Kimberlee Williams v. BASF Catalysts LLC

765 F.3d 306, 2014 U.S. App. LEXIS 16999, 2014 WL 4343864
CourtCourt of Appeals for the Third Circuit
DecidedSeptember 3, 2014
Docket13-1089
StatusPublished
Cited by333 cases

This text of 765 F.3d 306 (Kimberlee Williams v. BASF Catalysts LLC) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kimberlee Williams v. BASF Catalysts LLC, 765 F.3d 306, 2014 U.S. App. LEXIS 16999, 2014 WL 4343864 (3d Cir. 2014).

Opinion

OPINION

FUENTES, Circuit Judge.

This putative class action lawsuit alleges that BASF Catalysts LLC and Cahill Gordon & Reindel conspired to prevent thousands of asbestos-injury victims from obtaining fair tort recoveries for their injuries. Decades ago, BASF’s predecessor, Engelhard Corp, discovered that its talc products . contained disease-causing asbestos. Plaintiffs allege that, rather than confront the consequences of this discovery, Engelhard, with the help of its attorneys from Cahill, elected to pursue a strategy of denial and deceit. According to the complaint, Engelhard and Cahill collected the tests and reports that documented the presence of asbestos in Engel- *311 hard talc and they destroyed or hid them; when new plaintiffs focused on Engel-hard’s talc as a possible cause of their disease, Engelhard represented that its talc did not contain asbestos and that no tests had ever said otherwise.

As pleaded, this lawsuit concerns years of purported deceit by Engelhard and Ca-hill. This action is not itself an asbestos injury case, but rather an action about Engelhard and Cahill’s conduct when they confronted asbestos injury cases in state courts around the country. The alleged scheme outlived most of the original plaintiffs, whose diseases have since taken their lives. It did not last forever. Spurred by recent testimony that Engelhard’s talc contained asbestos and that the company knew it, survivors and successors of the original asbestos-injury suits have brought new claims against Cahill and BASF, En-gelhard’s successor. The crux of their complaint is that BASF and Cahill defrauded them in their initial lawsuits and caused them to settle or dismiss claims that they would otherwise have pursued.

The District Court dismissed plaintiffs’ complaint in its entirety. Analyzing the claims individually, the District Court determined that each was inadequately pled or barred by law. Analyzing the various declarations and injunctions requested by plaintiffs — ranging from an injunction against the future invocation of res judica-ta based on past state court judgments to a declaration that BASF and Cahill committed fraud — the District Court dismissed them as beyond its power to grant. The Court did, however, reject defendants’ argument that the Rooker-Feldman doctrine deprived it of jurisdiction. Plaintiffs have appealed the dismissal of three claims: fraud, fraudulent concealment, and violation of the New Jersey Racketeer Influenced and Corrupt Organizations Act. Plaintiffs also defend their requested relief.

We conclude that the District Court erred when it dismissed the fraud and fraudulent concealment claims. The Amended Class Action Complaint properly alleges the elements of fraud and fraudulent concealment — namely that BASF and Cahill lied about and destroyed the asbestos evidence to plaintiffs’ detriment. Neither the New Jersey litigation privilege nor pleading requirements stand in the way of these claims.

The District Court did not err in dismissing the New Jersey RICO claim. Plaintiffs, obliged to plead an injury to their business or property, have not done so. They have alleged an injury to the prosecution of their earlier lawsuits which, under New Jersey law, does not constitute an injury to their property.

Lastly, the District Court correctly discerned that it could not grant plaintiffs all of their requested relief. To the extent that plaintiffs attempt to have the District Court decide, at this point, the statute of limitations, laches, and preclusion issues that will likely arise in future cases, plaintiffs fail to present at Court with a whole or ripe controversy. Plaintiffs may, however, seek injunctive and declaratory relief aimed at resolving the claims alleged.

Accordingly, we reverse in part, affirm in part, and remand for further proceedings.

I. Background of the Case

We accept as true the Amended Class Action Complaint’s well-pled allegations. That complaint alleges a sustained plot by BASF and its law firm, Cahill Gordon, to mislead actual and potential asbestos-exposure plaintiffs into believing that BASF’s talc products did not contain asbestos. In truth, plaintiffs contend, BASF’s own tests *312 and records proved that its talc products contained asbestos.

Defendants in this case include both En-gelhard’s successor, BASF, and Engel-hard’s former employees and attorneys. For much of the events of the ease, the relevant BASF companies operated under the Engelhard label. 1 Thomas D. Halket was BASF’s in-house counsel assigned to asbestos claims. Glenn Hemstock was BASF’s Vice President of Research and Development. Hemstock supervised those scientists who “tested or conducted research on Engelhard’s talc.” Compl. ¶ 42. Arthur A. Dornbusch II was BASF’s General Counsel. We refer to these BASF defendants as “BASF” or “Engelhard.”

Cahill Gordon & Reindel LLP represented BASF and its predecessors in asbestos litigation from 1983 to 2010. During that time, Howard G. Sloane, Scott A. Martin, and Ira J. Dembrow worked for BASF as lawyers at Cahill. We refer to these Cahill defendants as “Cahill.”

The six named plaintiffs in this action represent the interest of a deceased spouse or relative who had worked in proximity to asbestos and died of asbestos disease. These plaintiffs — for whom we will often use Kimberlee Williams as a representative — assert fraud, fraudulent concealment, and New Jersey RICO claims on behalf of their deceased relatives.

A. Engelhard mined talc containing asbestos.

From 1967 to 1983, Engelhard operated a talc mine in Johnson, Vermont. “Talc is a naturally occurring mineral that is mined and then processed or used in manufacturing by companies in numerous parts of the United States.” Compl. ¶ 68. Engelhard processed the talc from the Johnson Mine into products, such as “Emtal talc” and “G & S Talc.” Compl. ¶ 73. These products found use in wall board, joint compound, auto body “filler,” dusting agents, and children’s balloons. Compl. ¶ 74.

Emtal talc and other Engelhard tale products “contained chrysotile asbestos fibers, as well as other asbestos forms including tremolite and serpentine asbestos.” Compl. ¶ 75. During the 1970s and 1980s, multiple laboratory tests indicated that Engelhard talc, including Emtal brand talc and talc from the Johnson Mine, contained asbestos. Engelhard, and later BASF, “had knowledge” of these tests and their results, and, in fact, maintained “[t]he tests and assay results” in their records. Compl. ¶¶ 76-80.

Faced with unfavorable test results, En-gelhard ignored them. According to the complaint, Engelhard “represented to its customers, industry trade groups and the Federal Government that the Emtal talc was asbestos free and even marketed the product as a viable asbestos substitute, thereby causing wide spread [sic] and unknowing exposure to asbestos to United States citizens, including workers and workers’ spouses and children, nationwide.” Compl. ¶ 83.

B. Engelhard gets sued for the asbestos-related death of an employee.

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765 F.3d 306, 2014 U.S. App. LEXIS 16999, 2014 WL 4343864, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kimberlee-williams-v-basf-catalysts-llc-ca3-2014.