Bledsoe v. Dalkon Shield Trust (In re A.H. Robins Co.)

197 B.R. 550, 1995 Bankr. LEXIS 2071
CourtDistrict Court, E.D. Virginia
DecidedAugust 14, 1995
DocketNo. 85-01307-R
StatusPublished
Cited by21 cases

This text of 197 B.R. 550 (Bledsoe v. Dalkon Shield Trust (In re A.H. Robins Co.)) is published on Counsel Stack Legal Research, covering District Court, E.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bledsoe v. Dalkon Shield Trust (In re A.H. Robins Co.), 197 B.R. 550, 1995 Bankr. LEXIS 2071 (E.D. Va. 1995).

Opinion

MEMORANDUM

MERHIGE, District Judge.

These matters are before the Court on the motions of Barbara Raygor and Cheslene Bledsoe to vacate adverse Alternative Dispute Resolution (“ADR”) decisions and order new ADR hearings.1 For the reasons which follow, the motions will be denied.

[552]*552I.

Movants Barbara Raygor and Cheslene Bledsoe (“Movants”) are Daikon Shield claimants who separately rejected their Option 3 offers of compensation and elected to proceed with binding ADR. See Claims Resolution Facility (“CRF”) § E.4. In each case, the same ADR referee was appointed by the Private Adjudication Center (the Neutral Third Party or “NTP”).

Pursuant to the First Amended ADR Rules, the parties in each case submitted Statements of Facts and Issues for the referee’s consideration twelve days before their April 26, 1994, hearings. Raygor sought damages for uncontrolled bleeding and em-bedment of the Daikon Shield. Bledsoe sought compensation for uncontrolled bleeding, pelvic inflammatory disease (“PID”) and infertility. In support of their respective cases, Movants also submitted expert testimony through the affidavit of Dr. Clark A. Shattuck. In short, Shattuck stated that the Daikon Shield was the cause of the injuries about which each Movant complained.2 The Daikon Shield Claimants Trust (“Trust”) argued in both cases that the Daikon Shield was not the cause of the Movants’ injuries, yet did not proffer any testimony.

The referee issued her written decisions on May 10, 1994. In both cases, the referee decided in favor of the Trust. A careful review of each decision reveals that the referee relied significantly on the Trust’s Statements of Facts and Issues in drafting her decision. In fact, she actually copied large portions of the Trust’s statements verbatim.3 The referee also failed to make any reference to the evidence presented at the hearings, including the Shattuck affidavits.

Movants now seek to have these awards vacated pursuant to Rules 60(b)(4) and 60(b)(6) of the Federal Rule of Civil Procedure.4 Raygor seeks relief under the following theories:

(1) The referee improperly interpreted First Amended ADR Rule XII.F.2. as permitting her to consider the Trust’s Statement of Facts and Issues in reaching her decision. Raygor contends that this “interpretive expansion” both exceeded the referee’s authority and violated this Court’s exclusive jurisdiction.
(2) The referee failed to render a fair and impartial award in that her reliance on the Trust’s Statement of Facts and Issues suggests a predisposition to the Trust’s position.

Bledsoe moves the Court for relief based on the same two theories in addition to the following:

(1) The referee improperly interpreted First Amended ADR Rule XII.G. as requiring a claimant to prove not merely the existence of an injury, but that the injury exceeds a “side-effect” threshold.
(2) The referee failed to resolve all monetary claims for relief presented to her by Bledsoe.

In response, the Trust, argues that relief cannot be provided under Rule 60(b), and that even if Rule 60(b) was the appropriate procedural vehicle, Movants have failed to [553]*553set forth adequate grounds for relief under that rule.

II.

As an initial matter, the nature of ADR must be examined. ADR was designed to be a more efficient, more expedient and less costly alternative to trial or arbitration. “The purpose of ADR is to allow claimants whose offers are $10,000 or less the opportunity to present their cases in person to a neutral third person as quickly as possible and with as few legal complications as possible.” First Amended ADR Rule I.5 Unlike arbitration or trial, there is no discovery process in ADR. First Amended ADR Rule VI. Moreover, the Trust, which bears the administrative costs of ADR, is represented by a non-lawyer advocate. Hearings are limited to two and one-half hours and awards must be issued within fifteen days of the hearing. Clearly, the Trustees structured ADR to further the CRF’s goal of “providing an efficient economical mechanism for liquidating claims which favors settlement over arbitration and litigation.” CRF § A.

When a claimant elects ADR, she “agree[s] that the referee’s decision is final and binding.” Movant’s Motion, Exh. A (Agreement to Submit to Binding ADR); see Gunnell v. Dalkon Shield, Claimants Trust, 197 B.R. 533, 536 (E.D.Va.1994) (ADR Agreement is binding). Moreover, a claimant choosing ADR agrees to waive her right to pursue litigation against the Trust as well as her right to elect in-depth review/settlement conference and arbitration. Id.; see also First Amended ADR Rule II.B. In short, ADR was designed to be every bit as final as an acceptance of an offer under Option 3 and thus an inexpensive and expedient alternative to trial or arbitration. For this reason, unlike the rules governing arbitration, there is no provision in the ADR rules for judicial review of a referee’s decision.

III.

Movants utilize Rule 60(b) as the procedural vehicle to obtain relief in these matters, relying on Dalkon Shield Claimants Trust v. Honore, 197 B.R. 530 (E.D.Va.1994). In Honore, several claimants filed motions for rehearings of their claims owing to discontentment with their ADR awards. The ADR referee affirmatively interpreted the ADR rules as permitting not only the pre-decision reopening of hearings, but the post-decision “correction of plain error or ... review of material otherwise permitted.” 197 B.R. at 532 (quoting Referee’s Memorandum of Conference).6 The Court determined that the referee “usurped this Court’s exclusive jurisdiction to interpret the Plan and related instruments” (i.e., the ADR Rules) by gleaning from the express rules an implied authority to conduct post-decision process. Consequently, the Court held his action to be a “legal nullity.” Id. at 532-33. In closing, the Court stated:

The Court is mindful that the facts of this matter raise an additional question. What, if any relief is available to a claimant who feels unjustly treated by the ADR process? The instant motion does not present this question and the Court does not address it. The Court notes, however, that it has the power to grant relief from final judgments pursuant to Bankruptcy Rule 9024 and Federal Rule of Civil Procedure 60(b).

Id. at 533.

Movants interpret this portion of Honoré as a ruling that Rule 60(b) relief will be available to disgruntled claimants. They are mistaken, however, as the language regarding Rule 60(b) is nothing more than dictum. Since Honoré, the Court has further considered the purposes and nature of Rule 60(b), and now holds that Rule 60(b) is not the appropriate procedural mechanism for seeking relief from an ADR decision. More spe[554]*554cifically, Rule 60(b) provides relief from final judgments, orders or proceedings of federal courts. No matter how liberally this provision is interpreted, see Stancil v.

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Related

Schwalm v. Dalkon Shield Trust
217 B.R. 763 (E.D. Virginia, 1998)
Velu v. Dalkon Shield Trust (In re A.H. Robins Co.)
217 B.R. 175 (E.D. Virginia, 1998)
Lammert v. Dalkon Shield Trust
216 B.R. 539 (E.D. Virginia, 1997)
Bledsoe v. Dalkon Shield Trust
Fourth Circuit, 1997

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Bluebook (online)
197 B.R. 550, 1995 Bankr. LEXIS 2071, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bledsoe-v-dalkon-shield-trust-in-re-ah-robins-co-vaed-1995.