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There was no way the sprinkler system in Diversified Records’ West Pittston, Pa., warehouse could have doused the 1997 fire that destroyed more than 800,000 boxes of documents. It was never completed, let alone activated. Nevertheless, a Luzerne County, Pa., jury found the sprinkler system’s maker, Grinnell Corp., partially at fault for a blaze that burned for days, destroying the massive warehouse and tens of thousands of records belonging to clients including First Union Bank and Mobil Oil. On Jan. 17, jurors awarded Mobil $20.7 million, a month after awarding First Union $20.5 million in compensation for documents turned to ash by the fire. Although Diversified was found 60 percent liable, Grinnell, found 40 percent liable, may bear the brunt of the judgment, said Grinnell’s lawyers, John Bell and Robert McNamara of Chicago’s Johnson & Bell. “They’ve already told everybody they’re going to bankruptcy,” Bell said last week of Diversified. He called the trial “a travesty. Grinnell was the deep pocket and the judge made some rulings that affected our ability to get a fair trial.” Bell and McNamara had argued that Grinnell’s system should not be considered defective because it was never completed. But jurors found that even if it the system was up and running, it could not have saved the documents. Determining how much those papers were worth became a time-consuming process for the jury. First Union, which lost 152,000 boxes, and Mobil, which lost 68,000, argued that they should be compensated for the lost documents and the time it would take to reconstruct them, as well as for future costs and losses they might incur. Mobil was awarded $7.4 million for tax losses attributed to missing financial papers and more than $874,000 for past and future losses related to the loss of records for underground storage tanks in California. It won another $3 million for destroyed marine library records related to engineering and technical work across the globe. “Most of the 68,000 boxes of lost documents cannot be replaced or reconstructed without significant cost,” said Mobil attorney Richard Stabinski of Phelan Pettit & Biedrzycki of Philadelphia. “The jury recognized this fact and acted accordingly.” Bell said Grinnell will appeal both judgments.

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