ADVWG applauds investigation into asbestos bankruptcy trusts

The Asbestos Double-Victims Workgroup (ADVWG) is calling on additional state officials and federal authorities to join 13 states investigating whether several large national asbestos bankruptcy trusts are mismanaging funds, including if they failed to reimburse Medicaid and other medical providers as required in federal secondary payer laws.
 
In March, attorneys general from the states of AlabamaArkansasKansasLouisianaMichiganMontanaNebraskaNevadaSouth CarolinaSouth DakotaUtahWest Virginia, and Wisconsin joined forces in issuing a Civil Investigation Demand (CID) to four of the nation’s largest bankruptcy trusts. The trusts did not comply with the CID which led to the Utah-based lawsuit asking the court to require compliance.
 
Those trusts are formed under a law allowing companies with asbestos liability to emerge from a bankruptcy process solvent while creating trusts to pay currents and estimated victims. The AGs are concerned that negligent management of the trusts is cutting the amounts available to help victims, a disproportionate number of whom are veterans, and may not be repaying health care costs. Those victims may be unaware of possible claw-back actions coming down the pike.
 
The multi-state investigation comes on the heels of the “Garlock” case in North Carolina when a federal judge disclosed that evidence had been suppressed in all 15 cases where he had allowed specific discovery. Both the CID and the Utah lawsuit make clear links to the Garlock case and represent the first law enforcement action on the judge’s findings.
 
Sara Warner, Courts Monitor publisher, is a founding member and spokesperson for the ADVWG.
 

Asbestos Bankruptcy Settlement, Conflicts & Racketeering Clouds Loom

In the latest HuffPo piece by Courts Monitor Publisher, Sara Warner, she writes about Garlock’s asbestos bankruptcy settlement which has multiple implications for the $10 billion per year asbestos-lawsuit industry:  

“In the insular world of civil litigation, watershed events usually arrive on an installment plan, trickling in at the pace of… well, at the pace of civil litigation. Yet, sometimes disruption arrives quickly, like last week’s landmark settlement agreement between a North Carolina gasket maker called Garlock Sealing Technologies and asbestos victims’ attorneys. 

While the ink has yet to dry and the court has not considered, let alone approved, of the deal, the nation’s asbestos litigation community quickly noted that the announced settlement not only addresses the precedent-setting bankruptcy case but seems to include multiple civil racketeering allegations against high-profile plaintiff’s firms.”

Read more on the Huffington Post… 

CM Publisher Posts Veteran’s Asbestos Plight On HuffPo

Courts Monitor Publisher Sara Warner has posted to The Huffington Post about how asbestos cancer policy impacts U.S. veterans. She notes that “… every year, hundreds or even thousands of American veterans who thought they survived military service discover that they were wrong; exposure to asbestos was a mortal wound that took decades to surface, evolving into the much-advertised mesothelioma, a terminal cancer.

She adds that “… both sides also agree that the government under which those vets served excludes itself from the resulting accountability, at least in the U.S. courts. What they do not agree upon is how to fix it, and the resulting debate has left veterans taking sides.”

Read the post here: http://www.huffingtonpost.com/sara-warner/a-sad-truth-for-veterans_b_9417622.html

‘Outlier': Garlock Case Gives Traction to Asbestos Fraud Claims

Originally featured in the Huffington Post. 

Even if all you know (or ever want to know) about the world of asbestos litigation business comes from those unavoidable “if you or a loved one has been diagnosed with mesothelioma” commercials, you still ought to know that big changes are coming to what is called the longest-running personal injury litigation in the United States; some estimates (okay, mine) say it does about $10 billion a year, making it as big as the “industry” of pro football, the NFL.

Multiple defense lawyers have been alleging institutional and operational fraud for years, but lately those charges are gaining some credence. From North Carolina to New York, cases that were initially discredited by victims’ attorneys as mere “outliers” are gaining traction as federal courts allow lawsuits to advance.

For example, politically savvy New Yorkers are likely aware that Manhattan’s Sheldon Silver resigned his longtime post as State Assembly Speaker earlier this year after he was indicted on fraud and extortion charges in a $4 million influence-peddling scheme. However, they may not have made the connection that his fraud charges stemmed from how victims of mesothelioma, the “asbestos cancer,” found legal help. Prosecutors allege Speaker Silver steered taxpayer money to a clinic in exchange for the clinic steering victims to his law firm, in turn receiving millions of dollars in referral payments from a prominent asbestos litigation firm. Such referral fees are common, but the taxpayer implications are not.

Meanwhile, on a key civil litigation front, a North Carolina bankruptcy case initially branded as an “outlier” is gaining credibility. An NPR report noted that “Garlock” offered a look inside the “murky world” of asbestos litigation and a key issues was telling one story in civil cases and another story to any of some 60 to 100 “trust funds,” which were set up when companies declared bankruptcy over asbestos liability.

Judge George Hodges, in the Garlock case, identified significant issues in 15 of 15 cases. In his decision, Judge Hodges said that more research would no doubt have found more problems, although he stopped well short of what the lawyers call “the F bomb,” which to them is “fraud.” But Garlock has brought a civil RICO suit against several asbestos victim’s firms, alleging a pattern of misrepresentation over many years.

At first, the whole Garlock case, and its ancillary issues, were more or less dismissed by the plaintiff’s bar. The talking point was that the judge was new to the litigation and the allegations against the firms would dissolve upon contact with appeals courts. But the opposite has happened so far: Garlock has been upheld through multiple appeals, getting victories even from Democratic-appointed judges – it’s worth noting that asbestos litigation is so political that which party appointed your judge can be a big deal.

Just this month, U.S. District Judge Graham Mullen (a President George H. W. Bush appointee) upheld a lower court ruling that Trust Fund records being sought by Garlock Sealing Technologies should be produced. He also agreed with the complaint that the “requests are broad” but added: “Yet, so is the fraud in which plaintiffs are alleged to have engaged.”

The firm in that case — New York’s Belluck & Fox — made an argument that no doubt illustrates the strategy for those making cases of the Garlock discoveries, stating:

It is now clear that, while the complaint includes allegations about just 11 cases, plaintiffs are seeking to expand discovery to include all the trust claims of virtually every Belluck & Fox client that ever brought a claim against Garlock – whether the case was litigated in the tort system or not.

Belluck & Fox is not alone. Big national firms, like Dallas-based Simon Greenstone and Waters & Kraus and Philadelphia’s Shein Law Center, are also targets and no doubt will face similar discovery efforts.

Those court victories are likely to play a huge role as the U.S. House of Representatives takes up debate on what’s called the “FACT Act,” for “Fairness in in Asbestos Claims Trust,” later this month. That legislation has little chance that President Obama will ever sign it into law, but it does offer a platform and rallying point for those who would change how victims sue over asbestos. The FACT movement may be for “show” in Washington, but six states – Oklahoma, Wisconsin, West Virginia, Texas and Ohio – have passed some form of the legislation.

In what might be a “first use” in Texas, a judge in Harris County has granted a “stay” motion based on that state’s FACT Act legislation. The case involves a Navy veteran with mesothelioma and the judge has agreed that claims against bankruptcy trusts must be considered, even if those concerns are NOT part of the current trial.

Whatever asbestos “scandal” there is may be a slow-motion crisis, but I’ve made the argument that it’s about to exit the litigation world to involve hundreds or even thousands of innocent victims’ families. Some lawyers have turned their clients intoperjury pawns. Others may discover they might owe Uncle Sam some of their hard-won settlement and judgment money. And I truly believe that Democrats, who benefit from the plaintiff bar’s donations, are being slow to realize the gravity of the situation.

The common theme is that focus needs to shift to what it all means to victims.

I’m not the only one who thinks so. The journalist Paul Johnson, best known as a Washington correspondent for Canada’s Global TV and his documentary reporting from Afghanistan, is making asbestos litigation the topic of his next U.S.-based film. He says the project so far has been eye-opening.

“Our story begins with a small car dealership in central California getting sued for what seems to be no good reason,” says Johnson. “We follow that 7-year battle involving all kinds of twists and some serious allegations against a major firm; I will say that it shows that sometimes you might need a lawyer to keep an eye on your lawyer.”

Johnson said the movie, slated for 2016, is “… most unsettling when you find yourself sitting in a New York conference room at one of the more liberal universities on earth, and a professor is assuring you that this [asbestos litigation] scandal will one day be seen as bigger than Teapot Dome or Enron, but it’s what you want as a reporter to find a huge scandal that almost nobody outside the trade press is covering.”

We are anxiously awaiting the release of this film for the topic that “nobody is covering” could very well be the one “everyone is watching” in 2016.

(Sara Warner is publisher of the National Courts Monitor and California Courts Monitor. Disclosure: Although Ms. Warner has not participated in the Paul Johnson film mentioned, some Courts Monitor contract researchers and contributing editors have contributed to the documentary and the National Courts Monitor is in discussions to host the Washington, D.C. premier of the movie.)

Asbestos Plaintiff Firms Said To Pocket $2B/Yr.

The National Courts Monitor, our sister website, is reporting on a new estimate that plaintiff’s firms earn a whopping $2 billion per year on asbestos cases. The estimate, by a defense-side attorney, comes in the context of litigation-community debate and raises questions about creation of “Perjury Pawns.”
 

Warner Posts Challenge To GOP Senate

Courts Monitor Publisher Sara Warner is suggesting the new GOP Senate might find success with bankruptcy reform, but only once the Democrats come up with consumer protections for “perjury pawns.” See her ideas at the Huffington Post: Sara Warner

Asbestos Litigation Summit Tackles Issues of Trust

CCM Publisher Sara Warner lights up the Huffington Post again with her latest blog. 

The insular and well-heeled world of American asbestos litigation is gathering atop San Francisco’s Nob Hill this week for what amounts to an annual current-events snapshot, and this year things may get a bit testy in the industry triangle of plaintiff attorneys, defense firms and insurance companies. Read More.

CityWatch: Dems Tone-Deaf on Veterans’ Asbestos Issue

CityWatch has published the recent commentary by California Courts Monitor publisher, Sara Warner. The piece, originally published on the Huffington Post’s national political page, argues that Democrats are tone deaf when it comes to the role that veterans play in asbestos bankruptcy trust issues.

Read it at CityWatch here.

 
 
 

Courts Monitor Writer On Vets’ Asbestos Issue

On the Huffington Post’s national political page today, Sara Warner, publisher of the California Courts Monitor, argues that Democrats are being tone deaf when it comes to the role that veterans play in asbestos bankruptcy trust issues.
 
You can find her comments here: Dems Tone-Deaf on Veterans’ Asbestos Issue

Clients Need a ‘Bill of Rights’ argues CCM Publisher in HuffPo

California Courts Monitor publisher, Sara Warner, makes an argument for a “Client Bill of Rights” to protect clients in civil litigation today in the Huffington Post.

Sara Cocoran Warner, Founding Publisher of the California Courts Monitor

Sara Cocoran Warner, Founding Publisher of the California Courts Monitor

In her post, she states:

“We hear about personal injury cases being “bundled” with other cases to increase settlements, often without client knowledge. We hear that some attorneys distribute settlement money based on which client arrangements benefit them most. We hear about lawyers creating companies, like document courier services, that they use to drive up the “expenses” they can deduct from client payments…Hopefully, if true, these are rare events. A solid bill of rights might help keep them that way.”

Read the HuffPo piece here and join in the conversation.