Brick Wall

United States District Court Judge Mark L. Wolf recently denied the “medical monitoring” claims of a putative class alleging beryllium exposure. This is the first decision addressing medical monitoring claims in Massachusetts since the landmark Donovan ruling in 2009, and strengthens the restrictions on such claims.

Medical monitoring claims, a relatively modern addition to tort law, seek monetary damages for medical testing required after toxic exposure. States increasingly allow medical monitoring claims to proceed. However, a divide remains between courts which require evidence of physical injury and those which require only evidence of increased risk of injury. In Donovan v. Philip Morris USA Inc., 455 Mass. 215 (2009), Massachusetts’ highest court ruled that medical monitoring claims are allowed, as long as evidence of physiological, or “subcellular,” changes are present.

In Donovan, plaintiffs sought to represent a class of symptom-free smokers and asked the court to order medical monitoring. Philip Morris sought dismissal of the medical monitoring claims based on the lack of injury to any of the plaintiffs. On the question of whether medical monitoring claims are valid under Massachusetts law, the U.S. District Court certified the question to the Supreme Judicial Court.

The primary dispute: whether plaintiffs must establish physical injury to sustain their claims, or merely an increased risk of injury. The SJC ruled that plaintiffs can sustain a medical monitoring claim in Massachusetts by proving seven elements, including: “[exposure] to a hazardous substance that produced, at least, subcellular changes that substantially increased the risk of serious disease, illness, or injury.” Donovan at 226. The requirement of “subcellular,” or physiological, changes was a departure from the law of many other states. While the Donovan decision confirmed that medical monitoring claims could be brought in Massachusetts, it also restricted such claims to plaintiffs who had suffered actual physical damage.

Fast forward two years. This past June, U.S. District Court Judge Mark L. Wolf granted a defendant summary judgment in the first medical monitoring decision to be addressed in Massachusetts since Donovan. In the consolidated cases of Betucchy, et al. v. Raytheon Co. (1:10-cv-11652) and Genereux v. Hadric Laboratories Inc. (04-cv-12137), plaintiffs sued Raytheon for, among other things, medical monitoring costs associated with exposure to beryllium at Raytheon’s Waltham facility. Their complaints alleged that Raytheon’s improper handling of the chemical increased their risk of developing Chronic Beryllium Disease (“CBD”). None of the members of the putative class exhibited any signs or symptoms of CBD, and none had received abnormal results on the BeLPT, the test for that disease.

Raytheon moved for summary judgment, claiming that the plaintiffs failed to produce any evidence of the “subcellular change” required by the SJC in Donovan. In granting Raytheon’s motion, Judge Wolf examined the plaintiffs’ only evidence: the testimony of plaintiffs’ expert. The expert could not conclude that any of the plaintiffs suffered subcellular changes, nor did he find that any plaintiff had abnormal BeLPT tests. Finally, he had testified that increased exposure to
Continue Reading Another Brick In The Wall Against Medical Monitoring Claims

Court Ruling

  • The Massachusetts Payment of Wages Statute (the “Wage Act”) has lately received a great deal of attention from Massachusetts trial and appellate courts.  Although the statute has been in place since 1993, Massachusetts employers have recently faced a marked increase in Wage Act claims, likely due to the availability of treble damages and attorneys fees.  Just in the past year, Massachusetts court rulings have reflected this renewed interest in the Wage Act, as they attempt to define the law and its intricacies. Below is just a sample of Massachusetts courts’ continuing concern with the Wage Act:

Dow v. CasaleOut-of-state Employees.  Superior Court Judge Peter Lauriat recently ruled that an out-of-state employee could bring a valid Wage Act claim against his employers because they were located in Massachusetts.  Plaintiff had been a salesman for Starback Communications, Inc., and lived and worked in Florida.  When the company folded, he sued his employers in Massachusetts for unpaid commissions and wages.  The defendant employers moved for summary judgment, claiming that the Wage Act should not apply to employees outside of the Commonwealth.  Judge Lauriat disagreed, ruling that employees outside of Massachusetts could sue under the Wage Act if they have sufficient contacts with the Commonwealth.  In Dow, the court found that the plaintiff met this burden after considering that he:

  • Conducted most business over the internet;
  • Was in daily contact with his supervisor in Massachusetts;
  • Had customers in Massachusetts;
  • Traveled often to Massachusetts;
  • Occasionally worked in the same space at the company’s office in Massachusetts;
  • Owned business cards bearing the firm’s Massachusetts address; and
  • Was required to process all purchase orders through the Massachusetts location.

Moreover, Judge Lauriat ruled that,

“the Wage Act was designed to regulate the actions of Massachusetts employers, regardless of where the employees work,” and offered that “in this age of the ubiquitous Blackberry, IPad [sic] and smartphone, any person can work in any location that has internet access. Were the court to accept [the defendants’] argument, the Wage Act would afford no protection to an employee who conducted the employer’s business anywhere but in Massachusetts.”

Though Judge Lauriat’s expansion of the Wage Act does not hold precedential value, it will at least provide guidance to other trial courts.  As such, Massachusetts employers must be prepared that a court may very well hold that the Wage Act applies to employees located anywhere in the country, so long as their employer is located in Massachusetts and they establish sufficient contacts with the Commonwealth.

Farrell v. Farrell Sports Concepts, et al. Severance Pay.  Superior Court Judge Garry Inge recently held, in a very controversial opinion, that a fired employee cannot sue his employer for severance pay under the Wage Act.  Previously, in 2003, The Massachusetts Appeals Court held in Prozinski v. Northeast Real Estate Services that severance pay was not available through the Wage Act because it is not expressly mentioned in the statute.  Two years later, the Massachusetts Supreme Judicial Court ruled that the term
Continue Reading The Massachusetts Wage Act: Increased Number of Claims Leads to Influx of Important Rulings

Congress

Recently, the Subcommittee on Courts, Commercial and Administrative Law of the U.S. House Judiciary Committee, held a hearing on an important new bill aimed at furthering transparency in asbestos bankruptcy trusts.  Proponents of the controversial new bill, entitled H.R. 4369, the “Furthering Asbestos Claim Transparency Act (FACT) Act of 2012,” say that it would shed some much-needed light on the secretive claims processes of the bankruptcy trusts.

Asbestos-related liabilities have plagued hundreds of corporate defendants over the past twenty-plus years. Many have sought protection under Chapter 11 of the U.S. Bankruptcy Code.  Section 524(g) of that Chapter allows a debtor company to channel asbestos claims to a trust set up for the purpose of paying those claims.  Pursuant to that Section, the trust assumes the asbestos liabilities and the debtor’s assets are transferred to the trust, which then pays the asbestos-related claims.  The debtor company is thus relieved of all present and future asbestos-related liabilities.  See GAO-11-819, at 2-3 (2011), Report of theU.S. Government Accountability Office to the Chairman, Committee on the Judiciary, House of Representatives: Asbestos Injury Compensation; The Role and Administration of Asbestos Trusts, (pdf download). The problem, according to proponents of H.R. 4369, is that the claims process is a private, non-adversarial administrative process, and is shielded from public scrutiny by complex “trust distribution procedures,” or “TDPs.” Marc Scarcella, an economist at Bates White, LLC, testified in support of the bill.  Mr. Scarcella addressed concerns about the lack of mechanisms to cross-check trust claims against claims made to other trusts or in the tort system:

“lack of transparency and accountability may incentivize specious and inconsistent claiming across the tort and trust systems” and “may result in trust funds being depleted by erroneous payments.”  Hearing Before the H. Jud. Comm. Subcomm. On Courts, Commercial and Administrative Law, 112th Cong. (2011-2012) (statement of Marc Scarcella, Bates White, LLC).  H.R. 4369 would preclude such misuse by requiring each trust to file quarterly reports which disclose: (i) who has filed a claim against the trust; and (ii) the asbestos exposures alleged by each claimant.  See id.

The lone opponent of H.R. 4369 at the hearing was plaintiffs’ attorney Charles Siegel of Waters & Kraus LLP.  Attorney Siegal testified that the legislation “would place new burdens on trusts … but would only serve solvent defendants’ interests.”  Mr. Scarcella addressed these concerns, however, by stating that the new transparency considerations would benefit everyone involved, particularly future claimants.  Moreover, he testified that the reporting would not burden the trusts because the claims administration process is controlled electronically.

Concerns about asbestos bankruptcy trusts is not new. There are legislative efforts at reform underway in several states, including Ohio, Lousiana, and Texas, to name but a few.  The fact that the issue has finally made its way before the U.S. Congress is heartening, but there is a long way to go.  The bill in its current form does not appear to address the filing of


Continue Reading Shed a Little Light: Congressional Hearing on Asbestos Bankruptcy Trusts Promises Much-Needed Transparency