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Fraud – Court Finds Defendants & Defense Law Firm Hid Evidence

September 17, 2014

This is epic! There are often times when I suspect a defense firm of playing not entirely by the rules, but those suspicions always remain at the suspicion stage and do not end up translating themselves into actual proof of malfeasance–although it is not the result of a lack of trying, it is just that either we are overly suspicious or those who do this sort off the rules acts are just very good at it. This finding however, makes me feel that perhaps I am not overly suspicious… Read on!

Last week, an extraordinary decision was issued by the federal Third Circuit Court of Appeals in an asbestos case, which really should rock the corporate defense bar. In the case, Kimberlee Williams, et al. v. BASF Catalysts LLC, et al., asbestos victims provided evidence to the court that “that BASF and [‘the New York law firm that defended it for years in asbestos cases, Cahill Gordon & Reindel LLP’] systematically collected and destroyed or hid evidence of asbestos-contaminated products produced by a BASF predecessor, Engelhard, in order to evade liability and forge quick settlements.” See more here. It was enough evidence to revive a fraud case against BASF and its law firm for “lying about the toxic material, then depriving those injured by it of their day in court.”

This federal decision comes in the wake of fraud allegations made against a company called Garlock Sealing Technologies, which makes asbestos-containing gaskets. In that case, victims’ lawyers were initially accused of withholding certain information from Garlock – an absurd claim because, as I wrote in an earlier post, the supposedly “withheld” information was already in the company’s possession. If I were accused of committing fraud when I did no such thing, I’d start looking into it. And that’s exactly what happened, leading to a brief filed in June by Caplin & Drysdale, finding a ton of evidence proving the exact opposite to be true; that Garlock was the party that “violated [the judges’] discovery orders, hid evidence from the bankruptcy court and presented false testimony …. ‘Garlock has committed a fraud upon the court,’ the accompanying memo said in its first sentence.'” It’s a brutal brief, which you can read here.

via Corporate Lawyers Breaking Bad | Joanne Doroshow.

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