Editor’s note: This article is part of a series examining evidence submitted in Garlock Sealing Technologies’ bankruptcy proceeding that was recently unsealed as a result of Legal Newsline’s legal challenge.
CHARLOTTE, N.C. (Legal Newsline) – Attorneys at his firm were focused solely on proving their asbestos clients were harmed by solvent companies while delaying the filing of claims against bankrupt ones until the resolution of their lawsuits, Philadelphia attorney Benjamin Shein said in 2013.
A deposition of Shein conducted by an attorney for Garlock Sealing Technologies, which has filed a racketeering lawsuit against the Shein Law Center, was recently unsealed.
During Garlock’s bankruptcy proceeding, it sought to prove that the amount it paid in settlements and verdicts in asbestos lawsuits was inflated because plaintiffs attorneys manipulated their clients’ exposure evidence.
Bankruptcy Judge George Hodges agreed in 2014, ruling plaintiffs attorneys delayed filing claims with bankruptcy trusts because those claims could have been used as evidence by companies in the tort system, like Garlock, to argue it wasn’t as liable for the claimants’ injuries as the plaintiffs attorneys argued.
The following is an excerpt from Shein’s deposition. The questions were asked by Garlock attorney Garland Cassada.
Q: Does your firm delay filing trust claims until after you resolved an underlying tort action?
A: We file trust claims after the completion of the tort litigation.
Q: Okay, is there a purpose for waiting until after the completion of the tort litigation?
A: My duty to these clients is to maximize their recovery, okay, and the best way for me to maximize their recovery is to proceed against the solvent, viable non-bankrupt defendants first, and then if appropriate, to proceed against the bankrupt companies.
Q: Why would it maximize your client’s recoveries to hold all filing trust claims?
A: Because under Pennsylvania law, if a bankrupt claim is paid, not only filed but paid, that bankrupt payment claim, that defendant, would go on the verdict sheet and be eligible to be a share which the jury could consider.
Q: Okay. Is that a practice that then – a general practice you would follow in cases that your firm prosecuted against Garlock?
A: It varies on a case-by-case basis, but my goal is to maximize the recovery for these families and these victims, and if that’s appropriate in that case, that’s what we do.
Much of Shein’s deposition focused on the case of Vincent Golini, whose estate negotiated a $250,000 settlement with Garlock.
Golini did not identify any bankrupt companies as responsible when asked by Garlock and testified about pipe covering on ships he worked: “The condition on ships was always wonderful. There was a cast and everything was painted.”
However, Garlock says Golini, even before filing his lawsuit against Garlock, had already submitted 14 statements that said he worked in close proximity to workers manipulating asbestos-containing products.
Golini’s attorneys eventually filed 20 claims with bankruptcy trusts and four ballots.
Cassada asked Shein specifically about Golini’s deposition. Shein said he wasn’t involved “specifically” with Golini’s case until the trial.
Instead, Bethann Schaffzin prepared and represented Golini at his deposition, and Shein was unaware if she knew that Golini had worked around another specific asbestos-containing product over which he filed trust claims.
Q: Is it your firm’s practice typically for lawyers to share information that they have about your clients?
A: Certain information. I would not expect this type of information to necessarily be shared prior to a deposition.
Q: You wouldn’t expect information that a client gave one of your lawyers about products that he came in contact with regularly, frequently and in close proximity and was exposed to asbestos dust, that kind of information you wouldn’t expect to be shared?
A: As I said previously, our goal is to maximize a client’s recovery, okay, and in order to do that, what we focus on for the deposition is the viable, non-bankrupt companies. That’s our job, okay.
Our goal is to do our job on behalf of our clients, okay, not to do the defendants’ job for them.
After being asked if Golini’s exposure to the other product was disclosed at any time during pre-trial discovery, Shein said, “If it wasn’t, that was a mistake on the part of our firm.”
Hodges’ ruling ordered Garlock to put $125 million in its asbestos trust, more than $1 billion less than plaintiffs attorneys requested.
“This occurrence was a result of the effort by some plaintiffs and their lawyers to withhold evidence of exposure to other asbestos products and to delay filing claims against bankrupt defendants’ asbestos trusts until after obtaining recoveries from Garlock,” Hodges wrote.
“It appears certain that more extensive discovery would show more extensive abuse. But that is not necessary because the startling pattern of misrepresentation that has been shown is sufficiently persuasive.”
Garlock has filed other RICO suits against Belluck & Fox of New York and the Dallas firms Waters & Kraus and Simon Greenstone.
From the Pennsylvania Record: Reach editor John O’Brien at email@example.com.