EPA estimates that asbestos fibers contribute to 7,500 deaths per year in the United States. Most uses of asbestos have been banned since asbestos was found to cause lung cancer and other respiratory diseases in humans. However, it is estimated that 30 million tons of asbestos were used in thousands of building products since the late 1800s. Asbestos-containing building materials are commonly found in buildings constructed prior to the mid-1970s.
The asbestos regulations currently in place are necessary to ensure that people are not exposed to airborne asbestos fibers when buildings are remodeled or demolished. What are the statutes and regulations and to whom do they apply The regulations apply to remodeling or demolition projects which occur in public or commercial buildings. Private residences and apartment buildings with four or fewer dwellings are exempt from the regulations. Any project which is subject to these regulations requires a notification to the department within 10 working days prior to the start of the project.
Respondent Fibreboard Corporation, an asbestos manufacturer, was locked in litigation for decades. Plaintiffs filed a stream of personal injury claims against it, swelling throughout the 1980s and 1990s to thousands of claims for compensatory damages each year. Fibreboard engaged in litigation with its insurers, respondent Continental Casualty Company and respondent Pacific Indemnity Company, over insurance coverage for the personal injury claims.
In 1990, a California trial court ruled against Continental and Pacific, and the insurers appealed. At around the same time, Fibreboard approached a group of asbestos plaintiffs lawyers, offering to discuss a global settlement of Fibreboards asbestos liability. Negotiations at one point led to the settlement of some 45,000 pending claims, and the parties eventually agreed upon $1. 535 billion as the key term of a Global Settlement Agreement.
Of this sum, $1. 5 billion would come from Continental and Pacific, which had joined the negotiations, while Fibreboard would contribute $10 million, all but $500,000 of it from other insurance proceeds. At plaintiffs counsels insistence, Fibreboard and its insurers then reached a backup settlement of the coverage dispute in the Trilateral Settlement Agreement, under which the insurers agreed to provide Fibreboard with $2 billion to defend against asbestos claimants and pay the winners, should the Global Settlement Agreement fail to win court approval.
Subsequently, a group of named plaintiffs filed the present action in Federal District Court, seeking certification for settlement purposes of a mandatory class that comprised three groupsclaimants who had not yet sued Fibreboard, those who had dismissed such claims and retained the right to sue in the future, and relatives of class membersbut excluded claimants who had actions pending against Fibreboard or who had filed and, for negotiated value, dismissed such claims, and whose only retained right is to sue Fibreboard upon development of an asbestos-related malignancy.
The District Court allowed petitioners and other objectors to intervene, held a fairness hearing under Federal Rule of Civil Procedure 23(e), ruled that the threshold Rule 23(a) numerosity, commonality, typicality, and adequacy of representation requirements were met, and certified the class under Rule 23(b)(1)(B). In response to intervenors objections that the absence of a limited fund precluded Rule 23(b)(1)(B) certification, the District Court ruled that both the disputed insurance asset liquidated by the $1. 5 billion global settlement, and, alternatively, the sum of the value of Fibreboard plus the value of its insurance coverage, as measured by the insurance funds settlement value, were relevant limited funds.
The Fifth Circuit affirmed both as to class certification and adequacy of settlement. Agreeing with the District Courts application of Rule 23(a), the Court of Appeals found, inter alia, that there were no conflicts of interest sufficiently serious to undermine the adequacy of class counsels representation.