Articles Posted in Asbestos Litigation

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gp logo.jpgGeorgia-Pacific LLC was founded in 1927 as the Georgia Hardwood Lumber Company. Now, after years of expanding and acquisitions, Georgia Pacific is one of the world’s leading manufacturers and distributors of tissue, pulp, paper, toilet and paper towel dispensers, packaging, building products and related chemicals. Georgia Pacific, an American pulp and paper company based in Atlanta, Georgia, is also a named defendant in a multitude of asbestos cases. From 1965 through 1977 Georgia-Pacific used asbestos to create a building products compound used for hanging wallboard and finishing ceilings.

By 2001 the company had approximately 63,000 pending asbestos injury claims, which soon became the biggest issue clouding the company’s future. By 2004 the company had set aside over $100 million dollars in a ten-year defense fund. In that year alone Georgia-Pacific paid out $200 million dollars to resolve claims, an 11-million-dollar increase from 2003, when claim payments totaled 189 million. By January of 2005 Georgia-Pacific faced approximately 344,300 asbestos claims, costing the company a total of $830 million. It was during 2005 and in response to the overwhelming, rapidly increasing number of asbestos claims, that the company funded a series of studies testing the harmful effects of an asbestos containing joint compound that they previously manufactured. Findings were subsequently published in a series of articles. Eleven papers, published in the journals Inhalation Toxicology, the Journal of Occupational and Environmental Hygiene, the Annals of Occupational Hygiene and Risk Analysis were referred to in court depositions by GP’s Stewart Holm, as “litigation-driven research.”

Stewart Holm, Georgia-Pacific’s own director of toxicology and chemical management, co-authored the majority of the articles and consulted extensively on those that he did not. Georgia Pacific’s own in-house counsel reviewed the articles before they were published and actually recommended revisions. The problem stems from the fact that the studies did not disclose Georgia-Pacific’s involvement in their creation, and two of them falsely claimed “[GP] did not participate in the design of the study, analysis of the data, or preparation of the manuscript.”

Five New York judges ruled that Georgia Pacific must allow a private inspection of the documents and data related to eleven scientific articles that were financed by Georgia Pacific and meant to cast doubt on the harmful effects of Chrysotile asbestos. Although Georgia Pacific argued that the documents were attorney-client privilege, the Court determined that it fell under the crime-fraud exception to attorney-client privilege. The crime-fraud exception applies when legal services are solicited to commit a crime or fraud. The Court also said the data underlying the studies was not privileged and should be produced. There were sufficient extenuating circumstances to warrant a closer inspection of the documents.
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justice-statue-18-inch-YT-7746.jpgState Court vs. Federal – Weighing the pros and cons.
Typically, whenever possible, asbestos cases are filed in state court. A procedural defense tactic being implemented with increasing frequency is to have the case moved to Federal court.

The Plaintiff determines where the case is to be filed.
In state court, the plaintiff has the potential to recover punitive damages. The case is generally heard more expeditiously. Because plaintiffs’ lawyers choose where to file lawsuits, they have an opportunity to file in states that have particularly favorable legal rules. Approximately 80 percent of asbestos cases are filed in state court.

The right to have the case removed or heard in federal court is the exclusive right of the Defendant or Defendants.
In federal court, all cases filed since 1990 have been assigned to one judge in Philadelphia. This process was established to adjudicate the overwhelming number of asbestos claims. It is now known as the Multi District Litigation (or MDL). Not once has this judge allowed a case to be tried for punitive damages. Cases in federal court typically take much longer to go to trial and can be left inactive for significant periods of time.

The Defendant can move to have the case removed to federal court for several reasons. In asbestos cases, the principal grounds for removal are the Federal Enclave Clause and federal officer removal. The Federal Enclave Clause authorizes Congress to exercise exclusive legislation “over all places purchased by consent of the legislature of the state in which the same shall be, for the erection of forts, magazines, arsenals, dock-yards, and other needful things.” Basically, this puts any exposure that occurred at shipyards, military bases and the like under federal jurisdiction.

The federal officer removal statute provides in pertinent part that “[a]ny officer of the United States or agency thereof, or person acting under him, for any act under color of such office . . .” may remove a civil action or criminal proceeding commenced against him in a State Court to the district court of the United States for the district and division embracing the place wherein it is pending. Manufacturers who provided asbestos containing products to federal agencies, such as the military, claim that they were operating as a federal contractor and thus a federal officer was involved in the business.

Plaintiffs can attempt to thwart these efforts by dismissing the defendant who sought to have the case removed and then request the court remand the case. Or, they can stipulate that the plaintiff is only proceeding against the removing defendant on state law claims thus nullifying the basis for federal jurisdiction.

DISTRICT COURT 2.pngRecently, United Technologies Corp. (UTC) succeeded in removing two pending asbestos cases based on the U.S. Codes federal officer removal provision. The Plaintiffs in these cases were exposed at military bases. CBS ‘s predecessor-in-interest, Westinghouse was also successful in both getting and keeping their case in federal court claiming that, because their products were delivered to an agency of the United States Government, they were operating as a federal contractor and thus a federal officer was involved in the business.
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What happens to an Asbestos or Tobacco case if, before it can reach its conclusion, the injured party passes away from their injury? That is what will be decided in the Florida cases of Joan Ruble v. Rinker Materials Corporation Case No. SC11-1173 and Karen Capone v. Philip Morris USA, Inc. Case No. SC11-849. Although one is an asbestos case and the other a tobacco case, the two Miami-Dade County cases involve similar legal issues. Both cases were filed while the plaintiff was living and were subsequently dismissed upon their death. Both petitioners then appealed the order of dismissal and both were affirmed. Now both have been heard by the Supreme Court of Florida and await a final ruling.

All parties seem to agree that Pursuant to section 768.20 F.S.A.:

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SCALES OF JUSTICE RED TAPE.JPGRed Tape tips the scales of Justice out of balance and may have hastened the death of one asbestos victim. Delay tactics are one of the most popular strategic maneuvers used by asbestos defense attorneys today. Requesting an extension of time from the courts, canceling and rescheduling depositions and dragging their feet when it comes to turning over incriminating documentation are all tactics employed by defense attorneys. Discovery as defined by Black’s Law Dictionary, is the ascertainment of that which was previously unknown; the disclosure or coming to light of what was previously hidden; the acquisition of notice or knowledge of given acts or facts. Discovery is an integral part of the judicial process, but it is during this exchange of information where the system and the injured party can be abused. The expeditious implementation of justice is rarely as important to the accused as it is to the person who has suffered a loss and is seeking compensatory action.

John Johnson, 69, was a marine. Since 1961 he worked as a carpenter, mechanic, and plumber. Any of his jobs could’ve exposed him to the asbestos that likely caused his disease, the Los Angeles Times reports. So he sued 65 companies for compensation. Mr. Johnson collapsed just 40 minutes after a grueling deposition. He lost his battle with mesothelioma the very next day. Despite affidavits from his doctor stating that 12 hours of depositions over a few weeks would be about as much as the 69-year-old’s health could stand, a Los Angeles Superior Court judge allowed the companies he was suing a total of 25 hours.
The attorney for the defense actually requested from the court five (5) additional hours from the original twenty that they were granted. They spent this time asking questions that they already had the answers to such as:

  • Is the VA Hospital in West, L.A.?
  • What are your sons’ names?
  • What are your sons’ ages? Locations? Marital Status? Etc.
  • What is your wife’s name? Which happened to have been listed in the case caption of not only the complaint, but every subsequent pleading filed in the case; including those filed by the defense themselves.

One cannot help but wonder if these questions were truly relevant to establishing the culpability of the defendant. The defense was already in possession of this information. If in fact it was relevant and if in fact there was some clarification of these facts necessary, could the answers have not been provided in the written format of standard interrogatories? Johnson’s lawyer believes companies seek to delay finishing these cases because a victim’s recovery will be reduced greatly once they die. Once he died, damages for Johnson’s own pain and suffering were lost. His family can now only sue for his medical bills and loss of companionship, according to his lawyer.

Delay tactics can also be used to exhaust the financial resources of the plaintiff, make the recollection of actual events less clear with the passing of time, and/or delay payment of an inevitable judgment or pressure the plaintiff into accepting a lesser but more prompt compensation. What delay tactics always result in is the frustration of the plaintiff, occasionally to such a point that an injured party is willing to drop a suit that has merit and forgo that which he is justly entitled to.

Delay tactics are not only reserved for cases that are actually litigated. Bankrupt defendants also seek refuge within the appeals process or behind mountains of red tape pawned off as procedural requirements as a means to postpone the release and disbursement of assets. For example, there are claimants who have been waiting for compensation from Travelers Insurance Company since 2004.
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open database.jpgShould the Asbestos Trust’s database of claimant information be an OPEN BOOK??? The Furthering Asbestos Claim Transparency Act of 2012 or FACT as it has become known (Officially H.R. 4369) was introduced on April 16, 2012 by Rep. Ben Quayle. This Act proposes to amend title 11 of the United States Code to require the public disclosure by trusts established under section 524(g) of such title, of quarterly reports that contain detailed information regarding the receipt and disposition of claims for injuries based on exposure to asbestos, and the filing of such reports with the Executive Office for United States Trustees.

In a statement released by Mr. Quayle following the release of FACT he claims:

“by requiring the trusts to operate transparently, Congress can deter further abuse and preserve the trusts’ assets for truly needy and sick victims of asbestos exposure”.

Those who are already inundated by the red tape of bankruptcy filings say this is just another attempt to discourage and prevent those “sick victims of asbestos exposure” from receiving just compensation in a fair and timely manner. Additionally, the dissemination of submitted information, as well as disclosing settlement amounts, trample on the individuals right to privacy. Moreover claims of abuse and fraud within the bankruptcy trust are unfounded.

There have been some efforts at the state level to bring more transparency to the trusts’ operation. At least two states have proposed similar trust reform. Ohio’s senate heard testimony in March on a bill already passed by the House of Representatives, while Oklahoma’s senate passed a bill on March 14. The Oklahoma bill is currently sitting in the House Judiciary Committee. The House bill; however, is the first step in moving the legislation at the federal level.

Thumbnail image for ancient-antique-scroll-on-white-background-israel.jpgThis bill or resolution was assigned to a congressional committee on April 17, 2012, which will consider it before possibly sending it on to the House or Senate as a whole.
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Travelers_New_.jpgIn what is the latest in a long and convoluted series of lawsuits revolving around Travelers Insurance Co. and its payment of asbestos settlement claims, United States District Court Judge John Koetle for the Southern District of New York ruled that “it was an error to require Travelers to make the settlement payments” and that “the judgment must be reversed.” He wrote that Judge Lifland had incorrectly concluded that settlement lawyers had met all conditions required for Travelers to make payments under the 2004 settlements. This ruling reversed the Bankruptcy Court’s January 20, 2011 final judgment on the December 16, 2010 order granting, inter alia, Statutory Direct Action Settlement Counsel’s motion to compel payment of the StatutoryJM LOGO.jpg Direct Action Settlement Agreement. Simply stated, Travelers Insurance Company, who provided general liability coverage and other insurance between 1947 and 1976 to Johns Manville Corp, is no longer required to pay nearly $500 million towards asbestos settlements; specifically, the claims that center on the asbestos products manufactured by now-bankrupt Johns Manville Corp., one of the largest manufacturers of asbestos products in U.S. history.

The current case is Travelers Indemnity Co v. Statutory and Hawaii Direct Action Settlement Counsel et al, U.S. District Court, Southern District of New York, Nos. 11-01312 and 11-01329. The original case pits Travelers against 26 state-court actions that were bundled into three settlements and mediated by former New York Gov. Mario Cuomo between 2002 and 2004. Those settlements were fought by outside parties, including Chubb Indemnity Insurance Co., which said it didn’t want Travelers to be off the hook for future liabilities as a condition of the settlements. In the most recent ruling, the federal judge said that as a result of other court decisions, the Cuomo settlements do not absolve Travelers of future claims from Chubb and other insurers. As a result, Travelers is not required to pay the thousands of people sickened from inhaling microscopic asbestos fibers.

With 500 Million dollars in dispute, it is likely that we have not heard the last of Travelers. But until then, countless victims of asbestos exposure will be denied justice, left without compensation.
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TRAIN WITH ENGINEER.jpgThe The Supreme Court Decision in KURNS, EXECUTRIX OF THE ESTATE OF CORSON, DECEASED, ET AL. v. RAILROAD FRICTION PRODUCTS CORP. ET AL. handed down on Wednesday, February 29th, 2012 will PUT ON THE BRAKES for railroad workers, who contracted an asbestos related disease, from seeking justice in the courthouse against manufacturers of harmful asbestos containing products. The Supreme Court affirmed the Third Circuit’s holding that the federal Locomotive Inspection Act (“LIA”) preempts plaintiffs’ state tort law claims for design defects and failure to warn.

What is somewhat disconcerting is that the opinion was delivered by Justice Thomas who in the past has defended the state’s rights to regulate against any implied federal preemption. This was not seen as keeping in line with Thomas’ prior stand on federal vs. state preemption. Justice Kagan wrote a concurring opinion. Justice Sotomayor wrote an opinion concurring in part and dissenting in part, which Justices Breyer and Ginsburg joined.

In spite of the disappointing ruling, railroad workers can still file a lawsuit involving asbestos injury claims under the Federal Employees Liability Act. FELA allows workers to file suit against employers instead of the asbestos manufacturers. Because indemnity claims (claims that the manufacturers are liable) would be state law based, the railroads will possess no indemnity or contribution rights against such entities either. Any attempt by the Railroads to bring the asbestos manufacturers in under the ruling handed down in Ayers will be subject to dismissal, as federally preempted by this decision. Additionally, FELA cases may now take the position that the LIA now provides coverage and rights for locomotives that are “not in use” as previously held by this Court. It has not yet been determined how this will effect claims filed against asbestos manufacturers through the bankruptcy courts.

When a victim of an asbestos related disease such as mesothelioma files a personal injury lawsuit, it will likely allege that the manufacturer of asbestos products knew the dangers associated with the use of the mineral and, without regard for the safety of the end user of the product, continued to manufacture the same. This decision will allow these companies to escape liability in railroad cases.

From the standpoint of workers, this decision exemplifies the value of voting for a President. When casting their ballot, an individual must take into account that one of the most intriguing and important ways in which ordinary workers may be affected by the Office of the President, is through appointments to the Supreme Court.

The Alliance for Justice summarized the situation perfectly:

“By upholding the lower courts’ decisions in favor of the corporate defendants, the Supreme Court is preventing injured citizens from holding railroad manufacturers responsible for violating state safety laws and regulations, many of which speak to local safety hazards and provide more stringent protections than those afforded by federal laws. Once again the Corporate Court has used federal preemption to protect corporate interests and prevent states from protecting public safety.”

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stop watch.jpgA statute of limitations, as defined by Black’s Law Dictionary, are Statutes of the federal government and various states setting maximum time periods during which certain actions can be brought or rights enforced. After the time period set out in the applicable statute of limitations has run, no legal action can be brought regardless of whether any cause of action ever existed.

There are statutes of limitations in place that pertain to a living injured party and there are statutes that are applicable in the event the injured party is deceased (the wrongful death statute) BEFORE the statute of limitations expires. If the injured party is deceased before the statute of limitation expires, it is ALWAYS the wrongful death statute that is applicable regardless of whether it lengthens or shortens the time period in which an action can be brought.

Usually, in a personal injury case, the statute date can be easily calculated by simply taking the date of the incident (ie: a motor vehicle accident or slip and fall) and applying the relevant time frame allowable by the statute. Because of the latency period of an asbestos related condition, which can be anywhere between 15 and 50 years, the statute of limitations cannot justly be applied from the date of exposure. In an asbestos case, the statute of limitations must be calculated from the date of diagnosis. The applicable time period must be calculated from the date the injured party is conclusively diagnosed with an asbestos related condition. Asbestosis and Pleural Disease are two non-malignant asbestos related diseases. Laryngeal Cancer, Colon Cancer, Lung Cancer and Mesothelioma are malignancies that may also potentially be asbestos related conditions.

Should you be diagnosed with a non-malignant condition, that statute is to be calculated from that date of diagnosis; however, if you are subsequently diagnosed with an asbestos related malignancy, that statute is to be re-calculated from the date of the malignancy. The 2011 Florida statute 774.206 states as follows:

  • Notwithstanding any other law, with respect to any asbestos or silica claim not barred as of the effective date of this act, the limitations period does not begin to run until the exposed person discovers, or through the exercise of reasonable diligence should have discovered, that he or she is physically impaired by an asbestos-related or silica-related condition
  • An asbestos or silica claim arising out of a nonmalignant condition shall be a distinct cause of action from an asbestos or silica claim relating to the same exposed person arising out of asbestos-related or silica-related cancer. Damages may not be awarded for fear or risk of cancer in a civil action asserting an asbestos or silica claim.
  • A settlement of a nonmalignant asbestos or silica claim concluded after the effective date of this act may not require, as a condition of settlement, the release of any future claim for asbestos-related or silica-related cancer.

FLORIDA MAP.jpgAsbestos cases are personal injury claims based on product liability and so the Florida Statue allows four years from the date of diagnosis for the injured party to file a claim / complaint. The wrongful death statute is two years.
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Smoke_Stock_002_by_#1.jpg Accusations of Fraud in the Asbestos bankruptcy courts are being tossed about. But is there really deliberate deception on the part of the Plaintiffs, or is this just another smokescreen created by the defendants to take the focus off their wrong doing and liability and justify diminishing payments?

According to the U.S. Government Accountability Office (GAO) , there are 60 different trusts, created as companies declared bankruptcy because of asbestos-related liabilities to relieve them of future liabilities. Those trusts have paid out $3 billion to settle 461,000 claims in 2010, compared to $3.6 billion in 2009 and $3.3 billion in 2008. In all, $17.5 billion between 1988 and 2000 has been paid out to settle 3.3 million claims. Just because of the sheer volume, the possibility for fraud exists within the system of trusts set up by bankruptcy courts to deal with asbestos personal injury claims. The GAO report said 98% of trust claims go through an “expedited review” process that requires only a claim form with “documented evidence” of exposure such as work history, invoices, or deposition testimony of plaintiff or coworkers plus a medical report
Claims of fraud seem to be based in two parts: One, that the claimants are providing inconsistent exposure history. Two, that the medical profession has seized an opportunity to capitalize on the situation and has provided false information / documentation.

Exposure History: There are claims that conflicting exposure history has been submitted to different trusts. The universe of claimants consists largely of “blue collar” workers; members of unions who filled the work force of industries such as construction, mechanical, railroad, manufacturing and the like. The unions typically sent workers to jobsites for limited amounts of times depending on the work or project to be completed. They worked at multiple jobsites on multiple projects. Working at two different jobsites (or more) during the same time frame is not conflicting information – It is the way it was. The trusts require that exposure and product identification is verified by sworn affidavits, co-worker affidavits, Social Security earnings reports and or actual paycheck stubs. The latency period for an asbestos related disease is between 15 and 50 years which means the documentation must go back commensurately.

Medical Evidence. Prior investigations have shown how a tiny number of physicians have submitted tens of thousands of diagnoses of asbestos-related disease, many of them subsequently found to be incorrect. But the few “bad apples” that we all know will be found in every bunch have been identified, and the information has most definitely been disseminated. CRMC, VERUS LLC, TRUST ONLINE DELAWARE CLAIMS PROCESSING FACILITY are amongst the largest claims processing facilities and currently handle approximately 30 or more of the bankruptcy Trusts open for filing. They each have a similar posting or notice, easily obtained on the internet, listing UNACCEPTABLE DOCTORS AND FACILITIES.*1 Moreover, the consistency or similarities with which they list the doctors supports the fact that not only is there communications within the trusts handled by the same claims processing facility, but there is indeed communication amongst the processing facilities.

The U.S. Chamber of Commerce issued a press release in mid October calling the asbestos trust system “broken” because of this lack of transparency. “It is becoming clear that rather than acting to prevent abusive claims, the asbestos trusts are effectively encouraging fraud by inhibiting claims information sharing between the trusts and the tort system,” said Lisa Rickard, president of the U.S. Chamber Institute for Legal Reform.

The GAO said 65% of trusts reviewed treated claims information as confidential under rules that consider information submitted as part of a legal settlement process as privileged. Defendants and insurers say the trusts should be treated as non-adversarial settlement vehicles. They frequently seek information about claims paid so they can set off any court award by the amount the plaintiff has already obtained elsewhere. Clearly the request to make personal medical information publicly available is motivated by the desire to protect the almighty dollar of big business and insurance companies and has a complete disregard for the personal rights of the victims of asbestos exposure.

There is no disputing the fact that there are unscrupulous individuals looking to capitalize on the misfortune of many. But there are strict guidelines and criterion implemented by the trusts to assure the integrity of their system. In short it is the victims of asbestos exposure who suffer the most; adhering to stricter regulations and burdens of proof and being ultimately rewarded with significantly lower dollar amounts.
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Michigan legislation currently under consideration would allow any company that merged with another prior to the 1972 regulations, and as a result became mired in legal liability over asbestos production, to treat the acquired company as a separate subsidiary. Lawsuits would then be capped at the total value of the subsidiary company, rather than the value of the parent company.

bill.jpgHouse Bill 4601, from the state of Michigan, is a reintroduction of legislation introduced in the 2007-2008 (SB 591) and 2009-2010 (HB 5167) legislative sessions and would address the situation one successor corporation has experienced since acquiring a company that at one time made, sold, and installed asbestos insulation. The bill would limit the liability of a successor corporation that acquired or merged – before 1972 – with a predecessor corporation that had engaged in asbestos-related activities.

Currently, under the rule of successor liability, a successor corporation (one that acquires or merges with another) can be held liable for any civil actions filed against the business acquired (predecessor corporation), up to the total value of the successor corporation, even if it did nothing to create the liability or the liability had been created before the merger or acquisition.

CCS logo.gifOne company who would benefit from such legislation would be Pennsylvania-based Crown Cork and Seal. Crown did not manufacture any products that contained asbestos. They did acquire another company in 1963, Mundet Cork, which did manufacture products containing asbestos. Mundet Cork’s products that contained asbestos include the following;

  • Mundet Mineral Wool Finishing Cement
  • Mundet Mineral Wool Insulating Cement
  • Mundet Cork 85% Magnesia Asbestos Insulation
  • Mundet Block Insulation
  • Mundet Pipe Covering

This company DID install asbestos and was liable to pay a significant number of claims related to asbestos exposure – unless they convinced state lawmakers around the country to pick up the tab. Crown has paid out more than $700 million in asbestos claims and seen its bond rating reduced to junk status. The company that in 1998 employed 12,000 nationwide now has just 4,000 workers remaining.

Backers of the bill pointed to Halliburton, the energy company famously run by Dick Cheney before he became vice president, to make their case. In the 1990s, Halliburton acquired a company subject to lawsuits as a result of asbestos claims, but Halliburton kept its acquisition — Dresser Industries — as a separate subsidiary, ensuring that when Dresser went into bankruptcy, it didn’t affect its parent company’s books. The only people to actually speak in favor of this bill in the House Judiciary Committee were the company’s General Counsel and Rep. Joe Haveman (R-Holland), who sponsored the bill and said it shows that Michigan is “open for business.”

The bill was not voted on in the House Judiciary Committee and it is probable that the Committee Chair will hear more testimony in the weeks to come.

Similar legislation has passed in 15 other states.

What does this type of legislation mean to asbestos victims? Significantly less funds available to compensate those stricken with Mesothelioma, Asbestos related Lung Cancer and other asbestos related diseases. The is a limited about of funds available to compensate the numerous victims of asbestos exposure. Taking away or reducing the responsibility of a parent company reduces the drastically diminishing pool of funds available. In the case of Bill 4601, not only does it create a special exemption for one company, but it would force individuals (in this case, Michigan residents) suffering from asbestos poisoning who don’t have sufficient means or insurance into the state’s worker compensation system, Medicaid or Medicare, forcing Michigan taxpayers to assume all the risks for one out-of-state corporation failing to do sufficient research before approving a merger.

Asbestos victims are speaking out. The International Association of Heat and Frost Insulators made a public appeal for justice in a press release by President James E. Grogan dated November 30, 2011 declaring their opposition to the bill. The question remains…Can their voices be heard over the cacophony created by big business, insurance companies and the like trying only to protect their own interests?
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