Bondex witness recounts risk averse settlement route in Madison County asbestos court

PITTSBURGH – Madison County was among the worst judicial jurisdictions in the entire country as far as asbestos litigation was concerned, and a real thorn in the side of defendants who found themselves named in injury claim after injury claim by those allegedly affected by asbestos exposure.

That was a sub-theme that emerged earlier this week during an asbestos bankruptcy proceeding in federal court in western Pennsylvania.

On the first day of an anticipated week-long estimation hearing designed to clear up discrepancies with regard to the projected dollars owed to present and future asbestos injury claimants, one witness took the stand and described what he termed the worst civil jurisdiction nationwide.

Kelly Tompkins, a former general counsel for Bondex International, a subsidiary of Specialty Products Holding Corp., the two companies that, along with RPM International Inc., make up the debtors in the bankruptcy case, spoke poorly about the tort system in Madison County.

“Simply put, the Madison County system was geared toward, in my view, forcing settlements,” Tompkins said from the stand.

At one point in time, defense costs relating to the litigation initiated in Madison County jumped from $6 million to $10 million, Tompkins testified. “I simply couldn’t possibly defend, let alone take to trial, every case in Madison County,” he said.

As general counsel, Tompkins said, his job was to manage litigation costs, and when the insurers stopped indemnifying the debtors, who were still solvent at the time, Tompkins really had no choice but to go down the settlement route.

“In Madison County, we looked at alternative ways of resolving the litigation,” Tompkins said.

On direct examination by one of the debtors’ attorneys, Tompkins was asked about the insurers, who, the witness said, didn’t seem interested in exploring more “aggressive and different defense strategies.”

Prior to that time, if an asbestos case were taken to trial, insurers would typically cover 90 percent of the costs, while the companies would be on the hook for about 10 percent.

As for Madison County, Tompkins testified that procedural rules in that jurisdiction made it near impossible for a defendant such as his prior employer to take a case to trial.

For example, the way the system was set up, multiple cases could be scheduled to go to trial on the same day, he said.

The procedural difficulties were one reason behind deciding to settle an asbestos case before trial.

In many cases that were settled in Madison County, no discovery was done, no depositions were taken. The cases were simply settled because it was an “economically effective means” of mitigating risk with regard to litigation, Tompkins said.

And it was one of the main catalysts behind large group settlements entered into with the Lanier firm (of Houston), a big name plaintiffs’ firm that had filed many asbestos claims (through local counsel) in Madison County, Tompkins said.

But while settling was the chosen route from a risk minimization standpoint, Tompkins said he was still convinced that some of the allegedly injured parties were not injured because of exposure to Bondex’s product.

Many of those Madison County plaintiffs, Tompkins said, which had come from all over the country, had symptoms consistent with industrial exposure, not exposure to Bondex products, which were designed for do-it-yourself home use.