Record of Garlock Settlement History to be Unsealed

On October 16, 2014, U.S. Bankruptcy Judge George Hodges ordered the unsealing of an extensive record relating to past settlements of Garlock Sealing Technologies.  One report of this ruling can be found here, although as of October 22, the formal order has not been posted online.  Documents unsealed as a result of this order are expected to be available around the week of November 24, 2014.  The ruling was made in response to numerous motions to seal certain information, filed by claimants and by Garlock in In re Garlock Sealing Technologies.

After months of contentious discovery, Hodges previously had conducted a 23-day trial concerning the basis for the plaintiffs’ claims related to Garlock’s gasket and sealing products. Hodges found, among other things, that the liability evidence against Garlock reportedly showed that Garlock’s nonfriable products had little or no contribution to asbestos-related diseases.  Hodges also found that by concealing evidence and delaying filing of claims against entities that manufactured more friable products, plaintiffs were able to obtain higher judgments and extract inflated settlements from Garlock.

Hodges  overruled the objections of the claimants, who argued that the disclosure of this information violated their privacy.  While all parties agreed to protect some confidentiality, it was reported that once a claimant chose to file a public lawsuit, their identities in relation to those claims were not entitled to protection.  Similarly, settlement information Garlock submitted in the estimation trial was no longer entitled to protection from public scrutiny, because Garlock submitted this information voluntarily, thereby waiving work product or attorney-client privileges.

These documents will likely provide a rare behind-the-scenes view into common settlement practices used to resolve massive volumes of claims.  Hodges’ detailed ruling has shown how the litigation of individual cases can be used for financial gain unrelated to legal liability or fault. It remains to be seen whether our legal system can introduce sufficient transparency between the asbestos trust system and the civil litigation to prevent these abuses from spreading.