Archive for the ‘Pennsylvania’ Category

March 21, 2008, Philadelphia - A bankruptcy judge has ruled that Federal-Mogul Corp. insurers may have to pay more than $500 million for asbestos damages under the Chapter 11 plan that allowed the company to emerge from bankruptcy in 2007.

Federal-Mogul Corp. is just one in a long list of companies-that includes industry giants such as W.R. Grace-that were forced to file for bankruptcy to manage vast numbers of asbestos liability lawsuits.

Judge Judith Fitzgerald of the US Bankruptcy Court in Pittsburgh ruled against more than two dozen insurance companies that had been fighting to avoid paying damages claims laid in connection with Federal-Mogul Corp.’s asbestos-containing products.

The insurance companies argued that they shouldn’t be forced to pay into a trust the company had set up while in Chapter 11, as they had bargained to cover damage claims that had been laid against the company.

There are five insurance companies involved in the dispute, including Ace Property & Casualty Insurance Co., AIG Casualty Co., Allianze Global Corporate & Specialty AG, Firstman’s Fund Insurance Co. and Hartford Accident and Indemnity Co.

Plaintiff attorney Peter Van N. Lockwood said that more than $500 million worth of insurance policies is at stake.

Judge Fitzgerald’s decision resolves an issue that was left wide open when Federal-Mogul Corp. exited from Chapter 11 bankruptcy in December 2007. The company was allowed to emerge even while asbestos claimants and insurers were waiting for the judge to make a ruling on the issue of insurance coverage.

The new ruling was made public on Thursday, when Judge Fitzgerald told insurance companies they would have to pay the claims that the Federal-Mogul asbestos trust was currently handling. Judge Fitzgerald pointed out that the insurance companies would have had to pay Federal-Mogul if the company had not filed for bankruptcy.

However, the insurance companies had made the challenge on the grounds that paying into the trust and paying Federal-Mogul isn’t the same thing. They believe the trust is not motivated to defend itself against claims that might be worthless, whereas the company itself had motivation to do so.

Fitzgerald’s ruling has preserved a strategy that is favored by corporations that have massive problems with tort liabilities. A company in this situation can divert damage claims away from itself by using their insurers to partially fund the trusts they create.

If the judge had ruled in favor of the insurance companies, it would have set a precedent that would deny other companies the ability to use insurance policies to fund Chapter 11 trusts.

Such a ruling would also have been an enormous blow to people with asbestos-related diseases hoping to claim compensation from the companies they believed to be responsible, as it may have become more difficult to do so-particularly in the current Federal-Mogul case.

March 20, 2008 – A Philadelphia jury awarded $25.2 million in compensatory and punitive damages in an asbestos-related lawsuit. Two other cases that had been consolidated with the first were settled before liability was established. In those cases the jury established potential damages of $12.6 million.

All three of the cases involved death from malignant mesothelioma, an aggressive and almost invariably fatal cancer that occurs only as a result of exposure to asbestos.

The jury in the six week trial arrived at damages verdicts for all three cases on February 14. Between then and the liability verdict on March 14, two of the three cases were settled. In each of the three cases, several defendants settled prior to the damages phase.

The case that continued to the liability phase was settled in the estate of James Baccus, who died of malignant mesothelioma after beginning legal action. In this case $7 million in compensatory damages and $18.2 million in punitive damages were awarded.

James Baccus had served in the US Navy in Philadelphia, allegedly coming into contact with asbestos in the course of his service. However, he had also allegedly been exposed in Kentucky, and had also once worked for American Synthetic Rubber.

The case was brought against Crane Co., John Crane and Yarway. In addition to the $7 million in compensatory damages, the $18.2 million punitive damages was apportioned with 45% against John Crane, 35% against Crane Co., and 20% against Yarway.

In addition, the jury found both Crane Co. and Yarway “grossly negligent for failure to warn of the dangers of asbestos in reckless disregard of the safety of others,” assessing $11.9 million and $6.3 million in punitive damages respectively.

Several other defendants settled before even the compensatory damages phase of the trial. These included Ingersoll Rand, THAN, IMO/DeLaval, Westinghouse, Owens Illinois and Goulds Pumps.

An attorney for the defendents admitted to being “highly confident” that Crane Co. and Yarway would appeal the awards, saying that the verdict was considered “very unusual.”

The other cases, which were both settled before the liability phase of the trial, also involved men who had died from mesothelioma.

Richard Scherr died from mesothelioma at 71, after allegedly being exposed to asbestos while working for construction company PFK-Mark III Inc. The compensatory portion of the trial awarded Scheerr’s family and estate $8.6 million.

William Wheeler died twelve months after diagnosis of malignant mesothelioma, at the age of 67. Wheeler was a union painter who was allegedly exposed to asbestos at several different sites. The jury awarded Wheeler’s estate $4 million in compensatory damages.

March 18, 2008, Pittsburg, Pennsylvania – The family of an Indiana County, Pennsylvania man who died in 2005 was awarded a total of $226,000 last week. The jury in the case ruled that the man’s death was a result of asbestos exposure.

George Baroni, who died from mesothelioma at the age of 73, had worked for Fisher Scientific from 1959 to 1994. Baroni was later diagnosed with pleural mesothelioma.

Malignant mesothelioma is a cancer that develops in the lining of the lungs, and is known to develop only in people who have been exposed to inhalable asbestos fibers. Mesothelioma is difficult to diagnose early, is highly aggressive, and is very treatment-resistant. The disease is incurable, and has an almost 100% mortality rate.

Fisher Scientific was one of five companies sued by the family of George Baroni. Each of the five companies manufactured products that allegedly contained asbestos fibers. The other companies involved in the case were F.B. Wright Co., George Hamilton Inc, Pittsburgh Gage Co., and Taylored Industries of Harmarville in Allegheny County.

Of the five, F.B. Wright Co., George Hamilton Inc, and Pittsburgh Gage Co. settled out of court. Taylored Industries has not settled.

Since 2000, Fisher Scientific has been involved in several lawsuits filed in Indiana County. All of the lawsuits involved plaintiffs who were former company employees that had developed asbestos-related diseases.

In the past several decades, an increasing number of lawsuits have been brought against companies that were once involved in the production of asbestos or the use of the substance in manufacturing.

Once highly prized for its high tensile strength, fire resistance, and insulating properties, asbestos is now publicly known to be a serious health hazard that causes chronic lung conditions as well as cancer.

Following in the wake of the knowledge that many companies involved in the production or use of asbestos had full understanding of the dangers the substance posed to employees, asbestos-related lawsuits have become almost commonplace.

A group of companies and trade associations known collectively as the Asbestos Alliance estimates that there are at least 200,000 asbestos-related lawsuits pending, out of a total of more than 730,000 that have already been filed. Collectively, asbestos lawsuits have already cost approximately $70 billion in claims and fees.

In the wake of that $70 billion figure, and of more highly publicized asbestos verdicts worth up to tens of millions of dollars for individuals with asbestos-related diseases, $226,000 may seem like a drop in the bucket. For the family of George Baroni, however the legal victory of having named those responsible for Baroni’s death is surely worth much more.

March 18, 2008, Philadelphia - W.R. Grace, the company that contaminated an entire town with asbestos, is in more financial trouble following the news that some lenders have refused to continue its bankruptcy loans.

W.R. Grace, the company that once mined asbestos-contaminated Vermiculite in the town of Libby, Montana has been forced to reduce its Chapter 11 finance package from $250 million to $200 million. The company’s existing bankruptcy package expires on April 1. Throughout most of the bankruptcy case W.R. Grace has had around $250 million in loans available; now that figure will be reduced by around 20%.

Janet Baer, a W.R. Grace attorney, told Judge Judith Fitzgerald, overseer of the company’s long-running bankruptcy restructuring efforts, that the company’s existing lenders had been asked to sign on for another two years, but some had declined to do so.

According to Baer, “the tightening of the credit industry” is to blame for the fact that some lenders have declined to renew their credit after having offered Chapter 11 loans to the company for several years.

The lender syndicate is headed by Bank of America Corp. Baer did not name the lenders that had declined to renew their credit to W.R. Grace.
Judge Fitzgerald has signed off on an order that allows the former Vermiculite-mining company to extend its Chapter 11 loans until 2010. W.R. Grace is still awaiting a ruling that will determine how much money it needs to set aside in a trust that will cover asbestos damages. The ruling is needed before the company can emerge from bankruptcy.

W.R. Grace is not the only bankrupt company that has had trouble retaining lenders throughout its Chapter 11 period. Many other bankrupt companies that were once sought-after lending clients are having similar problems.

Solutia Inc. emerged from bankruptcy in February, but only after the company had sued banks that had declined to offer $2 billion in exit loans. The lawsuit was settled before a decision was made. Delphi Corp. is another company having trouble with investors and lenders, as it struggles to emerge from bankruptcy.

W.R. Grace is not in immediate need of loans to fund its exit from bankruptcy. The company will face another two months or more of trial proceedings that will attempt to estimate how much money the company owes to people who have been affected by asbestos problems attributed to it.

The trouble is, a ruling isn’t expected until the middle of 2008, and both sides have already stated that they expect to appeal the decision.

According to documents filed with the Securities and Exchange Commission, W.R. Grace had $484.4 million in cash, and over $100 million in investments at the end of last year.
A week ago, the company finally agreed to pay $250 million to the federal government to help cover the cost of the Libby, Montana clean-up.

March 12, 2008, Montgomery, Pennsylvania - The EPA responded this week to concerns and comments from a Community Action Group about the BoRit asbestos site in Ambler.

Larry Johnson, an EPA Community Involvement Coordinator working with the action group, emphasized the importance of working with the community to remediate at the site, but the EPA has still given no details about when the project will begin, or how the remediation work will be carried out. However, Johnson does say that the EPA Region 3 group plans to incorporate the action group’s requests in their remediation plans.

The community group’s main concerns are asbestos removal, site monitoring, and stream bank stabilization. The EPA gave few details about how it plans to accomplish these requests.

A “responsive summary” issued by the EPA included only vague references to the federal environmental group’s plans for the site. EPA personnel, including on-scene coordinator Eduardo Rovira, say that the language used to describe the action plan is vague so that the EPA’s plans can be easily adapted according to the needs of the site, without having to get approval from headquarters for any changes made.

In addition, Larry Johnson has told the community that they will be kept informed of how the remediation project is proceeding, with regular online updates and an EPA representative on-site at weekly intervals to answer questions and talk about concerns the community may have.

The action group is already concerned about the EPA’s plans to remediate the site and carry out monitoring for one year to ensure the site’s safety. The action group strongly recommends a minimum monitoring period of five years, with testing of the site conducted at least annually.

According to Larry Johnson, that kind of monitoring is outside the bounds of remediation projects such as this one, which aren’t designed to carry out long-term monitoring of a site once it has been cleaned up.

Another action group concern is that the current remediation plan that is proposed for the site could hinder any future remediation attempts. On-scene coordinator Eduardo Rovira has responded to the concern by saying that the proposed plan is a permanent solution, and that future remediation work should not be needed.

The project cannot proceed, however, until headquarters signs on the paperwork. Jack Kelly, another on-scene coordinator for the BoRit site, says there should be no issue with getting approval for the project. Kelly further explained that the hold-up is mainly due to the fact that an asbestos site is involved, for which planning requires some extra care.

Once EPA approval has been granted, a public hearing will be scheduled to inform the public about what will happen. Work on the site can begin after the meeting has been held. The project is expected to take around one year to complete.

AMBLER, Pennsylvania - The Environmental Protection Agency met with the BoRit Community Advisory Group last week to discuss their final cleanup plans for the asbestos and other toxic chemicals at the old BoRit site.

Larry Johnson, Community Involvement Coordinator for the EPA, stated that the plan is still being drafted and there is no date set for its release. Johnson says that he has received 320 emails from citizens concerned with exposed asbestos at the site, erosion of the stream banks and the ongoing site monitoring being conducted by the EPA.

Removal action is being designed to address those specific issues, Johnson said. The final plan will be revealed and discussed at a public meeting which has been delayed because health agencies have requested the opportunity to present an environmental review at the same time. A state and local epidemiologist will be on hand to discuss the review and answer questions about the air monitoring and possible health effects. One of the reviews will deal specifically with cancer.

Asbestos, one of the main contaminants at the site, is a known carcinogen. Airborne asbestos is known to cause mesothelioma, a rare cancer that is only found in those who have been exposed to asbestos, and to increase the risk of developing lung cancer,  asbestos cancer, and a number of other deadly cancers. Asbestos also causes an invariably fatal condition where lung scarring progressively debilitates and cripples the lungs.

Removal work will begin at the site after the meeting. A representative of the EPA will be available at the site at least once a week so that concerned citizens can discuss the removal process and other concerns. In addition, there will be public meetings at the end of the removal process to address the effectiveness of the removal.

Meanwhile, BoRit is also going through the Site Assessment Program to deciced which of five main cleanup options best addresses the needs of the community and the problems of the site. That process will determine whether or not BoRit will be proposed to the National Priorities List, which is a last resort reserved for the most badly contaminated sites where there are no other alternatives. NPL is only called upon when hazardous sites meet specific criteria, including that the site must be subject to regulations under the Comprehensive Environmental Response Compensation and Liability Act of 1980 - better known as Superfund.

In addition, sites considered for Superfund may be issued a health advisory by the Agency of Toxic Substances and Disease Registry. Various factors are weighed into a final ‘threshold number’. Factors taken into account include the amount of waste at the site and the effect of the waste on community health and the environment.

A score has not yet been determined for BoRit. In order to be considered for the Superfund designation, a site must score at least 28.5 on the scale.

There should be an indication by summer as to whether BoRit will proceed as an NPL proposal. Even if it is not, EPA will remain involved in assisting the community with cleanup plans and efforts.

HAMPTON, Pennsylvania – The students displaced from St. Ursula’s School when a flood exposed asbestos in the walls and ceilings are back in school – but not at their old school building.

Instead, students will attend class for the rest of the school year in modular classrooms set up in the parking lots outside the school and church in Hampton. Teachers and students returned to school Monday as workers finished setting up the last of the classrooms.

Since January 14 when students returned after an extended holiday, the 155 students have been attending classes at St. Richard in Richland, about seven miles away from their usual school. Sister Joanita Fedor called the experience a “two week field trip”.

On December 20, a valve on one of the school toilets broke during the night. By the time the break was discovered, water had flooded the main floor and damaged the floors and the ceiling below. The water damage also exposed asbestos, a hazardous air pollutant. Asbestos in school buildings is becoming a major issue across the country as buildings that were built in the 1950s, 1960s and 1970s age and require renovations and repairs. Asbestos was widely used in construction, particularly in schools and commercial buildings, because of its excellent insulation and fireproofing qualities. Asbestos is contained in many materials that were used in construction, including wallboard, ceiling and floor tiles and pipe insulation.

As long as the materials that contain asbestos remain intact and undisturbed, asbestos is not a hazard. Once the materials become dilapidated or damaged, however, they may release asbestos fibers into the air. The tiny fibers can stay in the air for a long time where they can be inhaled. Once inhaled or ingested, the fibers can remain in the body for decades and cause health problems ranging from lung scarring and asbestosis to mesothelioma, a rare cancer that thickens the lining around the lungs.

The cost to remove the asbestos and repair the school is expected to exceed $500,000.

On Sunday, the modular classrooms were blessed during church services and were open for parents to tour. The students will be in the modular classrooms for the rest of the school year. There is no set date for completion of repairs, but students will not return to the school until the asbestos has been completely abated and the repairs are finished.

Each modular classroom will house one grade, and has its own security system, restrooms and phones.

Students lost an additional five days of school because of the damage and the asbestos contamination, and will be attending school through June 13 because of that.

Work on the school will continue through the summer and should be safe for students by the fall.

AMBLER, Pennsylvania - Members present did not reach consensus at the meeting; a few items need to be rewritten, reviewed and approved. They will do so via e-mail by Dec. 22 and submit their formal response to the EPA by Dec. 31, according to CAG member Sharon McCormick of Ambler.

The group of Ambler, Upper Dublin and Whitpain residents have met for the past six months to address a solutions to risks “presented by the largest, un-remediated asbestos site in the U.S., according to a rough letter addressed to EPA.
A working group of members drafted a cover letter and detailed document, which the CAG considered line-by-line at the meeting.

The CAG agreed their formal comments should respond to the federal on-scene coordination team’s presentation at their Nov. 28 meeting rather than suggest what should be done with the site.

A five-page attachment to the letter addresses four areas of concern regarding EPA’s proposal - effective and environmentally sensitive stream bank stabilization; complete and effective encapsulation or removal of all exposed asbestos-containing material; comprehensive monitoring during removal actions and afterwards; and collaboration with government agencies and property owners on institutional controls.

A fifth “catch-all,” as CAG member Fred Connor of Whitpain described the last area of concern, outlines the group’s request for continued partnership to “produce and promote long-term solutions” for the site, which they called a “vital component of the regionally significant Wissahickon Green Ribbon Preserve and integral part of over 60 acres of open space between Butler Pike and Mt. Pleasant Avenue.”

The CAG requested continued monitoring and sampling at the site and asked EPA to consider the possibility that “worst case scenario” health risk calculations “may have underestimated major factors known to community members.” The group also encouraged EPA and all agencies involved to take a “more aggressive approach to data collection.”

According to the CAG’s draft comment document, available community health data does not reflect the “true incidence” of mesothelioma, asbestosis and other asbestos-related diseases historically associated with the site.

The document claimed members of the CAG can report specific cases of individuals recently diagnosed with asbestos-related diseases where “proximity to the site is believed to be the only known risk factor.”

During a short recess, Edie Marincola of Ambler said five members of her husband’s family died from asbestos-related diseases, the most recent being her father-in-law, in January 2007.
He “walked around for 68 years with no problems,” and in the past five years developed lung cancer caused by mesothelioma, she said.

Bill Rose, who grew up in Ambler, said he and other children used to sled down the “white mountains,” or asbestos piles. His father and uncles died from asbestos-related diseases, he said.
Before the CAG broke into smaller groups to brainstorm language changes to areas of concern, some observers commented.

Phil Heimlich of Blue Bell said his both his mother and uncle died from mesotheliomia in the past decade. He called EPA’s proposal a “political statement to downplay the severity of the situation.”

Tim Hughes, founder of Citizens for a Better Ambler, said a paragraph hidden at the end of the CAG’s document that said the site should continue to be assessed for inclusion on the National Priorities List in conjunction with proposed removal actions should be visible in the opening letter.

The CAG agreed the opening letter should stress that the proposed removal plan “must be a catalyst” for follow-up. “For too many years, the BoRit parcels have posed both real and potential health risks to our community,” the draft letter read.

Bill Baker of Ambler presented a petition to get the site on the NPL, which has been circulating the community since November. So far Baker, McCormick, Ambler Borough Councilwoman

Judy Baigis and others have captured more than 1,000 signatures.

Of the 400 signatures from Ambler residents, 35 households reported an asbestos-related death or illness that has affected their family, according to McCormick, who said they will continue to petition.

by Melissa Brooks, Staff Writer for Montgomery Newspapers