconsistent statements about how their clients got sick.
In this case, plaintiff law firms first asked to have their own names redacted from court documents. They dropped that request shortly before the Thursday hearing, leading the insurance-company lawyer to question whether the court should even consider redacting claimant names since that issue was barely raised in prior filings.
Judge Agresti started out by making fun of the insurers, who intervened in the case between Honeywell and the trust.
“I got a kick out of that, insurance companies being proponents of public access,” the judge said. But by the end of the hearing, he said that based on public policy and the federal bankruptcy statute, he was inclined to agree with the insurers.
He rejected plaintiff claims the insurers were only seeking information they could use to fight claims in other asbestos cases.
“You have to make an evidentiary foundation to show this is bad faith,” the judge said.