May 23, 2012
LegalNewsine.com: Delaware judge disgusted with bankruptcy trust secrecy
WILMINGTON, Del. (Legal Newsline) – Texas attorney Brent Coon submitted 20 claims to asbestos bankruptcy trusts on behalf of a Florida woman’s estate without the client’s new lawyers knowing, court records in Delaware show.
Those claims also painted a different picture as to how June Montgomery was exposed to asbestos. Her lawsuit, filed in Delaware against 22 companies, said her husband Arthur brought the material home from work on his clothes.
In one of her bankruptcy trust submissions, however, she claimed exposure through her employment at Samuel Ward Manufacturing in Boston. Florida law, which governed the Delaware case, allows juries to apportion percentages of liability to non-defendants.
Judge Peggy Ableman, of the New Castle County Superior Court, showed disgust during a November hearing after the claims were brought to light by Scott Barnes, an attorney with Florida firm Levin Papantonio. June’s son Brian, who represented her estate after her April 2010 death, mentioned two bankruptcy settlements to Barnes on Nov. 5, the Saturday before a trial was to begin.
“This is dishonesty at its highest level,” Ableman said. “This is a guy who got checks and never reported those to you. It affected their discovery.”
Foster Wheeler Energy Corp. had filed a motion Oct. 27 seeking disclosure of pre-trial settlements, but Barnes replied that there were none. Ableman denied the motion as moot.
More than 60 bankruptcy trusts have been created to allow former asbestos defendants pay out claims. The trust system acts independently of the civil justice system, where solvent companies are sued.
“This is really seriously egregiously bad behavior,” she said. “This is misrepresenting. This is trying to defraud.
“I don’t like that in this litigation, and it happens a lot. And I’m trying to put an end to it. This is an example of the games that are played.”
Coon’s firm had referred the Montgomerys to the Levin firm. At a deposition the day after Barnes’ email brought the bankruptcy claims to light, Brian Montgomery testified that he did not attempt to make the Levin firm and its co-counsel aware of the claims.
He also said that he had no plans to ask Coon about the status of other claims. Foster Wheeler wrote in a motion to dismiss the case that Brian Montgomery would not definitively say if Coon was still acting on behalf of the estate with his consent.
At the time of the motion, Montgomery’s estate had settled with the bankruptcy trusts of Keene, Celotex and Johns Manville. Another 17 remained pending.
Two bankruptcy claim forms indicated that June Montgomery died on April 3, 2010. The company argued that proves someone with the family had contacted Coon’s firm after the firm referred it to Levin Papantonio.
“In other words, if Brian Montgomery did not have further contact with the attorneys at Brent Coon & Associates (except, of course, to accept checks from them and deposit the same), someone representing his family or the estate must have contacted the lawyers at Brent Coon’s office to advise them that Mrs. Montgomery had died,” the motion says.
“Although it is not clear from this record who that person was, it seems reasonable to suspect that the individual worked for one of the other three law firms that have been representing the Montgomery family and estate in this litigation.”
Another inconsistency pointed out by the company involved drywall work conducted by Arthur Montgomery.
He had associated Georgia Pacific with his drywall work, but claims were submitted by Coon to United States Gypsum and National Gypsum – companies whose primary products were drywall-related, the company said.
“In other words, the representations to the bankruptcy trusts paint a much broader allegation of exposure to asbestos than either Plaintiff or Plaintiff’s counsel let on during the course of the litigation in Delaware,” the motion says.
“In an effort to obtain money from 20 other entities, Plaintiff admitted that Mrs. Montgomery was exposed to asbestos from their products. Yet Plaintiff did not share that information with Plaintiff’s own experts, likely because Dr. Legier would say that all of those exposures were substantial factors in causing Mrs. Montgomery’s disease, thereby severely undermining the claimed ‘bystander’ exposure from work Mr. Montgomery did as an electrician.”
After a February hearing before Judge John Parkins, the two sides agreed to dismiss the case. Had the plaintiff wanted to proceed, the defense would have been allowed to conduct new discovery paid for by the plaintiff.
Foster Wheeler was the lone remaining defendant that had not settled. Coon could not immediately be reached for comment.