### IN THE UNI TED STAT ES COURT OF APPEALS
FOR THE FIF TH CIRCU IT

N o

. 1 0

- 6 0 0 1 5

D O R I S E V E R I T T

, E x e c u t r i x o f T h e E s t a t e o f

R o b e r t M

. E v e r i t t

, S r

. , D e c e a s e d ; G O R D O N K

. A B B O T T ; S A M U E L F

. A B E L ; L U C A S C L A R E N C E A B E L ; K E N N E T H A D A I R ; E T A L

,

P l a i n t i f f s

- A p p e l l a n t s ,

v

.

P N E U M O A B E X

, L

. L

. C

. , S u c c e s s o r b y m e r g e r t o P n e u m o A b e x C o r p o r a t i o n ,

D e f e n d a n t

- A p p e l l e e

.

A p p e a l f

r o m t h e U n i t e d S t a t e s D i s t r i c t C o u r t

f o r t h e S o u t h e r n D i s t r i c t o f M i s s i s s i p p i

U S D C N o

. 3 : 0 6

- C V

- 2 3 1

B e f o r e D e M O S S

, B E N A V I D E S

, a n d E L R O D

, C i r c u i t J u d g e s

.

P E R C U R I A M : *

P l a i n t i f f s

- A p p e l l a n t s , a g r o u p o f a p p r o x i m a t e l y 1 3 0 0 t o 1 4 0 0 p l a i n t i f f s ( t h e

E v e r i t t P a r t i e s ) f

i l e d a l a w s u i t i n d i s t r i c t c o u r t t o e n f o r c e a s e t t l e m e n t

a g r e e m e n t a r i s i n g o u t o f a s b e s t o s l i t i g a t i o n a g a i n s t D e f e n d a n t

- A p p e l l e e P n e u m o

A b e x , L

. L

. C

. ( P n e u m o ) a n d c e r t a i n o t h e r a s b e s t o s m a n u f a c t u r e r s , w h o a r e n o t

p a r t i e s t o t h i s c a s e

. T h e d i s t r i c t c o u r t g r a n t e d s u m m a r y j u d g m e n t t o P n e u m o

. U n i te d S ta te s C o u rt o f A p p ea l s

F i ft h C i rc u i t 

### F I L E D

Februa ry 14 , 20 11

Lyle W . Cayce
Clerk

Purs uant to 5th Cir. R. 47.5

, the cour t has det erm ined that this op i n i o n s hould not *

be publ ish ed and is not pr ece dent excep t unde r the lim ite d cir cum st ance s se t for th in 5th Cir.

R. 47.5 .4. Case: 10-60015 Document: 00511380757 Page: 1 Date Filed: 02/14/2011N o

. 1 0

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T h e E v e r i t t P a r t i e s a p p e a l e d

, a n d w e n o w R E V E R S E a n d R E M A N D

.

I

.

P n e u m o i s a h o l d i n g c o m p a n y t h a t i n c l u d e s , a m o n g o t h e r t h i n g s , t h e A b e x

b r a k e b u s i n e s s , w h i c h b e g a n m a n u f a c t u r i n g p r o d u c t s t h a t c o n t a i n a s b e s t o s i n

t h e 1 9 2 0 s

. P u r s u a n t t o a s e r i e s o f c o r p o r a t e t r a n s a c t i o n s t r a n s f e r r i n g c o n t r o l o f

P n e u m o a n d i t s p r e d e c e s s o r s , t h e d e t a i l s o f w h i c h a r e n o t r e l e v a n t t o t h i s c a s e ,

P n e u m o w a s b y 2 0 0 1 t h e b e n e f i c i a r y o f a n i n d e m n i t y f

r o m i t s p a r e n t c o m p a n y ,

F e d e r a l

- M o g u l C o r p o r a t i o n ( F e d e r a l

- M o g u l )

, f o r a l l a s b e s t o s

- r e l a t e d c l a i m s

a r i s i n g f

r o m o r r e l a t i n g t o t h e p r o d u c t s , a s s e t s o r p a s t c o n d u c t a n d o p e r a t i o n s

o f t h e A b e x b r a k e b u s i n e s s b r o u g h t a g a i n s t P n e u m o a f t e r A u g u s t 2 9

, 1 9 9 8

.

In F e b ru a ry 2 0 0 0

, th e E v e ritt P a rtie s file d a la w su it in th e C ircu it C o u rt

o f J e ffe rso n C o u n ty

, M ississip p i a g a in st P n e u m o a n d ce r t a i n o th e r a sb e sto s

m a n u fa ctu re rs, d istrib u to rs, o r se ll e r s a ffilia te d w ith F e d e ra l-M o g u l se e k in g

re co v e ry fo r in ju rie s a lle g e d to h a v e re su lte d fro m th e ir e x p o su re to a sb e sto s.

H ila ry A

. A n d erso n v

. T h e F lin tk o te C o m

p a n y , N o

. 2 0 0 0 -2 2 (M iss C ir. C t. F e b

.

8

, 2 0 0 0 ). In S e p te m b e r 2 0 0 1

, th e E v e ritt P a rtie s se ttle d th e ir cla im s a g a in st

P n e u m o a n d th re e o f th e o th e r co -d e fe n d a n ts in th a t ca se b y le tte r a g re e m e n t. 2

T h e le tte r a g re e m e n t e n title s i n d i v i d u a l p la in tiffs to p a y m e n t fo r th e ir

s u b m i t te d cla im s a t sp e cifie d ra te s b a se d o n th e ir p a rticu la r a sb e sto s-re la te d

d ise a se

. It a lso o b lig a te s P n e u m o a n d its co -d e fe n d a n ts to m a k e six q u a rte rly

p a y m e n ts in to a se ttle m e n t fu n d to sa tisfy th o se cla im s b e g in n in g o n N o v e m b e r

1

, 2 0 0 1 a n d co n tin u in g q u a rte rly u n til F e b ru a ry 1

, 2 0 0 3

. T h e a g re e m e n t sta te s

th a t a n y re m a in in g su m s to b e p a id to p la in tiffs a re to b e d e te rm in e d o n M a y

1

, 2 0 0 3

, a lth o u g h it p ro v id e s n o e x p re ss d e a d lin e fo r cla im s to b e su b m itte d o r

p a id

. In d iv id u a l p la in tiffs m a y e ffe ctiv e ly o p t-o u t o f th e a g re e m e n t b y e le ctin g

The let ter agree me nt me m o r i a l i z i n g the se ttl em ent is dat ed July 6, 2001, but the 2

undi sp uted r eco rd s how s that t he se ttl em ent wa s execut ed in Sep tem ber, 200 1.

2 Case: 10-60015 Document: 00511380757 Page: 2 Date Filed: 02/14/2011N o

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“n o t to a cce p t” th e s e t t l e m e n t. T h e a g re e m e n t sta te s th a t th e d ism issa l w ith

p re ju d ice w ith re sp e ct to “a n y su ch p la in tiff n o t a cce p tin g th is se ttle m e n t sh a ll

b e v a ca te d .”

U n d e r th e le tte r a g re e m e n t, in d iv id u a l p la in tiffs a re re q u ire d to p ro v id e

ce rta in d o cu m e n ta tio n p rio r to re ce iv in g p a y m e n t, in clu d in g a re le a se o f

l ia b ility

, a ce rtifica tio n o f a m e d ica l d o cto r e v id e n cin g a n a sb e sto s-re la te d

d ise a se , a n d

, w h e re a p p ro p ria te

, d o cu m e n ta tio n re la tin g to e sta te p a p e rs a n d

d e a th ce rtifica te s. T h e a g re e m e n t is s i l e n t a s to th e co n se q u e n ce s o f a

b a n k ru p tcy o r o th e r re o rg a n iza tio n o f P n e u m o o r o f P n e u m o ’s p a r e n t

co m p a n ie s, b u t p r ovi d e s e a ch p a rty a te rm in a tio n rig h t “if fe d e ra l o r M ississip p i

sta te to rt re fo rm le g isla tio n o r ju d icia l d e cisio n w e re to b e e n a cte d so a s to ca u se

e ith e r p a rty ” to co n clu d e th a t its co n tin u e d p a rticip a tio n in th e se t t l e m e n t

a g re e m e n t w o u ld n o lo n g e r b e in its b e st in te re sts.

O n O cto b e r 1

, 2 0 0 1

, b e fo re a n y p a y m e n ts in to th e se ttle m e n t tru st h a d

co m e d u e (a n d b e fo re a n y su ch p a y m e n ts h a d in fa ct been made ), F e d e ra l-M o g u l

a n d ce rta i n o f i t s a ffilia te s - in clu d in g a ll o f th e A n d erso n d e fe n d a n ts e x ce p t

P n e u m o - file d fo r C h a p te r 1 1 b a n k ru p tcy p ro te ctio n in th e U n ite d S ta te s

B a n k ru p tcy C o u rt fo r th e D istrict o f D e la w a re

. P n e u m o so u g h t to in te rv e n e

in th e b a n k ru p tcy p ro ce e d in g a s a n o n -d e b to r t hird p a rty

, se e k in g th e e x te n sio n

o f th e F e d e ra l-M o g u l b a n k ru p tcy a u to m a t i c s t a y to P n e u m o a n d a lso a

ch a n n e lin g in j u n ctio n p ro te ctin g P n e u m o ’s a sse ts u n d e r S e ctio n 5 2 4 (g ) o f th e

b a n k ru p tcy co d e

. It is u n d isp u te d th a t th e E v e ritt P a rtie s d id n o t o p p o se th a t

filin g

. F e d e ra l-M o g u l su b se q u e n tly in fo rm e d P n e u m o th a t it co u ld n o lo n g e r

sa tisfy i t s in d e m n ity o b lig a tio n s. N o r d id th e y o p p o se P n e u m o ’s fu rth e r

d e cla ra to ry ju d g m e n t co m p la in t in th e b a n k ru p tcy co u rt in D e ce m b e r 2 0 0 5

, a s

b e ca m e cle a r a t o ra l a rg u m e n t.

A t so m e la te r tim e (a lth o u g h th e re co rd d o e s n o t sh o w p re cise ly w h e n )

,

3 Case: 10-60015 Document: 00511380757 Page: 3 Date Filed: 02/14/2011N o

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P n e u m o w ith d re w its re q u e st fo r a n a u to m a tic sta y fro m th e b a n k ru p tcy co u rt.

P n e u m o ’s o th e r re q u e sts f o r i n ju n ctiv e re lie f w e re d e n ie d b y th e b a n k ru p tcy

co u rt n e a rly fiv e y e a rs la te r, o n J a n u a ry 2 0

, 2 0 0 6

. O n ce it b e ca m e cle a r th a t n o

in ju n ctiv e re lie f w o u ld issu e fro m th e b a n k ru p tcy co u rt in P n e u m o ’ s f a v o r,

fifty -se v e n o f th e in d iv id u a l E v e ritt p la in tiffs su b m itte d cla im s fo r p a y m e n t a s

p ro v id e d in th e le tte r a g re e m e n t. P n e u m o re je cte d th o se cla im s a s u n tim e ly o n

M a rch 2 8 , 2 0 0 6

.

D e sp ite th e fa ct th a t P n e u m o ’s re q u e st fo r in ju n ctiv e re lie f w a s re je cte d

b y th e b a n k ru p t c y c o u rt, th e cla im s a g a in st P n e u m o w e re ta k e n in to a cco u n t

in th e v a rio u s p la n s o f re o rg a n iza tio n p ro p o se d fo r th e F e d e ra l-M o g u l d e b to rs.

In su p p o rt o f th o se p la n s o f re o rg a n iza tio n , P n e u m o s u b m itte d a sw o rn

d e cla ra tio n to th e b a n k ru p tcy co u rt in J u n e 2 0 0 7 b y its p re sid e n t, S te v e n L

.

F a sm a n

. F a sm a n ’s d e cla ra tio n e x p la in e d th a t a lth o u g h th e cla im s o f th e

E v e ritt P a rtie s w e re se ttle d b e fo re F e d e ra l-M o g u l’s b a n k ru p tcy

, “th e D e b to rs

sto p p e d p ro ce ssin g th e se ttle m e n t a n d m a d e n o fu rth e r se ttle m e n t p a y m e n ts”

a fte r th e d a te o f th e b a n k ru p tcy

. A s a re su lt, F a sm a n e x p la in e d

, th o se “se ttle d

b u t n o t p a id ” cla im a n ts file d su it a g a in st P n e u m o

. O n N o v e m b e r 8

, 2 0 0 7

, th e

b a n k ru p tcy co u rt a p p ro v e d o n e o f th e a lte rn a tiv e p ro p o sa ls fo r re o rg a n iza tio n

.

T h e so -ca lle d “P la n B ” sch e m e th e co u r t a p p ro v e d a w a rd e d P n e u m o $ 1 4 0

m ill i o n in fu ll sa tisfa ctio n o f th e th e n -p re se n t a n d fu tu re a sb e sto s cla im s fo r

w h ich F e d e ra l-M o g u l o w e d in d e m n ity to P n e u m o , b u t w a s u n a b le to p a y d u e to

th e b a n k ru p tcy

.

T h e E v e ritt P a rtie s file d th e ir a m e n d e d co m p la in t in th is a ctio n o n

A u g u st 1 5

, 2 0 0 8

, se e k in g e n fo rce m e n t o f th e se ttle m e n t a g re e m e n t. A fte r

co n d u cti n g d isco v e ry , th e E v e ritt P a rtie s a n d P n e u m o file d sim u lta n e o u s

m o tio n s fo r su m m a ry ju d g m e n t. T h e d istrict co u rt d e n ie d th e E v e ritt P a rtie s’

m o tio n , g ra n te d P n e u m o ’s m o tio n , a n d d ism isse d th e E v e ritt P a rtie s’ co m p la in t

4 Case: 10-60015 Document: 00511380757 Page: 4 Date Filed: 02/14/2011N o

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w ith p re ju d ice

. A lth o u g h th e d istrict co u rt co n clu d e d th a t th e le tte r a g re e m e n t

w a s a v a lid co n tra ct (ra th e r th a n , a s P n e u m o h a d cla im e d

, m e re ly a n o ffe r th a t

th e in d iv id u a l E v e ritt p la in tiffs n e v e r a cce p te d ), it h e ld th a t th e E v e ritt P a rtie s’

cla im s u n d e r th e le tte r a g re e m e n t w e re tim e b a rre d in p a rt b e ca u se th e y file d

th is la w su it m o re th a n th re e y e a rs a fte r P n e u m o first fa ile d to m a k e p a y m e n ts

in to th e se ttle m e n t fu n d o n N o v e m b e r 1

, 2 0 0 1

. T h e tria l co u rt a lso re je cte d th e

E v e ritt P a rtie s’ su b sta n tiv e co n tra ctu a l cla ims

, hol di ng t hat t he Everitt P a rtie s’

b re a ch e d th e le tte r a g re e m e n t b y fa ilin g to p re se n t th e ir cla im s p rio r to w h a t

th e co u rt ch a ra cte rize d a s th e “im p licit” M a y 1

, 2 0 0 3 d e a d lin e . M o re o v e r, th e

d istrict co u rt re je cte d th e E v e ritt P a rtie s’ co n te n tio n s th a t th e F e d e ra l-M o g u l

b a n k ru p tcy te m p o ra rily su sp e n d e d p e rfo rm a n ce u n d e r th e a g re e m e n t, th a t th e

b a n k ru p tcy sta y a u to m a tica lly e x te n d e d t o P n e u m o , a n d th a t P n e u m o w a s

e q u ita b ly e sto p p e d fro m a sse rtin g th e sta tu te o f lim ita tio n s. T h e E v e ritt

P a rtie s tim e ly a p p e a le d

.

II.

T h is co u rt re v ie w s th e d istrict co u rt’s su m m a ry ju d g m e n t d e n o v o ,

a p p ly in g th e sa m e le g a l sta n d a rd s u se d b y th e d istrict co u rt. S a n d ers-B u rn v

.
C ity o f P la n , 5 9 4 F .3 d 3 6 6 (5 th C ir. 2 0 1 0 ). S u m m a ry ju d g m e n t is p ro p e r if th e

m o v a n t sh o w s th a t “th e re is n o g e n u in e issu e a s to a n y m a te ria l fa ct a n d th a t

th e m o v a n t i s e n title d to ju d g m e n t a s a m a tte r o f la w .” F e d

. R

. C iv

. P

. 5 6 (a ).

T h e p a rtie s a g re e th a t M ississip p i la w a p p lie s to th is d iv e rsity ca se

.

B o th o f P n e u m o ’s ch ie f a rg u m e n ts in th is ca se , w h ich th e d istrict co u rt

a cce p te d

, d e p e n d o n th e id e a th a t t h e S e p te m b e r 2 0 0 1 se ttle m e n t a g re e m e n t

w a s b r e a c h e d

. W ith re sp e ct to th e sta tu te o f lim ita tio n s, th e E v e ritt P a rtie s’

cla im s ca n o n ly b e b a rre d if in fa ct th e ir cla im s m a tu re d w h e n P n e u m o fa ile d

to make i t s i ns t al lm e n t p a y m e n ts a s sch e d u le d

. T h e co u rt’s su b sta n tiv e h o ld in g

is e q u a lly co n tin g e n t o n a b re a ch

, n a m e ly

, th e E v e ritt P a rtie s’ fa ilu re to p re se n t

5 Case: 10-60015 Document: 00511380757 Page: 5 Date Filed: 02/14/2011N o

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th e ir cla im s b y M a y 1

, 2 0 0 3

. In re sp o n se to P n e u m o ’ s a r g u m e n t, th e E v e ritt

P la in tiffs d isp u te th a t M a y 1

, 2 0 0 3 co n stitu te d a cla im s d e a d lin e , a n d a rg u e

th a t in a n y e v e n t, t h e a u to m a tic sta y a risin g fro m th e F e d e ra l-M o g u l

b a n k ru p tcy a p p lie d to P n e u m o , a n d to lle d th e tim e to su b m it a n y cla im s u n d e r

th e le tte r a g re e m e n t a n d u n d e r th e M ississip p i sta tu te o f lim ita tio n s.

W e n e e d ta k e n o p o sitio n o n th o se q u e stio n s to re so lv e th e issu e s h e re

.

R a th e r, o u r ju d g m e n t tu rn s o n th e p a rtie s’ b e h a v i o r

. It is a g e n e ra l ru le o f

co n tra ct in te rp re ta tio n u n d e r M ississip p i la w th a t “[w ]h e re a co n tra ct is to b e

co n stru e d b y its te rm s a lo n e , it is th e d u ty o f th e co u rt to in te rp re t it; b u t w h e re

its m e a n in g is o b scu re , . . . th e q u e stio n o f in te rp re ta tio n sh o u ld b e su b m itte d

to th e ju ry .” B a

y lo t v . H a b eeb , 1 4 7 S o . 2 d 4 9 0 , 4 9 4 (M iss. 1 9 6 2 ).

T h e se ttle m e n t a g re e m e n t h e re m a d e n o p ro v isio n fo r th e b a n k ru p tcy o f

F e d e ra l-M o g u l. F a ce d w ith th a t a m b ig u ity

, th e re co rd o n th i s a p p e a l sh o w s

th a t b o th p a rtie s co n siste n tly a cte d a s if th e b a n k ru p tcy d e la y e d

im p le m e n ta tio n o f t h e ir se ttle m e n t. M o st im p o rta n t, im m e d ia te ly a fte r

F e d e ra l-M o g u l file d its C h a p t e r 1 1 p e titio n , P n e u m o so u g h t a d e cla ra to ry

ju d g m e n t w ith th e E v e ritt P a rtie s’ co o p e ra tio n se e k in g th e e x te n sio n o f th e

F e d e ra l-M o g u l a u to m a t i c sta y to cla im s a g a in st itse lf. T h e E v e ritt P a rtie s

a cq u ie sce d a g a in w h e n P n e u m o file d a f u r th e r co m p la in t fo r d e cla ra to ry

ju d g m e n t in D e ce m b e r 2 0 0 5

. W h e n q u e stio n e d d ire ctly a t o ra l a rg u m e n t,

P n e u m o ’s co u n se l n e v e r d e n ie d th e fa ct o f th a t co o p e ra tio n , a n d w a s u n a b le to

p in p o in t a n y d a te in th is re co rd b e fo re th e b a n k ru p tcy c o u r t’s J a n u a ry 2 0 0 6

d e te rm in a tio n th a t th e p a rtie s’ co o p e ra tiv e p a th s d iv e rg e d

. O n th is re co rd

, n o

r e a s o n a b le a cto r in e ith e r P n e u m o ’s o r th e E v e ritt P a rtie s’ p o sitio n s w o u l d

b e lie v e th e se ttle m e n t a g re e m e n t w a s o p e ra tiv e

. In d e e d

, h a d th e E v e r i t t

P a rtie s th e n fil e d th e ir cla im s a g a in st P n e u m o , th e y w o u ld h a v e b e e n in th e

a n o m a lo u s p o sitio n o f p o te n tia lly v io la tin g th e v e ry a u t o m a t i c sta y to w h ich

6 Case: 10-60015 Document: 00511380757 Page: 6 Date Filed: 02/14/2011N o

. 1 0

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th e y h a d a cq u ie sce d

. M o re o v e r, p ro c e e d in g a g a in st P n e u m o d u rin g th e

p e n d e n cy o f P n e u m o ’s a p p lica tio n fo r a n a u to m a tic sta y w o u ld h a v e d isru p te d

th e co m p le x a n d o n g o i n g b a n k ru p tcy n e g o tia tio n s se e k in g to se cu re a g lo b a l

se t tle m e n t o f P n e u m o ’s a sb e sto s lia b ility in d e m n ity cla im s a g a in st

F e d e ra l-M o g u l a n d its p re d e ce sso rs in in te re st. S u ch a ctio n , b y p u ttin g in to

je o p a rd y P n e u m o ’s rig h ts to re co v e r i n d e m n ity fu n d s fro m F e d e ra l-M o g u l,

w o u ld a lso h a v e b e e n u n re a so n a b le in th e circu m sta n ce s.

T h e p a r t i e s’ co u rse o f co n d u ct fo llo w in g P n e u m o ’s in itia l filin g in th e

b a n k r u p tcy co u rt w a s e q u a lly co n siste n t w ith a n in te n t to d e la y

im p le m e n ta tio n o f th e se ttle m e n t a g re e m e n t u n til th e re so lu tio n o f th e

F e d e ra l-M o g u l re o rg a n iza tio n

. W h e n th e N o v e m b e r 1

, 2 0 0 1 d e a d lin e fo r th e

first in sta llm e n t p a y m e n t in to th e se ttle m e n t fu n d a rriv e d

, P n e u m o ch o se n o t

to p a y

. T h e E v e ritt P a rtie s m a d e n o p ro te st, a s o n e w o u ld e x p e ct fro m a h o stile

p a rty e x p e ctin g p a y m e n t. N o r d id th e in d iv id u a l p la in tiffs e x e rcise th e ir

co n tra ctu a l rig h t to o p t-o u t o f th e se ttle m e n t. R a th e r, th e y w a ite d to se e th e

o u tco m e o f th e b a n k ru p tcy sta y p ro ce e d in g s, a n d m a d e th e ir cla im s

e x p e d itio u sly a fe w m o n th s a fte r th e b a n k ru p tcy co u rt d e n ie d re lie f in J a n u a ry

2 0 0 6

. In tu rn , P n e u m o ra ise d n o o b je ctio n s to th e in d iv id u a l E v e ritt p la in tiffs’

fa ilu re to p re se n t th e ir cla i m s u n til M a rch 2 8

, 2 0 0 6

, a lm o st th re e y e a rs a fte r

th e p u rp o rte d M a y 1

, 2 0 0 3 d e a d lin e

. T o th e co n tra ry , a s la te a s 2 0 0 7 a n d w e ll

a fte r P n e u m o sa y s th e E v e r i t t cla im s e x p ire d

, th e F a sm a n d e cla ra tio n

ch a ra cte rize d th e E v e ritt cla im s a s “se ttle d b u t n o t p a id ,” a scrib in g th e ir

d e la y e d p ro ce ssin g to th e F e der al

- Mogul bankr upt c y. Pneumo’ s s ug g e stio n th a t

th is co n ce ssio n sh o u ld b e d isco u n te d b e ca u se it d o e s n o t “re fle ct th a t [F a sm a n ]

e v e n re a d th e se ttle m e n t a g re e m e n t u p o n w h ich th e cla im s a re b a se d ” stra in s

cre d ib ility

. A s F a sm a n h im se lf sw o r e i n t h e sa m e d e cla ra tio n , o n e o f h is

p rim a ry re sp o n sib ilitie s fo r th e p a st tw e lv e y e a rs h a d b e e n s u p e rv isin g th e

7 Case: 10-60015 Document: 00511380757 Page: 7 Date Filed: 02/14/2011N o

. 1 0

- 6 0 0 1 5

d e fe n se o f a p p ro x im a te ly 2 4 0 ,0 0 0 a sb e sto s cla im s a g a in st P n e u m o

. A s a re su lt,

h e h a d “b e co m e v e ry fa m ilia r w ith th e co rp o ra te a n d litig a tio n h isto ry ” o f

P n e u m o a n d its a sb e sto s-re la te d lia b ilitie s.

T h a t th e re is a m b ig u ity in th e in te rp re ta tio n o f th e se ttle m e n t a g re e m e n t

d o e s n o t m e a n th a t th e E v e ritt P a rtie s w ill u ltim a te ly p re v a il. It m a y b e , u p o n

fu rth e r p ro ce e d i n g s i n th e d istrict co u rt, th a t P n e u m o ca n a d d u ce e v id e n ce

sh o w in g th a t n o u n d e rsta n d in g b e tw e e n th e p a rtie s d e la y e d im p le m e n ta tio n o f

th e se ttle m e n t a g re e m e n t, o r th a t th e p a rtie s n e g o tia te d a d iffe re n t re so lu tio n

to th e p ro b le m o f th e F e d e ra l-M o g u l b a n k ru p tcy

. P n e u m o m a y a lso h a v e a cce ss

to v a rio u s o th e r d e fe n se s to th e E v e ritt P a rtie s’ co n tra ctu a l cla im s. O n th e

cu rre n t re co rd

, h o w e v e r, th is co u rt ca n n o t fin d th a t th e se ttle m e n t a g re e m e n t

is cle a r e n o u g h t o ju stify th e fo rfe itu re o f th e in d iv id u a l E v e ritt p la in tiffs’

cla im s. S ee M

o n sa n to C o

. v

. C o ch ra n , 1 8 0 S o .2 d 6 2 4

, 6 3 0 (M iss. 1 9 6 5 ) (“e q u ity

a b h o rs a fo r fe itu re a n d is d isp o se d to se ize o n slig h t circu m sta n ce s to a v o id a

fo rfe itu re ”).

III.

F o r th e fo re g o in g re a so n s, th e ju d g m e n t is R E V E R S E D a n d

R E M A N D E D

.

8 Case: 10-60015 Document: 00511380757 Page: 8 Date Filed: 02/14/2011