Hardy v. Johns-Manville Sales Corp.

• Decision Date: 13 March 1981
• Docket Number: Civ. A. No. M-79-145-CA.
• Citation: 509 F. Supp. 1353
• Parties: C. A. HARDY et al. v. JOHNS-MANVILLE SALES CORPORATION et al.
• Court: U.S. District Court — Eastern District of Texas

509 F. Supp. 1353

C. A. HARDY et al. v. JOHNS-MANVILLE SALES CORPORATION et al.

Civ. A. No. M-79-145-CA.

United States District Court, E. D. Texas, Marshall Division.

March 13, 1981.

Rex Houston, Wellborn, Houston, Bailey, Perry & Adkinson, Henderson, Tex. and Scott Baldwin, Jones, Jones & Baldwin, Marshall, Tex., for plaintiffs.

Tony Chauveaux, Weller, Wheelus & Green, Beaumont, Tex. and Otto Ritter, Roberts, Harbour, Smith, Harris, French & Ritter, Longview, Tex., for defendants.

MEMORANDUM OPINION AND ORDER

ROBERT M. PARKER, District Judge.

In these asbestos-related cases, three motions are before the Court. The Defendant Forty-Eight Insulations has moved for an order permitting discovery and for leave to file cross-actions based upon a contribution theory of market share apportionment.¹ Sixteen defendants² have joined in a motion for reconsideration of the collateral estoppel order entered pursuant to Flatt v. Johns-Manville Sales Corporation, 488 F.Supp. 836 (E.D.Tex.1980). Alternatively, the sixteen defendants request the Court to certify the question of collateral estoppel for interlocutory appeal to the Fifth Circuit as provided for in 28 U.S.C. § 1292(b).

By separate order, the Court shall grant the two motions of Defendant Forty-Eight Insulations. The motion for reconsideration is denied; a contemporaneous order shall grant the interlocutory appeal certification.

I.

The Marshall cases represent a variety of asbestos-related claims. Some of the plaintiffs were insulation workers, while others claim exposure as pipefitters, carpenters and factory workers. Absolute identity of defendants does not exist on a case by case basis. That is, complaints may name Johns-Manville alone or include as many as twenty asbestos manufacturers. At latest tally, fifty-seven such cases were assigned to the docket of the undersigned in the Marshall division alone. By two separate orders, the cases are consolidated for pretrial purposes and captioned collectively Hardy v. Johns-Manville Sales Corporation, M-79-145-CA and consolidated cases. (See Orders dated June 9, 1980, and October 23, 1980).

Ten years ago the widow of Clarence Borel tried her case to a favorable jury verdict before the Honorable Joe J. Fisher. Borel v. Fibreboard Paper Products Corporation, 493 F.2d 1076 (5th Cir. 1973) cert. denied 419 U.S. 869, 95 S.Ct. 127, 42 L.Ed.2d 107 (1974), affirmed Judge Fisher's judgment entered on the jury findings. Since that time, the Eastern District of Texas has become inundated with asbestos-related litigation. Huge oil refineries and petrochemical plants in the southern end of the district have partially accounted for the existence of over three thousand plaintiffs within the Eastern District alone. The shipyards on the coastline and the presence of an asbestos manufacturing plant in Tyler, Texas, add to our burgeoning asbestos-related docket. In short, Judge Fisher's pioneering Borel trial and the industrial environment of the district have tended to contribute to the large number of asbestos-related filings.

Ten years after Borel, it cannot be seriously argued that asbestos exposure causes disease. So comfortable are we with that assertion, that a former Secretary of Health, Education and Welfare estimated that more than 67,000 human lives are taken each year by asbestos-related cancers.³ Thus far in the litigation, asbestos has been found to be a competent producing cause of asbestosis and mesothelioma. Borel, supra.

Pulmonary asbestosis can best be described as a nonmalignant scarring of the lungs.⁴ Asbestosis is generally cumulative; the continued exposure to asbestos dust and fibres increases both the risk and the severity of the disease. Borel, supra. Its latent period makes it legally and medically impossible to state with certainty when asbestosis was first contracted or which exposure to asbestos caused or contributed to the disease.⁵ Knowledge of the danger can be attributed to the industry as early as the mid-1930's,⁶ and the conduct throughout the industry despite the danger has been summarized as one of indifferent silence. Borel, supra.

The industry was also silent with respect to the dangerous relationship between asbestos and cancer. Mesothelioma is a form of malignant tumor of the chest and lungs; it may also effect the abdomen.⁷ Extraordinarily painful and always fatal, it is a relatively rare form of cancer whose relationship to asbestos has been generally known since the late 1930's.⁸ Like asbestosis, mesothelioma has a long latent period. Borel, supra. Rather unlike asbestosis, mesothelioma may result from one exposure to asbestos dust or fibres.⁹

Yet, products containing asbestos fibres have great utility in an industrial society. The heat resistant property of asbestos has made it important in insulation and pipe covering. Each year in the U. S. alone industry consumes one million tons of asbestos.¹⁰

Asbestos-related cases provide the courts with a classic utility versus danger evaluation. The Fifth Circuit has spoken with respect to marketing defects in insulation products. Borel, supra. Ten years after the verdict in Borel, considerable dispute exists with respect to its holding, and this Court's interpretation of that decision. The questions before the Court in the consolidated cases require serious consideration. The gravity of the issues raised and their interrelationship have prompted a rather lengthy response. While this Court may be accused of re-inventing the Borel wheel, the issues deserve more than a perfunctory response in a vacuum. With the brief review of the history of the litigation together with examination of the generic substance and its relationship to disease as a context, the Court may address the issues of market share liability and collateral estoppel.

II.

The question of applicability of a market share apportionment of liability is before the Court on the basis of two motions: 1) a motion for leave to file a cross action based on the theory, and 2) a motion for leave to conduct discovery on the issue. Therefore, the Court is not thrust in the position of making a final adjudication of whether market share is applicable to the Hardy case or any of the other fifty-six cases. On the contrary, the Court shall grant the two motions for the cases generally, and the specific question of applicability to a particular set of facts is reserved for determination at trial.

The federal rules require the Court to grant leave to amend pleadings on a liberal basis. Rule 15(a), Fed.R.Civ.P. The Court should not exercise tighter reins in allowing pleadings merely because the matter sought to be plead is a novel legal issue; the rules require that discretion be freely given. 6 Wright & Miller, Fed.Prac. & Proc. § 1484. Because the Court has previously set limits on discovery in these cases, Defendant Forty-Eight has chosen to move for an order permitting discovery on the issue rather than waiting for co-defendants to challenge discovery efforts with motions for protective orders. In this context, the election by Forty-Eight Insulations is entirely appropriate and is likely to result in judicial economy. The rule in this Circuit with respect to permitting discovery turns on whether the information sought is reasonably calculated to lead to admissible evidence if discovery is allowed. Burns v. Thiokol Chemical Company, 483 F.2d 300 (5th Cir. 1973); Rule 26(b)(1), Fed.R.Civ.P. The Rules of Evidence provide that admissible evidence is relevant evidence. Rules 401, 402, Fed.Rules of Evidence. Therefore, if discovery on shares of a relevant market is likely to lead to evidence which may be admitted as probative on an ultimate issue in the case, then discovery should be allowed to proceed.

The determination necessary for resolution of the discovery issue requires the Court to consider the relevance of the market share information. Therefore, the Court is required to evaluate the legal context in which the market share information might be offered. Despite the charge made by one defendant that any amplification by the Court on the relevance of market share information would violate the case or controversy limits of Article III and constitute an advisory opinion, the Court must in accordance with Burns, supra, make a preliminary evaluation of relevance.

Even if the law of the Circuit did not require the Court to make a preliminary determination that the market share discovery motion is calculated to lead to relevant evidence, the largest asbestos insulation manufacturer has asked for one.¹¹ Additionally, as a practical matter, the question is too serious to be disposed of in a one-page order. All parties, plaintiffs and defendants, should have adequate knowledge and notice of the Court's preliminary view of the viability of a system of market share liability.

It is important to note that the motions before the Court which relate to market share are not filed on behalf of a plaintiff; these are defense motions. They raise an issue not yet considered in this district — the applicability of a Sindell theory of liability in the asbestos-related cases. Sindell v. Abbott Laboratories, 26 Cal.3d 588, 163 Cal. Rptr. 132, 607 P.2d 924 (1980), cert. denied, ___ U.S. ___, 101 S.Ct. 286, 66 L.Ed.2d 140, (1980). In fairness, the movant has not couched the motion in these terms. Forty-Eight seeks the benefit of market share apportionment of damages without the burden of Sindell liability.¹²

At this point the Erie-alarm should sound in the hearts of legal scholars. Erie Railroad Company v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Admittedly, in these diversity cases, the Court is venturing into territory without the benefit of charts drawn by the Texas Supreme Court. The legal reactionaries would have this Court sit as Judge Frank's ventriloquist's dummy waiting until, if ever, the Texas Supreme Court speaks. Richardson v. C. I. R., 126 F.2d 562, 567 (2d Cir. 1942)....