Our plain-English summary of In re Asbestos Products Liability Litigation (NO. VI) (U.S. District Court, Eastern District of Pennsylvania, June 28, 2017).
Maynard Herman and his wife Irene sued Ametek, Inc. and other companies in the Philadelphia Court of Common Pleas. They alleged that Mr. Herman's work exposed him to asbestos and that he developed mesothelioma. Defendants removed the case to federal court on diversity grounds. Ametek is a Pennsylvania citizen, which would normally bar removal, so defendants argued that the plaintiffs had fraudulently joined Ametek. Plaintiffs claimed Ametek was liable as successor to Haveg Industries, which made the asbestos-containing products, because Ametek bought Haveg's assets in 1980. The court did not decide whether Ametek was actually a successor. It asked only whether defendants had shown there was no reasonable basis for that claim. Applying the four Pennsylvania factors for de facto merger or mere continuation (continuity of ownership, cessation of business, assumption of obligations, continuity of operations), the court found each showed at least a possibility of successor liability. It granted the motion and sent the case back to state court.
We wrote this summary from the court's opinion with the help of AI. It is not the court's wording, and it is not legal advice. The full opinion is below.
You don't need the product names or old records. No fee unless we recover compensation for your family.
The decision
- Court: U.S. District Court, Eastern District of Pennsylvania
- Decided: June 28, 2017
- Stage: Jurisdiction, venue or removal
- State: Pennsylvania
Outcome. The court granted plaintiffs Maynard and Irene Herman's motion to remand to the Philadelphia Court of Common Pleas, finding defendants had not shown that the joinder of Ametek was fraudulent.
What the court held. On a remand motion after removal for fraudulent joinder, defendants must show there is no reasonable basis for the successor liability claim; if there is a possibility a state court could find successor liability under the de facto merger or mere continuation factors, remand is required.
Issues decided: Successor Liability, Venue, Removal and Transfer.
The people and their exposure
- Maynard Herman
| Who | Work | Where | When | Products |
|---|---|---|---|---|
| Maynard Herman | asbestos containing products produced by Haveg Industries |
The defendants
- Ametek, Inc. (manufacturer)
- The Budd Company, Inc.
- Champlain Cable Corporation
- Cytec Engineered Materials, Inc.
- General Electric Company
- Meriden Molded Plastics, Inc.
- Occidental Chemical Corporation
- Rockwell Automation, Inc.
- ThyssenKrupp USA, Inc.
- Union Carbide Corporation
Other decisions in this case
Other rulings from the same court in the same case, in our library:
- Wingfield v. John Crane (In re Asbestos Products Liability Litigation (NO. VI)) (June 3, 2011). The court granted the Moving Defendants' motion (John Crane, Warren Pumps, General Electric, Georgia-Pacific and Crane Co.) to exclude Emmett Wingfield's videotaped deposition, a ruling against the plaintiff.
The court's opinion
The text below is Google Scholar's copy of the court's opinion, a public record. Numbers in brackets, such as [*921], mark where each page of the printed reporter begins.
IN RE: ASBESTOS PRODUCTS LIABILITY LITIGATION (No. VI).
MAYNARD HERMAN, etal.,
v.
AMETEK, INC., etal.
Consolidated Under MDL Docket No. 875, Civil Action No. 17-1602.
June 28, 2017.
United States District Court, E.D. Pennsylvania.
MAYNARD HERMAN, Plaintiff, represented by CHARLES S. SIEGEL, WATERS & KRAUS LLP.
MAYNARD HERMAN, Plaintiff, represented by MELANIE J. GARNER, LOCKS LAW FIRM, PATRICK J. WIGLE, WATERS & KRAUS, LLP & MICHAEL B. LEH, LOCKS LAW FIRM.
IRENE S. HERMAN, Plaintiff, represented by CHARLES S. SIEGEL, WATERS & KRAUS LLP, MELANIE J. GARNER,
LOCKS LAW FIRM, PATRICK J. WIGLE, WATERS & KRAUS, LLP & MICHAEL B. LEH, LOCKS LAW FIRM.
AMETEK, INC., Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY,
GIBBONS PC.
THE BUDD COMPANY, INC., Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC & GREGORY M. STOKES, SWARTZ CAMPBELL LLC.
CHAMPLAIN CABLE CORPORATION, Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Defendant, represented by JAMES P. HADDEN, MARON MARVEL BRADLEY &
ANDERSON PA.
GENERAL ELECTRIC COMPANY, Defendant, represented by DAVID A. SPEZIALI, SPEZIALI, GREENWALD, GOLDSTEIN & HAWKINS, P.C. & JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Defendant, represented by ADRIANNA YANEZ, WHITE & WILLIAMS LLP, WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Defendant, represented by JOHN STEWARD SLOSSON, NELSON,
MULLINS, RILEY AND SCARBOROUGH & MARK ALLEN LOCKETT, BONNER KIERNAN TREBACH & CROCIATA LLP.
ROCKWELL AUTOMATION, INC., Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Defendant, represented by KEVIN P. MCCOY, CARLTON FIELDS JORDEN BURT, P.A. & CATHERINE N. JASONS, KELLEY JASONS MCGUIRE SPINELLI HANNA LLP.
GENERAL ELECTRIC COMPANY, Cross Claimant, represented by JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by MARK ALLEN LOCKETT, BONNER
KIERNAN TREBACH & CROCIATA LLP.
UNION CARBIDE CORPORATION, Cross Defendant, represented by CATHERINE N. JASONS, KELLEY JASONS
MCGUIRE SPINELLI HANNA LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Claimant, represented by MARK ALLEN LOCKETT, BONNER KIERNAN
TREBACH & CROCIATA LLP.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by WESLEY R. PAYNE, WHITE AND WILLIAMS LLP, JONATHAN WOY, White and Williams LLP & ADRIANNA YANEZ, WHITE & WILLIAMS LLP.
ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Cross Defendant, represented by CATHERINE N. JASONS, KELLEY JASONS
MCGUIRE SPINELLI HANNA LLP.
ROCKWELL AUTOMATION, INC., Cross Claimant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by MARK ALLEN LOCKETT, BONNER
KIERNAN TREBACH & CROCIATA LLP.
THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Cross Defendant, represented by CATHERINE N. JASONS, KELLEY JASONS
MCGUIRE SPINELLI HANNA LLP.
THE BUDD COMPANY, INC., Cross Claimant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by MARK ALLEN LOCKETT, BONNER
KIERNAN TREBACH & CROCIATA LLP.
ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Cross Defendant, represented by CATHERINE N. JASONS, KELLEY JASONS
MCGUIRE SPINELLI HANNA LLP.
THYSSENKRUPP USA, INC., Cross Claimant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by MARK ALLEN LOCKETT, BONNER
KIERNAN TREBACH & CROCIATA LLP.
ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Cross Defendant, represented by CATHERINE N. JASONS, KELLEY JASONS
MCGUIRE SPINELLI HANNA LLP.
MERIDEN MOLDED PLASTICS, INC., Cross Claimant, represented by ADRIANNA YANEZ, WHITE & WILLIAMS LLP.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by DAVID A. SPEZIALI, SPEZIALI, GREENWALD,
GOLDSTEIN & HAWKINS, P.C. & JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by JOHN STEWARD SLOSSON, NELSON,
MULLINS, RILEY AND SCARBOROUGH & MARK ALLEN LOCKETT, BONNER KIERNAN TREBACH & CROCIATA LLP.
ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
UNION CARBIDE CORPORATION, Cross Defendant, represented by KEVIN P. MCCOY, CARLTON FIELDS JORDEN
BURT, P.A. & CATHERINE N. JASONS, KELLEY JASONS MCGUIRE SPINELLI HANNA LLP.
UNION CARBIDE CORPORATION, Cross Claimant, represented by KEVIN P. MCCOY, CARLTON FIELDS JORDEN
BURT, P.A. & CATHERINE N. JASONS, KELLEY JASONS MCGUIRE SPINELLI HANNA LLP.
AMETEK, INC., Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. & STEPHEN J. FINLEY, GIBBONS PC.
CHAMPLAIN CABLE CORPORATION, Cross Defendant, represented by FRANCIS MCGILL HADDEN, GIBBONS P.C. &
STEPHEN J. FINLEY, GIBBONS PC.
CYTEC ENGINEERED MATERIALS, INC., Cross Defendant, represented by JAMES P. HADDEN, MARON MARVEL
BRADLEY & ANDERSON PA.
GENERAL ELECTRIC COMPANY, Cross Defendant, represented by DAVID A. SPEZIALI, SPEZIALI, GREENWALD,
GOLDSTEIN & HAWKINS, P.C. & JOHN P. MCSHEA, MCSHEA LAW FIRM PC.
MERIDEN MOLDED PLASTICS, INC., Cross Defendant, represented by ADRIANNA YANEZ, WHITE & WILLIAMS LLP,
WESLEY R. PAYNE, WHITE AND WILLIAMS LLP & JONATHAN WOY, White and Williams LLP.
OCCIDENTAL CHEMICAL CORPORATION, Cross Defendant, represented by JOHN STEWARD SLOSSON, NELSON,
MULLINS, RILEY AND SCARBOROUGH & MARK ALLEN LOCKETT, BONNER KIERNAN TREBACH & CROCIATA LLP.
ROCKWELL AUTOMATION, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC. THE BUDD COMPANY, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
THYSSENKRUPP USA, INC., Cross Defendant, represented by G. DANIEL BRUCH, Jr., SWARTZ CAMPBELL, LLC.
MEMORANDUM
EDUARDO C. ROBRENO, District Judge.
Presently before the Court is Plaintiff's motion to remand the action to the Court of Common Pleas of Philadelphia. For the reasons that follow, the Court will grant the motion.
I. FACTS AND HISTORY
This is a personal injury asbestos action, originally brought in state court, in which Plaintiffs allege that Maynard Herman sustained occupational exposure to asbestos for which the Defendants are responsible. As a result of this exposure, Mr.
Herman contracted Mesothelioma.
On April 7, 2017, Defendants removed the case to this court pursuant to 28 U.S.C. §§ 1332, 1441, and 1446, asserting diversity jurisdiction. Since Defendant Ametek, Inc. is a citizen of Pennsylvania, the state in which the case was brought, 28 U.S.C. § 1441(b)(2) would typically bar jurisdiction. However, Defendants assert that Plaintiffs fraudulently joined Ametek in order to defeat removal and, as a result, the Court may disregard Ametek's citizenship. Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97 (1921); In re Briscoe, 448 F.3d 201, 215-16 (3d Cir. 2006).
After removal, Plaintiffs filed this motion for remand arguing that their joinder of Ametek as a defendant was not fraudulent since Ametek is liable as a successor for Mr. Herman's exposure to asbestos containing products produced by Haveg Industries. Plaintiffs acknowledge that when Ametek bought Haveg in 1980, the agreement facially concerned only the purchase of the latter's assets, and that the default rule in Pennsylvania is for successor non-liability. However, they correctly assert that there are several recognized exceptions that could create successor liability between Ametek and Haveg. See Berg Chilling Sys., Inc. v. Hull Corp., 435 F.3d 455, 468 (3d Cir. 2006). Specifically, if Ametek's purchase of Haveg was actually a de facto merger of the two corporations or served as a mere continuation of Haveg, Ametek would legally be considered Haveg's successor regardless of how the contract between them was framed. Id.
II. STANDARDS
On this motion for remand under 28 U.S.C. § 1447(c), the Court's task is not to decide whether Ametek actually is a mere continuation of Haveg's operations such that successor liability should apply. Instead, strictly construing the arguments against removal and resolving all doubts in favor of remand,[1] the Court must determine whether the Defendants have met their heavy burden of establishing that there is no reasonable basis for Plaintiffs' successor liability claims — that there is not the slimmest possibility that the state court could find in their favor and, instead, could not but conclude that their claims are wholly insubstantial and frivolous. Briscoe, 448 F.3d at 217-18.
The factors a court should consider in determining whether a transaction amounted to a de facto merger or a mere continuation are: (1) the existence of some sort of proof of continuity of ownership or stockholder interest; (2) the cessation of the ordinary business by, and dissolution of, the predecessor; (3) the assumption by the successor of the obligations or liabilities ordinarily necessary for the uninterrupted continuation of the business; and (4) a continuity of the management, personnel, physical location, and the general business operation. Fizzano Bros. Concrete Prod. v. XLN, Inc., 42 A.3d 951, 969 (Pa. 2012); Cont'l Ins. Co. v. Schneider, Inc., 810 A.2d 127, 135 (Pa. Super. 2002), aff'd, 873 A.2d 1286 (Pa. 2005). Although a court must consider all four factors, "all need not exist before" finding successor liability. Schneider, 810 A.2d at 135.[2] Similarly, these elements "are not a mechanically-applied checklist, but a map to guide a reviewing court to a determination that," "for all intents and purposes, a merger has" occurred. Fizzano Bros., 42 A.3d at 969. In determining whether removal jurisdiction exists, the Court may "look to more than just the pleading allegations to identify indicia of fraudulent joinder" as long as it does "not step `from the threshold jurisdictional issue into a decision on the merits.'" Briscoe, 448 F.3d at 219 (quoting Boyer v. Snap-on Tools Corp., 913 F.2d 108, 112 (3d Cir. 1990)). III. DISCUSSION
A. The Continuity of Ownership
Plaintiffs have produced "some proof" of continuity of ownership between Ametek and Haveg through John Lux. Specifically, Plaintiffs assert, citing business documents and deposition testimony, that: (1) Mr. Lux was one of Haveg's owners in 1964; (2) after Hercules Inc. bought Haveg in 1964 as a wholly-owned subsidiary, Hercules gave Mr. Lux a seat on its board of directors; (3) in 1966, Mr. Lux became the president and CEO of Ametek and, after the sale of Haveg to Ametek in 1980, was the chairman of Ametek's board of directors.
Resolving all doubts in favor of Plaintiffs, the Court finds that this factor supports a possibility of successor liability and Defendants have failed to show otherwise.
B. The Cessation of Business
Regarding the cessation and dissolution of Haveg, Plaintiffs note that as part of the purchase agreement, Haveg was required to change its name and cease using Haveg trademarks. Defendants counter that the purchase agreement also provided that Haveg (and Hercules) were required to indemnify Ametek and that they retained most liabilities, including those regarding asbestos injury. They argue that this indicates that Haveg continued to exist after the sale of its assets. It is unclear from the record in what capacity Haveg survived, but it is clear that it did not survive as "Haveg." The Pennsylvania Supreme Court indicated that the cessation of ordinary business prong might be met if, as a result of the asset purchase agreement, the transferor company essentially ceased operating or had become dormant. Fizzano Bros., 42 A.3d at 971. Here, it appears that Haveg did continue to exist, but it is not clear in what capacity. Thus, resolving all doubts in favor of Plaintiffs, the Court concludes that this factor also supports a possibility of successor liability and Defendants have not established otherwise.
C. The Assumption of Obligations
Regarding what liabilities and obligations Ametek assumed as part of the purchase agreement, Defendants contend that it did not assume any relevant liabilities. However, as indicated by Plaintiffs, Ametek did assume all of Haveg's accounts payable, its rights and obligations under existing contracts, its related purchase and sales orders, and its obligations regarding salary payments and vacation time for retained employees. The aforementioned obligations are exactly the type which the Pennsylvania Supreme Court indicated would allow the continuation of business and could meet this prong. Id. at 972. Thus, this prong also suggests the possibility of successor liability despite Defendants' protestations to the contrary. D. The Continuity of Business Operations
Defendants raise no real argument that this prong is not met. Thus, they have failed to meet their heavy burden of proof. Nonetheless, Plaintiffs provide that, according to the purchase agreement, Ametek bought "substantially all of the assets, property and business" of Haveg, (Purchase Agreement ECF No. 11-3 at 10), including Haveg's real property, fixed assets, accounts receivable, inventories (other than its asbestos inventory), the right to use the name "Haveg" and all brand-related intellectual property, the technology and "know-how" of the business, and the right to take possession of the books and records.
Through citation to deposition testimony, Plaintiffs also contend that Ametek retained certain of Haveg's key employees including managers and engineers, as well as line workers and security guards. They assert that Ametek also continued to produce the Haveg product line, used the same labels, and offered repair services for older Haveg products. Plaintiffs conclude that:
[t]he retention of Haveg personnel, the acquisition of substantially all of its assets, the continued marketing of its products, use of its product labels and material safety data [sheets], and acquisition of all of Haveg's intellectual property, existing business relationships, and good will were all clearly intended to permit Ametek continue Haveg's operations seamlessly.
(Plaintiffs' Motion ECF No. 33-1 at 9).
The Court agrees that, at this stage of the proceedings, this factor, as well as the previous three, indicates the possibility of successor liability, and, thus, remand to state court is required.
IV. CONCLUSION
Construing all of the arguments against removal and resolving all doubts in favor of remand, the Court concludes that Defendants have not met their heavy burden of establishing that Plaintiffs' claim of successor liability has no reasonable basis and is wholly insubstantial and frivolous. Briscoe, 448 F.3d at 217-18. Thus, Plaintiff's motion for remand must be granted.
An appropriate order follows.
[1] In cases where the government contractor defense is implicated, removal is favored and the burden of proof necessary to win a remand is much different than under Section 1447(c). In re Asbestos Prod. Liab. Litig. (No. VI) (Barnes), 770 F. Supp. 2d 736, 741 (E.D. Pa. 2011) (citing Sun Buick, Inc. v. Saab Cars USA, Inc., 26 F.3d 1259, 1261 (3d Cir. 1994)). Although this issue arises with frequency in asbestos-related cases, it is not present here.
[2] The Pennsylvania Supreme Court has held that in the context of contract cases, the reviewing court must at least find continuity of ownership. Fizzano Bros., 42 A.3d at 969. However, it left open the question of whether, in tort cases, "the continuity of ownership prong may be relaxed." Id. at 966-67. In considering a motion for remand based on diversity removal, the court must resolve any uncertainty in the law in favor of the plaintiffs. Brisco, 448 F.3d at 219. Thus, although it is not strictly necessary in this case, the Court will review the continuity of ownership prong in a relaxed manner.
Sources
How to cite it
Cite the decision
In re Asbestos Products Liability Litigation (NO. VI) (U.S. District Court, Eastern District of Pennsylvania June 28, 2017).
Cite our summary
“Summary of In re Asbestos Products Liability Litigation (NO. VI).” AsbestosClaims.Law Library. https://asbestosclaims.law/library/cases/in-re-asbestos-products-liability-litigation-no-vi-2017.
ACL Doc numbers and their short links never change. See how to cite the Library.
Talk with an asbestos lawyer
Start with what you remember, and we'll take it from there.
This page is provided for general informational purposes and does not constitute legal advice. Every asbestos case turns on its own facts, exposure history, diagnosis, deadlines, available evidence, and applicable law. Reviewing this page does not create an attorney-client relationship. For advice about your specific situation, call 833-4-ASBESTOS for a free case review.