Court Bars Employee's Asbestos Suit Due to Employer Bankruptcy
The Washington State Supreme Court ruled August 9 that the estate of a man who died of mesothelioma caused by on-the-job asbestos exposure cannot sue his former employer because the suit was filed after the company filed for bankruptcy. Roger Herring worked for subcontractors of Todd Shipyards Corp. during the...
August 10, 2007 at 10:00 AM
2 minute read
The original version of this story was published on Law.com
The Washington State Supreme Court ruled August 9 that the estate of a man who died of mesothelioma caused by on-the-job asbestos exposure cannot sue his former employer because the suit was filed after the company filed for bankruptcy.
Roger Herring worked for subcontractors of Todd Shipyards Corp. during the 1960s and early 1970s and worked with asbestos for at least 20 years. In 1986 he was diagnosed with pleural thickening caused by asbestos exposure. It would not be the last of his health problems.
In 1989, Herring developed asbestosis, or scarring of the lungs, and sued several manufacturers of asbestos products, not including Todd. It wasn't until 2002 that Herring was diagnosed with mesothelioma and filed suit against Todd based on that diagnosis. Herring died two years later, and his estate continued the suit.
Todd Shipyards filed for Chapter 11 bankruptcy in 1987. Knowing Todd faced asbestos-related claims, the bankruptcy court issued a bar claims date, blocking suits brought against Todd after 1988. At the time, Todd placed notice in several newspapers, including the Seattle Times, Seattle Post-Intelligencer, New York Times and Wall Street Journal, announcing its bankruptcy and the bar date for lawsuits.
The case hinged on whether Herring was entitled to more notice of the bankruptcy and bar date. Herring never received actual notification and claimed Todd never informed Herring's union, which could have informed him. A union officer reasoned in a declaration that “had the union been notified of the Todd Shipyards bankruptcy, it would have notified its members by publication and/or during union meetings, which to my knowledge was never done.”
In a unanimous decision for what it called “a tragic case,” the Washington Supreme Court reversed an appeals court decision and found Herring's estate was barred from filing suit due to Todd's bankruptcy, concluding Herring was only entitled to notice by publication.
“Where the bankrupt knows of a large class of claimants … due process and diligence requires reasonable notice to those claimants,” wrote Justice Tom Chambers. “However, because it is undisputed that Todd did not have knowledge of Herring's claim, Todd could not have given actual notice to Herring. … Under current federal case law, it appears to us that Todd had no duty to inform Herring's union.”
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