ERIE, Pa. (Legal Newsline) - The public won't have access to information from a case that accuses an asbestos bankruptcy trust from giving out money to lawyers without double-checking their claims.
U.S. Bankruptcy Judge Thomas Agresti on Oct. 31 ruled against insurance companies calling themselves Public Access Proponents who sought evidence of fraudulent claims. He found it was improper to reveal evidence that was never submitted during a May trial.
"There seems little reason to doubt that the Parties were acting strategically here by deliberately redacting materal from the exhibits they submitted at trial in the hope that doing so would prevent the public generally, and the insurers in particular, from obtaining access to the redacted information via a right to access under Section 107 or the common law," Agresti wrote.
"But is there anything wrong or improper in doing so? There does not seem to be."
It’s part of a fight between companies that pay asbestos claims and the lawyers and clients who receive those funds, as Honeywell International and insurers try to establish if asbestos attorneys are submitting fraudulent and inconsistent injury claims.
Honeywell funds the NARCO bankruptcy trust, one of dozens designed to pay asbestos claims without resorting to costly civil litigation. Honeywell is concerned no one in charge of the NARCO money is looking hard enough – or perhaps not looking at all – when they pay out claims.
First, a trust advisory committee consisting of asbestos lawyers asked for information that could identify which firms made which claims to be redacted but later withdrew that request. Information that identifies claimants could be a gold mine for anyone trying to prove a claimant or their attorneys lied on claim forms.
Honeywell and the insurers seek to show claimants told inconsistent stories across all their claim forms filed with trusts in order to pin as much fault on each company as possible.
The insurers didn't want to make public information like Social Security numbers, birthdays and medical information, other than the claimed disease. They also sought names.
"(T)here is no general requirement that a party must introduce a complete copy of a document into evidence as an exhibit," Agresti wrote. "In fact, the Federal Rules of Evidence expressly recognize that parties are free to introduce only select portions of a document into evidence.
"This clearly implies that in the absence of any such action by an adverse party the introduction of a partial document is proper. That is what happened in the present case - the redacted exhibits, in effect parts of the complete exhibits, were admitted into evidence without opposition by any of the parties."
Agresti wrote there is nothing improper about parties "tailoring their submission of exhibits so as to avoid the disclosure of information they would prefer to keep from public access..."
Insurers had noted that the trust advisory committee is comprised of members of six asbestos firms – Baron & Budd; Cooney & Conway; Kazan, McClain, Satterley & Greenwood; Goldberg, Persky & White; Motley Rice; and Weitz & Luxenberg.
They pointed to a ruling for transparency that resulted from Legal Newsline’s court fight in the Garlock Sealing Technologies bankruptcy. Legal Newsline was first not allowed in the courtroom before mounting a legal challenge that allowed public access to Garlock’s evidence of double-dipping by asbestos firms.
“A lack of transparency in the tort system and in the post-confirmation trusts established to pay asbestos claims has allowed certain counsel to file claims in multiple venues making inconsistent representations regarding the products to which claimants were exposed,” the insurers wrote.
“As the Garlock court concluded, this practice is ‘widespread and significant.’”