One MDL Magistrate Judge Says Narrow Discovery May Be Taken Regarding Prefiling Investigation in a Mass Tort MDL Situation

How much pre-filing inquiry is needed for a "mass tort" product laibility claim, and when must be it done ? A recent opinion in the Digitek MDL is related to those issues, but is limited to a narrow discovery issue. Digitek is a drug. The claims in essence are that a batch of the drug was mismanfucatured, resulting in sales of doses more potent than usual, with the more potent doses caapable of causing material physical harm.

The discovery requests at issue are defendants' requests for admissons. The requests seek admissions that medical and pharmacy records had not been obtained by plaintiff's counsel when 39 particular claims were filed. The defendants acknowledged the obvious reality that the discovery requests are aimed at generating evidence to support Rule 11 motions that defendants might seek to file in the future. That's important because some opinions have warned against Rule 11 motions spawning "satellite litigation."

A Magistrate Judge's opinion approves the discovery requests over plaintiff's objections. The opinion is a basic work a day paper with limited analysis, and a weak discussion of legal privilege issues (although the outcome seems correct. That said, there are precious few opinions out there on precisely these issues, so the opinion is worth reading and tucking away for persons commonly involved with mass tort litigation. The opinion is here.


________________________________________________________________

Hat tip to LAW360 for publishing an article on the opinion and including the opinion with the article.

Sanford CFO Guilty Plea Implicates Lawyer A and then Proskauer and Partner Sued in Class Action

Talk about a global tort. While waiting to transport one of my daughters this evening, I spent a few minutes reading the guilty plea (thanks, NYT) by Sanford's CFO, James Davis. What raw fraud and greed. Hard to imagine why it was so hard for regulators to figure it out.

Reading the plea, it seemed to me plain that "Lawyer A" will be soon charged with being a central part of the fraud over at least the last two or three years of the scheme. So, I ran a quick Google search to see who might be lawyer A. The search turned up a late Friday AmLaw blog post that provides lots of reminders about past stories on Sanford, and reports in this post that an investor class action was filed late Friday afternoon against the Proskauer law firm and Thomas Sjoblom, saying he is "Lawyer A."

Not a good year for the legal profession.

New Science - Creating a Test to Find People with Specific Genetic Defects to Create a Unique Cohort for a Clinical Trial

This August 27 press release from Abbott and Pfizer exemplifies another way science is changing and will over time create new legal issues as to remedies for tort claims. The pertinent part of the press release is quoted below; the gist is that the two are undertaking a joint effort to create a diagnostic test to find persons with a specific genetic defect so that a clinical trial can be then undertaken only with patients with that particular genetic defect. Soon enough, plaintiffs will be able to have good science behind requests asking courts to order a risk -creator to pay for much more than just a traditional annual check-up.

________________________________________________________________


Des Plaines, Illinois and New York — Abbott (NYSE: ABT) announced today that it has entered into an agreement with Pfizer Inc to develop a molecular diagnostic test intended to screen non-small cell lung cancer (NSCLC) tumors for the presence of gene rearrangements. Pfizer has developed a novel investigational agent that selectively targets cancer-causing genes implicated in the progress of many cancers. To be eligible to receive Pfizer's oral therapy, a particular genetic translocation (rearrangement) known to be found in NSCLC tumors and a wide variety of other cancers, but not in normal cells, must be present.

Under terms of the agreement, Abbott will develop a companion diagnostic test that will determine a patient's genetic status and will be used in patient selection for future clinical trials of PF-02341066.

"We are very pleased to partner with Abbott to develop a companion diagnostic test for non-small cell lung cancer and ensure its global availability for patients and physicians who need this information to make the best treatment decisions," said Garry Nicholson, General Manager, Pfizer Oncology Business Unit. "This test will allow us to focus on the patient population most likely to benefit from our NSCLC candidate. Working in close partnership with the experienced Abbott team, we are confident that we will deliver yet another application of personalized medicine to address a currently unmet medical need in NSCLC."

"Pfizer's novel compound for treating non-small cell lung cancer appears to be ideally suited to individualized therapy," said Stafford O'Kelly, head of Abbott's molecular diagnostics business. "Abbott is a leader in the development and commercialization of companion diagnostics and we're delighted to collaborate with Pfizer, a leader in cancer therapeutics, on the development of a test to identify patients who might benefit from this important compound."

The Evolving Litigation Industry - Real and Mock Jurors Now Part of Litigation Seminars

The litigation industry continues to evolve. Starting a couple of years back, it became far more more common for judges in repetitive types of litigation (e.g. asbestos, medical malpractice) to appear on panels at litigation seminars. Now things are going the next step and jurors are appearing at seminars in various ways.



Here are two examples. First, HB Litigation Seminars issued this press release to further advertise that a panel of an upcoming asbestos litigation seminar will include two former jurors from asbestos trials. According to the press release:



"SAN FRANCISCO, Aug. 24 /PRNewswire/ -- Sharon Boothe, partner and head of programming at HB Litigation Conferences LLC, announced today that she has added to the faculty of HB's Sept. 23-25 "National Asbestos Litigation Conference" individuals who served on juries at trials of two high profile California asbestos cases.
"These jurors will join 11 judges and a phalanx of experienced asbestos attorneys and experts, plus more than two dozen in-house counsel at what promises to be the most informative asbestos litigation program we have produced since we started running these events in 1992," Boothe said.


The jurors come from Haupt v. A.W. Chesterton and Woodard v. Alfa Laval, both of which involved mesothelioma claims that resulted in large verdicts where the U.S. Navy was held responsible for the bulk of the awards. The Haupt case resulted in a $1.45 million award. The jury in the Woodard case returned a nearly $17 million award, thought to be the largest asbestos mesothelioma verdict returned in Los Angeles County."



The second example of jurors in seminars comes from a rival litigation industry service provider, HarrisMartin. Last June, that litigation seminar firm ran this asbestos litigation seminar that consisted of a mock trial with jurors wired up to provide real time reactions to arguments and questions. I attended a similar prior seminar from the same firm and it was quite good because it allows many people to obtain the benefit of mock jury studies all at one time. That's helpful because mock jury studies are not cheap, and so insurers and clients sometimes make short-sighed decisions not to undertake the expense or effort, sometimes leading to trial disasters.

The Litigation Industry - 1 Lung Cancer and 17 Mesothelioma Lawsuits - A Week's Worth of Madison County New Asbestos Case Filings

Many words have been written and said about asbestos litigation and class action litigation in Madison County. Disturbingly, academics and many others lack meaningful access to many concrete facts regarding the day in, day out events in Madison County and other courts that are very active in tort litigation. Instead, war stories and antecdotes - often but not always extreme - tend to dominate the media and academic exchanges, and produce many disputes about what really is and is not happening. In that light, the points of this post are 1) to provide an example of one week of asbestos claims filed in Madison County and 2) also to point out that the litigation industry now includes free news sources focused on providing a continuing flow of information regarding some of the active forums for tort litigation.

One group of sources for data consist of "the Record" publications that focus on Illinois' Madison and St. Clair counties, Southeast Texas and West Virginia. Specific to Illinois are the Madison and St. Clair County Records. All are free online publications, with paid print versions. The publications are run by private ownership, with an investment from the U.S. Chamber of Commerce. The Chamber of course has a view but that does not change the facts nor the reality that these publications provide by far the best real time, free and easy windows in to the goings on in these active venues that are so much a part of the litigation industry.

Free email subscriptions bring readers the news each week as defined by the Record; subscription sign up is available at the Ma,dison Record's home page (here). More or less each week the Record publishes a summary of the new asbstos case filings ( I keep bugging them to also put the complaints online, but so far that has not happened.) Set out below is the weekly summary for the week July 27-31.

As you read the case summaries, note how few of the cases appear to have a meaningful connection to Illinois. And, beyond considering the litigation industry view, consider also the widespread impact of cancer. Imagine what these families have been through or are going through as they try to cope with the devastion caused by these 18 of the 1.4 million cancers that will be diagnosed this year in the United Sates according to this detailed Powerpoint presentation for 2009 from from the American Cancer Society.

_________________________________________________________________


18 new asbestos cases filed July 27-31


8/20/2009 8:39 AM
By Kelly Holleran

A total of 18 new asbestos lawsuits were filed in Madison County during the week of July 27 through July 31.

The following claims were filed:

--Norbert and Marjorie Bossen of Iowa allege Norbert Bossen developed mesothelioma after his work in the United States Navy from 1944 until 1946; as a boilermaker in the late 1940s and early 1950s; with Gilbert and Bossen Farm Implements from the early 1950s until 1967; as a pipe fitter from 1967 until 1982; and performing home remodeling work to his homes in the mid 1970s. The Bossens are represented by Robert Rowland and Elizabeth V. Heller of Goldenberg, Heller, Antognoli and Rowland in Edwardsville. Sean P. Worsey of Levin, Simes, Kaiser and Gornick in San Francisco will serve of counsel. Madison County Circuit Court case number: 09-L-795.

--Walter Derby of Colorado, an aviation mechanic, consulting engineer, police officer, security guard, laborer, tree trimmer and contractor/construction worker at various locations throughout Illinois, California, Colorado and Oklahoma from 1967 until 2007 claims mesothelioma. Derby is represented by Timothy F. Thompson Jr. and Ryan J. Kiwala of Simmons, Browder, Gianaris, Angelides and Barnerd in East Alton. Madison County Circuit Court case number: 09-L-789.

--Catherine Fridmanski claims her recently deceased cousin, Andrew Mulato, developed mesothelioma after his work as a bricklayer and steelworker at various locations from 1940 until 1980. Fridmanski is represented by Andrew O'Brien, Christopher Thoron, Christina J. Nielson, Bartholomew J. Baumstark and Gerald J. FitzGerald of the O'Brien Law Firm in St. Louis. Madison County Circuit Court case number: 09-L-792.

--Josie Gonzales of Texas claims her recently deceased husband, Eulalio Gonzales, developed mesothelioma after his work as a laborer and foreman at various locations throughout Illinois, Missouri, Colorado, Kansas, New Mexico and Texas from 1958 until 1985. Josie Gonzales is represented by Amy E. Garrett and W. Brent Copple of Simmons, Browder, Gianaris, Angelides and Barnerd in East Alton. Madison County Circuit Court case number: 09-L-798.

--Joseph and Sandra Goudreau of Michigan claim Joseph Goudreau developed mesothelioma after his work as a laborer, painter, operator and engineer at various locations in Illinois, Michigan, Alabama and Wisconsin from 1950 until 2000. The Goudreaus are represented by Timothy F. Thompson Jr. and Ryan J. Kiwala of Simmons, Browder, Gianaris, Angelides and Barnerd in East Alton. Madison County Circuit Court case number: 09-L-801.

--Julie Hied of Montana claims her recently deceased husband, Lyle Woolston,developed mesothelioma after his work as a rancher and mechanic at various locations from 1968 until 1978. Hied is represented by Robert Phillips, Perry J. Browder and Rosalind M. Robertson of Simmons, Browder, Gianaris, Angelides and Barnerd in East Alton. Madison County Circuit Court case number: 09-L-775.

--Betty Hughes of Virginia claims her recently deceased husband, Cecil Hughes, developed mesothelioma after his work as a laborer and carpenter from 1970 until 1979. Hughes is represented by Robert Phillips, Perry J. Browder and Rosalind M. Robertson of Simmons, Browder, Gianaris, Angelisdes and Barnerd in East Alton. Madison County Circuit Court case number: 09-L-776.

--Robert and Barbara Krupp of Illinois allege Robert Krupp developed lung cancer after his work in the U.S. Coast Guard from 1952 until 1955; as a laborer at Mallinckrodt Chemical Company from 1955 until 1957; as a laborer at The New York, New Haven and Hartford Railroad Company from 1957 until 1961; as a laborer at Stickland Trucklines from 1962 until 1965; and as a laborer at Manufacturers Railway Company from 1965 until 1991. The Krupps are represented by Randy L. Gori and Barry Julian of Gori, Julian and Associates in Edwardsville. Madison County Circuit Court case number: 09-L-777.

--John Lappin of Missouri, a machinist and steelworker from 1947 until 1992, claims mesothelioma. Lappin is represented by Andrew O'Brien, Christopher Thoron, Christina J. Nielson, Bartholomew J. Baumstark and Gerald J. FitzGerald of O'Brien Law Firm in St. Louis. Madison County Circuit Court case number: 09-L-772.

--Ronald H. and Karen L. Larson claim Ronald H. Larson developed mesothelioma after his work as a field lineman with the United States Army from 1960 until 1963 and as a steel plate inspector at Bethlehem Steel from 1963 until 1987. The Larsons are represented by Randy L. Gori of Gori, Julian and Associates in Edwardsville. W. Mark Lanier, Patrick N. Haines, C. Taylor Campbell, J.D. McMullen and William H. Barfield of The Lanier Law Firm in Houston will serve of counsel. Madison County Circuit Court case number: 09-L-781.

--Christopher Morelli of New Jersey claims his recently deceased wife, Michelle Morelli, developed mesothelioma after her work as a laborer at Lockheed Martin in 1982. She was also exposed to asbestos fibers while doing abatement work during the late 1990s and was secondarily exposed through her husband, who owned a painting, drywall and texture company from 1982 until now, according to the complaint. Christopher Morelli is represented by Randy L. Gori and Barry Julian of Gori, Julian and Associates in Edwardsville. Madison County Circuit Court case number: 09-L-782.

--Jimmy E. and Rosalee Murphy of Arkansas claim Jimmy Murphy developed mesothelioma after his work as a manufacturer from 1967 until 1971 at Tucker Duck and Rubber Company, Fort Smith Table and Chairs and Bowmen and Company; as a laborer for Capco from 1971 until 1976; as a welder for Structural Steel in 1976; as a forklift operator for Farmland Feed Mill from 1976 until 1980; as a welder for Branham Industries from 1980 until 1981; as a welder for Interstate Electric from 1983 until 1986; and as an assembly line worker for Trane from 1986 until 2000. The Murphys are represented by Elizabeth V. Heller and Robert Rowland of Goldenberg, Heller, Antognoli and Rowland in Edwardsville. Madison County Circuit Court case number: 09-L-793.

--Shirley Jo Peeler of Ohio, a cashier for Liberal Markets from 1953 until 1956 and an employee at Revco and a press operator at Stanhope Products from 1956 until 1958, claims mesothelioma. Peeler is represented by Elizabeth V. Heller and Robert Rowland of Goldenberg, Heller, Antognoli and Rowland in Edwardsville. Madison County Circuit Court case number: 09-L-794.

--Larry C. and Bettye M. Sims claim Larry C. Sims developed mesothelioma after his work as an engineer and machinist mate while in the U.S. Navy from 1962 until 1987; as a maintenance man at Dorchester School District in South Carolina from 1987 until 1998; as a home remodeler at his house from 1960 until 1970; and as a shadetree mechanic from 1959 until 1979. The Sims are represented by Randy L. Gori of Gori, Julian and Associates in Alton. W. Mark Lanier, Patrick N. Haines, Angela B. Greenberg, Sam T. Richard, Bridget B. Truxillo and Lauren H. Ware of The Lanier Law Firm in Houston will serve of counsel. Madison County Circuit Court case number: 09-L-779.

--Toni Solano of Texas claims her recently deceased husband, John M. Solano, developed mesothelioma after his work as a laborer and division engineer for Burlington Northern Santa Fe Rail Road from 1975 until 2005. Toni Solano is represented by Elizabeth V. Heller and Robert Rowland of Goldenberg, Heller, Antognoli and Rowland in Edwardsville. Madison County Circuit Court case number: 09-L-796.

--Robert A. and Darlene M. Switzer claim Robert A. Switzer developed mesothelioma after his work as a service representative, products liability specialist, maintenance, expert claims witness for Caterpillar Tractor Company from 1953 until 1988; while being enrolled in officer's candidate school where he learned and performed duties on Navy ship from 1944 until 1946; while working for a road equipment contractor and on welded metal tracks from 1949 until 1953; as a farmer at Norvel Switzer Farm from 1926 until 1944; as a shadetree mechanic from the 1950s until 1980; and in residential construction from the 1950s until 1980. The Switzers are represented by Randy L. Gori of Gori, Julian and Associates in Edwardsville. W. Mark Lanier, Patrick N. Haines, R. Craig Bullock and J. Kyle Beane of Houston will serve of counsel. Madison County Circuit Court case number: 09-L-780.

--Leo J. and Ruth A. Vietmeier claim Leo J. Vietmeier developed mesothelioma after his work as a laborer, assembly line worker and maintenance man at American Vitrified in the 1950s; as a laborer while in the AFL-CIO Union in the 1960s; as a mine worker at Pegg's Run Coal Mill in Pennsylvania in the 1970s; as a meat cutter at Giant Eagle from 1980 until 1996; as a home remodeler at his home from 1967 until 1990; and as a shadetree mechanic on his automobiles from 1950 until 1980. The Vietmeiers are represented by Randy L. Gori of Gori, Julian and Associates in Alton. W. Mark Lanier, Patrick N. Haines, Angela B. Greenburg, Sam T. Richard, Bridget Baragona and Lauren H. Ware of The Lanier Law Firm in Houston will serve of counsel. Madison County Circuit Court case number: 09-L-778.

--Mary Ellen White of New Hampshire claims her recently deceased husband, John Grohosky, developed mesothelioma after his work in the U.S. Navy from 1944 until 1964 and as a forklift driver from the early 1970s until 1988. White is represented by Randy L. Gori and Barry Julian of Gori, Julian and Associates in Edwardsville. Madison County Circuit Court case number: 09-L-784.

--Fred Young of Wisconsin, who served in the British Navy from August 1940 until August 1954 and who worked as a mechanical researcher from 1954 until 1956; as a mechanical researcher at AV Roc from 1956 until 1958; as a design engineer for Pratt and Whitney from 1958 until 1960; as a design engineer at the GE Nuclear Power Demonstration Plant from 1960 until 1963; as a senior reactor operator at Ontario Hydro from 1963 until 1965; as a maintenance supervisor at Thunder Bay Generating Plant from 1965 until 1967; as a maintenance supervisor at Wisconsin Electric Point Beach Plant from 1968 until 1972; as a laborer at Bechtel from 1972 until 1984; and as a consultant at Wisconsin Electric Point Beach Plant from 1984 until 1989, claims mesothelioma. Young is represented by Randy L. Gori and Barry Julian of Gori, Julian and Associates in Edwardsville. Madison County Circuit Court case number: 09-L-797.

The Chapter 11 Game Goes On - Cubs to Use Chapter 11 for a Quick Cleansing and Injunction

This prior post reported on the possibility that the Tribune would put the Cubs into chapter 11 to cleanse the entity of risks. It's now happening as reported in this article in the Tribune, which states that the Cubs want a short stay so that the entity can get all the benefits of chapter 11, but no detriments:

"In court papers, Tribune Co. lawyers outlined a two-step process for court approval, which includes having the team file for bankruptcy at a later date. The company wants the team to be in bankruptcy for just a few days, according to court documents. An extended stay in court could damage the Cubs' baseball operations, team Chairman Crane Kenney said in court papers."The process of competing for player talent in MLB is incomparably fierce, and by operating in Chapter 11 the Cubs would face a severe competitive disadvantage in their ability to retain, acquire or trade for players, based on the perception that the transaction would require Bankruptcy Court approval or might be unwound at a later date," Kenney said." I (emphasis added).

So, now we have yet another example of chapter 11 being used more or less solely to obtain injunctive relief against the possibility of future claims. One has to wonder what has happened to chapter 11 when it can be used for benefits but not detriments, with little or no notice to the rest of the world, and does not save any jobs or a business and instead is just legal engineering. For much more on this topic from a lawyer who argued for tort claimants in Chrysler, go to this blog by bankruptcy lawyer Steve Jakubowski.

All that said, I still love and so will repeat the comment I heard when discussing the Cub's possible use of chapter 11 with a colleague who is a bankruptcy law expert and a Brooklyn native. The response was brilliant; he said:

"It is the bottom of the 8th in a crucial game against the Cardinals. Cards lead 4 to 3. There are 2 outs. Cubs have the bases loaded with Derek Lee at bat. The count is 2 and 0. Would you need bankruptcy court approval to put "on" the take sign ?"

Great Summary of Twombly/Iqbal Rulings

This August 6 post from the Device and Drug Law Blog provides a great summary of Twombly/Iqbal rulings over the last couple of years.

Madison County's Asbestos Judge, Daniel Stack, to Retire in 2010

This article from the Madison County Record reports that Judge Daniel Stack has decided to retire as of 2010. Judge Stack is well known as the Madison County judge who took over the asbestos docket from Judge Byron. Judge Stack is generally credited with having made Madison County a less extreme place to litigate for asbestos defendants, although that's relative praise. That said, Madison County continues to grind out trial dates and settlements for asbestos cases, and so claims for 2009 are up from recent years.

Chrysler Opinion by 2d Circuit - Todd Brown Comments On the Sacrifice of Rights of Future Claimants and I Pile On Regarding The Scope of Future Claima

Todd Brown is a former defense-side lawyer (Wilmer Hale and Jones Day) now teaching law in Buffalo after a stint at Temple. Mr. Brown has written pretty extensively and astutely on deep flaws in asbestos bankruptcies (see my post here regarding his prior law review on section 524(g)). Mr. Brown has been guest blogging and commented here on Pointoflaw on two aspects of the 2d Circuit's Chrysler opinion. As it pertains to tort claimants, Mr Brown said the following:

" Second, the panel addressed the various arguments that the Chrysler assets could not be sold free and clear of successor liability for various personal injury type claims. Here, the panel adopted a fairly broad reading of the "interests" that can be cleansed in a Section 363 sale, reasoning that this interpretation is more consistent with the purpose of this section and the priority scheme of the Bankruptcy Code.

The panel refused to weigh in on the question of whether a Section 363 sale can cleanse future claims (such as those that might arise from asbestos exposure). This not only makes sense in the abstract; it is the right approach for future claimants. As we have seen in the 524(g) context (which requires setting aside funds to pay current and future asbestos claims, among other things), future claimants' interests are often sacrificed by those currently asserting asbestos claims against bankruptcy estates. Now that courts have started taking a harder line against these schemes, it is easy to see how the 363 sale approach might be viewed as a possible end-run around 524(g)'s limitations on front-loading recoveries. Until the "free and clear" sale's applicability to future claimants is clarified, however, such an end-run remains, at best, extremely risky for most asbestos defendants." (emphasis added).

Todd certainly is correct that the the interests of future claimants have repeatedly been been sacrificed in the asbestos chapter 11 cases. To go further, recognize that future claimants are NOT just the personal injury claimants, and instead there are multiple types of future claimants against the debtor's estate. Future claimants may be, for example, state agencies that want to recoup expenses from a debtor that caused personal injuries or created an environmental mess. Future claimants also include underlying case co-defendants which want to pursue cross-claims against former co-defendants now hiding behind chapter 11 injunctions The same applies to those insurers with subrogation and indemnity rights. against debtors.

Bankruptcy judges and plan proponents may in the future rue the day they did not 1) give due process notice to these groups of future claimants, and 2) did not cause appointment of a futures representative who actually intended to and actually did represent the interests of these other groups of "future claimants."

Plaintiff's Bar and US Chamber of Commerce Agree - Let's Make It Easier to Sue Non-US Manufacturers

Catching up on things I missed while on vacation. PointofLaw includes this interesting post on a draft federal statute to require overseas manufacturers of many consumer products to appoint registered agents in the US for service of process. The point is to make it equally easy to sue overseas companies. According to pointoflaw, the bill amazingly produced harmony between the plaintiff's bar and the US Chamber of Commerce- - now that's quite a feat:

"The bill follows on the footsteps of a Senate Judiciary subcommittee hearing in May, "Leveling the Playing Field and Protecting Americans." As the sponsors show, the issue crosses partisan lines. General support is also broad: Witnesses at the hearing included a representative of the trial lawyer lobby, AAJ, as well as Victor Schwartz, testifying on behalf of the U.S. Chamber."

W.R. Grace, Solvency Findings, Asbestos Liability Estimates, and Injunctions that Bind Others

Today's post follows up on this August 13 post regarding asbestos plaintiff's lawyers asking the Court to order the rest of the world not give any effect to whatever the Court finds on Grace's solvency, and item 4 of this prior post of May 12 regarding Nobel prize winner James Heckman's expert report in Grace in which he and the non-asbestos creditors indicted bankruptcy court estimation proceedings as having no scientific validity.

The topic today is Grace's August 7 trial brief asserting that it is impossible for the Court to determine whether Grace is solvent or insolvent, and that instead it should just find that Grace will be solvent and viable if the plan is confirmed. Grace's brief [Docket 22732] is available through PACER or here.

Key quotes from the Grace brief are below. The gist is that estimates of its "personal injury liability" range from a low end of $ 200 million (from Grace's expert, Tom Florence) to $ 6.2 billion (plaintiff's expert Mark Peterson). In addition, its "property damage liability" is estimated by some at about $ 3-5 billion, with one calculation suggesting $ 82 billion. The facts, as argued by Grace, are set out below. The question I pose is this:

In tort cases, we say that good science must be applied. In business litigation, the general rules is that damages must be proved with reasonable certainty. Given those rules, why would it be socially useful and/or constitutional for bankruptcy courts to issue world-wide injunctive orders without making actual factual findings on key issues when the factual claims are so extremely different as they are in the Grace case, and the answer on solvency plainly could come out on either side of the solvency question?

In posing that question, I recognize that Grace and others will and do say that what we need most are deals that end litigation and that courts should accept deals. But, isn't it also fair to say that individual case settlements are much different because, unlike Grace's desired confirmation order, those other settlements do not include sweeping injunctions purporting to bar and limit the manner of future prosecution of tens or hundreds of thousands of present or future claims to be asserted by personal injury claimants, and that also will enjoin cross-claims or subrogation claims to be asserted by underlying case co-defendants and/or insurers in those same hundreds or thousands of future personal injury claims?

The Grace brief states the following, at 12-14:

"Among the most significant hurdles that the Committee and the Lenders must overcome
before they even get to the analysis under section 1129 is the requirement that they prove the Debtors are solvent. This they cannot do. The most significant component of Debtors' liabilities, the Asbestos PI Claims, has never been agreed upon or adjudicated. The estimation proceeding, which was designed specifically to estimate the value of the Asbestos PI Claims,was not completed. And there has never been an agreed upon or adjudicated resolution of Debtors' potential property damage asbestos claims. Without such adjudication, the liabilities cannot be established, and the Lenders and Committee cannot prove that the Debtors are solvent.

The incomplete estimation proceeding only highlights the fact that, absent the Plan, there is an enormously wide range of estimated values of the Debtors' asbestos liabilities. For example, the Debtors' estimation expert, Dr. Tom Florence, estimated that value of Debtors'asbestos personal injury claims ranged between $200 million and $989 million with a median value of $468 million. But Dr. Denise Martin, another one of Debtors' experts, determined that at the standard 95% confidence interval for scientific reliability, Dr. Florence's estimates could range from $4.6 million to $6.3 billion. The PI Committee's expert, Dr. Mark Peterson, could
offer no more definite estimates of Debtors' asbestos liabilities. He opined that Debtors' potential liabilities for asbestos personal injury claims were "between $4.7 and $6.2 billion and most likely between $5.4 and $6.2 billion." See Expert Report of Dr. Mark Peterson in Connection with the Asbestos Personal Injury Estimation Hearing, dated June 20, 2007 at ES-5 (Dkt. 16113, Ex. A).

Likewise, the value of the Zonolite Attic Insulation ("ZAI") claims is also highly
uncertain and disputed. While the Plan provides between $54.5 million and $58 million to ZAI (and potential additional contract payments), ZAI made substantially higher demands. For example, ZAI claimants have previously stated that ZAI could potentially be in 11 million homes5 with a value of$5,000 to $7,500 per home,6 for a total of up to $82.5 billion. Even using the claimants' lower estimates of 1 million homes7 at a value of $3,000 to $5,000 per home, the total liability would be $3 billion to $5 billion. The range of non-ZAI Propert Damage liability is also entirely uncertain. While the Plan provides $ 49.3 million for non-ZAI Property
Damage claims, the potential claim was much greater. Together, the total potential Property Damage liability, absent a Plan, reaches at least $3.149 billion to $5.149 billion and may be much greater.


B. The liability disputes foreclose any demonstration of solvency. The Plan
disposes of that liability and therefore cannot be relied on to prove solvency.

As described above, there has never been an adjudication of Debtors' asbestos liabilities, and estimates of those liabilities vary greatly. There is simply no estimation method that can accurately measure the Debtors' asbestos liabilities. Without a binding determination of Debtors' potential asbestos liabilities, there cannot be a final and binding determination that Debtors are solvent. Zily Aff. ~ 4.9

As discussed infra, the Lenders' new expert, Robert 1. Frezza, relies on estimates from the never-completed estimation hearing to attempt to "determine" Debtors' solvency. This attempt is unavailing. Indeed, the only way that Mr. Frezza can even begin to argue Debtors' solvency is by relying upon the Plan, the very one to which the Committee and the Lenders now object. Absent the Plan, there is no cap on Debtors' asbestos liabilities. As already noted, the Proposed Asbestos Settlement, which forms the basis of the Plan, does not represent an adjudication of the Debtors' asbestos liabilities. Rather, it represents a compromise that disposes
of the need to adjudicate those liabilities. Without the Plan, all that is left are potentially enormous amounts of asbestos liabilities, the adjudication of which would determine whether Debtors are solvent. In other words, the Plan does not prove solvency; it paves the way for solvency from and after the Effective Date."

Glaxo, Sponsored Writing and Paxil

This article from the Associated Press in the August 19, 2009 issue of the NYT reports on Glaxo's program in which "ghostwriters" were hired to assist doctors in writing medical journal articles regarding Paxil. The information provided is rather skimpy in terms of trying to evaluate the scope and influence of the ghost-writing and whether it actually produced incorrect statements. The article states:

August 19, 2009
Glaxo Used Ghostwriting Program to Promote Paxil
By THE ASSOCIATED PRESS
Filed at 5:07 p.m. ET
WASHINGTON (AP) -- Drugmaker GlaxoSmithKline used a sophisticated ghostwriting program to promote its antidepressant Paxil, allowing doctors to take credit for medical journal articles mainly written by company consultants, according to court documents obtained by The Associated Press.
An internal company memo instructs salespeople to approach physicians and offer to help them write and publish articles about their positive experiences prescribing the drug.
Known as the CASPPER program, the paper explains how the company can help physicians with everything from ''developing a topic,'' to ''submitting the manuscript for publication.''
The document was uncovered by the Baum Hedlund PC law firm of Los Angeles, which is representing hundreds of former Paxil users in personal injury and wrongful death suits against GlaxoSmithKline. The firm alleges the company downplayed several risks connected with its drug, including increased suicidal behavior and birth defects.
A spokeswoman for London-based Glaxo said the published articles noted any assistance to the main authors.
''The program was not heavily used and was discontinued a number of years ago,'' said Mary Anne Rhyne.
According to the memo, which dates from April 2000, the CASPPER program was designed to ''strengthen the product positioning and overcome competitive issues.''
At the time, Paxil was competing with rival antidepressant blockbusters like Eli Lilly's Prozac and Pfizer's Zoloft. Paxil has since lost its patent protection and competes against cheaper generic versions. Sales of Paxil last year totaled $849 million.
Drug companies frequently hire outside firms to draft a manuscript touting a company's drug, retain a physician to sign off as the author and then find a publisher to unwittingly publish the work.
But the use of ghostwriting by drug companies has come under increased scrutiny by members of Congress, including Sen. Charles Grassley, R-Iowa, a longtime critic of the industry's influence over physicians. Grassley and Sen. Herb Kohl, D-Wis., are pushing a bill that would require companies to disclose all payments to physicians over $100.
According to ghostwriting expert Dr. Leemon McHenry, Glaxo's program was unusually intertwined with its internal sales and marketing department.
''We know that GSK has engaged in ghostwriting for many years,'' said McHenry, who works as a research consultant for Baum Hedlund. ''But to create an internal ghostwriting program and have the gall to name it after a cartoon ghost demonstrates their juvenile attitude and careless disregard for patients.''
McHenry acknowledged that ghostwriting is legal in principal, but said it could contribute to illegal activity if the information is misleading and causes harm.
''If these ghostwritten publications are contributing to the harm of patients because they're making false claims, then that's illegal,'' McHenry said.
Articles from the company's program appeared in five journals between 2000 and 2002, including the American Journal of Psychiatry and the Journal of the American Academy of Child and Adolescent Psychiatry.
Drug company salespeople often present medical journal articles to physicians as independent proof that their drugs are safe and effective.
Publication in a medical journal also is a point of prestige for physicians, a fact Glaxo's memo seems to acknowledge: ''Physicians will be eager to participate in CASPPER regardless of their professional stature,'' the brief notes.
(This version CORRECTS spelling of 'Baum' in graf 4.)