Beard, In re, s. 86-3844

• Decision Date: 11 February 1987
• Docket Number: 86-3851,Nos. 86-3844,s. 86-3844
• Citation: 811 F.2d 818
• Parties: In re Diana R. BEARD, et al., Petitioners (Two Cases).
• Court: U.S. Court of Appeals — Fourth Circuit

Page 818

811 F.2d 818

55 USLW 2475

In re Diana R. BEARD, et al., Petitioners (Two Cases).

Nos. 86-3844, 86-3851.

United States Court of Appeals,

Fourth Circuit.

Argued July 1, 1986.

Decided Feb. 11, 1987.

Bradley Post, Douglas E. Bragg, for petitioners.

James S. Crockett, Jr., William R. Cogar, Murray Drabkin, David Schiller, Harold S. Novikoff, Stanley K. Joynes, Ross C. Reeves, for respondent.

Before RUSSELL, WIDENER and CHAPMAN, Circuit Judges.

WIDENER, Circuit Judge:

Petitioners, Diana R. Beard and others (Mrs. Beard), are all women who have filed claims in the Chapter 11 bankruptcy of A.H. Robins Company, Inc. (Robins). All of their claims relate to injuries they suffered from using the Dalkon Shield, an interuterine contraceptive device manufactured by Robins. Mrs. Beard has filed two petitions with this court seeking writs of mandamus. In the first petition, Mrs. Beard asks this court to issue a writ of mandamus to United States District Judge Robert R. Merhige, Jr., directing him to disqualify himself pursuant to 28 U.S.C. Sec. 455 from presiding over the Robins bankruptcy. In the second petition, Mrs. Beard asks this court to issue a writ of mandamus to United States District Judge Robert R. Merhige, Jr., directing him to provide for the verbatim stenographic recording of all proceedings in the Robins bankruptcy. We decline to issue either writ.

I

We first consider Mrs. Beard's initial petition seeking the disqualification of Judge Merhige, a United States District Judge for the Eastern District of Virginia and stationed at Richmond. Richmond is also the corporate headquarters of Robins. As a result of the filing of a large number of personal injury claims regarding the Dalkon Shield, Robins filed a petition under Chapter 11 of the Bankruptcy Code, 11 U.S.C. Secs. 101, et seq., on August 21, 1985, at Richmond, in the Eastern District of Virginia. ¹ Pursuant to 28 U.S.C. Sec. 1334 Judge Merhige began to exercise jurisdiction over the Robins bankruptcy. ² Mrs. Beard claims that Judge Merhige should be disqualified from taking any further action in the Robins bankruptcy because of certain actions taken by him both prior and subsequent to the filing of the Chapter 11 petition.

To understand Mrs. Beard's claims of disqualification on account of actions of Judge Merhige prior to the bankruptcy, a brief statement of the Dalkon Shield litigation is necessary. Robins engaged in the manufacture and marketing of the Dalkon Shield from 1971 to 1974. Production was discontinued in 1974 following widespread complaints regarding the device's safety. A.H. Robins Co., Inc. v. Piccinin, 788 F.2d 994 (4th Cir.1986). The first Dalkon Shield product liability case filed at Richmond in the United States District Court for the Eastern District of Virginia was commenced in August 1976. By random selection, the case was assigned to Judge Merhige. From then on, all Dalkon Shield cases filed in Richmond were assigned to Judge Merhige pursuant to that court's operating procedure. By August 22, 1985, 399 Dalkon Shield cases had been assigned to Judge Merhige. More than 200,000 claims have now been filed in the Chapter 11 case.

In August 1984, a number of Dalkon Shield cases were transferred from the United States District Court in Minnesota to Richmond in the Eastern District of Virginia. Those cases, as a matter of course, were also assigned to Judge Merhige. In October 1984, Robins moved, in the district court, to certify a nationwide class action on the issue of punitive damages. In November 1984, plaintiffs in the Minnesota cases, through counsel Joseph S. Friedberg, Ronald I. Meshbesher, and John A. Cochrane, moved to consolidate those cases for punitive damage purposes only. (Messrs. Friedberg, Meshbesher and Cochrane are sometimes referred to in the record as attorneys for the Minnesota plaintiffs or the Richmond plaintiffs.) Judge Merhige granted the consolidation motion for the punitive damage issue only.

Robins' class action was generally opposed by claimants' attorneys, including those attorneys representing the Richmond plaintiffs. Attorneys Bradley Post of Wichita, Kansas, and Robert Manchester of Burlington, Vermont, on behalf of clients, filed motions to intervene in the Richmond cases for the limited purpose of opposing Robins' motion to certify a punitive damage class. ³ Mr. Douglas Bragg entered an appearance as co-counsel in Mr. Post's case. Mr. Thomas J. Brandi, of Denver, Colorado, opposed Robins' motion before Judge Merhige but apparently filed no motion to intervene. Messrs. Manchester and Brandi served as co-lead counsel for claimants opposing Robins' class action motion. Mr. Murray J. Janus served as local counsel. Messrs. Friedberg and Meshbesher served as co-lead counsel in these Virginia cases. Messrs. Post and Bragg, along with others, represent Mrs. Beard in the petitions now before this court.

A hearing was held before Judge Merhige on July 18, 1985. The Richmond plaintiffs were represented at the hearing by Messrs. Joseph Friedberg, Douglas Thomson and John Cochrane. Mr. Manchester was present on behalf of the intervenors. Mr. Alexander N. Slaughter appeared on behalf of Robins. ⁴ Judge Merhige advised the attorneys that he was organizing a meeting, on August 6, 1985, of state and federal judges who were handling Dalkon Shield cases to solicit ideas for disposing of these personal injury cases. Judge Merhige sought comments from the attorneys present on that forthcoming meeting. Mr. Manchester commented that it would be helpful to know, among other things, certain financial information regarding Robins. Judge Merhige continued this discussion regarding Robins' financial condition by noting that he heard that things were tight at Robins. Judge Merhige said that he did not want to get all the judges together for a meeting only to subsequently discover that Robins had filed a petition in bankruptcy. The judge requested Robins' counsel to consider those thoughts. Robins' attorney advised Judge Merhige that he would respond to the court's inquiry before the scheduled August 6th meeting.

Judge Merhige then expressed his belief that all of the Dalkon Shield cases would end up in the district court in Richmond either because of class action status or because of a Robins bankruptcy petition. He invited the plaintiffs to seek out any judge they may want to come to Richmond and try those cases in place of him if they so wished.

At that hearing, Judge Merhige announced that he planned to deny Robins' class action motion. Counsel for plaintiffs, Mr. Friedberg, announced that he planned to file a motion for class certification and affirmative collateral estoppel.

On July 22, 1985 another hearing was held and Judge Merhige entered an order denying Robins' motion for a class action as to punitive damages. On August 2, 1985, plaintiffs, through counsel Mr. Friedberg, filed a motion seeking a nationwide class action and affirmative collateral estoppel.

Following the July 22nd hearing and Judge Merhige's inquiry of counsel regarding Robins' financial condition, Robins' counsel suggested that E.C. Robins, Jr., the company's president, could provide Judge Merhige with the information he sought. Counsel for Robins asked that the meeting take place at a time that would minimize publicity. Judge Merhige then suggested that the meeting take place at his home. Counsel for the Richmond plaintiffs and the defendant Robins agreed to the meeting. ⁵ E.C. Robins, Sr. accompanied his son to Judge Merhige's home on August 1, 1985, although he had not been expected to attend the meeting. Judge Merhige explained to the Robins that he had planned a meeting of judges to discuss the handling of the Dalkon Shield cases and he did not want to meet if Robins planned to file a petition in bankruptcy. The Robins told Judge Merhige that the company considered reorganization under Chapter 11 to be a last resort that it hoped to avoid.

Satisfied that no bankruptcy petition filing was imminent, Judge Merhige proceeded with his plans and on August 6, 1985 met with approximately 12 other judges in Wichita, Kansas. The judges exchanged information and ideas regarding the nationwide implications of the Dalkon Shield litigation. Judge Merhige advised the group that Robins hoped to avoid a Chapter 11 petition. Neither counsel for Robins nor counsel for any of the claimants attended this meeting.

On August 9, 1985, a hearing was held before Judge Merhige on the plaintiffs' class action motion. No decision was made on the motion. The parties and the court discussed various aspects of the case, including the viability of a limited fund theory. Judge Merhige asked the plaintiffs' counsel to consider whether punitive damages should remain in these cases. He asked Robins' counsel to consider admitting that the Dalkon Shield was defective and that as a result many women were injured. Plaintiffs were represented at the hearing by Mr. Friedberg. Mr. Janus was present as liaison counsel for plaintiffs. Messrs. Cogar, Slaughter, and Miller were present on Robins' behalf. Mr. Manchester was also present at the hearing, noting that he was there on behalf of the intervenors. Judge Merhige asked Mr. Manchester if he planned to file an intervention motion. Mr. Manchester answered that he was already properly before the court, and the matter was dropped. ⁶

Another hearing on the class action motion was scheduled for August 22, 1985. On August 21st, Robins filed its petition for Chapter 11 reorganization, thereby staying all proceedings then pending involving Robins. On that same day, Judge Merhige entered Administrative Order 1 (mentioned in n. 2 supra) and assumed jurisdiction over the bankruptcy.

At the hearing on August 22nd, Judge Merhige announced that all of the pending Dalkon Shield cases were stayed as a matter of law because of the Chapter 11 bankruptcy petition filed by Robins. Judge Merhige solicited comments from counsel. Mr....