Asbestos case settles following motion to vacate deferral of punitive damages

By Jim Boyle and Jon Campisi | May 7, 2014

Two weeks after a lawyer representing the widow of a mesothelioma victim sought to move forward with a punitive damages claim on behalf of his client despite a rule change that deferred such claims in asbestos actions, a settlement was reached.

Attorney Michael C. Mudd, of Maune, Raichle, Hartley, French & Mudd near St. Louis, Mo., filed a motion on April 17 at Philadelphia’s Common Pleas Court requesting a judge specially vacate General Court Regulation No. 2013-01 as to the deferral of punitive damages claims in the case and allow the submission of the claims and supporting evidence to the jury. On April 29, court records show that the matter had been settled for an undisclosed amount.

Mudd represents Rosemary T. Checho, wife of the late Thomas N. Checho, who died in September 2012, just under a year after he was diagnosed with malignant pleural mesothelioma.

The plaintiff alleged her husband contracted the asbestos-related cancer as a result of his 35-year-plus career as an operator of hot metal typesetting machines and through other means.

Mudd took issue with the fact that while punitive damages were historically deferred in Philadelphia asbestos cases per the special rule, the arrangement was predicated upon reverse bifurcated trials, which is where damages are assessed in a first phase, and liability is determined in a second.

Reverse bifurcation, however, is no longer the practice in asbestos trials at Philadelphia’s Common Pleas Court.

Back in late 2011, Judge John W. Herron, the administrative judge of the trial division, announced the rules change, which also did away with the practice of consolidating asbestos cases; such cases are now tried individually and “straight through.”

In his filing, Mudd, the plaintiff’s attorney, wrote, “Since asbestos trials in Philadelphia are no longer reverse bifurcated, the rationale for the deferral of punitive damages claims no longer exists.”

Nevertheless, Mudd noted, punitive damages claims continued to be deferred under the court’s Feb. 7, 2013 general court regulation.

A similar issue came up in New York early last month, when State Supreme Court Justice Sherry Klein Heitler allowed plaintiffs to file for punitive damages in the New York City Asbestos Litigation (NYCAL) docket.

Heitler wrote in her ruling, "“What I cannot ignore is the fact that victims of asbestos exposure are permitted to apply for punitive damages in every New York state court except this one. I for one cannot justify a situation in which an asbestos plaintiff is permitted to apply for punitive damages in Buffalo but not this court. This raises serious constitutional equal protection concerns which should not be overlooked.”

Opponents to the motion said that allowing punitive damages will only hurt future victims as plaintiffs deplete funds that should help those injured from asbestos. They also said non-deferral will repeatedly punish companies for the same conduct.

The issue of deferring punitive damages is a long-standing one in asbestos litigation. In 2012, members of national and state organizations, including the Pennsylvania Business Council, Pennsylvania Chamber of Business and Industry, the Pennsylvania Manufacturers' Association and the Chamber of Commerce co-signed a position paper endorsing the continued deferral.

"The financial viability of remaining solvent defendants continues to be threatened both by the enormity of the litigation and the challenging economy," the paper states. "It would be particularly unwise now for the Court to reintroduce punitive damages to augment economic pressures on employers and raise the specter that future claimants may be left without timely or adequate recoveries."

The opinion goes on to state that the point of large punitive awards has been received loud and clear by business-owners. The goal of damages as a deterrent has been met long ago as more than 100 companies have gone into bankruptcy from asbestos litigation.

In the Checho case, Mudd wrote that under present regulations, if a plaintiff has presented facts from which a jury might reasonably conclude that the preponderance of the evidence establishes outrageous conduct by a defendant, “then the punitive damages claim should be submitted to the jury.”

Mudd said Checho, his client, would introduce evidence and elicit testimony that might have shown “willful, wanton and/or reckless conduct” on behalf of the defendants, especially those tied to the hot metal typesetting machines that the plaintiff’s late husband worked with.

Failure to partially vacate the portion of the general court regulation deferring punitive damages claims in asbestos cases for Checho’s case would prevent the jury’s consideration of such claims and would severely prejudice “substantial constitutional rights of Plaintiff,” Mudd wrote.

“Preventing Plaintiff from presenting decedent’s punitive damages claim to the jury is a violation of her right to due process of law,” Mudd wrote.

The attorney also maintained that the deferral of punitive damages also violates Article I, Section 18 of the Pennsylvania Constitution, which prohibits limitations on damages except in workers’ compensation cases.

Herron’s February 2013 regulation stated that all punitive damages claims in asbestos cases shall be deferred, and could only be litigated in pharmaceutical mass tort cases provided that the coordinating judge, following appropriate motion practice by defense counsel at least 60 days in advance of trial, rules that there are sufficient “requisite proofs” to support the claim going to trial.

With the Checho case settled out of court, a decision on the motion will not be made, leaving the deferral rule in tact.

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