October 30, 2009

TO THE COMPANIES IN INTEREST:

Re: Two Disease Rule” – Pennsylvania Supreme Court permits asbestos plaintiff to recover against defendant not named in prior suit.

In an opinion dated October 21, 2009, a year after it was argued, the Pennsylvania Supreme Court ruled that where a plaintiff brought a suit before Pennsylvania became a “two-disease state,” to recover for non-malignant conditions and the risk and fear of developing cancer, and settled with some defendants, the same plaintiff can maintain a later suit against a defendant not named in the prior action and recover for a malignant condition.

Up until 1992, asbestos plaintiffs in Pennsylvania were required to bring all of their asbestos-related injury claims in one lawsuit. Specifically, an asbestos plaintiff with a a non-malignant condition could maintain an action for the non-malignant condition as well as his risk and fear of developing a malignancy in the future. In 1992, the Pennsylvania Superior Court in the Marinari v. Asbestos Corp., et al decision, adopted the “two-disease” rule. Under this, claims for non-malignant and for malignant conditions were considered separate causes of action. A plaintiff with a non-malignant condition could no longer recover for fear or risk of developing cancer because, should cancer subsequently occur, a new cause of action would be created. The actual holding in Marinari was that the claim of a plaintiff, who brought suit within two years of developing asbestos related cancer but more than four years after developing asbestos related pleural thickening, was not time barred by the two year statute of limitations because the claims for pleural thickening and for cancer were separate causes of action.

In the Abrams and Shaw cases, decided by the Pennsylvania Supreme Court on October 21, 2009, the plaintiffs’ decedents developed non-malignant asbestos related diseases in the mid 1980s and within two years filed suits against various defendants seeking damages for those diseases as well as increased risk and fear of cancer. They did not sue defendant John Crane, Inc. At the time those suits were brought, the plaintiffs were required to bring all of their claims in a single action. The initial actions filed by Abrams and Shaw were settled with various defendants in 1993.

In 2002, both Abrams and Shaw were diagnosed with lung cancer and they filed suits in February 2003 against various companies including John Crane. Crane subsequently filed a motion for summary judgment which asserted that the plaintiffs’ claims were barred by the two-year statute of limitations. Crane argued that under the law in effect when the plaintiffs’ first suits were filed, all claims had to be brought in a single action, and that as a result of not suing Crane, the cause of action against Crane became time barred two years after the original diagnoses of an asbestos related condition. The Philadelphia Court of Common Pleas agreed and granted Crane’s motion for summary judgment. Subsequently, a three judge panel of the Pennsylvania Superior Court reversed, but after granting re-argument, an en banc panel of the Superior Court affirmed the trial court’s grant of summary judgment in Crane’s favor.

In a 4-2 decision (with one justice not participating), the Pennsylvania Supreme Court reversed the Superior Court and reinstated the plaintiffs’ claims. In so ruling, the Supreme Court, citing authority that in the undersigned’s opinion was not really on point, ruled that the causes of action the plaintiffs have against Crane are “separate and distinct” from the causes of action they had against other defendants they previously sued. The Court stated that only the causes of action for non-malignancies and the risk and fear of cancer became time barred in the late 1980s. The causes of action for lung cancer did not accrue until 2002 and therefore the suits filed in February 2003 were timely. The Supreme Court viewed the plaintiffs as being in the same position as a plaintiff who was diagnosed with a non-malignant disease before 1992 who did not file an asbestos related lawsuit within two years of that diagnosis. Under Marinari, that plaintiff would be permitted to file suit to recover for the malignancy.

The two dissenting justices opined that Crane was entitled to rely upon the statute of limitations as it existed in the late 1980s and on the claims thereby being time barred. The dissent also pointed out that the majority opinion raised the possibility of double recoveries; plaintiffs in the positions of Abrams and Shaw could be viewed as having recovered compensation for their expected harm (their non-malignant condition and the risk of contracting cancer) and if such plaintiffs are later permitted a full recovery in the event they actually contract cancer, they will be able to receive full compensation a second time.

It remains to be seen whether the majority’s opinion will have unintended consequences. For example, will the language about the plaintiffs’ causes of action against Crane being separate and distinct from the causes of action asserted against other defendants in the 1980s invite plaintiffs to do what traditionally has been viewed as splitting a cause of action, for example, bringing a suit against one set of defendants, settling or trying it, and then bringing suit against another set of defendants; or as perhaps suggested by the dissenters, will plaintiffs’ attorneys again seek to recover for increased risk of cancer in non-malignancy cases in view of the majority’s apparent conclusions that claims for lung cancer are not identical to claims for risk of cancer.

Should you have any questions about the above, please do not hesitate to contact me at (215) 665-3301, or email at lantieri@bbs-law.com

Very truly yours,

PAUL F. LANTIERI

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