Amicus
News
No.
5. May 13, 1996
Asbestos
Class Settlement Decertified by 3rd Circuit
On May
10, the U.S. Court of Appeals for the Third Circuit blocked a class action
settlement that would have affected the liability claims of 250,000 to 2
million workers injured by asbestos. Georgine v. Amchem Products, Inc.,
No. 94-1925 (3rd Cir ., May 10, 1996). The court held that the action failed
to satisfy the requirements for a class action under Fed. R. Civ. Pro. 23
and contained inherent conflicts of interests between those presently injured
and future claimants.
The agreement
was negotiated by the Center for Claims Resolution, representing asbestos
suppliers, and several attorneys who represent asbestos claimants. Plaintiffs
filed a class action on behalf of all workers exposed to defendants asbestos
products. At the same time, the parties filed a proposed settlement agreement.
For claimants who did not opt out of the class, the agreement essentially
replaced their tort claims with an administrative scheme providing a schedule
of payments for various asbestos-r elated injuries. The District Court certified
the class and determined that the settlement was fair.
AAJ filed
an amicus curiae brief in the district court which focussed on the loss
of the right to trial by jury for persons who have been exposed to asbestos,
but have not yet manifested any injury. The brief suggested that, at minimum,
those claimants be afforded an opportunity when they develop an asbestos
disease to choose to pursue their claims in a common law tort action.
In an
opinion by Judge Becker, the court of appeals ruled that class actions filed
for settlement purposes must meet the same criteria under Rule 23 that apply
to litigation classes. Because of the differences among claimants as to
the type of injury, ca usation and damages, the court found that the class
action did not satisfy the requirements of typicality of claims and commality
of issues. Of particular importance, Judge Becker stated, was the conflict
of interest between different groups of class memb ers. Presently injured
claimants have an interest in maximizing current payments, while future
claimants will wish to preserve resources for future payments. Judge Becker
suggested that the difficult issues posed by mass torts might require Congressional
action. However, reform must come from the policymakers, not the courts.
AAJs
amicus brief and the text of the courts opinion can be downloaded from AAJ/NET
at www.justice.org in the Courts section. For further information, please
contact Jeffrey White.
Phone:
202-965-3500 x310
FAX: 202-955-0920
E-Mail:
jeffrey.white@justice.org
|
