In Re Ah Robins Co., Inc.

131 B.R. 292, 1991 U.S. Dist. LEXIS 17027, 1991 WL 163129
CourtDistrict Court, E.D. Virginia
DecidedJuly 25, 1991
DocketBankruptcy 85-01307-R
StatusPublished
Cited by7 cases

This text of 131 B.R. 292 (In Re Ah Robins Co., Inc.) 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
In Re Ah Robins Co., Inc., 131 B.R. 292, 1991 U.S. Dist. LEXIS 17027, 1991 WL 163129 (E.D. Va. 1991).

Opinion

*293 MEMORANDUM

MERHIGE, District Judge.

Each of the captioned proceedings requires an interpretation of Article I, Section 1.85 of the Debtors Sixth Amended and Restated Plan of Reorganization (“Plan”), pursuant to Article VIII, Section 8.05(c). Section 1.85 defines “Unreleased Claims” under the Plan and thereby sets the parameters delimiting those suits that both involve the Daikon Shield (“Shield”) and that fall beyond the scope of the Plan’s broad injunction.

With the exception of the matter styled Dalkon Shield Claimants Trust v. Ralph G. Reiser, the initiating parties — either Daikon Shield claimants, former Daikon Shield claimants, and one who may be a late claimant — have brought these matters before the Court by virtue of Motions to Interpret the Plan. The Reiser matter is before the Court on a Complaint by the Daikon Shield Claimants Trust (“Trust”) seeking a permanent injunction enjoining Ralph G. Reiser, counsel for claimants Kathleen and Anthony Galeotafiore, from the continuation of a civil action pending in the Supreme Court of the State of New York, in the County of Nassau. The Galeo-tafiores filed this action against medical doctors alleging malpractice associated with the Shield.

The Trust has moved for judgment on the pleadings as to the motions of June and Gerald Welsh and has responded to each of the motions to interpret. Certain of the health care providers have intervened in an effort to convince the Court that the Plan bars the claims asserted against them.

DISCUSSION

Each of the movants whose motions to interpret the Plan are now pending before the Court, as well as the Galeotafiores, has filed an action against certain health care providers. Each contends that his or her suit is “based exclusively on medical malpractice” under Section 1.85 of the Plan and is thereby not barred by the release and injunctive provisions of Sections 8.03 and 8.04 of the Plan.

After a careful analysis of the Plan, the Court is satisfied that none of the movants seeking an interpretation of Section 1.85 of the Plan, nor Mr. Reiser’s clients, have “Unreleased Claims” as referred to in Article I, Section 1.85 of the Plan. Additionally, some, though not all, parties appear to have violated the injunctive provisions of Section 8.04.

I. The Plan

Not unlike statutory interpretations, an interpretation of the meaning and intent of the Plan — including the Claimants Trust Agreement, Other Claimants Trust Agreement and/or the Claims Resolution Facility — must begin with the precise language utilized in the Plan. The Plan specifically defines the operative terns in these motions, terms whose context in the Plan the Court also must consider. Additionally, the Court must consider the intent and purpose of the scheme of reorganization, as found in the history of the bankruptcy proceedings and in the massive litigation engaged in since the inception of the Debtor’s utilization of Chapter 11 of the Bankruptcy Code. In this regard, the Court at all times remains aware that the principal — if not sole — objective of the Plan that emerged from those proceedings, in reference to individuals with valid Shield claims, is to pay, within its limited resources, full value for injuries related to the use of the Shield.

The history of this case reflects an intent on the part of the Debtor, the appropriate committees and American Home Products (whose financial involvement in the reorganization made it possible, in a major part, to fund the Trust in an amount estimated at the time to be sufficient) to compensate all valid Shield claimants fully and fairly and to channel all Shield claims to the Trust, thereby effectuating what was referred to in the context of claims involving use of the Shield as “global peace.” Indeed, that goal was an absolute requirement of American Home Products, which was then contemplating becoming, as it did, the Debtor’s successor by way of a merger, but which was not willing to participate unless it was to be free of the burdens attending continued litigation.

With this background in mind, four aspects of the Plan are of particular relevance to the arguments now before the Court. These are the definition of a “Dal- *294 kon Shield Claim,” the scope of the release of alternative liability for Daikon Shield Claims and the Plan’s resultant injunction, as well as the parameter of Unreleased Claims which may be pursued regardless of that injunction.

A “Daikon Shield Claim” is defined in Article I, Section 1.37 as follows:

"... all Claims, demands, suits, causes of action, proceedings or any other rights or asserted rights to payment heretofore, now or hereafter asserted against the Debtor, the Successor Corporation, any of the Affiliates of the Debtor or the Successor Corporation, or either of the Trusts, whether or not reduced to judgment, based upon or in any manner arising from or related to (w) the Daikon Shield, (x) the research and development, manufacture, distribution, sale, provision, recommendation, insertion, use or removal of a Daikon Shield, (y) the processing, adjustment, defense, settlement, payment, negotiation or handling of any claims, demands, suits, proceedings or causes of action based upon or relating in any way to the Daikon Shield, or (z) the failure to warn, disclose or provide information concerning, or to take remedial action with respect to, the Daikon Shield, including, without limitation, (a) those for death or personal injuries, including emotional distress, (b) those of any Person against whom any claim, demand, proceeding, suit or cause of action based upon or in any manner arising from or relating to any of the matters enumerated or described in (w), (x), (y) and/or (z) above has been, is or may be asserted (including, without limitation, rights of indemnity, whether contractual or otherwise), contribution, subrogation and reimbursement, (c) those for damages, including punitive damages, (d) those for attorneys’ fees and other expenses, fees or costs, (e) those for any possible economic loss or loss of consortium, (f) those for damage to reputation, and.” (Emphasis added).

In short, the definition of Daikon Shield Claim makes clear that any claim asserted or right to payment based upon or in any manner arising from or related to the Shield is intended to be a Daikon Shield Claim. In addition, the Trust contends that it has consistently interpreted the definition broadly to, as counsel for the Trust states, “encompass any claim for damages for injuries received in a sequence of events or set of facts in which the Daikon Shield was involved in any fashion.”

Under the Plan, holders of Daikon Shield Claims generally “release” all claims “based upon or in any manner arising from or related to the Daikon Shield.” In Section 8.03, the Plan specifically confirms the scope of this Release.

8.03 Release.

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Related

Bergaust v. Flaherty
703 S.E.2d 248 (Court of Appeals of Virginia, 2011)
King v. Dalkon Shield Trust (In re A.H. Robins Co.)
219 B.R. 161 (E.D. Virginia, 1998)
In Re Robins Company, Incorporated
109 F.3d 965 (Fourth Circuit, 1997)
Rogers v. Stall
200 A.D.2d 830 (Appellate Division of the Supreme Court of New York, 1994)
In Re A.H. Robins Company, Incorporated
972 F.2d 77 (Fourth Circuit, 1992)
Dalkon Shield Trust v. Reiser
972 F.2d 77 (Fourth Circuit, 1992)

Cite This Page — Counsel Stack

Bluebook (online)
131 B.R. 292, 1991 U.S. Dist. LEXIS 17027, 1991 WL 163129, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-ah-robins-co-inc-vaed-1991.