CHICAGO (Legal Newsline) - Fraud drove asbestos lawsuits at the prominent plaintiffs firm Simmons Hanly Conroy, pipemaker J-M Manufacturing Company is alleging in a new racketeering lawsuit.
The company sued Simmons Hanly and several of its employees on May 10 in Chicago federal court. The firm boasts that it has recovered more than $10 billion for asbestos clients over the years, but J-M's lawsuit alleges it has done this by crossing "all objective legal and ethical boundaries."
J-M started its investigation after a former asbestos lawyer at Simmons sued the firm for retaliation for reporting alleged wrongdoing. Scott Peebles ultimately settled his case, but J-M got involved with an effort to unseal certain portions of his allegations.
J-M is claiming in its lawsuit that its probe has discovered clients were coached on what to say about exposure to an asbestos-containing pipe the company produced, or they outright lied.
"The Simmons Hanly Defendants, including lawyers, non-legal professionals, consultants, and clients working with the firm’s Asbestos Department, are a quintessential RICO enterprise," the suit says.
"The enterprise is highly structured. Everyone has a role to play, and they all work toward the same goal of extracting settlements and obtaining jury verdicts through a pattern of unlawful conduct, including racketeering activity."
Laurence Nassif, managing partner at Simmons Hanly Conroy, issued a response to the lawsuit, claiming it is a ploy to avoid accepting responsibility for having sold an asbestos-containing pipe.
"As we have alleged in Court, the company was aware its product line was deadly when it purchased the pipe manufacturing operation from Johns-Manville in the early 1980s," he said. "This is a baseless lawsuit and just the latest evidence that JM Eagle will spare no expense to avoid taking accountability for its dangerous practices and the harm it has caused innocent people.
"Simmons Hanly Conroy will continue to fight for our injured clients, and we trust the litigation process will prove these allegations to be false and lacking in any merit whatsoever."
Key to asbestos claims is product identification. Plaintiffs are asked to recall products used decades ago on jobsites so their lawyers can sue the companies associated with them, though it is tough to determine the accuracy of the testimony.
The complaint cites a group of cases resolved within the last five years, including Sebastian Bretado's. He claimed he contracted mesothelioma while doing "line drainage" for landscapers in the 1980s.
During a deposition, Bretado was shown products and labels and asked if he remembered working with them. He answered that he had used a power saw and power drill on J-M's pipe, though the company says he couldn't remember any specific location he ever worked, the full name of any co-workers or the names of any customers.
He provided the name of three employers, including Oak Ridge Landscaping. The two individual employers have passed, but their family members testified that they never ran any landscaping businesses, while the principal of Oak Ridge said the company never used the J-M pipe and that he didn't remember Bretado.
"(T)he Bretado case was infected by perjury and false statements," the suit says. "J-M spent significant sums to mount a defense to that case and counter the product identification and exposure testimony.
"Given the uncertainty of litigation, the company ultimately settled the case in August 2019 and made a settlement payment in or around September 2019."
Also alleged is Reyna Carranza claimed to have worked with J-M's pipe in the 1980s for a company called Indelcor that didn't exist until the mid-1990s. The company's owner told Simmons lawyer Suvir Dhar the day the complaint was filed that the information in it wasn't accurate, the suit says.
"Dhar reportedly stated that Simmons Hanly already knew that, meaning that the firm knew the complaint against J-M Manufacturing was not based in fact and filed it anyway," the suit says.
The case went on for more than a year before Simmons voluntarily dismissed it - "The with-prejudice dismissal of Carranza confirms that the case was a sham."
The complaint tells several similar stories. Also alleged is the somewhat familiar pattern of hiding exposure claims against companies that went to the bankruptcy system (where payouts are limited) to first pursue maximum recoveries in the tort system, where a jury verdict could be eight-figures.
Garlock Sealing Technologies' legal team took aim at that practice when the company was setting up its bankruptcy trusts, and Bestwall is using that same strategy now.
Before Garlock Sealing Technologies convinced a judge this was happening, companies facing lawsuits had no way to prove the same clients were telling different exposure histories in claims made to bankruptcy trusts.
After the Garlock ruling, which came after the company showed exposure history contradictions in the 15 cases it was permitted to investigate, 17 states passed laws requiring automatic disclosure of trust claims to civil defendants so they could find out who was being blamed for what.
J-M says it has been sued more than 430 times by Simmons Hanly since 2001 and has settled more than 75. The firm has several offices around the country, including in the nation's asbestos litigation epicenter - Madison County, Ill.
Individual defendants named by J-M are partner Nicholas Angelides, partner and head of the Asbestos Department Perry Browder, partner Amy Garrett, Benjamin Goldstein, Dhar, partner Crystal Foley, partner Deborah Rosenthal and case investigator Stan Jones. Browder did not return an email seeking comment.