This is the last post on Blogger. New posts will be hosted at Lexblog and reachable by our main domain address www.globaltort.com. We've even moved the archive over to the new locale!
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Thanks!
Thursday, February 25, 2010
CDG Wins For the Third Straight Time Against One Recalcitrant Insurer
A brief self-promotional note for Childress Duffy Goldblatt. Yesterday my partner Mike Duffy and his trial team won a first party insurance property damage verdict for $ 2.85 million after allowing for the deductible. This is the third recent seven-figure trial verdict against the same recalcitrant insurer that refuses to pay fair values to its insureds. You may recall this prior post regarding that situation; the following is the key excerpt from an interview of my partner Mike Childress.
"We tried a seven-figure case last year after the insurance lawyer said that, if he could not win that particular trial, he should just return the rest of the files involving claims against that insurer. We have twelve cases against that same insurer, all of which involve the same type of loss. Our client won full damages at trial, but the insurer is still refusing to settle the remaining cases. In fact, it is the second case we have tried against this insurer and won. So, we will try the rest of the cases."
"We tried a seven-figure case last year after the insurance lawyer said that, if he could not win that particular trial, he should just return the rest of the files involving claims against that insurer. We have twelve cases against that same insurer, all of which involve the same type of loss. Our client won full damages at trial, but the insurer is still refusing to settle the remaining cases. In fact, it is the second case we have tried against this insurer and won. So, we will try the rest of the cases."
GlobalTort is Moving to a New Platform
As of later today or tomorrow, GlobalTort is moving to a new Internet home with LexBlog. A new home is needed because this platform lacks a reliable spell checker and various other "back end" utilities that make writing easier. I'm also told some browsers could not reliably hit the site.
Your browser should make the change without you having to do anything, but if you have a problem, please let me know at khartley@cdglawyers.com. The subscription options also will be broader.
Your browser should make the change without you having to do anything, but if you have a problem, please let me know at khartley@cdglawyers.com. The subscription options also will be broader.
Tuesday, February 23, 2010
Actual Great Results from New Cancer Therapies Tailored to Particular Genomes !!!!!
God love smart scientists and doctors ! Back in February, this post covered some of the ground on medical treatments aimed at individual genomes. In August, this post reported on Abbbott and Pfizer working in creating a gene chip to screen patients with a specific type of cancer for specific genomic changes so that a clinical trial can be run using people with that specific genomic defect. In this week of focus on health care, it is just plain wonderful to read that similar approaches are starting to produce the "miracles" needed for some of the almost 1.5 million Americans who will be diagnosed with cancer this year.
The specifics ? Now coming on line are humane therapies - pills !- tailored to particular changes in individual genomes. These therapies are actually shrinking tumors, and are doing so without the incredible brutality of chemotherapy and bone marrow transplants. There are still issues and uncertainties ahead, but these types of results prove the merit to treating specific genomes.
Here are the absolute key quotes from an article this morning in the NYT:
"The trial of PLX4032 offers a glimpse at how doctors, patients and drug developers navigate a medical frontier as more drugs tailored to the genetic profile of a cancer are being widely tested on humans for the first time.
Throughout the fall, the only two patients on the trial whose tumors continued to grow were the ones who did not have the particular gene mutation for which the drug had been designed. They were removed from the trial. By late December, tumors in the 11 patients who did have the mutation had shrunk. Those involved in the trial held their collective breath waiting to see how long the remissions would last. "
The entire article is here; addtional key excerpts on the science are pasted below. The entire article is well worth reading for the human side of the story.
_____________________________________________________________________________
February 23, 2010
Target CancerAfter Long Fight, Drug Gives Sudden Reprieve
By AMY HARMON
For the melanoma patients who signed on to try a drug known as PLX4032, the clinical trial was a last resort. Their bodies were riddled with tumors, leaving them almost certainly just months to live.
But a few weeks after taking their first dose, nearly all of them began to recover.
Lee Reyes, 30, of Fresno, Calif., who had begun using a feeding tube because of a growth pressing against his throat, bit into a cinnamon roll.
Rita Quigley, who had been grateful just to find herself breathing each morning since learning she had the virulent skin cancer, went shopping for new clothes with her daughters at a mall in Huntsville, Ala.
Randy Williams, 46, who drove 600 miles from his home in Jonesboro, Ark., to the M.D. Anderson Cancer Center in Houston to get the experimental drug, rolled out of bed. “Something’s working,” he thought, “because nothing’s hurting.”
It was a sweet moment, in autumn 2008, for Dr. Keith Flaherty, the University of Pennsylvania oncologist leading the drug’s first clinical trial. A new kind of cancer therapy, it was tailored to a particular genetic mutation that was driving the disease, and after six years of disappointments his faith in the promise of such a “targeted” approach finally seemed borne out. His collaborators at five other major cancer centers, melanoma clinicians who had tested dozens of potential therapies for their patients with no success, were equally elated.
In a kind of “pinch me” exercise, the six doctors sent one another “before and after” CT scans of their patients.
One was of Mark Bunting, 52, an airline pilot in Sandy, Utah. His initial scan in early October showed the cancer in his bones, an incursion considered virtually impossible to reverse. After two months on the drug, it had all but disappeared.
“Holy Cow!” Dr. Flaherty typed in reply to the slide from Dr. Antoni Ribas at the University of California, Los Angeles, that Dec. 17.
The trial of PLX4032 offers a glimpse at how doctors, patients and drug developers navigate a medical frontier as more drugs tailored to the genetic profile of a cancer are being widely tested on humans for the first time.
Throughout the fall, the only two patients on the trial whose tumors continued to grow were the ones who did not have the particular gene mutation for which the drug had been designed. They were removed from the trial. By late December, tumors in the 11 patients who did have the mutation had shrunk. Those involved in the trial held their collective breath waiting to see how long the remissions would last.
It was a far cry from where they had been a year earlier, when a previous incarnation of the drug had no effect. Urged on by Dr. Flaherty and Dr. Chapman, the companies that owned it had spent months devising a new formulation that could be absorbed at higher doses.
But the new drug, still in the earliest phase of testing, had to pass several more hurdles before federal regulators would determine whether it was safe and effective enough for widespread use.
In December, as the doctors added more patients to the Phase 1 trial, looking for the highest dose they could give without intolerable side effects, they scrambled to prepare slides with graphs and statistics to convince the Food and Drug Administration that the drug should be tested in a larger Phase 2 trial. The agency required a summary of any and all side effects — there had been only a few — and any deaths of patients on the study; thankfully, there had been none since the drug was reformulated. In a matter of days they needed to submit their findings for a prestigious meeting of clinical oncologists in June.
The trial in Bethesda, run by the National Cancer Institute, involved coaxing immune cells to grow in a test tube in a procedure that worked for only a small fraction of patients, Dr. Flaherty knew.
But there would be no point in Mr. Nelson taking PLX4032 if his tumor did not carry the right mutation. For now, the doctor had a slot for only one more patient on the trial, and he and his collaborators had agreed it was almost unethical to give the drug to people without that mutation.
He wished, not for the first time, that he could snap his fingers and know the genetic profile of his patient’s cancer cells. But getting a hospital that had operated on a patient months earlier to retrieve a tumor sample from storage could take days or weeks; the test for the gene mutation could take even longer. To speed the process, Mr. Nelson drove his tumor sample himself from Robert Wood Johnson University Hospital in New Brunswick, N.J., where it had been removed from his lymph nodes, to the laboratory at the University of Pennsylvania.
Once unleashed, however, any cancer seemed to rely on the protein made by a particular mutated gene to fuel its wild growth. In all of the PLX patients, that gene was B-RAF. And whatever the cause, they came to consider themselves, so far as it was possible with what has always been a virtually untreatable cancer, charmed.
Dialing Back
The side effects struck at the 1,120-milligram dose.
Many patients had been taking the reformulated drug for five months with no signs of relapsing. The doctors had hoped that by pushing up the dose they could shut down the cancer more effectively. Some patients were taking as many as 28 pills a day.
Ms. Adams, in Oklahoma City, woke up one morning covered in a rash. Frightened that she would be dropped from the trial, she tried to ignore it. But at work, her boss was horrified and insisted that she call the doctor. Another woman’s hand swelled up, and she could not make a fist. A Philadelphia patient had horrible nausea and diarrhea, and Mr. Bunting’s joints grew so stiff that he had to hand jars to his wife to remove the lids, even when they had already been opened.
Maybe the drug, designed to turn off only the defective B-RAF protein, was, at high doses, also affecting its role in healthy cells. Or perhaps it was interfering with other proteins the body needed to function properly. On their next conference call, the doctors agreed that they had to dial back the dose.
As the side effects began to subside, many of the patients began to believe they had beaten their cancer. One evening, Mr. Bunting performed what had become his pill-taking ritual as his wife puttered around the kitchen.
One Step Forward ...
When Mr. Nelson strolled into the University of Pennsylvania for a scheduled day of blood work and monitoring in mid-March, Ms. Redlinger greeted him as if he had risen from the dead.
Gazing out the window of the clinic room, he spied a hot dog stand.
He had never seen a melanoma patient who had been that sick improve that much. He was not sure he had ever seen a melanoma patient that sick who improved at all.
The first patient to respond in the trial, Elmer Bucksbaum, had been admitted to the hospital. The cancer had spread to his brain.
Dr. Flaherty stopped walking.
The drug, Dr. Flaherty knew, was powerless in the brain. But had the drug held off the cancer elsewhere in Mr. Bucksbaum’s body? Or would other patients, too, begin to relapse?
Mr. Bucksbaum died a few days later.
Wednesday: The Next Hurdle.
The specifics ? Now coming on line are humane therapies - pills !- tailored to particular changes in individual genomes. These therapies are actually shrinking tumors, and are doing so without the incredible brutality of chemotherapy and bone marrow transplants. There are still issues and uncertainties ahead, but these types of results prove the merit to treating specific genomes.
Here are the absolute key quotes from an article this morning in the NYT:
"The trial of PLX4032 offers a glimpse at how doctors, patients and drug developers navigate a medical frontier as more drugs tailored to the genetic profile of a cancer are being widely tested on humans for the first time.
Throughout the fall, the only two patients on the trial whose tumors continued to grow were the ones who did not have the particular gene mutation for which the drug had been designed. They were removed from the trial. By late December, tumors in the 11 patients who did have the mutation had shrunk. Those involved in the trial held their collective breath waiting to see how long the remissions would last. "
The entire article is here; addtional key excerpts on the science are pasted below. The entire article is well worth reading for the human side of the story.
_____________________________________________________________________________
February 23, 2010
Target CancerAfter Long Fight, Drug Gives Sudden Reprieve
By AMY HARMON
For the melanoma patients who signed on to try a drug known as PLX4032, the clinical trial was a last resort. Their bodies were riddled with tumors, leaving them almost certainly just months to live.
But a few weeks after taking their first dose, nearly all of them began to recover.
Lee Reyes, 30, of Fresno, Calif., who had begun using a feeding tube because of a growth pressing against his throat, bit into a cinnamon roll.
Rita Quigley, who had been grateful just to find herself breathing each morning since learning she had the virulent skin cancer, went shopping for new clothes with her daughters at a mall in Huntsville, Ala.
Randy Williams, 46, who drove 600 miles from his home in Jonesboro, Ark., to the M.D. Anderson Cancer Center in Houston to get the experimental drug, rolled out of bed. “Something’s working,” he thought, “because nothing’s hurting.”
It was a sweet moment, in autumn 2008, for Dr. Keith Flaherty, the University of Pennsylvania oncologist leading the drug’s first clinical trial. A new kind of cancer therapy, it was tailored to a particular genetic mutation that was driving the disease, and after six years of disappointments his faith in the promise of such a “targeted” approach finally seemed borne out. His collaborators at five other major cancer centers, melanoma clinicians who had tested dozens of potential therapies for their patients with no success, were equally elated.
In a kind of “pinch me” exercise, the six doctors sent one another “before and after” CT scans of their patients.
One was of Mark Bunting, 52, an airline pilot in Sandy, Utah. His initial scan in early October showed the cancer in his bones, an incursion considered virtually impossible to reverse. After two months on the drug, it had all but disappeared.
“Holy Cow!” Dr. Flaherty typed in reply to the slide from Dr. Antoni Ribas at the University of California, Los Angeles, that Dec. 17.
The trial of PLX4032 offers a glimpse at how doctors, patients and drug developers navigate a medical frontier as more drugs tailored to the genetic profile of a cancer are being widely tested on humans for the first time.
Throughout the fall, the only two patients on the trial whose tumors continued to grow were the ones who did not have the particular gene mutation for which the drug had been designed. They were removed from the trial. By late December, tumors in the 11 patients who did have the mutation had shrunk. Those involved in the trial held their collective breath waiting to see how long the remissions would last.
It was a far cry from where they had been a year earlier, when a previous incarnation of the drug had no effect. Urged on by Dr. Flaherty and Dr. Chapman, the companies that owned it had spent months devising a new formulation that could be absorbed at higher doses.
But the new drug, still in the earliest phase of testing, had to pass several more hurdles before federal regulators would determine whether it was safe and effective enough for widespread use.
In December, as the doctors added more patients to the Phase 1 trial, looking for the highest dose they could give without intolerable side effects, they scrambled to prepare slides with graphs and statistics to convince the Food and Drug Administration that the drug should be tested in a larger Phase 2 trial. The agency required a summary of any and all side effects — there had been only a few — and any deaths of patients on the study; thankfully, there had been none since the drug was reformulated. In a matter of days they needed to submit their findings for a prestigious meeting of clinical oncologists in June.
The trial in Bethesda, run by the National Cancer Institute, involved coaxing immune cells to grow in a test tube in a procedure that worked for only a small fraction of patients, Dr. Flaherty knew.
But there would be no point in Mr. Nelson taking PLX4032 if his tumor did not carry the right mutation. For now, the doctor had a slot for only one more patient on the trial, and he and his collaborators had agreed it was almost unethical to give the drug to people without that mutation.
He wished, not for the first time, that he could snap his fingers and know the genetic profile of his patient’s cancer cells. But getting a hospital that had operated on a patient months earlier to retrieve a tumor sample from storage could take days or weeks; the test for the gene mutation could take even longer. To speed the process, Mr. Nelson drove his tumor sample himself from Robert Wood Johnson University Hospital in New Brunswick, N.J., where it had been removed from his lymph nodes, to the laboratory at the University of Pennsylvania.
Once unleashed, however, any cancer seemed to rely on the protein made by a particular mutated gene to fuel its wild growth. In all of the PLX patients, that gene was B-RAF. And whatever the cause, they came to consider themselves, so far as it was possible with what has always been a virtually untreatable cancer, charmed.
Dialing Back
The side effects struck at the 1,120-milligram dose.
Many patients had been taking the reformulated drug for five months with no signs of relapsing. The doctors had hoped that by pushing up the dose they could shut down the cancer more effectively. Some patients were taking as many as 28 pills a day.
Ms. Adams, in Oklahoma City, woke up one morning covered in a rash. Frightened that she would be dropped from the trial, she tried to ignore it. But at work, her boss was horrified and insisted that she call the doctor. Another woman’s hand swelled up, and she could not make a fist. A Philadelphia patient had horrible nausea and diarrhea, and Mr. Bunting’s joints grew so stiff that he had to hand jars to his wife to remove the lids, even when they had already been opened.
Maybe the drug, designed to turn off only the defective B-RAF protein, was, at high doses, also affecting its role in healthy cells. Or perhaps it was interfering with other proteins the body needed to function properly. On their next conference call, the doctors agreed that they had to dial back the dose.
As the side effects began to subside, many of the patients began to believe they had beaten their cancer. One evening, Mr. Bunting performed what had become his pill-taking ritual as his wife puttered around the kitchen.
One Step Forward ...
When Mr. Nelson strolled into the University of Pennsylvania for a scheduled day of blood work and monitoring in mid-March, Ms. Redlinger greeted him as if he had risen from the dead.
Gazing out the window of the clinic room, he spied a hot dog stand.
He had never seen a melanoma patient who had been that sick improve that much. He was not sure he had ever seen a melanoma patient that sick who improved at all.
The first patient to respond in the trial, Elmer Bucksbaum, had been admitted to the hospital. The cancer had spread to his brain.
Dr. Flaherty stopped walking.
The drug, Dr. Flaherty knew, was powerless in the brain. But had the drug held off the cancer elsewhere in Mr. Bucksbaum’s body? Or would other patients, too, begin to relapse?
Mr. Bucksbaum died a few days later.
Wednesday: The Next Hurdle.
Sunday, February 21, 2010
Sovereigns and Their Roles Related to Commercial Activities Involving Substances that Present Health Risks
Here's an invitation for readers to guest blog or comment on a question related to mass tort litigation, governments and substances that are extracted and exported despite known health risks and the absence of complete certainty regarding health effects. Feel free to reframe the question, but I see it as:
when, if ever, should government agencies and/or officials be held liable for statements or other actions taken in support of commercial mining, extracting, distributing or manufacturing of substances known to have some health risks. For example, mining , exporting and manufacturing involving chrysotile asbestos fibers.
Obviously various sovereign immnunity doctrines already exist and tend to draw lines between tradtional government activties, discretionary functions, and commercial activities. Those lines and these issues seem to me likely to face renewed scrutiny over the next few years due to increased globalization and explicit government outreach to and involvement in commercial activities with international impacts. For some context for the question, consider this prior post regarding "aiding and abetting" claims asserted against two goverments for assisting the Stanford ponzi scheme. Consider also a recent article regarding Canadian physicians accusing Canadian officials of issuing misleading statements about the absence or presence of health hazards from chrsyotile asbestos fibers. The text pasted below is from this February 12, 2010 article by Michelle Lalonde from the Canadian Gazette.
__________________________________________________________________________________
On hot seat over asbestos
Physicians attack Premier; Damning report rebuts his contention mineral can have benign uses
By MICHELLE LALONDE, The GazetteFebruary 12, 2010
Just as a group of prominent Canadian physicians accuse Premier Jean Charest of lying to the public about asbestos, another damning report on the mineral will be published today in the American Journal of Industrial Medicine.
Charest recently returned from a trade mission in India, where anti-asbestos protesters accused his government of hypocrisy for exporting the cancer-causing mineral to developing countries while removing it from Quebec schools and public buildings because of health concerns.
On the trade mission, the premier was quoted in La Presse as saying "Chrysotile (asbestos) can be used in a safe manner; this is what WHO reports say. It is not a banned substance. It is up to the government of India to put the necessary laws in place."
In fact, the World Health Organization has said that all types of asbestos, including the type mined in Quebec (chrysotile) cause asbestosis, mesothelioma and cancer of the lung, and recommends against continued use of any form of asbestos. The International Labour Organization adopted a resolution in 2006 urging the elimination of use of all forms of asbestos and of materials containing asbestos.
A group of 14 Canadian physicians, including McGill University's Abby Lippman and Dick Menzies of the Montreal Chest Institute, sent a letter to Charest yesterday expressing their "shock" at his statements and accusing him of misrepresenting the position of the World Health Organization.
"Premier Charest, you have the right to oppose the WHO position. However, and especially because of the public trust in your position, you do not have the right to misrepresent the WHO position as being what you perhaps wish it were, instead of what it is," the letter says.
Menzies, a respiratory physician at the Montreal Chest Institute and one of the signatories of the letter, said selling asbestos to countries that clearly lack the resources to enforce workplace safety standards is like selling guns to children. You can say that you warned them about the danger, but it is still morally unacceptable.
"They simply do not have the same workplace safety standards we do here. To argue that it is not a carcinogen is ludicrous. To argue that it's dangerous, but it is their responsibility to handle it safely is a moral question."
The physicians have asked for a meeting with the premier on the issue, and also urged him to clarify his statement. Calls by The Gazette to the premier's office were not returned.
Meanwhile, a report to be published today in the March issue of the American Journal of Industrial Medicine shows the devastating impact Quebec's asbestos is having on the health of workers in Mexico who come into contact with the mineral.
The researchers looked at 472 Mexican workers, 119 of whom had been found to have pleural mesothelioma, a fatal lung disease. More than 80 per cent of those with the disease had been exposed to asbestos on the job.
"Our results show a clear relationship between industrial use of all types of asbestos and malignant pleural mesothelioma, and in Mexico the major type of asbestos is chrysotile imported from Canada, confirming that asbestos is a carcinogenic agent that has been recognized as such by the IARC (International Agency for Research on Cancer) since 1977," the report says.
The cost of medical attention for each mesothelioma case during the first year of treatment was estimated at $8,238 U.S.
"The social and economic impact of these diseases and asbestos-related deaths should be absorbed by the industries that have generated the damage and not by the health institutions, as it occurs at present," the authors conclude.
mlalonde@thegazette.canwest.com
© Copyright (c) The Montreal Gazette
Read more: http://www.montrealgazette.com/health/seat+over+asbestos/2553167/story.html#ixzz0gBdvY3kv
when, if ever, should government agencies and/or officials be held liable for statements or other actions taken in support of commercial mining, extracting, distributing or manufacturing of substances known to have some health risks. For example, mining , exporting and manufacturing involving chrysotile asbestos fibers.
Obviously various sovereign immnunity doctrines already exist and tend to draw lines between tradtional government activties, discretionary functions, and commercial activities. Those lines and these issues seem to me likely to face renewed scrutiny over the next few years due to increased globalization and explicit government outreach to and involvement in commercial activities with international impacts. For some context for the question, consider this prior post regarding "aiding and abetting" claims asserted against two goverments for assisting the Stanford ponzi scheme. Consider also a recent article regarding Canadian physicians accusing Canadian officials of issuing misleading statements about the absence or presence of health hazards from chrsyotile asbestos fibers. The text pasted below is from this February 12, 2010 article by Michelle Lalonde from the Canadian Gazette.
__________________________________________________________________________________
On hot seat over asbestos
Physicians attack Premier; Damning report rebuts his contention mineral can have benign uses
By MICHELLE LALONDE, The GazetteFebruary 12, 2010
Just as a group of prominent Canadian physicians accuse Premier Jean Charest of lying to the public about asbestos, another damning report on the mineral will be published today in the American Journal of Industrial Medicine.
Charest recently returned from a trade mission in India, where anti-asbestos protesters accused his government of hypocrisy for exporting the cancer-causing mineral to developing countries while removing it from Quebec schools and public buildings because of health concerns.
On the trade mission, the premier was quoted in La Presse as saying "Chrysotile (asbestos) can be used in a safe manner; this is what WHO reports say. It is not a banned substance. It is up to the government of India to put the necessary laws in place."
In fact, the World Health Organization has said that all types of asbestos, including the type mined in Quebec (chrysotile) cause asbestosis, mesothelioma and cancer of the lung, and recommends against continued use of any form of asbestos. The International Labour Organization adopted a resolution in 2006 urging the elimination of use of all forms of asbestos and of materials containing asbestos.
A group of 14 Canadian physicians, including McGill University's Abby Lippman and Dick Menzies of the Montreal Chest Institute, sent a letter to Charest yesterday expressing their "shock" at his statements and accusing him of misrepresenting the position of the World Health Organization.
"Premier Charest, you have the right to oppose the WHO position. However, and especially because of the public trust in your position, you do not have the right to misrepresent the WHO position as being what you perhaps wish it were, instead of what it is," the letter says.
Menzies, a respiratory physician at the Montreal Chest Institute and one of the signatories of the letter, said selling asbestos to countries that clearly lack the resources to enforce workplace safety standards is like selling guns to children. You can say that you warned them about the danger, but it is still morally unacceptable.
"They simply do not have the same workplace safety standards we do here. To argue that it is not a carcinogen is ludicrous. To argue that it's dangerous, but it is their responsibility to handle it safely is a moral question."
The physicians have asked for a meeting with the premier on the issue, and also urged him to clarify his statement. Calls by The Gazette to the premier's office were not returned.
Meanwhile, a report to be published today in the March issue of the American Journal of Industrial Medicine shows the devastating impact Quebec's asbestos is having on the health of workers in Mexico who come into contact with the mineral.
The researchers looked at 472 Mexican workers, 119 of whom had been found to have pleural mesothelioma, a fatal lung disease. More than 80 per cent of those with the disease had been exposed to asbestos on the job.
"Our results show a clear relationship between industrial use of all types of asbestos and malignant pleural mesothelioma, and in Mexico the major type of asbestos is chrysotile imported from Canada, confirming that asbestos is a carcinogenic agent that has been recognized as such by the IARC (International Agency for Research on Cancer) since 1977," the report says.
The cost of medical attention for each mesothelioma case during the first year of treatment was estimated at $8,238 U.S.
"The social and economic impact of these diseases and asbestos-related deaths should be absorbed by the industries that have generated the damage and not by the health institutions, as it occurs at present," the authors conclude.
mlalonde@thegazette.canwest.com
© Copyright (c) The Montreal Gazette
Read more: http://www.montrealgazette.com/health/seat+over+asbestos/2553167/story.html#ixzz0gBdvY3kv
Saturday, February 20, 2010
Even Newer Uses of Social Media as a Marketing Tool for Law Firms Seeking Mesothelioma Clients
By now I trust everyone is used to many of he marketing approaches to reach mesothelioma victims. Here's a new one for me - some members of the asbestos plainiff's bar are now marketing themselve using social media and a "cause" to ask other people to go out and ceate videos to promote asbestos awareness. Go here to see the online version of the press release pasted below.
________________________________________________________________________________
"Nationwide Video Search Kicks off Ban Asbestos Campaign
Students Can Submit Videos for Chance to Win Trip to LA Film Festival
WELLESLEY, Mass., Feb. 10 /PRNewswire/ -- "Ban Asbestos Now," a campaign to build awareness of the continued use of asbestos in the United States, today launched the Ban Asbestos Now Video Search, asking students across the United States to use their creativity to draw national attention to the toxic, and often deadly, substance considered "the largest manmade public health crisis in history" according to the Asbestos Disease Awareness Organization (ADAO).
Each year, 2000-3000 people are diagnosed with mesothelioma, a rare form of cancer which is almost always caused by exposure to asbestos. Asbestos has been banned in some 50 countries, however it still exists potentially everywhere throughout the United States, including the ceilings and floors of building that were built before 1980, duct tape, caulking, textured paints, car brakes and automotive parts, and even children's toys.
To help eliminate this deadly killer, the "Ban Asbestos Now" Campaign asks students at colleges, universities and film schools across the United States to submit videos that drive attention to the national asbestos problem and compel Americans to join the movement to "Ban Asbestos Now." To enter the search, students, in teams of no more than 4, need to create a 90-120 second video vignette that addresses such questions such as, "Did You Know Asbestos Is Still Legal in the US?", "Where Can You Find It?", and "Do You Know What Diseases It Can Cause?"
The winning individual or team will be sent to the world famous 2010 Los Angeles Film Festival in Westwood Village, with $1000 cash per team member, and the winning video may become the viral platform of the "Ban Asbestos Now" campaign at www.BanAsbestosNow.com. The winner will be announced on May 19th, 2010 by a select judge's panel chosen by Sokolove Law.
Please visit www.BanAsbestosNow.net to view our Ban Asbestos Now Video Search Toolkit, which includes contest rules, video creation and submission guidelines, and promotional materials. You may also contact Sean Galliher at sgalliher@sokolovelaw.com.
About Ban Asbestos Now
The Ban Asbestos Now campaign is designed to generate awareness that asbestos is toxic, deadly and still legal in the United States, despite being banned in some 50 countries. Each year, 2000-3000 people continue to be diagnosed with mesothelioma, a rare form of cancer which is almost always caused by exposure to asbestos. The Ban Asbestos Now campaign urges Americans to draw attention to the national asbestos problem by joining the movement to ban the deadly substance in the United States. Learn more about Ban Asbestos Now at www.BanAsbestosNow.com.
About Sokolove Law
For nearly 30 years, Sokolove Law has reinvented how people obtain legal services. Our mission is to provide equal access to the civil justice system while ensuring superior quality legal representation. As a pioneer in legal advertising, Sokolove Law has grown to be the largest marketer of legal services in the country. Our proven business model matches particular client needs to the more than 400 law firms that we work with. The result is success for our clients and co-counsel. Sokolove Law operates as a limited liability company in all states except Virginia, California, Michigan, and Tennessee, where it operates as a limited liability partnership. Learn more about Sokolove Law at www.sokolovelaw.com.
SOURCE Sokolove Law
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________________________________________________________________________________
"Nationwide Video Search Kicks off Ban Asbestos Campaign
Students Can Submit Videos for Chance to Win Trip to LA Film Festival
WELLESLEY, Mass., Feb. 10 /PRNewswire/ -- "Ban Asbestos Now," a campaign to build awareness of the continued use of asbestos in the United States, today launched the Ban Asbestos Now Video Search, asking students across the United States to use their creativity to draw national attention to the toxic, and often deadly, substance considered "the largest manmade public health crisis in history" according to the Asbestos Disease Awareness Organization (ADAO).
Each year, 2000-3000 people are diagnosed with mesothelioma, a rare form of cancer which is almost always caused by exposure to asbestos. Asbestos has been banned in some 50 countries, however it still exists potentially everywhere throughout the United States, including the ceilings and floors of building that were built before 1980, duct tape, caulking, textured paints, car brakes and automotive parts, and even children's toys.
To help eliminate this deadly killer, the "Ban Asbestos Now" Campaign asks students at colleges, universities and film schools across the United States to submit videos that drive attention to the national asbestos problem and compel Americans to join the movement to "Ban Asbestos Now." To enter the search, students, in teams of no more than 4, need to create a 90-120 second video vignette that addresses such questions such as, "Did You Know Asbestos Is Still Legal in the US?", "Where Can You Find It?", and "Do You Know What Diseases It Can Cause?"
The winning individual or team will be sent to the world famous 2010 Los Angeles Film Festival in Westwood Village, with $1000 cash per team member, and the winning video may become the viral platform of the "Ban Asbestos Now" campaign at www.BanAsbestosNow.com. The winner will be announced on May 19th, 2010 by a select judge's panel chosen by Sokolove Law.
Please visit www.BanAsbestosNow.net to view our Ban Asbestos Now Video Search Toolkit, which includes contest rules, video creation and submission guidelines, and promotional materials. You may also contact Sean Galliher at sgalliher@sokolovelaw.com.
About Ban Asbestos Now
The Ban Asbestos Now campaign is designed to generate awareness that asbestos is toxic, deadly and still legal in the United States, despite being banned in some 50 countries. Each year, 2000-3000 people continue to be diagnosed with mesothelioma, a rare form of cancer which is almost always caused by exposure to asbestos. The Ban Asbestos Now campaign urges Americans to draw attention to the national asbestos problem by joining the movement to ban the deadly substance in the United States. Learn more about Ban Asbestos Now at www.BanAsbestosNow.com.
About Sokolove Law
For nearly 30 years, Sokolove Law has reinvented how people obtain legal services. Our mission is to provide equal access to the civil justice system while ensuring superior quality legal representation. As a pioneer in legal advertising, Sokolove Law has grown to be the largest marketer of legal services in the country. Our proven business model matches particular client needs to the more than 400 law firms that we work with. The result is success for our clients and co-counsel. Sokolove Law operates as a limited liability company in all states except Virginia, California, Michigan, and Tennessee, where it operates as a limited liability partnership. Learn more about Sokolove Law at www.sokolovelaw.com.
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Friday, February 19, 2010
Schemes of Arrangement - CSR's Demerger Effort Thwarted by Objections Regarding Its Potential Asbestos Obligations
What a great legal term of art - "scheme of arrangement." The term has multiple but related nuanced meanings and applications because "schemes" are essentially corporate law opportunities to end or alter the business life or structure of a corporation. Depending on the nation and the particualr use, schemes may have varying outcomes when used in the diverse ways that are possible in the various nations that arise from the former British Empire.
This post focuses on an attempted "scheme" under Australian corporate law. In this instance, the scheme consists of the efforts of a public company, CSR, to move forward with a "demerger" (a "spin-off" in the US) that would split one public company into two "more focused" public companies. Only one of the emerging companies would, they hope, be liable for asbestos bodily injury or property damage claims that will or may arise from past ownership of a crocidolite mine and sales of various asbestos-containing products. Thus, by dividing the ompany into two peices. the proposed demerger would reduce the amount of corporate assets available to pay the current and potential future asbestos claims that arise from past business operations. The opinin explains the numbers as follows: "In its financial statements for the half year ended 30 September 2009 CSR has recognised a provision of A$446.8 million for current and future asbestos liabilities. This comprises 10% of CSR’s total assets as at 30 September 2009 but, based on the pro forma balance sheet produced by CSR as at 30 September 2009, would comprise 18% of New CSR’s assets at that date."
To date, the scheme has not succeeded because the trial judge hearing the petition agreed with objections involving the ability to pay future asbestos claim expenses. Who were the objectors ? According to the opinion, " The proposed capital reduction has prompted considerable interest in, and opposition to, the Scheme. This was evidenced by the Australian Securities and Investments Commission (ASIC) and a number of objectors seeking, and being given, leave to intervene in the proceeding when it first came before the Court on 17 December 2009. The matter was then adjourned to allow the objectors and ASIC time to obtain expert assistance in reviewing the Scheme. The objectors were [underlying case co-defendants ] James Hardie Industries NV and James Hardie 117 Pty Limited (together “James Hardie”), the Asbestos Injuries Compensation Fund Limited (under NSW administered winding up), AMACA Pty Limited (under NSW administered winding up) and AMABA Pty Limited (under NSW administered winding up) (together “AICF”) and the Attorney-General for the State of New South Wales (NSW). The objectors all opposed the Scheme and argued against the Court making the orders sought by CSR. ...ASIC and the objectors were concerned only with potential prejudice to asbestos claimants, that is persons who now have, or in the future may have, a claim for compensation from CSR for injury sustained from exposure to asbestos." The trial court opinion rejecting the scheme certainly was less enjoyable for management than a succesful 2003 scheme,
The CSR scheme is interesting on a comparative law basis and a social basis. Thus, in the US, companies have often enough spun off liability-laden entities without the SEC and other entities seeking to block the spin-off, and instead simply reacting later, as was done with Tronox. In contrast, the objections here were a subject of popular media coverage as to objections of the Australian Securities and Investment Comission, regional Australian governments, and the various James Hardie interests that arise from James Hardie entities being co-defendants in underlying asbestos cases. The objections by codefendant Hardie entities arlso are noteworthy in view of Hardie previously undertaking to create a foundation to manage and pay for its own asbestos litigation and then moving from Australia to the Netehrlands as part of it's own asbestos-related scheme, a move more recently followed by Hardie moving from the Netherlands to tax-haven Ireland. Moreover, some of Hardie's officers and directors recently were convicted of criminal securities law violations arising from public statements on estimates of future asbestos expenses (this prior post links to the opinion/judgment) because the trial judge appears not to have believed the testimony of the directors. And as described yesterday, Hardie and CSR apparently now are quarreling over their respective obligations in particular asbestos cases.
Another noteworthy part of the opinion revolves around certainty. Thus, the opinion refers to a suggestion that the 2d demerger entity provide a guarantee for the entity holding the asbestos liabilities. See paragraphs 37-38. That suggestion was rejected, and thus the trial judge wrote: " I understand that CSR did not regard the suggestion as attractive. Its submissions in reply noted that the proposal “would significantly alter the commercial characteristics of the proposed demerger”. In particular it was said that the proposal would subject Sucrogen “to a contingent liability over which it had no effective control, which had no correlation to its business revenue and which offered no commercial return or benefit”. Thus, CSR's response seesm to illustrate a reality I mentioned yesterday in the context of entities emerging from bankruptcy : bankers and investors will always want and seek a predictable free cash flow to sell at a multiple.
The other side of that coin, however, is that the court was unwilling to give the business entities the certainty they want. Why? Because past conduct created enormous uncertainties for exposed persons, and unless science can change the outcomes, thousands of the currently uncertain individuals will in the future suffer painful deaths from mesothelioma, a point raised explicitly by counsel for the New South Wales region. Thus, the trial judge explained:
"There is one last issue to be addressed, namely the submissions made for NSW. Mr Oakes SC who appeared for NSW stated that from his client's point of view the central issue is:
[W]ho in the future should bear the risks if asbestos claims projections are too low, or that actual cash flow is too low because of the inherent uncertainties in long-term earnings and cash flow forecasts ... ? So the question is: should the risks be borne by the businesses that currently comprise the CSR group and, thus, indirectly by the CSR shareholders, or should the risks be borne by the current and future asbestos claimants? Our submission is the risks shouldn’t be borne by the current and future asbestos claimants ...
A final point. The opinion is frustrating because it alludes to various expert future expense predictions submitted by the parties, but does not go into detail, deeming the information confidential. As a lawyer for corporations, I understand the desires and arguments for secrecy. That said, the law develops through precedent, and it’s much harder to apply and learn from precedent when crucial facts are not on the public record and are not explicitly addressed in the opinion. Courts and companies face difficult issues ahead in trying to balance the competing considerations as to secrecy. Set out below are the statements the court did put on the record regarding the predictions of future expenses.
“Analyses of expert reports
31. It is not possible to give detailed analysis of the confidential reports, however, the flavour of the debate is reflected in submissions made on behalf of those commissioning the various reports. For example, the written submissions for ASIC contain 12 pages of detailed analysis of the actuarial material concerning asbestos liabilities and financial stress testing. The submissions analyse the CSR actuarial material including the expert reports and advice provided by Taylor Fry and Navigant, the expert reviews of that material by KPMG and Ernst & Young as well as the response of the CSR advisers. The submissions set out ASIC’s conclusions in relation to the actuarial material as follows:
First it is self evident that there is considerable uncertainty surrounding any process of actuarially assessing future asbestos liabilities. Notwithstanding that CSR ceased involvement in asbestos related activities in 1977 both [Taylor Fry] and Navigant have continually being [sic] revising their central estimates upwards from 2004 based on new information that emerges.
Second, as described above, there are limitations on the scope of the actuarial assessments which have the potential to under estimate the overall valuations.
Third, within the actuarial assessments there are significant matters of judgement over which reasonable minds may differ and which have considerable potential to adversely and materially affect the valuations. This is exemplified by the differences in professional opinion between KPMG and Taylor Fry in relation to both the central estimate and the 95th percentile estimate of the Australian liabilities.
Fourth, ASIC submits that in determining this application the Court need not embark upon the task of determining which expert is “correct” or to be preferred. Instead it should note the differences of professional opinion but, in the context of determining the application based on the approach outlined above, it should afford significant weight to the views expressed by KPMG at least so far as they affect the 95th percentile estimate provided by [Taylor Fry]. KPMG have significant expertise in the area and they have provided a detailed rationale for their opinion on these issues. Their views at least so far as they affect the 95th percentile estimates are supported by [Ernst & Young] and, in some limited respects, by Finity.
32. The submissions also analyse the financial stress testing that CSR had undertaken and the Ernst & Young review of this stress testing. The conclusion is stated as follows:
A review of the material concerning the financial analysis and stress testing undertaken by and on behalf of CSR reveals that there are a number of aspects of uncertainty surrounding such an exercise mainly:
(i) The obvious uncertainties that arise from any exercise of financial modelling the future performance of any business especially in the context of measuring its ability to meet long tail liabilities such as those that arise from asbestos use;
(ii) The limited external scrutiny of the assumptions and workings of the 5 year and 20 year financial models prepared by CSR management, the inputs to which most always primarily originate from CSR's management;
(iii) The judgements involved in identifying the various risks to the business, the relevant parameters for the “shock testing” and the exclusion of other forms of risk ...; and
(iv) The absence of any testing of the combination of a prolonged downturn and the high case estimates and the related questions of judgement as to whether it would be feasible for New CSR to respond to the various risks to the business under the shock scenarios that were stress tested.
33. CSR's submissions in reply make the following comments about the submissions made by ASIC:
In its written and oral submissions, ASIC ... sought to stress the uncertainties and limitations inherent in actuarial analyses of future events. Such a submission should not be taken too far.
By definition, any assessment of possible future events involves uncertainty and any attempt to actuarially assess such events will be subject to limitations. As the Court noted in argument, such uncertainties and limitations are equally applicable to CSR in its current structure as they are to CSR post-demerger. Provided that the advice provided to the CSR Board has been shown to be reasonable, the fact that the advice is subject to uncertainties does not warrant a conclusion that the advice should be rejected or lacks persuasive force.
Further, ... the doubts and uncertainties and the differences between the actuarial experts are of no relevance in circumstances where CSR's analysis has taken account of the full range of actuarial opinion. Cash outflows associated with the asbestos-related claims have been projected having regard to all “reasonable hypotheses”. Further, no party has sought to demonstrate a flaw in the other principal aspects of that analysis, namely the projection and “stress testing” of future cash inflows from CSR's de-merged business operations. That aspect of the analysis has been reviewed by PWC. It has also been reviewed on behalf of ASIC by [Ernst & Young] without unfavourable comment. In the light of the above, and as there is no correlation between risks attending the projected business cash inflows and the risks of under-estimation of the asbestos related cash outflows, the analysis provides a very high level of comfort that asbestos claims will be met.
ASIC's submissions should be read with this in mind. Its submissions are open to the criticisms that:
• they fail to reflect the conclusions of their own expert;
• they place undue focus on limitations and uncertainties that no actuary (including KPMG) can avoid without regard to the conclusions ultimately stated by the experts;
• they overstate the significance of the limitations and uncertainties ...
34. In addition to these criticisms CSR made detailed submissions in tabular form responding to the submissions made by AICF. Those submissions confirm that there is a genuine dispute between the experts as to the appropriate way to assess New CSR’s ability to meet future asbestos claims. The submissions made on behalf of James Hardie echoed the submissions of ASIC and AICF as well as making some additional criticisms of the provision made for New CSR to meet future asbestos claims.
35. In summary, the expert evidence presented by CSR, ASIC, and the other intervening parties brings into sharp relief the inherent uncertainty involved in any actuarial estimate of future asbestos-related claims and in particular the limitations and qualifications expressed in the actuarial reports relied on by CSR. In addition, specific issues raised by the experts retained by ASIC and AICF point to particular limitations in the material supplied by CSR’s experts in relation to future asbestos claims that cannot be reliably estimated at this time. The starting point in considering whether these flaws should lead to my not being satisfied that the provisions made in respect of asbestos-related claims following demerger are consistent with public policy or commercial morality must be:
(a) that New CSR will be the repository of all CSR's liabilities in respect of asbestos-related claims both present and future; and
(b) that it will suffer a significant reduction in the capital available to meet such claims.
36. The significance of those two factors increases with the uncertainty of the actuarial estimates and other expert opinion and is such that I cannot be satisfied that the provisions made are consistent with commercial morality or that the Scheme, if given effect, would not involve an unfair or oppressive result. Moreover, these same issues lead me to conclude that the material in the explanatory statement cannot provide adequate disclosure to CSR shareholders of New CSR's ability to meet these future liabilities. For both these reasons I have concluded that I should decline to make the orders for convening the Scheme meeting. In the circumstances, it is not necessary that I should consider the aspects of the Scheme that might otherwise be addressed at the first hearing.”
This post focuses on an attempted "scheme" under Australian corporate law. In this instance, the scheme consists of the efforts of a public company, CSR, to move forward with a "demerger" (a "spin-off" in the US) that would split one public company into two "more focused" public companies. Only one of the emerging companies would, they hope, be liable for asbestos bodily injury or property damage claims that will or may arise from past ownership of a crocidolite mine and sales of various asbestos-containing products. Thus, by dividing the ompany into two peices. the proposed demerger would reduce the amount of corporate assets available to pay the current and potential future asbestos claims that arise from past business operations. The opinin explains the numbers as follows: "In its financial statements for the half year ended 30 September 2009 CSR has recognised a provision of A$446.8 million for current and future asbestos liabilities. This comprises 10% of CSR’s total assets as at 30 September 2009 but, based on the pro forma balance sheet produced by CSR as at 30 September 2009, would comprise 18% of New CSR’s assets at that date."
To date, the scheme has not succeeded because the trial judge hearing the petition agreed with objections involving the ability to pay future asbestos claim expenses. Who were the objectors ? According to the opinion, " The proposed capital reduction has prompted considerable interest in, and opposition to, the Scheme. This was evidenced by the Australian Securities and Investments Commission (ASIC) and a number of objectors seeking, and being given, leave to intervene in the proceeding when it first came before the Court on 17 December 2009. The matter was then adjourned to allow the objectors and ASIC time to obtain expert assistance in reviewing the Scheme. The objectors were [underlying case co-defendants ] James Hardie Industries NV and James Hardie 117 Pty Limited (together “James Hardie”), the Asbestos Injuries Compensation Fund Limited (under NSW administered winding up), AMACA Pty Limited (under NSW administered winding up) and AMABA Pty Limited (under NSW administered winding up) (together “AICF”) and the Attorney-General for the State of New South Wales (NSW). The objectors all opposed the Scheme and argued against the Court making the orders sought by CSR. ...ASIC and the objectors were concerned only with potential prejudice to asbestos claimants, that is persons who now have, or in the future may have, a claim for compensation from CSR for injury sustained from exposure to asbestos." The trial court opinion rejecting the scheme certainly was less enjoyable for management than a succesful 2003 scheme,
The CSR scheme is interesting on a comparative law basis and a social basis. Thus, in the US, companies have often enough spun off liability-laden entities without the SEC and other entities seeking to block the spin-off, and instead simply reacting later, as was done with Tronox. In contrast, the objections here were a subject of popular media coverage as to objections of the Australian Securities and Investment Comission, regional Australian governments, and the various James Hardie interests that arise from James Hardie entities being co-defendants in underlying asbestos cases. The objections by codefendant Hardie entities arlso are noteworthy in view of Hardie previously undertaking to create a foundation to manage and pay for its own asbestos litigation and then moving from Australia to the Netehrlands as part of it's own asbestos-related scheme, a move more recently followed by Hardie moving from the Netherlands to tax-haven Ireland. Moreover, some of Hardie's officers and directors recently were convicted of criminal securities law violations arising from public statements on estimates of future asbestos expenses (this prior post links to the opinion/judgment) because the trial judge appears not to have believed the testimony of the directors. And as described yesterday, Hardie and CSR apparently now are quarreling over their respective obligations in particular asbestos cases.
Another noteworthy part of the opinion revolves around certainty. Thus, the opinion refers to a suggestion that the 2d demerger entity provide a guarantee for the entity holding the asbestos liabilities. See paragraphs 37-38. That suggestion was rejected, and thus the trial judge wrote: " I understand that CSR did not regard the suggestion as attractive. Its submissions in reply noted that the proposal “would significantly alter the commercial characteristics of the proposed demerger”. In particular it was said that the proposal would subject Sucrogen “to a contingent liability over which it had no effective control, which had no correlation to its business revenue and which offered no commercial return or benefit”. Thus, CSR's response seesm to illustrate a reality I mentioned yesterday in the context of entities emerging from bankruptcy : bankers and investors will always want and seek a predictable free cash flow to sell at a multiple.
The other side of that coin, however, is that the court was unwilling to give the business entities the certainty they want. Why? Because past conduct created enormous uncertainties for exposed persons, and unless science can change the outcomes, thousands of the currently uncertain individuals will in the future suffer painful deaths from mesothelioma, a point raised explicitly by counsel for the New South Wales region. Thus, the trial judge explained:
"There is one last issue to be addressed, namely the submissions made for NSW. Mr Oakes SC who appeared for NSW stated that from his client's point of view the central issue is:
[W]ho in the future should bear the risks if asbestos claims projections are too low, or that actual cash flow is too low because of the inherent uncertainties in long-term earnings and cash flow forecasts ... ? So the question is: should the risks be borne by the businesses that currently comprise the CSR group and, thus, indirectly by the CSR shareholders, or should the risks be borne by the current and future asbestos claimants? Our submission is the risks shouldn’t be borne by the current and future asbestos claimants ...
A final point. The opinion is frustrating because it alludes to various expert future expense predictions submitted by the parties, but does not go into detail, deeming the information confidential. As a lawyer for corporations, I understand the desires and arguments for secrecy. That said, the law develops through precedent, and it’s much harder to apply and learn from precedent when crucial facts are not on the public record and are not explicitly addressed in the opinion. Courts and companies face difficult issues ahead in trying to balance the competing considerations as to secrecy. Set out below are the statements the court did put on the record regarding the predictions of future expenses.
“Analyses of expert reports
31. It is not possible to give detailed analysis of the confidential reports, however, the flavour of the debate is reflected in submissions made on behalf of those commissioning the various reports. For example, the written submissions for ASIC contain 12 pages of detailed analysis of the actuarial material concerning asbestos liabilities and financial stress testing. The submissions analyse the CSR actuarial material including the expert reports and advice provided by Taylor Fry and Navigant, the expert reviews of that material by KPMG and Ernst & Young as well as the response of the CSR advisers. The submissions set out ASIC’s conclusions in relation to the actuarial material as follows:
First it is self evident that there is considerable uncertainty surrounding any process of actuarially assessing future asbestos liabilities. Notwithstanding that CSR ceased involvement in asbestos related activities in 1977 both [Taylor Fry] and Navigant have continually being [sic] revising their central estimates upwards from 2004 based on new information that emerges.
Second, as described above, there are limitations on the scope of the actuarial assessments which have the potential to under estimate the overall valuations.
Third, within the actuarial assessments there are significant matters of judgement over which reasonable minds may differ and which have considerable potential to adversely and materially affect the valuations. This is exemplified by the differences in professional opinion between KPMG and Taylor Fry in relation to both the central estimate and the 95th percentile estimate of the Australian liabilities.
Fourth, ASIC submits that in determining this application the Court need not embark upon the task of determining which expert is “correct” or to be preferred. Instead it should note the differences of professional opinion but, in the context of determining the application based on the approach outlined above, it should afford significant weight to the views expressed by KPMG at least so far as they affect the 95th percentile estimate provided by [Taylor Fry]. KPMG have significant expertise in the area and they have provided a detailed rationale for their opinion on these issues. Their views at least so far as they affect the 95th percentile estimates are supported by [Ernst & Young] and, in some limited respects, by Finity.
32. The submissions also analyse the financial stress testing that CSR had undertaken and the Ernst & Young review of this stress testing. The conclusion is stated as follows:
A review of the material concerning the financial analysis and stress testing undertaken by and on behalf of CSR reveals that there are a number of aspects of uncertainty surrounding such an exercise mainly:
(i) The obvious uncertainties that arise from any exercise of financial modelling the future performance of any business especially in the context of measuring its ability to meet long tail liabilities such as those that arise from asbestos use;
(ii) The limited external scrutiny of the assumptions and workings of the 5 year and 20 year financial models prepared by CSR management, the inputs to which most always primarily originate from CSR's management;
(iii) The judgements involved in identifying the various risks to the business, the relevant parameters for the “shock testing” and the exclusion of other forms of risk ...; and
(iv) The absence of any testing of the combination of a prolonged downturn and the high case estimates and the related questions of judgement as to whether it would be feasible for New CSR to respond to the various risks to the business under the shock scenarios that were stress tested.
33. CSR's submissions in reply make the following comments about the submissions made by ASIC:
In its written and oral submissions, ASIC ... sought to stress the uncertainties and limitations inherent in actuarial analyses of future events. Such a submission should not be taken too far.
By definition, any assessment of possible future events involves uncertainty and any attempt to actuarially assess such events will be subject to limitations. As the Court noted in argument, such uncertainties and limitations are equally applicable to CSR in its current structure as they are to CSR post-demerger. Provided that the advice provided to the CSR Board has been shown to be reasonable, the fact that the advice is subject to uncertainties does not warrant a conclusion that the advice should be rejected or lacks persuasive force.
Further, ... the doubts and uncertainties and the differences between the actuarial experts are of no relevance in circumstances where CSR's analysis has taken account of the full range of actuarial opinion. Cash outflows associated with the asbestos-related claims have been projected having regard to all “reasonable hypotheses”. Further, no party has sought to demonstrate a flaw in the other principal aspects of that analysis, namely the projection and “stress testing” of future cash inflows from CSR's de-merged business operations. That aspect of the analysis has been reviewed by PWC. It has also been reviewed on behalf of ASIC by [Ernst & Young] without unfavourable comment. In the light of the above, and as there is no correlation between risks attending the projected business cash inflows and the risks of under-estimation of the asbestos related cash outflows, the analysis provides a very high level of comfort that asbestos claims will be met.
ASIC's submissions should be read with this in mind. Its submissions are open to the criticisms that:
• they fail to reflect the conclusions of their own expert;
• they place undue focus on limitations and uncertainties that no actuary (including KPMG) can avoid without regard to the conclusions ultimately stated by the experts;
• they overstate the significance of the limitations and uncertainties ...
34. In addition to these criticisms CSR made detailed submissions in tabular form responding to the submissions made by AICF. Those submissions confirm that there is a genuine dispute between the experts as to the appropriate way to assess New CSR’s ability to meet future asbestos claims. The submissions made on behalf of James Hardie echoed the submissions of ASIC and AICF as well as making some additional criticisms of the provision made for New CSR to meet future asbestos claims.
35. In summary, the expert evidence presented by CSR, ASIC, and the other intervening parties brings into sharp relief the inherent uncertainty involved in any actuarial estimate of future asbestos-related claims and in particular the limitations and qualifications expressed in the actuarial reports relied on by CSR. In addition, specific issues raised by the experts retained by ASIC and AICF point to particular limitations in the material supplied by CSR’s experts in relation to future asbestos claims that cannot be reliably estimated at this time. The starting point in considering whether these flaws should lead to my not being satisfied that the provisions made in respect of asbestos-related claims following demerger are consistent with public policy or commercial morality must be:
(a) that New CSR will be the repository of all CSR's liabilities in respect of asbestos-related claims both present and future; and
(b) that it will suffer a significant reduction in the capital available to meet such claims.
36. The significance of those two factors increases with the uncertainty of the actuarial estimates and other expert opinion and is such that I cannot be satisfied that the provisions made are consistent with commercial morality or that the Scheme, if given effect, would not involve an unfair or oppressive result. Moreover, these same issues lead me to conclude that the material in the explanatory statement cannot provide adequate disclosure to CSR shareholders of New CSR's ability to meet these future liabilities. For both these reasons I have concluded that I should decline to make the orders for convening the Scheme meeting. In the circumstances, it is not necessary that I should consider the aspects of the Scheme that might otherwise be addressed at the first hearing.”
Thursday, February 18, 2010
Cross Claiming Among Asbestos Defendants and Asbestos Trusts - A $ 2 Million (AU) Mesothelioma Settlement; CSR and James Hardie Provide Examples for Consideration
Pasted below are key excerpts from a February 18 Wall Street Journal Australia article by Miland Rout which provides news of a $ 2 million (AU) asbestos mesothelioma settlement for the death of a young father. The amount is news in itself.
From my vantage point, however, the even more interesting part of the story is the assertion - assumed to be true for present purposes - that asbestos defendants CSR and James Hardie will now proceed against each other to resolve which entity should pay how much of the settlement. According to the articles's description of statements by plaintiff's counsel from Slater & Gordon, the companies apparently are no longer observing some sort of understanding or agreement on how much each should contribute.
So, what does one say about intercompany allocation battles? My personal view is that we will see more cross-claiming ahead because some companies need to transfer fault and expense to others in order to survive. In a related vein, more of the cross-claiming I think will involve claims by current tort sytem defendants against "asbestos trusts" or foundations established by entities that have used chapter 11 (rightly or wrongly) to exit the tort system.
Why cross-claim? One reason is that the asbestos tort system today is farcical in the sense that the most culpable defendants exited the tort system early and did so far, far too cheaply. Simply put, Manville, Unarco, Raymark, and various insulation and boiler makers (e.g. Eagle-Picher, Babcock & Wilcox), and some other "early movers," paid far too little to exit the tort system. The result? Some (not all) victims are undercompensated and many (not all) remaining tort defendants are now paying far too large a share for asbestos claims.
Why did early exits occur for too little money ? There are many reasons. In my opinion, the fundamental problem is that bankruptcy law and courts try to provide one time certainty through one time estimates of future "liability." Why? Well, because at its core, law is all about economics and money, and Wall Street wants fast, one time answers in order to have a business unit with a predictable cash flow that can be sold for a higher number of multiples of a predictable mulitple of EBIDA or some measure of free cash flow. That approach may be desirable in the short term for for bankers and investors, but it's not working well for the victims or co-defendants, and so bankruptcy law is too often being used to trump all the social and economic policy efforts inherent in common law tort rules and in recent state legislative "tort reform" efforts (some of which are in some ways flawed, but that's a different story).
Simply put, one time answers from bankruptcy courts are an idea that's been proven not to work at all well. At least to date, some but not all long-tail claiming problems (e.g environmental "contamination," asbestos litigation, chemical exposure claims) have proved to be far too unpredictable to be resolved well at one particularr moment in time. That's especially true because the future liability estimation proceedings in bankruptcy court have virtually nothing to do with science.
Want proof from sources othere than some lawyer writing on a blog? Read the Manville bankruptcy opinions and learn that the plaintiff's bar and co-defendants failed to get 100% of Manville's stock and took far too little future cash flow from New Manville. Also note that the first liability estimate in Manville was so low that the Manville trust was insolvent when it first opened its doors, and so it soon had to close its door and go back into into bankruptcy court for a "do over." (During the oral argument last year in the Manville/Travelers case at the Supreme Court, Justice Steven's accepted Mr. Ostrager's argument that Manville has been a "success." When I read that comment, (see transcript at 14), I didn't know whether to laugh or cry - it simply proved how little the Justices know or understand about mass torts, and why other lawyers called the Court's opinion very "narrow" (read as meaning "advisory"), a view I share. Far more apt, at page 12, was Justice Stevens' comment that the Manville appeal was "mysterious." With all due respect, Chief Justice Roberts is leading theCourt in the wrong direction with his avowed intent to reach out and resolve "business cases" when, as there, the record is at best scant and unclear, and the subject matter involves complex real world problems unfamiliar to the Justices)
Want more proof ? Read Judge Weinstein's paper confessing that courts have not done well with masss torts. Also, as to bankruptcy in particular, read this scathing indictment of the bankruptcy court "liability estimation " process. Who wrote the indictment ? Lawyers for W.R. Grace equity holders wrote the brief, but the meat of the indictment is in the expert witness report submitted by James Heckman, a University of Chicago PhD econmist who won a Nobel prize for his other work in economics. His opinion exposes most but not all of the flaws inherent in "estimates" submitted by Mark Peterson, an expert almost always used today by the asbestos plaintiffs.
After reading those materials, read the prior posts on this blog (e.g. here, here and here,) regarding the W.R. Grace ch. 11 settlement - it was a fabulous outcome for Grace because it fought hard and the asbestos plaintiff's bar wanted to end the case before Grace forced Judge Fitzgerald to write an opinion applying science to law and recognizing and acting on the massive and dubious claiming practices of the not sick. Those claiming practices dominated and distorted asbestos claiming in the the early 2000s, and other eras. Moreover, those practices are relatively alive and well today in the "asbestos trust" system as the not sick have taken massive amounts of money out of the Owens-Corning trust (and others), thus using the wonders of chapter 11 law to run roughshod over tort reform laws enacted in Ohio and elsewhere that seek to block recoveries by the not sick. (Reminder of prior disclosures - I used to represent W.R. Grace and others in asbestos litigation - my standard disclosure is here.) Sadly, the not sick retain some power because Congress unwisely enacted section chapter 11 section 524(g) to "codify Manville" and gave veto power to the holders of 75% of the claims (regardless of the value or merit of the claims, some say.)
Also see the Quigley chapter 11 case, and the battles of a few "cancer victim" lawyers to block or limit recoveries by the not sick; some information is in this prior post but the case is one that deserves far more attention. Further, see this prior post on the GIT/Narco appeal the 3rd Circuit should be deciding soon - note especially the "silica trust" conjured up from a handful of claims. And, finally, I'd refer you to this prior post on mass tort issues that lie ahead, and the flawed use of futures representatives. Note especially the Plevin article linked to in that post - it details the vast and unworkable conflicts of interest that bankruptcy courts tolerate in futures representatives.
Here are the key excerpts from the WSJ article:
_______________________________________________________________________________
Hardie seeks asbestos compo from CSR Milanda Rout From: The Australian February 18, 2010 12:00AM
AUSTRALIA'S two biggest asbestos-makers are fighting it out in court over a $2 million settlement reached with a Victorian man who contracted asbestos-related cancer as a child.
James Hardie -- now known as Amaca -- has launched proceedings against CSR to seek a contribution for the compensation after Amaca settled the case involving 48-year-old Robert Berengo in the Victorian Supreme Court this week.
***
Amaca agreed to pay the compensation claim before it reached the courtroom on Tuesday, saving Mr Berengo -- who is about to start another round of chemotherapy -- from having to go through a trial. The settlement will be paid by Amaca irrespective of its action against CSR.
The liability case, according to lawyers Slater & Gordon, is one of the first to go to trial in Victoria after the breakdown of what they call a gentlemen's agreement between the two companies to share the financial liabilities of asbestos compensation cases.
Steve Plunkett, the head of Slater & Gordon's asbestos litigation team, said that until last year, the companies had agreed to share the costs of compensation for victims who were not certain about which of the two had manufactured the asbestos products to which they were exposed.
This was believed to be based roughly on market share but details of the agreement and who withdrew from it is in dispute.
Mr Plunkett said a number of cases had been affected by this issue and he hoped the eventual judgment handed down on the split of costs between the companies would help avoid a recurrence of this situation.
Mr Berengo's lawyer, Tracy Madden, also from Slater & Gordon, said the $2m settlement from Amaca was a great result for her client. She said they claimed he was exposed to asbestos when he used to hug his father in his asbestos-clad work clothes, and when he would help his father on jobs and shake his father's painting sheets at home.
***
Neither company was prepared to comment on the case
From my vantage point, however, the even more interesting part of the story is the assertion - assumed to be true for present purposes - that asbestos defendants CSR and James Hardie will now proceed against each other to resolve which entity should pay how much of the settlement. According to the articles's description of statements by plaintiff's counsel from Slater & Gordon, the companies apparently are no longer observing some sort of understanding or agreement on how much each should contribute.
So, what does one say about intercompany allocation battles? My personal view is that we will see more cross-claiming ahead because some companies need to transfer fault and expense to others in order to survive. In a related vein, more of the cross-claiming I think will involve claims by current tort sytem defendants against "asbestos trusts" or foundations established by entities that have used chapter 11 (rightly or wrongly) to exit the tort system.
Why cross-claim? One reason is that the asbestos tort system today is farcical in the sense that the most culpable defendants exited the tort system early and did so far, far too cheaply. Simply put, Manville, Unarco, Raymark, and various insulation and boiler makers (e.g. Eagle-Picher, Babcock & Wilcox), and some other "early movers," paid far too little to exit the tort system. The result? Some (not all) victims are undercompensated and many (not all) remaining tort defendants are now paying far too large a share for asbestos claims.
Why did early exits occur for too little money ? There are many reasons. In my opinion, the fundamental problem is that bankruptcy law and courts try to provide one time certainty through one time estimates of future "liability." Why? Well, because at its core, law is all about economics and money, and Wall Street wants fast, one time answers in order to have a business unit with a predictable cash flow that can be sold for a higher number of multiples of a predictable mulitple of EBIDA or some measure of free cash flow. That approach may be desirable in the short term for for bankers and investors, but it's not working well for the victims or co-defendants, and so bankruptcy law is too often being used to trump all the social and economic policy efforts inherent in common law tort rules and in recent state legislative "tort reform" efforts (some of which are in some ways flawed, but that's a different story).
Simply put, one time answers from bankruptcy courts are an idea that's been proven not to work at all well. At least to date, some but not all long-tail claiming problems (e.g environmental "contamination," asbestos litigation, chemical exposure claims) have proved to be far too unpredictable to be resolved well at one particularr moment in time. That's especially true because the future liability estimation proceedings in bankruptcy court have virtually nothing to do with science.
Want proof from sources othere than some lawyer writing on a blog? Read the Manville bankruptcy opinions and learn that the plaintiff's bar and co-defendants failed to get 100% of Manville's stock and took far too little future cash flow from New Manville. Also note that the first liability estimate in Manville was so low that the Manville trust was insolvent when it first opened its doors, and so it soon had to close its door and go back into into bankruptcy court for a "do over." (During the oral argument last year in the Manville/Travelers case at the Supreme Court, Justice Steven's accepted Mr. Ostrager's argument that Manville has been a "success." When I read that comment, (see transcript at 14), I didn't know whether to laugh or cry - it simply proved how little the Justices know or understand about mass torts, and why other lawyers called the Court's opinion very "narrow" (read as meaning "advisory"), a view I share. Far more apt, at page 12, was Justice Stevens' comment that the Manville appeal was "mysterious." With all due respect, Chief Justice Roberts is leading theCourt in the wrong direction with his avowed intent to reach out and resolve "business cases" when, as there, the record is at best scant and unclear, and the subject matter involves complex real world problems unfamiliar to the Justices)
Want more proof ? Read Judge Weinstein's paper confessing that courts have not done well with masss torts. Also, as to bankruptcy in particular, read this scathing indictment of the bankruptcy court "liability estimation " process. Who wrote the indictment ? Lawyers for W.R. Grace equity holders wrote the brief, but the meat of the indictment is in the expert witness report submitted by James Heckman, a University of Chicago PhD econmist who won a Nobel prize for his other work in economics. His opinion exposes most but not all of the flaws inherent in "estimates" submitted by Mark Peterson, an expert almost always used today by the asbestos plaintiffs.
After reading those materials, read the prior posts on this blog (e.g. here, here and here,) regarding the W.R. Grace ch. 11 settlement - it was a fabulous outcome for Grace because it fought hard and the asbestos plaintiff's bar wanted to end the case before Grace forced Judge Fitzgerald to write an opinion applying science to law and recognizing and acting on the massive and dubious claiming practices of the not sick. Those claiming practices dominated and distorted asbestos claiming in the the early 2000s, and other eras. Moreover, those practices are relatively alive and well today in the "asbestos trust" system as the not sick have taken massive amounts of money out of the Owens-Corning trust (and others), thus using the wonders of chapter 11 law to run roughshod over tort reform laws enacted in Ohio and elsewhere that seek to block recoveries by the not sick. (Reminder of prior disclosures - I used to represent W.R. Grace and others in asbestos litigation - my standard disclosure is here.) Sadly, the not sick retain some power because Congress unwisely enacted section chapter 11 section 524(g) to "codify Manville" and gave veto power to the holders of 75% of the claims (regardless of the value or merit of the claims, some say.)
Also see the Quigley chapter 11 case, and the battles of a few "cancer victim" lawyers to block or limit recoveries by the not sick; some information is in this prior post but the case is one that deserves far more attention. Further, see this prior post on the GIT/Narco appeal the 3rd Circuit should be deciding soon - note especially the "silica trust" conjured up from a handful of claims. And, finally, I'd refer you to this prior post on mass tort issues that lie ahead, and the flawed use of futures representatives. Note especially the Plevin article linked to in that post - it details the vast and unworkable conflicts of interest that bankruptcy courts tolerate in futures representatives.
Here are the key excerpts from the WSJ article:
_______________________________________________________________________________
Hardie seeks asbestos compo from CSR Milanda Rout From: The Australian February 18, 2010 12:00AM
AUSTRALIA'S two biggest asbestos-makers are fighting it out in court over a $2 million settlement reached with a Victorian man who contracted asbestos-related cancer as a child.
James Hardie -- now known as Amaca -- has launched proceedings against CSR to seek a contribution for the compensation after Amaca settled the case involving 48-year-old Robert Berengo in the Victorian Supreme Court this week.
***
Amaca agreed to pay the compensation claim before it reached the courtroom on Tuesday, saving Mr Berengo -- who is about to start another round of chemotherapy -- from having to go through a trial. The settlement will be paid by Amaca irrespective of its action against CSR.
The liability case, according to lawyers Slater & Gordon, is one of the first to go to trial in Victoria after the breakdown of what they call a gentlemen's agreement between the two companies to share the financial liabilities of asbestos compensation cases.
Steve Plunkett, the head of Slater & Gordon's asbestos litigation team, said that until last year, the companies had agreed to share the costs of compensation for victims who were not certain about which of the two had manufactured the asbestos products to which they were exposed.
This was believed to be based roughly on market share but details of the agreement and who withdrew from it is in dispute.
Mr Plunkett said a number of cases had been affected by this issue and he hoped the eventual judgment handed down on the split of costs between the companies would help avoid a recurrence of this situation.
Mr Berengo's lawyer, Tracy Madden, also from Slater & Gordon, said the $2m settlement from Amaca was a great result for her client. She said they claimed he was exposed to asbestos when he used to hug his father in his asbestos-clad work clothes, and when he would help his father on jobs and shake his father's painting sheets at home.
***
Neither company was prepared to comment on the case
Tuesday, February 16, 2010
Australian Consumer Agency Warns Against Decorative Tile Said to Contain Tremolite ("Asbestos") - Snow White
Global awareness of asbestos continues to increase. An Australian government agency issued late last week an advisory warning consumers against a set of decorative stone-like wall tiles said to contain tremolite from China. The information provided is too skimpy to evaluate the real risks. That's too bad - one would like think that by now all government safety agencies could speak lnowledgeably and articulately about "asbestos" and risk. If you'd like to see the Snow White tile, go here.
Monday, February 15, 2010
Comparative Law - Various National Approaches to Personal Injury Compensation Payments
See the cite and link below for a recent online comparative law paper that provides a broad brush picture of the similarities and differences between personal injury compensation approaches of the United States, various EU countries using civil law, and the UK and New Zealand.
In particular, the paper addresses differences in approach to using "lump sum" payments versus a stream of future payments, calculation of future financial loss in relation to children, deductibility of collateral benefits from awards of damages, and approaches to comparative fault. The article also touches briefly on subrogation in some countries.The paper thus provides helpful context for evaluating the various national approaches to dealing with long tail tort issues.
Margaret Devaney, A Comparative Assessment of Personal Injuries Compensation Schemes: Lessons for Tort Reform?, vol. 13.3 ELECTRONIC JOURNAL OF COMPARATIVE LAW, (September 2009).
In particular, the paper addresses differences in approach to using "lump sum" payments versus a stream of future payments, calculation of future financial loss in relation to children, deductibility of collateral benefits from awards of damages, and approaches to comparative fault. The article also touches briefly on subrogation in some countries.The paper thus provides helpful context for evaluating the various national approaches to dealing with long tail tort issues.
Margaret Devaney, A Comparative Assessment of Personal Injuries Compensation Schemes: Lessons for Tort Reform?, vol. 13.3 ELECTRONIC JOURNAL OF COMPARATIVE LAW, (September 2009).
Sunday, February 14, 2010
More on the $ 37 Million Colorado Verdict for Rescinding a Health Care Policy
The lawyer who won the $37 million verdict is lawyer who usually defends insurance companies, but switched sides in this setting. BulletProof Blog includes this interview of the lawyer, Mark Levy.
Saturday, February 13, 2010
New Science - Future Biomarker Chips for Cancer at Even Lower Protein Levels
This part of the future is not yet here, but the story pasted below illustrates part of the promise of biomarkers.....
ScienceDaily (Feb. 9, 2010) — The earlier the doctor finds the tumor, the better the patient's chances of recovery. A new testing method aims to detect the disease in its initial stages. The technology is based on a microfluidic chip with tiny channels in which a blood sample from the patient circulates. The chip traces marker proteins which are indicative of cancer. The measured concentration of the tumor marker in the blood will help doctors to diagnose the disease at an early stage.
Similar testing systems already exist but their measurements are not very precise and they can only detect molecules that are present in the blood in large quantities. What's more, the tests have to be carried out in a laboratory, which is time-consuming and costly.
A project funded by the German Ministry of Education and Research and coordinated by the Fraunhofer FIT aims to improve matters. Biofunctionalized nanoparticles developed by research scientists at the Fraunhofer Institute for Silicate Research ISC in Würzburg are the key element in the new sensor. "We have improved the detection limit compared with the present state of the art by a factor of one hundred," explains Dr. Jörn Probst, Head of the Business Unit Life Science at the ISC. "Whereas previously a hundred molecules were needed in a certain quantity of blood to detect tumor markers, we now need only one. This means that diseases can be diagnosed much earlier than with present methods."
But how does the biosensor integrated in the chip register the few biomolecules swimming around in the blood that are indicative of a certain disease? "We have placed antibody-occupied nanoparticles on the sensor electrode which fish out the relevant proteins. For this purpose, we repeatedly pump the blood across the electrode surface. As with a river, the flow is fastest in mid-channel and the water runs more slowly near the bank. We have therefore made a sort of fishing rod using nanoparticles which registers the antibodies in the middle of the blood flow where most proteins swim by per unit of time.« If an antibody catches the matching protein, a tumor marker, the electrical charge distribution shifts and this is picked up by the electrode."
The researcher groups are now developing a first demonstrator combining four independent single-molecule-sensitive biosensors. The experts are also working on the simultaneous detection of several tumor markers, which will increase the clarity of tests. The system will be ready to enter the market in a few years' time
ScienceDaily (Feb. 9, 2010) — The earlier the doctor finds the tumor, the better the patient's chances of recovery. A new testing method aims to detect the disease in its initial stages. The technology is based on a microfluidic chip with tiny channels in which a blood sample from the patient circulates. The chip traces marker proteins which are indicative of cancer. The measured concentration of the tumor marker in the blood will help doctors to diagnose the disease at an early stage.
Similar testing systems already exist but their measurements are not very precise and they can only detect molecules that are present in the blood in large quantities. What's more, the tests have to be carried out in a laboratory, which is time-consuming and costly.
A project funded by the German Ministry of Education and Research and coordinated by the Fraunhofer FIT aims to improve matters. Biofunctionalized nanoparticles developed by research scientists at the Fraunhofer Institute for Silicate Research ISC in Würzburg are the key element in the new sensor. "We have improved the detection limit compared with the present state of the art by a factor of one hundred," explains Dr. Jörn Probst, Head of the Business Unit Life Science at the ISC. "Whereas previously a hundred molecules were needed in a certain quantity of blood to detect tumor markers, we now need only one. This means that diseases can be diagnosed much earlier than with present methods."
But how does the biosensor integrated in the chip register the few biomolecules swimming around in the blood that are indicative of a certain disease? "We have placed antibody-occupied nanoparticles on the sensor electrode which fish out the relevant proteins. For this purpose, we repeatedly pump the blood across the electrode surface. As with a river, the flow is fastest in mid-channel and the water runs more slowly near the bank. We have therefore made a sort of fishing rod using nanoparticles which registers the antibodies in the middle of the blood flow where most proteins swim by per unit of time.« If an antibody catches the matching protein, a tumor marker, the electrical charge distribution shifts and this is picked up by the electrode."
The researcher groups are now developing a first demonstrator combining four independent single-molecule-sensitive biosensors. The experts are also working on the simultaneous detection of several tumor markers, which will increase the clarity of tests. The system will be ready to enter the market in a few years' time
Hazards from 3rd Hand Smoke Residue - Generating "Toxins" ?
The online story pasted below is noteworthy for the the conclusion that cigarette smoke residue from nicotine causes the presence of excess "toxins" on furnishings inside buildings. It seems premature to conclude that tobacco companies will soon face property damage claims for contaminating property, but it does make one wonder. Note also the closing paragraph's reference to developing biomarkers to prove the presence of the "toxins." Biomarker science is the subject of today's second post.
________________________________________________________________________
ScienceDaily (Feb. 9, 2010) — Nicotine in third-hand smoke, the residue from tobacco smoke that clings to virtually all surfaces long after a cigarette has been extinguished, reacts with the common indoor air pollutant nitrous acid to produce dangerous carcinogens. This new potential health hazard was revealed in a multi-institutional study led by researchers with the Lawrence Berkeley National Laboratory (Berkeley Lab).
"The burning of tobacco releases nicotine in the form of a vapor that adsorbs strongly onto indoor surfaces, such as walls, floors, carpeting, drapes and furniture. Nicotine can persist on those materials for days, weeks and even months. Our study shows that when this residual nicotine reacts with ambient nitrous acid it forms carcinogenic tobacco-specific nitrosamines or TSNAs," says Hugo Destaillats, a chemist with the Indoor Environment Department of Berkeley Lab's Environmental Energy Technologies Division. "TSNAs are among the most broadly acting and potent carcinogens present in unburned tobacco and tobacco smoke."
Destaillats is the corresponding author of a paper published in the Proceedings of the National Academy of Sciences (PNAS). Co-authoring the PNAS paper with Destaillats were Mohamad Sleiman, Lara Gundel and Brett Singer, all with Berkeley Lab's Indoor Environment Department, plus James Pankow with Portland State University, and Peyton Jacob with the University of California, San Francisco.
The authors report that in laboratory tests using cellulose as a model indoor material exposed to smoke, levels of newly formed TSNAs detected on cellulose surfaces were 10 times higher than those originally present in the sample following exposure for three hours to a "high but reasonable" concentration of nitrous acid (60 parts per billion by volume). Unvented gas appliances are the main source of nitrous acid indoors. Since most vehicle engines emit some nitrous acid that can infiltrate the passenger compartments, tests were also conducted on surfaces inside the truck of a heavy smoker, including the surface of a stainless steel glove compartment. These measurements also showed substantial levels of TSNAs. In both cases, one of the major products found was a TSNA that is absent in freshly emitted tobacco smoke -- the nitrosamine known as NNA. The potent carcinogens NNN and NNK were also formed in this reaction.
"Time-course measurements revealed fast TSNA formation, up to 0.4 percent conversion of nicotine within the first hour," says lead author Sleiman. "Given the rapid sorption and persistence of high levels of nicotine on indoor surfaces, including clothing and human skin, our findings indicate that third-hand smoke represents an unappreciated health hazard through dermal exposure, dust inhalation and ingestion."
Since the most likely human exposure to these TSNAs is through either inhalation of dust or the contact of skin with carpet or clothes, third-hand smoke would seem to pose the greatest hazard to infants and toddlers. The study's findings indicate that opening a window or deploying a fan to ventilate the room while a cigarette burns does not eliminate the hazard of third-hand smoke. Smoking outdoors is not much of an improvement, as co-author Gundel explains.
"Smoking outside is better than smoking indoors but nicotine residues will stick to a smoker's skin and clothing," she says. "Those residues follow a smoker back inside and get spread everywhere. The biggest risk is to young children. Dermal uptake of the nicotine through a child's skin is likely to occur when the smoker returns and if nitrous acid is in the air, which it usually is, then TSNAs will be formed."
The dangers of mainstream and secondhand tobacco smoke have been well documented as a cause of cancer, cardiovascular disease and stroke, pulmonary disease and birth defects. Only recently, however, has the general public been made aware of the threats posed by third-hand smoke. The term was coined in a study that appeared in the January 2009 edition of the journal "Pediatrics," in which it was reported that only 65 percent of non-smokers and 43 percent of smokers surveyed agreed with the statement that "Breathing air in a room today where people smoked yesterday can harm the health of infants and children."
Anyone who has entered a confined space -- a room, an elevator, a vehicle, etc. -- where someone recently smoked, knows that the scent lingers for an extended period of time. Scientists have been aware for several years that tobacco smoke is adsorbed on surfaces where semi-volatile and non-volatile chemical constituents can undergo reactions, but reactions of residual smoke constituents with atmospheric molecules such as nitrous acid have been overlooked as a source of harmful pollutants. This is the first study to quantify the reactions of third-hand smoke with nitrous acid, according to the authors.
"Whereas the sidestream smoke of one cigarette contains at least 100 nanograms equivalent total TSNAs, our results indicate that several hundred nanograms per square meter of nitrosamines may be formed on indoor surfaces in the presence of nitrous acid," says lead-author Sleiman.
Co-author James Pankow points out that the results of this study should raise concerns about the purported safety of electronic cigarettes. Also known as "e-cigarettes," electronic cigarettes claim to provide the "smoking experience," but without the risks of cancer. A battery-powered vaporizer inside the tube of a plastic cigarette turns a solution of nicotine into a smoky mist that can be inhaled and exhaled like tobacco smoke. Since no flame is required to ignite the e-cigarette and there is no tobacco or combustion, e-cigarettes are not restricted by anti-smoking laws.
"Nicotine, the addictive substance in tobacco smoke, has until now been considered to be non-toxic in the strictest sense of the term," says Kamlesh Asotra of the University of California's Tobacco-Related Disease Research Program, which funded this study. "What we see in this study is that the reactions of residual nicotine with nitrous acid at surface interfaces are a potential cancer hazard, and these results may be just the tip of the iceberg."
The Berkeley Lab researchers are now investigating the long-term stability in an indoor environment of the TSNAs produced as a result of third-hand smoke interactions with nitrous acid. The authors are also looking into the development of biomarkers to track exposures to these TSNAs. In addition, they are conducting studies to gain a better understanding of the chemistry behind the formation of these TSNAs and to find out more about other chemicals that are being produced when third-hand smoke reacts with nitrous acid.
"We know that these residual levels of nicotine may build up over time after several smoking cycles, and we know that through the process of aging, third-hand smoke can become more toxic over time," says Destaillats. "Our work highlights the importance of third-hand smoke reactions at indoor interfaces, particularly the production of nitrosamines with potential health impacts."
In the PNAS paper, Destaillats and his co-authors suggest various ways to limit the impact of the third hand smoke health hazard, starting with the implementation of 100 percent smoke-free environments in public places and self-restrictions in residences and automobiles. In buildings where substantial smoking has occurred, replacing nicotine-laden furnishings, carpets and wallboard can significantly reduce exposures.
________________________________________________________________________
ScienceDaily (Feb. 9, 2010) — Nicotine in third-hand smoke, the residue from tobacco smoke that clings to virtually all surfaces long after a cigarette has been extinguished, reacts with the common indoor air pollutant nitrous acid to produce dangerous carcinogens. This new potential health hazard was revealed in a multi-institutional study led by researchers with the Lawrence Berkeley National Laboratory (Berkeley Lab).
"The burning of tobacco releases nicotine in the form of a vapor that adsorbs strongly onto indoor surfaces, such as walls, floors, carpeting, drapes and furniture. Nicotine can persist on those materials for days, weeks and even months. Our study shows that when this residual nicotine reacts with ambient nitrous acid it forms carcinogenic tobacco-specific nitrosamines or TSNAs," says Hugo Destaillats, a chemist with the Indoor Environment Department of Berkeley Lab's Environmental Energy Technologies Division. "TSNAs are among the most broadly acting and potent carcinogens present in unburned tobacco and tobacco smoke."
Destaillats is the corresponding author of a paper published in the Proceedings of the National Academy of Sciences (PNAS). Co-authoring the PNAS paper with Destaillats were Mohamad Sleiman, Lara Gundel and Brett Singer, all with Berkeley Lab's Indoor Environment Department, plus James Pankow with Portland State University, and Peyton Jacob with the University of California, San Francisco.
The authors report that in laboratory tests using cellulose as a model indoor material exposed to smoke, levels of newly formed TSNAs detected on cellulose surfaces were 10 times higher than those originally present in the sample following exposure for three hours to a "high but reasonable" concentration of nitrous acid (60 parts per billion by volume). Unvented gas appliances are the main source of nitrous acid indoors. Since most vehicle engines emit some nitrous acid that can infiltrate the passenger compartments, tests were also conducted on surfaces inside the truck of a heavy smoker, including the surface of a stainless steel glove compartment. These measurements also showed substantial levels of TSNAs. In both cases, one of the major products found was a TSNA that is absent in freshly emitted tobacco smoke -- the nitrosamine known as NNA. The potent carcinogens NNN and NNK were also formed in this reaction.
"Time-course measurements revealed fast TSNA formation, up to 0.4 percent conversion of nicotine within the first hour," says lead author Sleiman. "Given the rapid sorption and persistence of high levels of nicotine on indoor surfaces, including clothing and human skin, our findings indicate that third-hand smoke represents an unappreciated health hazard through dermal exposure, dust inhalation and ingestion."
Since the most likely human exposure to these TSNAs is through either inhalation of dust or the contact of skin with carpet or clothes, third-hand smoke would seem to pose the greatest hazard to infants and toddlers. The study's findings indicate that opening a window or deploying a fan to ventilate the room while a cigarette burns does not eliminate the hazard of third-hand smoke. Smoking outdoors is not much of an improvement, as co-author Gundel explains.
"Smoking outside is better than smoking indoors but nicotine residues will stick to a smoker's skin and clothing," she says. "Those residues follow a smoker back inside and get spread everywhere. The biggest risk is to young children. Dermal uptake of the nicotine through a child's skin is likely to occur when the smoker returns and if nitrous acid is in the air, which it usually is, then TSNAs will be formed."
The dangers of mainstream and secondhand tobacco smoke have been well documented as a cause of cancer, cardiovascular disease and stroke, pulmonary disease and birth defects. Only recently, however, has the general public been made aware of the threats posed by third-hand smoke. The term was coined in a study that appeared in the January 2009 edition of the journal "Pediatrics," in which it was reported that only 65 percent of non-smokers and 43 percent of smokers surveyed agreed with the statement that "Breathing air in a room today where people smoked yesterday can harm the health of infants and children."
Anyone who has entered a confined space -- a room, an elevator, a vehicle, etc. -- where someone recently smoked, knows that the scent lingers for an extended period of time. Scientists have been aware for several years that tobacco smoke is adsorbed on surfaces where semi-volatile and non-volatile chemical constituents can undergo reactions, but reactions of residual smoke constituents with atmospheric molecules such as nitrous acid have been overlooked as a source of harmful pollutants. This is the first study to quantify the reactions of third-hand smoke with nitrous acid, according to the authors.
"Whereas the sidestream smoke of one cigarette contains at least 100 nanograms equivalent total TSNAs, our results indicate that several hundred nanograms per square meter of nitrosamines may be formed on indoor surfaces in the presence of nitrous acid," says lead-author Sleiman.
Co-author James Pankow points out that the results of this study should raise concerns about the purported safety of electronic cigarettes. Also known as "e-cigarettes," electronic cigarettes claim to provide the "smoking experience," but without the risks of cancer. A battery-powered vaporizer inside the tube of a plastic cigarette turns a solution of nicotine into a smoky mist that can be inhaled and exhaled like tobacco smoke. Since no flame is required to ignite the e-cigarette and there is no tobacco or combustion, e-cigarettes are not restricted by anti-smoking laws.
"Nicotine, the addictive substance in tobacco smoke, has until now been considered to be non-toxic in the strictest sense of the term," says Kamlesh Asotra of the University of California's Tobacco-Related Disease Research Program, which funded this study. "What we see in this study is that the reactions of residual nicotine with nitrous acid at surface interfaces are a potential cancer hazard, and these results may be just the tip of the iceberg."
The Berkeley Lab researchers are now investigating the long-term stability in an indoor environment of the TSNAs produced as a result of third-hand smoke interactions with nitrous acid. The authors are also looking into the development of biomarkers to track exposures to these TSNAs. In addition, they are conducting studies to gain a better understanding of the chemistry behind the formation of these TSNAs and to find out more about other chemicals that are being produced when third-hand smoke reacts with nitrous acid.
"We know that these residual levels of nicotine may build up over time after several smoking cycles, and we know that through the process of aging, third-hand smoke can become more toxic over time," says Destaillats. "Our work highlights the importance of third-hand smoke reactions at indoor interfaces, particularly the production of nitrosamines with potential health impacts."
In the PNAS paper, Destaillats and his co-authors suggest various ways to limit the impact of the third hand smoke health hazard, starting with the implementation of 100 percent smoke-free environments in public places and self-restrictions in residences and automobiles. In buildings where substantial smoking has occurred, replacing nicotine-laden furnishings, carpets and wallboard can significantly reduce exposures.
Friday, February 12, 2010
Asbestos Ban Sought in Phillipines, Along with Some Kind of "Early Detection" Program
The article is here. Note also that the article says the legislation would provide money for an early detection program for cancers. One wonders exactly what is contemplated.
Note further that the article is part of a stream of asbestos information pouting forth every day from various social media. The plaintiff's bar is doing very well at using social media to make people very conscious of asbestos.
Note further that the article is part of a stream of asbestos information pouting forth every day from various social media. The plaintiff's bar is doing very well at using social media to make people very conscious of asbestos.
Wednesday, February 10, 2010
Hardie and CSR Avoid "Collusion" Charges for Trial This Week
Here is an article updating this prior post on the effort to amend "collusion" claims against James Hardie and CSR in an asbestos personal injury trial. In short, the court denied the motion to amend on the eve of trial in this particular case, but is said to have indicated that similar amendments might be allowed in other cases not so close to trial. See the full text below.
_________________________________________________________________________
Judge denies late changes in asbestos case
LEONIE WOOD
February 10, 2010 .
THE Victorian Supreme Court has declined late changes to an asbestos damages case in which a Melbourne man, who is dying from mesothelioma, planned to accuse James Hardie and CSR of joining forces to disguise the dangers of asbestos.
Justice Terry Forrest said the proposed amendments in their present form would not be allowed.
Although the judge said the proposed pleadings in the case of Robert Berengo were deficient, he also made it clear that litigants in the future might well be able to allege joint liability if they properly set out the material facts and the case that is to be answered.
Mr Berengo wanted to allege that the Australian asbestos manufacturers deliberately did not put their brand names on their asbestos-related products during the 1960s and 1970s, making it harder to identify which of the two should bear liability in cases of injury and disease.
He also wanted to allege that the companies had agreed to co-operate to dissuade regulators from restricting the use of asbestos and to influence public opinion about the dangers of their product.
Mr Berengo's trial, in which he accused the two companies of negligence, begins on Tuesday
_________________________________________________________________________
Judge denies late changes in asbestos case
LEONIE WOOD
February 10, 2010 .
THE Victorian Supreme Court has declined late changes to an asbestos damages case in which a Melbourne man, who is dying from mesothelioma, planned to accuse James Hardie and CSR of joining forces to disguise the dangers of asbestos.
Justice Terry Forrest said the proposed amendments in their present form would not be allowed.
Although the judge said the proposed pleadings in the case of Robert Berengo were deficient, he also made it clear that litigants in the future might well be able to allege joint liability if they properly set out the material facts and the case that is to be answered.
Mr Berengo wanted to allege that the Australian asbestos manufacturers deliberately did not put their brand names on their asbestos-related products during the 1960s and 1970s, making it harder to identify which of the two should bear liability in cases of injury and disease.
He also wanted to allege that the companies had agreed to co-operate to dissuade regulators from restricting the use of asbestos and to influence public opinion about the dangers of their product.
Mr Berengo's trial, in which he accused the two companies of negligence, begins on Tuesday
Asbestos Litigation Risks - Some Companies Seek Unique Legislative Answers for Unique Risks
As described in this article, Crown Cork and Seal continues its efforts to obtain legislative solutions for its unique asbestos litigation risks. Key excerpts are below from an article about action by the legislature in Virginia:
A closely divided House of Delegates voted Monday to shield a company from liability to asbestos-related health claims.
"Del. Terry Kilgore's bill, HB 629, doesn't mention any company by name. But the way it is drafted, it applies to only one: Crown Cork & Seal, a Philadelphia-based manufacturer of cans and bottle caps. It has plants in Suffolk and Winchester.
Crown Cork & Seal has never manufactured any products containing asbestos. But in 1963 it purchased the stock of Mundet Cork Co., which had an insulation division that it sold 90 days later. Under existing law, Crown is liable to lawsuits resulting from the presence of asbestos in Mundet's insulation products.
Kilgore's bill. which won preliminary House approval, limits Crown's asbestos-related liability to the value of Mundet's assets at the time it was purchased.
Kilgore, R-Lee County, characterized the measure as a "jobs bill," saying it would protect a Virginia employer from potentially crippling litigation. Dozens of asbestos companies have been driven into bankruptcy by billions of dollars in lawsuits brought by workers who contracted deadly lung diseases from handling the material."
A closely divided House of Delegates voted Monday to shield a company from liability to asbestos-related health claims.
"Del. Terry Kilgore's bill, HB 629, doesn't mention any company by name. But the way it is drafted, it applies to only one: Crown Cork & Seal, a Philadelphia-based manufacturer of cans and bottle caps. It has plants in Suffolk and Winchester.
Crown Cork & Seal has never manufactured any products containing asbestos. But in 1963 it purchased the stock of Mundet Cork Co., which had an insulation division that it sold 90 days later. Under existing law, Crown is liable to lawsuits resulting from the presence of asbestos in Mundet's insulation products.
Kilgore's bill. which won preliminary House approval, limits Crown's asbestos-related liability to the value of Mundet's assets at the time it was purchased.
Kilgore, R-Lee County, characterized the measure as a "jobs bill," saying it would protect a Virginia employer from potentially crippling litigation. Dozens of asbestos companies have been driven into bankruptcy by billions of dollars in lawsuits brought by workers who contracted deadly lung diseases from handling the material."
Tuesday, February 9, 2010
More on the Palermo Claim to the Manville Trust 37 Years After Death
Thanks to information contributed by professional contacts, more information is coming out regarding the previously described "Palermo" claim to the Manville Trust, and a related federal court lawsuit against the DII Trust by the same claimant. The claims are unique because they are being made over the last four or so years, some 37 years after Mr. Palermo's death in 1966. This window into the asbestos trust world was opened by public publishing of opinion in Gail Garner v. DII Industries, 2010 U.S. Dist. LEXIS 9583 (Feb 4. 2010).
Here is an image of the complaint mentioned in the federal district. The complaint includes some very interesting correspondence with the Manville Trust regarding the claims raised.
Here is an online post that appears to be by the claimant, who says she is Mr. Palermo's daugher. The post is to a public website.
In short, it appears the daughter of Mr. Palermo is an active pro se litigant seeking money for his estate from at least 7 trusts. And, judging by the attachments to the complaint, there are multiple other unusual "extraordinary circumstances" claims to the chapter 11 asbestos trusts.
One can certainly appreciate the logic and reasons for the claims asserted by Ms. Garner on behalf of the estate. On the other hand, it's pretty amazing to see this happening and think about the defense side consequences. The claims also shed some light on propensity to claim, and various factors related to the appropirate amounts of compensation of claims so long after death. The claims also raise issues about whether and how much lawyers are needed for claims to chapter 11 trusts.
Most importantly, taken as a whole, the papers provide yet a precise example of why the actions of the chapter 11 trusts and the trustees should be transparent instead of cloaked in secrecy. The public and the policy makers of our day should have access to the facts. On secrecy, here's another plug for a 2009 law review article written by Stephen Wm. Smith, a United States Magistrate Judge in the Southern District of Texas, Houston division. See "Kudzu in the Courthouse: Judgments Made in the Shade," 3 Fed. Cts. L. Rev. # 2, 177 (2009). The full text article is available here, and is free.
------------------------------
From: http://www.deanamartin.com/Ask/ask_may05.asp
Dear Deana:
I just read your book in 2 sittings. I enjoyed it. It surprised me. There was much heartbreak as there was much enjoyment. My life was similar. My dad, Angelo Palermo, (Italian American) was away at work a lot (spray coating asbestos) and he lost a daughter (my sister) in a tragedy (she drowned), four years before he died. He died at age 51 of cancer. While I was reading your book, on page 198 you stated 'Dad, inhaling deeply on his Kent cigarette…’ I have an old ad about Kent cigarettes having asbestos filters. Thirty-four (34) years after the death of my father, I put in a claim against Johns-Manville, a large asbestos company. No attorney would take the case but I did it on my own, and won. I now have 6 more claims in against other asbestos companies. I believe you have a case to sue for asbestos wrongful death. There is no statue of limitation (discovery rule). I can help you and I would like some assistance in how I can publish a book about my case. Please respond. Really enjoyed your book. Our family, including my father, loved your father.
Sincerely,
Gail Palermo Garner
-------------------------------
Here is an image of the complaint mentioned in the federal district. The complaint includes some very interesting correspondence with the Manville Trust regarding the claims raised.
Here is an online post that appears to be by the claimant, who says she is Mr. Palermo's daugher. The post is to a public website.
In short, it appears the daughter of Mr. Palermo is an active pro se litigant seeking money for his estate from at least 7 trusts. And, judging by the attachments to the complaint, there are multiple other unusual "extraordinary circumstances" claims to the chapter 11 asbestos trusts.
One can certainly appreciate the logic and reasons for the claims asserted by Ms. Garner on behalf of the estate. On the other hand, it's pretty amazing to see this happening and think about the defense side consequences. The claims also shed some light on propensity to claim, and various factors related to the appropirate amounts of compensation of claims so long after death. The claims also raise issues about whether and how much lawyers are needed for claims to chapter 11 trusts.
Most importantly, taken as a whole, the papers provide yet a precise example of why the actions of the chapter 11 trusts and the trustees should be transparent instead of cloaked in secrecy. The public and the policy makers of our day should have access to the facts. On secrecy, here's another plug for a 2009 law review article written by Stephen Wm. Smith, a United States Magistrate Judge in the Southern District of Texas, Houston division. See "Kudzu in the Courthouse: Judgments Made in the Shade," 3 Fed. Cts. L. Rev. # 2, 177 (2009). The full text article is available here, and is free.
------------------------------
From: http://www.deanamartin.com/Ask/ask_may05.asp
Dear Deana:
I just read your book in 2 sittings. I enjoyed it. It surprised me. There was much heartbreak as there was much enjoyment. My life was similar. My dad, Angelo Palermo, (Italian American) was away at work a lot (spray coating asbestos) and he lost a daughter (my sister) in a tragedy (she drowned), four years before he died. He died at age 51 of cancer. While I was reading your book, on page 198 you stated 'Dad, inhaling deeply on his Kent cigarette…’ I have an old ad about Kent cigarettes having asbestos filters. Thirty-four (34) years after the death of my father, I put in a claim against Johns-Manville, a large asbestos company. No attorney would take the case but I did it on my own, and won. I now have 6 more claims in against other asbestos companies. I believe you have a case to sue for asbestos wrongful death. There is no statue of limitation (discovery rule). I can help you and I would like some assistance in how I can publish a book about my case. Please respond. Really enjoyed your book. Our family, including my father, loved your father.
Sincerely,
Gail Palermo Garner
-------------------------------
Monday, February 8, 2010
James Hardie and CSR - Allegations of "Collusion"
The asbestos litigation pot continues to boil in Australia. Over the last couple of weeks, CSR was denied the opportunity to split its business, a topic I keep hoping to get to, but life is busy. For now, here is a new article about plaintiff's seeking to amend a complaint to seek to prove up purported collusion between Hardie and CSR. How much does that sound like US litigation ? The text also is pasted below.
___________________________________________________________________________
Hardie, CSR 'colluded', sufferer says LEONIE WOOD
February 8, 2010 .
THE building products manufacturers James Hardie and CSR have been accused in court of joining forces during the 1960s and '70s in a bid to dissuade regulatory authorities from restricting or controlling the use of their potentially lethal asbestos products.
The court has also heard allegations that James Hardie and CSR deliberately did not mark their company names on asbestos-laden products so that they could conceal which company manufactured them - a move which, the court heard, would make it harder to identify which company had liability for future claims of potential injury or disease.
The allegations emerged on Friday before Justice Terry Forrest in the Victorian Supreme Court during preliminary proceedings ahead of a trial in which a Melbourne man, Robert Berengo, is claiming damages from James Hardie's asbestos liability fund, Amaca, and from CSR.
The fresh allegations come just days after Justice Margaret Stone in the Federal Court in Sydney cruelled CSR's plans to spin off its sugar business, citing concerns about the company's future ability to meet asbestos-related claims.
Justice Forrest will decide tomorrow if Mr Berengo's lawyers can amend his statement of claim to incorporate the new allegations of collusive behaviour.
If the judge allows the allegations to proceed, it may pave a new route for claimants in asbestos-related cases who often struggle to prove which of the two Australian asbestos manufacturers was responsible for products that caused their asbestosis or mesothelioma.
Counsel for both James Hardie and CSR criticised the form of the proposed amendments, with Graeme Uren, QC, for CSR describing them in court as ''a porridge of assertions that don't lend easily to a legal conclusion''.
Mr Berengo was a young boy in the early 1970s when he accompanied his father, a builder, to properties where asbestos-cement sheeting and other asbestos products would be sanded, altered or removed.
The proposed allegations are that James Hardie and CSR, which owned Wunderlich, had an agreement or arrangement about how they would influence Australian public opinion and regulatory authorities in the 1970s, and that they co-ordinated their lobbying of authorities and responses to media articles to stifle public concerns about asbestos.
Counsel for Mr Berengo, John Gordon, told the court that his client planned to allege that ''over a considerable period of time, the two companies … formed arrangements, agreements or an understanding to act together to influence the public debate on the dangers of asbestos, and to influence regulatory authorities on the control of, and the use of, the asbestos''.
He said that, as a result, the public was not warned by the companies of the risks and dangers of using asbestos products.
CSR sold Wunderlich to James Hardie in 1976. The case is due to begin on February 15.
___________________________________________________________________________
Hardie, CSR 'colluded', sufferer says LEONIE WOOD
February 8, 2010 .
THE building products manufacturers James Hardie and CSR have been accused in court of joining forces during the 1960s and '70s in a bid to dissuade regulatory authorities from restricting or controlling the use of their potentially lethal asbestos products.
The court has also heard allegations that James Hardie and CSR deliberately did not mark their company names on asbestos-laden products so that they could conceal which company manufactured them - a move which, the court heard, would make it harder to identify which company had liability for future claims of potential injury or disease.
The allegations emerged on Friday before Justice Terry Forrest in the Victorian Supreme Court during preliminary proceedings ahead of a trial in which a Melbourne man, Robert Berengo, is claiming damages from James Hardie's asbestos liability fund, Amaca, and from CSR.
The fresh allegations come just days after Justice Margaret Stone in the Federal Court in Sydney cruelled CSR's plans to spin off its sugar business, citing concerns about the company's future ability to meet asbestos-related claims.
Justice Forrest will decide tomorrow if Mr Berengo's lawyers can amend his statement of claim to incorporate the new allegations of collusive behaviour.
If the judge allows the allegations to proceed, it may pave a new route for claimants in asbestos-related cases who often struggle to prove which of the two Australian asbestos manufacturers was responsible for products that caused their asbestosis or mesothelioma.
Counsel for both James Hardie and CSR criticised the form of the proposed amendments, with Graeme Uren, QC, for CSR describing them in court as ''a porridge of assertions that don't lend easily to a legal conclusion''.
Mr Berengo was a young boy in the early 1970s when he accompanied his father, a builder, to properties where asbestos-cement sheeting and other asbestos products would be sanded, altered or removed.
The proposed allegations are that James Hardie and CSR, which owned Wunderlich, had an agreement or arrangement about how they would influence Australian public opinion and regulatory authorities in the 1970s, and that they co-ordinated their lobbying of authorities and responses to media articles to stifle public concerns about asbestos.
Counsel for Mr Berengo, John Gordon, told the court that his client planned to allege that ''over a considerable period of time, the two companies … formed arrangements, agreements or an understanding to act together to influence the public debate on the dangers of asbestos, and to influence regulatory authorities on the control of, and the use of, the asbestos''.
He said that, as a result, the public was not warned by the companies of the risks and dangers of using asbestos products.
CSR sold Wunderlich to James Hardie in 1976. The case is due to begin on February 15.
Sunday, February 7, 2010
How Often Does Manville Trust Diagnose (and Pay?) Claims 37 Years After Death ?
Today, a new example of issues that arise from secrecy in asbestos litigation. The question in short: How often do asbestos trusts diagnose claims 37 or so years after death, and how often and how much do they pay out for claims that would ordinarily be barred by statutes of limitation?
Chapter 11 asbestos cases, and asbestos trusts, are noteworthy for a penchant for secrecy. The penchant for secrecy applies even though secrecy is perhaps the greatest antithesis of due process, and was an especially detested feature of Star Camber proceedings, as described here in simple terms and here at some length in a wonderfully easy to read but thorough 2009 law review article written by Stephen Wm. Smith, a United States Magistrate Judge in the Southern District of Texas, Houston division. See "Kudzu in the Courthouse: Judgments Made in the Shade," 3 Fed. Cts. L. Rev. # 2, 177 (2009).
Judge Smith explained the problems with secrecy, at 214:
“In our common-law tradition, the exercise of judicial power is an inherently public act. A court of record, by definition, is a court that acts on the record, placing its rulings in the public domain, whether by pronouncement in open court, handwriting on a parchment roll, typing on a docket sheet, or digital key-strokes on-line. It is not merely that publicity has many virtues—promoting public confidence in courts, enhancing reliable fact-finding, and curbing judicial abuse of power. Nor is it simply that the people have already bought and paid for the right to know what their judges do with their office. Rather, it is the public record of judicial decisions that renders those decisions legitimate. Philosophers from Kant to Rawls have written treatises on why this is so, but one of our colonial forebears nailed it with only eight words: “Justice may not be done in a corner.”
How does secrecy play out in asbestos litigation ? In many ways, and they are not all covered here.. For prior examples of asbestos trust secrecy, go here (absence of material data about Manville Trust payments to the not sick), and here (Manville Trust withdrawing data previously made public under licensing agreements). Here's a new example that arises because of an opinion sent along by a friend out east when he enountered a new federal district court opinion that involves asbestos trusts.
According to the pro se complaint, a Mr. Palermo worked with asbestos-contiaing products while working for Halliburton, and "[o]n June 6, 2003, Palermo was posthumously diagnosed with mesothelioma "by a tribunal of asbestos experts who were part of the Extraordinary Claims Panel of the Manville Trust." (Am. Compl. P 17.) How odd is that? To me, it's quite odd since the complaint also alleges that Mr. Palermo had died back in 1966 of metastasis from "stomach cancer."
If true, the allegations indicate that a diagnosis was made some 37 years after death. One may also assume a payment was made by the Manville Trust. The complaint goes to on complain - unsuccessfully - that another trust would not make a payment.
So, what does this all mean in the larger context? It's fairly easy to think that Mr. Palermo may well have actually died of peritoneal mesothelioma due to asbestos-inhalation. And, surely there are arguments to be made for paying compensation whose deaths were wrongfully caused, regardless of the date of death, but those arguments have not succeeded when statutes of limitation are applied. So, for purposes of social policy decision-making, one does have to wonder how often claims of some age are made, how the post-death diagnosis was made (old tissue ? medical records? narrative?), and how much money is paid out each year by the trust for claims of this ilk.
Can answers be obtained? I don't know, but will send an email off to the Manville Trust and will let you know if I hear anything back.
_______________________________________________________________________________
Here are key excerpts from the opinion in Gail Garner v. DII Industries, 2010 U.S. Dist. LEXIS 9583 (Feb 4. 2010).
"Viewing the allegations in the amended complaint as true, the following are the relevant facts for consideration of the present motion. The decedent, Angelo Palermo ("Palermo"), was a union insulation mason for twenty-nine years from 1937 through 1966 in the construction asbestos industry. He spray coated and handled asbestos-containing products while working for one or more of the Haliburton or Harbison-Walker entities. Palermo died on April 23, 1966, at the age of 51 years. (Am. Compl. PP 14 & 34.) His death certificate listed the immediate cause of death as acute liver failure due to "metastasis cancer due to primary stomach (place of origin)." (Am. Compl. PP 11-15.)
On June 6, 2003, Palermo was posthumously diagnosed with mesothelioma "by a tribunal of asbestos experts who were part of the Extraordinary Claims Panel of the Mansville Trust." (Am. Compl. P 17.) On April 4, 2006, Plaintiff filed a claim with DII Industries, LLC, and, the following day, filed a claim with the DII Trust, with regard to her father's death. Defendants eventually rejected the claims, and a pro bono evaluator confirmed Defendants' denial. (Am. Compl. PP 18-27.) (emphasis added)
Chapter 11 asbestos cases, and asbestos trusts, are noteworthy for a penchant for secrecy. The penchant for secrecy applies even though secrecy is perhaps the greatest antithesis of due process, and was an especially detested feature of Star Camber proceedings, as described here in simple terms and here at some length in a wonderfully easy to read but thorough 2009 law review article written by Stephen Wm. Smith, a United States Magistrate Judge in the Southern District of Texas, Houston division. See "Kudzu in the Courthouse: Judgments Made in the Shade," 3 Fed. Cts. L. Rev. # 2, 177 (2009).
Judge Smith explained the problems with secrecy, at 214:
“In our common-law tradition, the exercise of judicial power is an inherently public act. A court of record, by definition, is a court that acts on the record, placing its rulings in the public domain, whether by pronouncement in open court, handwriting on a parchment roll, typing on a docket sheet, or digital key-strokes on-line. It is not merely that publicity has many virtues—promoting public confidence in courts, enhancing reliable fact-finding, and curbing judicial abuse of power. Nor is it simply that the people have already bought and paid for the right to know what their judges do with their office. Rather, it is the public record of judicial decisions that renders those decisions legitimate. Philosophers from Kant to Rawls have written treatises on why this is so, but one of our colonial forebears nailed it with only eight words: “Justice may not be done in a corner.”
How does secrecy play out in asbestos litigation ? In many ways, and they are not all covered here.. For prior examples of asbestos trust secrecy, go here (absence of material data about Manville Trust payments to the not sick), and here (Manville Trust withdrawing data previously made public under licensing agreements). Here's a new example that arises because of an opinion sent along by a friend out east when he enountered a new federal district court opinion that involves asbestos trusts.
According to the pro se complaint, a Mr. Palermo worked with asbestos-contiaing products while working for Halliburton, and "[o]n June 6, 2003, Palermo was posthumously diagnosed with mesothelioma "by a tribunal of asbestos experts who were part of the Extraordinary Claims Panel of the Manville Trust." (Am. Compl. P 17.) How odd is that? To me, it's quite odd since the complaint also alleges that Mr. Palermo had died back in 1966 of metastasis from "stomach cancer."
If true, the allegations indicate that a diagnosis was made some 37 years after death. One may also assume a payment was made by the Manville Trust. The complaint goes to on complain - unsuccessfully - that another trust would not make a payment.
So, what does this all mean in the larger context? It's fairly easy to think that Mr. Palermo may well have actually died of peritoneal mesothelioma due to asbestos-inhalation. And, surely there are arguments to be made for paying compensation whose deaths were wrongfully caused, regardless of the date of death, but those arguments have not succeeded when statutes of limitation are applied. So, for purposes of social policy decision-making, one does have to wonder how often claims of some age are made, how the post-death diagnosis was made (old tissue ? medical records? narrative?), and how much money is paid out each year by the trust for claims of this ilk.
Can answers be obtained? I don't know, but will send an email off to the Manville Trust and will let you know if I hear anything back.
_______________________________________________________________________________
Here are key excerpts from the opinion in Gail Garner v. DII Industries, 2010 U.S. Dist. LEXIS 9583 (Feb 4. 2010).
"Viewing the allegations in the amended complaint as true, the following are the relevant facts for consideration of the present motion. The decedent, Angelo Palermo ("Palermo"), was a union insulation mason for twenty-nine years from 1937 through 1966 in the construction asbestos industry. He spray coated and handled asbestos-containing products while working for one or more of the Haliburton or Harbison-Walker entities. Palermo died on April 23, 1966, at the age of 51 years. (Am. Compl. PP 14 & 34.) His death certificate listed the immediate cause of death as acute liver failure due to "metastasis cancer due to primary stomach (place of origin)." (Am. Compl. PP 11-15.)
On June 6, 2003, Palermo was posthumously diagnosed with mesothelioma "by a tribunal of asbestos experts who were part of the Extraordinary Claims Panel of the Mansville Trust." (Am. Compl. P 17.) On April 4, 2006, Plaintiff filed a claim with DII Industries, LLC, and, the following day, filed a claim with the DII Trust, with regard to her father's death. Defendants eventually rejected the claims, and a pro bono evaluator confirmed Defendants' denial. (Am. Compl. PP 18-27.) (emphasis added)
Friday, February 5, 2010
Canadian Securities Class Actions - 2009 Summarized
Go here for a sumamry from D & O Diary of NERA's new study/report on Canadian securities cases.
Tuesday, February 2, 2010
Juror Comments on the $ 37 Million Bad Faith Verdict
Here is the link to juror comments on the $ 37 million bad faith verdict for rescission of a health care policy. Some excerpts are pasted below:
"In the case of Jennifer Latham, who was badly injured in 2005 when her car was broadsided by a meth dealer fleeing cops, Assurant denied her claim because ambiguous information about a uterine condition and an ER visit for a panic attack wasn't disclosed in the application she submitted months earlier.
As first reported here, the jury decided after six hours to award Latham and her two youngest children $37.3 million, including economic and punitive damages -- the largest bad-faith judgment against an insurance company in Colorado history.
But some jurors wanted to award even more.
Jury foreman Dan Vela says he was in favor of awarding Latham $150 million as a way of punishing the insurance company. "They didn't have a leg to stand on," says Vela, a general manager for a seamless gutter company. "I hope we sent a message back to them that this was wrong."
Jurors contacted by Westword say that Assurant failed to prove that Latham deliberately misrepresented her health on her application or that the company had conducted a reasonable investigation before revoking her coverage. Testimony indicated that the company's "rescission panel" reviewed more than a hundred cases in two hours -- "68 seconds apiece," as Latham attorney Marc Levy put it in his closing argument.
"We had to determine who was lying," says juror Denise Kaatz, a production manager for a Louisville apparel company. "Most of their witnesses seemed dishonest, defensive and just showed a basic lack of humanity. It was kind of frightening."
"I was blown away by just how much they acted like robots," adds Vela.
"In the case of Jennifer Latham, who was badly injured in 2005 when her car was broadsided by a meth dealer fleeing cops, Assurant denied her claim because ambiguous information about a uterine condition and an ER visit for a panic attack wasn't disclosed in the application she submitted months earlier.
As first reported here, the jury decided after six hours to award Latham and her two youngest children $37.3 million, including economic and punitive damages -- the largest bad-faith judgment against an insurance company in Colorado history.
But some jurors wanted to award even more.
Jury foreman Dan Vela says he was in favor of awarding Latham $150 million as a way of punishing the insurance company. "They didn't have a leg to stand on," says Vela, a general manager for a seamless gutter company. "I hope we sent a message back to them that this was wrong."
Jurors contacted by Westword say that Assurant failed to prove that Latham deliberately misrepresented her health on her application or that the company had conducted a reasonable investigation before revoking her coverage. Testimony indicated that the company's "rescission panel" reviewed more than a hundred cases in two hours -- "68 seconds apiece," as Latham attorney Marc Levy put it in his closing argument.
"We had to determine who was lying," says juror Denise Kaatz, a production manager for a Louisville apparel company. "Most of their witnesses seemed dishonest, defensive and just showed a basic lack of humanity. It was kind of frightening."
"I was blown away by just how much they acted like robots," adds Vela.
Citizens in India Protest Abestos Fiber Sales from Canada
Here's another example of global activism regarding asbestos. Here is the article online; the full text is pasted below.
February 1, 2010
Indian workers rebuke Quebec over asbestos
By CBC News
Unionized workers and activists in India capitalized on Quebec's trade mission this week to blast the province for its active role on the global asbestos market.
Unionized workers and activists in India capitalized on Quebec's trade mission this week to blast the province for its active role on the global asbestos market.
'It will be remembered as an act of barbarism in the history of industrial development where asbestos was knowingly allowed to be used, and where workers were knowingly subjected to it.'?Gobal Krishna, activist
While Quebec Premier Jean Charest led his 130-person mission through meetings with local business leaders and entrepreneurs, Indian opponents spoke out against the asbestos industry, blaming it for making workers in the subcontinent ill.
It's hypocritical for Quebec to ban the use of chrysotile asbestos at home, while selling it to countries in the developing world, said activist Gobal Krishna.
"It will be remembered as an act of barbarism in the history of industrial development where asbestos was knowingly allowed to be used, and where workers were knowingly subjected to it," Krishna told reporters at the news conference in Mumbai.
Asbestos has been banned by nearly every developed country and a growing number of developing nations, but countries like India still rely on the flame-resistant mineral for construction projects.
At least 20 per cent of workers in India are exposed to asbestos on a regular basis, and the building material is responsible for making many Indian workers sick, accused Sanjay Singhvi, secretary general of the Trade Union Centre of India, a labour federation.
Asbestos can't be used safely in India, he said.
The United Nations says chrysotile asbestos, widely used in building materials, accounted for about 94 per cent of global asbestos production and is considered a carcinogen by the World Health Organization. At least 90,000 people die each year from asbestos-related diseases such as lung cancer and mesothelioma, the UN said.
Singhvi said he was disappointed Charest refused to meet with his organization during the weeklong trade mission. Charest's office said Quebec promotes the responsible use of asbestos.
Quebec exports to India hit $427M
Charest arrived in Mumbai on Sunday with 130 Quebecers participating in the trade mission.
The premier said the mission aims to promote Quebec expertise in infrastructure, environmental technologies and telecommunications to the Indian market, which counts more than 1.2 billion people.
Thirteen deals were penned between Quebec and Indian companies on Monday, including an agreement with a Quebec City company specializing in cleaning industrial waste water.
Quebec exported $427 million in goods to India in 2008, including airplanes, paper, asbestos and electronics.
Opposition Parti Québécois members accuse Charest of fleeing to foreign lands in order to avoid political pressure at home, including calls for a public inquiry into the province's dysfunctional construction industry.
Quebec operates two asbestos mines.
February 1, 2010
Indian workers rebuke Quebec over asbestos
By CBC News
Unionized workers and activists in India capitalized on Quebec's trade mission this week to blast the province for its active role on the global asbestos market.
Unionized workers and activists in India capitalized on Quebec's trade mission this week to blast the province for its active role on the global asbestos market.
'It will be remembered as an act of barbarism in the history of industrial development where asbestos was knowingly allowed to be used, and where workers were knowingly subjected to it.'?Gobal Krishna, activist
While Quebec Premier Jean Charest led his 130-person mission through meetings with local business leaders and entrepreneurs, Indian opponents spoke out against the asbestos industry, blaming it for making workers in the subcontinent ill.
It's hypocritical for Quebec to ban the use of chrysotile asbestos at home, while selling it to countries in the developing world, said activist Gobal Krishna.
"It will be remembered as an act of barbarism in the history of industrial development where asbestos was knowingly allowed to be used, and where workers were knowingly subjected to it," Krishna told reporters at the news conference in Mumbai.
Asbestos has been banned by nearly every developed country and a growing number of developing nations, but countries like India still rely on the flame-resistant mineral for construction projects.
At least 20 per cent of workers in India are exposed to asbestos on a regular basis, and the building material is responsible for making many Indian workers sick, accused Sanjay Singhvi, secretary general of the Trade Union Centre of India, a labour federation.
Asbestos can't be used safely in India, he said.
The United Nations says chrysotile asbestos, widely used in building materials, accounted for about 94 per cent of global asbestos production and is considered a carcinogen by the World Health Organization. At least 90,000 people die each year from asbestos-related diseases such as lung cancer and mesothelioma, the UN said.
Singhvi said he was disappointed Charest refused to meet with his organization during the weeklong trade mission. Charest's office said Quebec promotes the responsible use of asbestos.
Quebec exports to India hit $427M
Charest arrived in Mumbai on Sunday with 130 Quebecers participating in the trade mission.
The premier said the mission aims to promote Quebec expertise in infrastructure, environmental technologies and telecommunications to the Indian market, which counts more than 1.2 billion people.
Thirteen deals were penned between Quebec and Indian companies on Monday, including an agreement with a Quebec City company specializing in cleaning industrial waste water.
Quebec exported $427 million in goods to India in 2008, including airplanes, paper, asbestos and electronics.
Opposition Parti Québécois members accuse Charest of fleeing to foreign lands in order to avoid political pressure at home, including calls for a public inquiry into the province's dysfunctional construction industry.
Quebec operates two asbestos mines.
Monday, February 1, 2010
New Science - Exhaled breath condensate biomarkers in asbestos-related lung disorders
Remember those controversies about biased doctors misreading reading x-rays to find asbestosis or "pleural changes consistent with exposure" to asbestos or silica ? New science will bring new controversies - see below for a recent article on using biomarkers in exhaled breath to find asbestosis. Here is the online source of the abstract pasted below.
_____________________________________________________________________________
Exhaled breath condensate biomarkers in asbestos-related lung disorders.
Sharron Chow, Charlotte Campbell, Alessandra Sandrini, Paul S Thomas, Anthony R Johnson, ...Deborah H Yates show all
Respiratory Medicine (2009)
Volume: 103, Issue: 8, Pages: 1091-1097
PubMed ID: 19520561
Abstract
OBJECTIVES: Asbestos induces generation of reactive oxygen and nitrogen species in laboratory studies. Several such species can be measured non-invasively in humans in exhaled breath condensate (EBC) but few have been evaluated. This study aimed to assess oxidative stress and lung inflammation in vivo. METHODS: Eighty six men were studied: sixty subjects with asbestos-related disorders (asbestosis: 18, diffuse pleural thickening (DPT): 16, pleural plaques (PPs): 26) and twenty six age- and gender-matched normal individuals. RESULTS: Subjects with asbestosis had raised EBC markers of oxidative stress compared with normal controls [8-isoprostane (geometric mean (95% CI) 0.51 (0.17-1.51) vs 0.07 (0.04-0.13) ng/ml, p<0.01); hydrogen peroxide (13.68 (8.63-21.68) vs 5.89 (3.99-8.69) microM, p<0.05), as well as increased EBC total protein (17.27 (10.57-28.23) vs 7.62 (5.13-11.34) microg/ml, p<0.05), and fractional exhaled nitric oxide (mean+/-SD) (9.67+/-3.26 vs 7.57+/-1.89ppb; p<0.05). EBC pH was lower in subjects with asbestosis compared with subjects with DPT (7.26+/-0.31 vs 7.53+/-0.24; p<0.05). There were no significant differences in exhaled carbon monoxide, EBC total nitrogen oxides and 3-nitrotyrosine between any of the asbestos-related disorders, or between these and controls. CONCLUSION: In asbestos-related disorders, markers of inflammation and oxidative stress are significantly elevated in subjects with asbestosis compared with healthy individuals but not in pleural diseases
_____________________________________________________________________________
Exhaled breath condensate biomarkers in asbestos-related lung disorders.
Sharron Chow, Charlotte Campbell, Alessandra Sandrini, Paul S Thomas, Anthony R Johnson, ...Deborah H Yates show all
Respiratory Medicine (2009)
Volume: 103, Issue: 8, Pages: 1091-1097
PubMed ID: 19520561
Abstract
OBJECTIVES: Asbestos induces generation of reactive oxygen and nitrogen species in laboratory studies. Several such species can be measured non-invasively in humans in exhaled breath condensate (EBC) but few have been evaluated. This study aimed to assess oxidative stress and lung inflammation in vivo. METHODS: Eighty six men were studied: sixty subjects with asbestos-related disorders (asbestosis: 18, diffuse pleural thickening (DPT): 16, pleural plaques (PPs): 26) and twenty six age- and gender-matched normal individuals. RESULTS: Subjects with asbestosis had raised EBC markers of oxidative stress compared with normal controls [8-isoprostane (geometric mean (95% CI) 0.51 (0.17-1.51) vs 0.07 (0.04-0.13) ng/ml, p<0.01); hydrogen peroxide (13.68 (8.63-21.68) vs 5.89 (3.99-8.69) microM, p<0.05), as well as increased EBC total protein (17.27 (10.57-28.23) vs 7.62 (5.13-11.34) microg/ml, p<0.05), and fractional exhaled nitric oxide (mean+/-SD) (9.67+/-3.26 vs 7.57+/-1.89ppb; p<0.05). EBC pH was lower in subjects with asbestosis compared with subjects with DPT (7.26+/-0.31 vs 7.53+/-0.24; p<0.05). There were no significant differences in exhaled carbon monoxide, EBC total nitrogen oxides and 3-nitrotyrosine between any of the asbestos-related disorders, or between these and controls. CONCLUSION: In asbestos-related disorders, markers of inflammation and oxidative stress are significantly elevated in subjects with asbestosis compared with healthy individuals but not in pleural diseases
Sunday, January 31, 2010
$ 37 Million Bad Faith Verdict - Post-Claim Underwriting by a Health Insurer
So, after I finished up my first post this morning, Mike sent around this link to a blog post about a new
$ 37 million bad faith verdict against an insurer that uses "post-claim underwriting" as one of its business methods. Plaintiff's counsel suggested $ 7 million in damages - the jury awarded $ 37 million.
Is this a reasonable verdict ? The more I see, the more I have to say: yes, it is a reasonable and logical verdict very precisely intended to deter bad corporate behavior. I say that after spending 25 years as a commerical litigator who has seen plenty of corporate behavior, most of it quite good and well intended, but sometimes there are in fact good faith misunderstandings and disputes. But, as to insurers, I keep seeing simply inexcusable behavior from some of them. For example, one corporate client has been battling insurers for 27 years (really !) to obtain coverage for asbestos claims that plainly are covered. In other situations, insurers appoint defense counsel who may be fabulous trial lawyers but cannot effectively represent my clients because they labor under conflicts of interest created by too many clients, with some of the clients having conflicting defense strategies. For example, most asbestos products contain white (chrysotile) asbestos fibers. Some experts say pure chrysotile cannot cause cancer because it breaks down quickly in the lungs. Whether or not one accept that defense completely, any decent defense lawyer for a seller of a chrysotile produce always looks for and wants to blame a particular plaintiff's disease on inhalation of amphibole asbestos fibers, which include but are not limited to the blue (crocidolite) and brown (amosite) asbestos fibers, not to mention tremolite and other asbestoform minerals and man made substances. Why blame the amphiboles ? Because amphibole fibers are FAR, FAR more toxic than are chrystotile fibers. Numerically, that means perhaps a 500 - 1 potency ratio when comparing crocidolite to chrysotile. Indeed, even hard core plaintiff's expert Dr. Richard Lemen acknowledges that amphibole fibers are incredibly potent; he simply will not exonerate chrsyotile fibers, especially when they include tremolite or other amphibole contamints (go here to see an article on this topic by Dr. Lemen and others).
To return to the point that started this post, some insurers should indeed see a message in the $37 million verdict. Here are some key excerpts from the article:
"Longmont teacher Jennifer Latham and her husband Frank both suffered broken bones, internal injuries and brain injuries from the crash. But Time Insurance, also known as Fortis and Assurant Health, rescinded a health insurance policy Jennifer had recently taken out, claiming that she'd failed to disclose a complete and accurate health history on its application form--leaving her with more than $180,000 in medical bills.
Time is notorious in the health insurance industry for its "post-claim underwriting"--going back to the application after a claim is made to determine if misrepresentations were made that would warrant revoking the policy, even if the medical conditions involved have nothing to do with the claim. A similar case in South Carolina, in which the company rejected coverage for a teenager who discovered through a blood donation that he had AIDS, resulted in a $10 million punitive judgment. That verdict was upheld last fall by the state's supreme court.
In closing arguments of the two-week Boulder trial, Latham attorney Marc Levy asked for $2 million in economic damages and roughly $5 million in punitive damages. "You are the final stop," he told the Boulder County jury of four women and two men. "You are the conscience of the community. Is this the way we want health insurance companies to act?"
Time attorney Walter Wilson maintained that Latham had failed to disclose certain medical information on the application, including one trip to an emergency room for "shortness of breath" that Latham maintains was a panic attack. He argued that evidence of her "alleged emotional distress" from cancellation of her health insurance "is scant at best and nonexistent in reality."
***
Testimony from Time officials indicated that the company only rescinds half of one percent of its policies--but that resulted in more than 8000 rescissions over a five-year period, saving the company $150 million in unpaid claims.
The Latham case and the practice of rescission in the health insurance industry is the subject of an upcoming Westword feature. Stay tuned."
$ 37 million bad faith verdict against an insurer that uses "post-claim underwriting" as one of its business methods. Plaintiff's counsel suggested $ 7 million in damages - the jury awarded $ 37 million.
Is this a reasonable verdict ? The more I see, the more I have to say: yes, it is a reasonable and logical verdict very precisely intended to deter bad corporate behavior. I say that after spending 25 years as a commerical litigator who has seen plenty of corporate behavior, most of it quite good and well intended, but sometimes there are in fact good faith misunderstandings and disputes. But, as to insurers, I keep seeing simply inexcusable behavior from some of them. For example, one corporate client has been battling insurers for 27 years (really !) to obtain coverage for asbestos claims that plainly are covered. In other situations, insurers appoint defense counsel who may be fabulous trial lawyers but cannot effectively represent my clients because they labor under conflicts of interest created by too many clients, with some of the clients having conflicting defense strategies. For example, most asbestos products contain white (chrysotile) asbestos fibers. Some experts say pure chrysotile cannot cause cancer because it breaks down quickly in the lungs. Whether or not one accept that defense completely, any decent defense lawyer for a seller of a chrysotile produce always looks for and wants to blame a particular plaintiff's disease on inhalation of amphibole asbestos fibers, which include but are not limited to the blue (crocidolite) and brown (amosite) asbestos fibers, not to mention tremolite and other asbestoform minerals and man made substances. Why blame the amphiboles ? Because amphibole fibers are FAR, FAR more toxic than are chrystotile fibers. Numerically, that means perhaps a 500 - 1 potency ratio when comparing crocidolite to chrysotile. Indeed, even hard core plaintiff's expert Dr. Richard Lemen acknowledges that amphibole fibers are incredibly potent; he simply will not exonerate chrsyotile fibers, especially when they include tremolite or other amphibole contamints (go here to see an article on this topic by Dr. Lemen and others).
To return to the point that started this post, some insurers should indeed see a message in the $37 million verdict. Here are some key excerpts from the article:
"Longmont teacher Jennifer Latham and her husband Frank both suffered broken bones, internal injuries and brain injuries from the crash. But Time Insurance, also known as Fortis and Assurant Health, rescinded a health insurance policy Jennifer had recently taken out, claiming that she'd failed to disclose a complete and accurate health history on its application form--leaving her with more than $180,000 in medical bills.
Time is notorious in the health insurance industry for its "post-claim underwriting"--going back to the application after a claim is made to determine if misrepresentations were made that would warrant revoking the policy, even if the medical conditions involved have nothing to do with the claim. A similar case in South Carolina, in which the company rejected coverage for a teenager who discovered through a blood donation that he had AIDS, resulted in a $10 million punitive judgment. That verdict was upheld last fall by the state's supreme court.
In closing arguments of the two-week Boulder trial, Latham attorney Marc Levy asked for $2 million in economic damages and roughly $5 million in punitive damages. "You are the final stop," he told the Boulder County jury of four women and two men. "You are the conscience of the community. Is this the way we want health insurance companies to act?"
Time attorney Walter Wilson maintained that Latham had failed to disclose certain medical information on the application, including one trip to an emergency room for "shortness of breath" that Latham maintains was a panic attack. He argued that evidence of her "alleged emotional distress" from cancellation of her health insurance "is scant at best and nonexistent in reality."
***
Testimony from Time officials indicated that the company only rescinds half of one percent of its policies--but that resulted in more than 8000 rescissions over a five-year period, saving the company $150 million in unpaid claims.
The Latham case and the practice of rescission in the health insurance industry is the subject of an upcoming Westword feature. Stay tuned."
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