A federal judge in Newark has denied a motion by New York-based Cahill, Gordon & Reindel and two of its attorneys seeking to be dismissed from a putative class action suit claiming they conspired with a client to destroy and fabricate evidence in thousands of asbestos injury cases. The judge also denied motions to dismiss Cahill Gordon’s alleged accomplice in the fraud, BASF Catalysts, along with two former in-house lawyers for the company.
The plaintiffs sufficiently stated facts to support claims of fraudulent concealment, spoliation, fraud and civil conspiracy against the defendants. U.S. District Judge Jose Linares of the District of New Jersey said in an April 5 ruling in Williams v. BASF Catalysts Inc.. His ruling follows a decision by U.S. District Judge Stanley Chesler in 2012 dismissing the case in its entirety and a partial reversal of that decision in 2014 by the U.S. Court of Appeals for the Third Circuit.
Cahill Gordon faces the class action over its role in defending BASF in a series of asbestos exposure suits concerning products containing talc from a company-owned mine in Vermont. Internal testing indicated that the talc contained asbestos, but BASF maintained that the product was asbestos-free, according to court documents. When it was named in an asbestos injury suit in 1979, a BASF predecessor, Engelhard, retained Cahill Gordon. Testimony in that suit, identified in court papers as the Westfall case, revealed that multiple tests performed by Engelhard employees and third parties showed the company’s talc contained asbestos, court documents said.
The plaintiffs allege that after the first case was settled, with a confidentiality clause in the agreement, BASF scientist Glenn Hemstock circulated a memo directing company employees to purge all materials relating to the asbestos-containing talc. The plaintiffs also accuse Cahill Gordon and BASF of procuring false representations from company employees and outside experts, and including false or misleading information in court filings. The alleged scheme came to light in 2009, when a former BASF researcher testified that he knew the company’s talc contained asbestos and that the Vermont mine was shut down for that reason. Between 1984 and 2009, BASF and Cahill Gordon made misrepresentations to thousands of claimants in asbestos injury suits around the country, the plaintiffs claim.
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Source: Cahill Gordon, BASF Can’t Escape Asbestos Fraud Suit | New Jersey Law Journal
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