Asbestos plaintiffs have filed motions opposing Ford Motor Co.’s bid to view sealed information that led a bankruptcy judge to conclude that their attorneys withheld evidence of “demonstrable misrepresentation” in the bankruptcy of Garlock Sealing Technologies LLC.
U.S. Bankruptcy Judge George Hodges of the Western District of North Carolina lost jurisdiction pending an appeal by news organization Legal Newsline of an order denying it access to sealed estimates of the value of claims against Garlock, a frequent co-defendant with Ford in asbestos cases, the plaintiffs said.
“Although Ford is not a party to the appeal, Ford’s motion unquestionably presents issues that are pending before the District Court in Legal Newsline’s appeal,” the plaintiffs said.
At issue is whether the public has a right to know about testimony and exhibits entered into evidence during parts of a closed hearing that led the court to its estimate of Garlock’s aggregate liability, the plaintiffs said.
In a case of first impression, Hodges found that a $9 million verdict in California and a $1.35 million verdict in Texas and additional plaintiffs wins resulted after plaintiffs attorneys withheld evidence of their clients’ exposure to other sources of asbestos.
Ford argues it might have relied upon misrepresentations of asbestos exposures and needs access to the sealed material to investigate.
In a separate motion, the asbestos claimants objected to a motion for access by Aetna Inc. and Rawling Co. LLC to the sealed evidence. Aetna is an insurer and Rawling a cost-containment vendor for insurers. The companies said they need access to protect their subrogation rights against asbestos defendants and reimbursement rights against members of insurance plans.
Among other arguments, the plaintiffs said the rights claimed by Aetna and Rawling don’t exist in some states.
“In North Carolina, for example, the law prohibits insurers, such as Aetna and Rawling’s other customers, from writing subrogation language into their insurance policies,” the plaintiffs said. “In New York, the state where Garlock’s manufacturing facilities are located, state law effectively bars health insurers from pursuing subrogation or reimbursement claims against plaintiffs and defendants who settle personal injury claims.”
Amaris Elliott-Engel contributes to law.com.