Gill vs. Acands Inc, (5th Cir. 2002)

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UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 01-41327 through 01-41335 No. 01-41366 (Consolidated) No. 01-11481 (Consolidated) No. 01-51209 (Consolidated) No. 01-51241 (Consolidated) BILLY ARNOLD, JR., ET AL., Plaintiffs - Appellees, VERSUS GARLOCK, INC., Defendant - Appellant.

Appeals from the United States District Court for the Southern District of Texas, Corpus Christi December 28, 2001 Before DeMOSS, PARKER and DENNIS, Circuit Judges ROBERT M. PARKER, Circuit Judge: Be fore us are 37 nearly identical motions by the Appellant, Garlock, Inc. (“Garlock”), to stay the proceedings of various district courts t hroughout the four federal districts in Texas pending Garloc k’s intended appeal. Having reviewed the various motions , which we treat as a single motion, the appellees’ The defendants, including In each of the instant cases, both Garlock and Gasket Holdings, Inc. (“Gasket Holdings”), a subsidiary of Federal-Mogul, Inc. (“Federal-Mogul”), were named as co-defendants, among the many others. All of the cases were originally filed under Texas state law in Texas state court without implicating federal jurisdiction. In October 2001, Federal-Mogul filed for protection pursuant to reorganization under Chapter 11 of Title 11 of the United States Code, in bankruptcy . Federal-Mogul included each of its 156 affilia tes and subsidiaries, including Gasket Holdings, in the Chapter 11 filing. All of the bankruptcy cases were filed in the United States Bankruptcy Court for the District of Delaware.

See T EX . C IV . P RAC . & R EM . C ODE §§ 32.001-003, 33.001-004, 011-017. 5 In Garlock§ 1334(b). Garlock therefore proceeded with removal actions in several federal district courts throughout Texas. Besides the 37 cases now before us, Garlock removed about 40 similar cases in the federal districts of Texas.

In each of the 37 insta nt cases, 5 Garlock moved in the respective district court for the entire case to be transferred to the United States District Court for the District of Delaware under 28 U.S.C. § 157(b)(5). Such a transfer would permit that district court to determine the appropriate venue, either itself or the federal district court in which th e respective action arose originally, in which to adjudicate the PITWD cl aims against the debtor and against Garlock as a non-debtor co-defendant who asserts a claim for contribution against the debtor. The plaintiffs in every such removed case uniformly responded with a motion to dismiss debtor Federal-Mogul/Gasket Holdi n gs (hereinafter, § 157(b)(5) to the United States D istrict Court for the District of Delaware, and remanded all remaining claims to Texas state court for lack of subject matter jurisdiction under 28 U.S.C. § 1447(c) and/or for equitable reasons under 28 U .S.C. § 1452(b). The district court made no ruling regarding either mandatory or discretionary abstention.

The district court in Dallas referred to the Corpus Christi court’s reasoning as “unassailable” and entered an order with identical results.

The district court in Galveston determi ned that bankruptcy subject matter jurisdiction under 28 U.S.C. § 1334(a) and (b) did not exist and that the case had been im properly removed under 28 U.S.C. § 1452(a). The court therefore remanded the entire case and all parties to Texas state court for lack of subject matter jurisdiction.

The district court which ruled in the Beaumont and Paris Division cases held that Garlock§ 1447(c) and alternatively for equitable reasons under § 1452(b).

The district court in San Antonio cited the d ecisions of several other federal district courts, including the Corpus Christi district court, and determined that subject matter jurisdiction did not exist, remanded its cases on that basis alone and dismissed the plaintiffsÂ’ motions to sever as moot.

The district court in Austin severed all clai ms against the debtor and transferred them to the District of Delaware under § 157(b)(5) and remanded all other claims to the Texas state court.

Following each of the district courts§ 157(b)(5), any decision to abstain and any dismissal of the debtor. In so doing, Garlock claims that the § 362, relating to cases in bankruptcy, not only stayed all actions against the debtor when it filed for bank ruptcy, but that it stayed all related actions before the various district courts as well. Garlock further contends that the 10-day automatic st ay of judgment under F E D . R. C IV . P. 62 should have prevented the clerks of th e district courts from certifying the remands back to state courts before Garlock could perfect its appeal. Some of the district clerks§ 157(b)(5) transfer issue, without frontally challenging an unappealable remand order. On the basis of such a transfer, Garlock contends, it seeks a fair and consolidated proceeding for all parties.

The appellees bring a different view to this court. They contend that Garlock’s true intent is simply to delay any proceeding against it for as long as possible. Such a dilatory intent, appellees contend, will have a devastating effect on them, some of whom are dying. Appellees f urther contend that Garlock’s dilatory intent is focused solely against these appellees because they have refused to enter into any standardized settlement plan or agreem ent such as those allegedly arranged between Garlock and other law firms engaged in asbestos litigation. It is true that Garlock has brought no other, similar case to this court on motions to stay or transfer except those in which the appellees’ counsel appears for the plaintiffs. On that basis, counsel characterizes Garlock’s interest not as an attempt to legitimately pursue a coordinated remedy under the bankruptcy law but as a cynical attempt to minimize its exposure with a law firm which “treats each case individually and attempts to achieve maximum value for its clients.” See Appellees’ Additional Response at 3. Because of the “emergency” nature of Garlock’s motions, we implemented a temporary stay in each c ase to provide sufficient time to fairly consider whether a formal stay pending appeal should issue. We have determined that no such stay should issue and, by this order, dissolve the temporary stays.

Our decision in this case is predicated on two primary bases.

First, that Garlock does not have a valid claim for contribution against Federal-Mogul or its associated business, Gasket Holdings, upon which to assert “related to” jurisdiction under the bankruptcy laws. Second, we find that Garlock has not otherwise met the elements necessary to obtain a discretionary stay pending appeal by this court. We will address each point raised in this complex matter.

II. Jurisdiction, Stays, Transfer of Claims, and Effect of Remand.

We will examine the basis for federal bankruptcy jurisdiction and the framework of GarlockÂ’s contentions therein.

A. Removal Authority and § 1452(a): A party may remove an y claim or cause of action in a civil acti on other than a proceeding before the United States Tax Court or a civil action by a governmental unit to enforce such governmental unitÂ’s police or regulatory power, to the district court for the district where such civil action is pending, if such district court has jurisdiction of such claim under section 1334 of this title.

Title 28 U.S.C. § 1334(a) provides that § 1334, et seq. Specifically, § 1334(b).

As the United State s Supreme Court has noted, § 541, and (2) suits betw een third parties which have an effect on the bankruptcy estate. C elotex Corp. v. Edwards , 514 U.S. 300, 308 n.5 (1995). GarlockÂ’s asserted claim for contribution against the debtor falls into the second category.

Most of the f ederal circuits, including the Fifth Circuit, derive their “relat ed to” jurisprudence from P acor, Inc. v. Higgins , 743 F.2d 984 (3rd Cir. 19 84). S ee Celotex, 514 U.S. at 308 n.6. In P acor , the Third Circuit determined that a third-party controversy not directly involving a debtor in bankruptcy was not related to the bankruptcy, but was, at best, a precursor to a claim against the debtor. S ee Pacor, 743 F.2d at 995. The Third Circuit so ruled on the bas is that any judgment between the two third parties could not have any preclusive effect by either res judicata or collateral estoppel against the debtor, who would be free to relitigate any claim brought against it. Id . Thus, “related to” jurisdiction would not come into play until a litigant brought a direct claim under bankruptcy jurisdiction based on the result of the prior judgment.

Within the Fifth Circuit, the test for whether a proceeding properly invokes federal bankruptcy jurisdiction is the same as the Third Circuit’s Pacor test, namely, whether “the outcome of that proceeding could conceivably have any effect on the estate being administered in bankruptcy.” I n re Canion , 196 F.3d 579, 585 (5th Cir. 1999). Certainty, or even likelihood of such an effect is not a requirement. I d . at 587 n.30 (citing Cope lin v. Sprico, Inc. , 182 F.3d 174 (3rd Cir. 1999)).

In In re Canion , a judgment creditor of the debtor, Canion, brought a direct action against several family members, employees, friends and associates of the debtor, asserting claims of fraud and tortious interference with the judgment creditor’s recovery of the judgment. I n re Canion , 196 F.3d at 582. Our determination was t hat this circumstance fell within the “related to” bankruptc y jurisdiction at the time the case was referred to the bankruptcy court (which is the time at which jurisdiction is tested) because the outcome of the proceedings against the defendants conceivably could have increased the debtor’s estate. Id . at 587. Appellees argue that Garlock presents no such direct claim and that its claim for contribution, not based on a contractual relationship, is too tenuous to connect the underlying asbestos PITWD claims to the debtor. 1. “Contribution” as a basis for “related to” jurisdiction and the automatic stay provision in bankruptcy.

The Sixth Circuit has held that a claim for contribution is a sufficient basi s for finding § 157(b)(5), the same relief sought by Garlock here. In I n re Dow Corning , 86 F.3d 482 (6th Cir. 1996), where a relatively small number of non-debtor co-defendants were close ly related to the pending breast implant litigation against debtor Dow C orning, a claim of contribution by the co-de fendants against Dow Corning, even if only intended and not yet asserted, was sufficient to invoke “related to” bankruptcy jurisdiction.

In In re Walker , 51 F.3d 562 (5th Cir. 1995), a party held liable to a debtor for a violation of the automatic stay provided in 11 U.S.C. § 362 sought to invoke § 362. I d. at 565-66. We found no federal contribution right to be invoked in § 362 and denied the appellantÂ’s claim. I d. at 567-68.

Here, Garlock has asserted its contribution rights entirely under Texas state law. As we discuss in Part III, Garlock’s contribution claim is invalid and therefore no “related to” jurisdiction could exist in this case.

B. Transfer of Personal Injury Tort and Wrongful Death Claims under 28 U.S.C. § 157(B)(5). Garlock seeks to transfer all of the PITWD claims in each of the lawsuits against it in accordance with 28 U.S.C. § 157, which empowers the district court where a bankruptcy is proceeding to determine the venue for certain PITWD claims related to the bankruptcy. Specifically, The district court shall order that personal injury tort and wrongful death claims shall be tried in the district court in which the bankruptcy case is pending, or in the district court in the district in which the claims arose, as determined by the district court in which the bankruptcy case is pending.

See 28 U.S.C. § 157(b)(5). Use of this transfer provision in the mass tort context is not strictly novel, but is to date uncommon. 7 In the cases before us, the v arious district courts either explicitly or implicitly denied GarlockÂ’s motions to transfer all underlying PITWD claims from the districts in Texas to the District of Delaware.

The Sixth Circuit has held that the den ial of a motion to transfer under § 157(b)(5) is immediately appealable on different grounds including a less rigid view of the “finality” requirement for bankruptcy judgments and under the collateral order doctrine of Cohen v. Beneficial Indus. Loan Corp. , 337 U.S. 541 (1949). S ee In re Dow Corning , 86 F.3d 482, 488 (6th Cir. 1996). Because of our ultimate holding herein, we need not determine the same issue for this circuit. Regardless, Garlock claims it should benefit from a stay of the district courtsÂ’ orders to present an appeal.

C. Stays Applicable to Bankruptcy Proceedings. 1. Title 11 U.S.C. § 362. Once a party files i n bankruptcy, under Chapter 11, for example, 11 U.S.C. § 362, et seq. , stays further actions against the debtor. Virtually any act attempting to enforce a judgment against or obtain property from the estate of the debtor is stayed once the title 11 proceedings are commenced. S ee id . § 362(a)(1)- (8). In the instant cases, Garlock contends that § 362 should stay any further actions against the non-debtor co-defendants and should stay the various district courts from dismissing debt or FederalMogul companies or remanding the related cases to state court. 8 Section 362 is rarely, however, a valid basis on which to stay actions against non-debtors. See Wedgeworth v. Fibreboard Corp. , 706 F.3d 541, 544 (5th Cir. 1983)(§ 362 neither apply to codefendants nor preclude severance”).

By exception, a bankruptcy court may invoke § 362 to stay proceedings against nonbankrupt co-defendants where such identity between the debto r and the third-party defendant exists that the debtor may be s aid to be the real party defendant and that a judgment against the third-party defendant will in effect be a judgment or finding against the debtor. A .H. Robins Co., 788 F.2d 994, 999 (4th Cir. 1986). In that case, however, the non-debtor co-defendants were indemnified associates, employees or insureds of the debtor so le manufacturer of the Dalkon Shield intrauterine device. Here, Garlock is one of scores of different asbestos makers, users, importers, etc., with no interest to establish such an identity with debtor Federal-Mogul/Gasket Holdings. There is no claim of a formal tie or contractual indemnification to create such an identity of interests. 2. Federal Rule of Civil Procedure 62. Garlock has also asserted that F ED . R. C IV . P. 62(a) should have operated to effect a ten-day stay of the various district courts§ 157(b)(5) issue. Rule 62(d) relates to Rule 62(a) in that Rule 62(a) provides a respite from the immediate execution of a judgment, except for an interlocutory or final judgment in an action for an injunction or in a receivership action, or for an accounting in an action for infringement of letters patent. Rule 62(d) then provides for a stay pending appeal, subject to the exceptions in Rule 62(a).

The stay provisions of Rule 62 pertain to judgments for money.

Hebert v. Exxon Corp , 953 F.2d 936, 938 (5th Cir. 1992). That does not preclude diverse forms of judgment pertaining to monetary responsibility from a stay under Rule 62(d) pending appeal nor Rule 62(a) for ten-day automatic stay of judgment. S ee id . at 938-39 (overturning a district court’s denial of a stay of declaratory judgment where the declaratory judgment was, in effect, a money judgment suitable for a Rule 62(d) stay subject to the requirements of Rule 62(a)). In the instant cases, however, the subject matter of Garlock’s motion is not for a stay of judgment, declaratory or otherwise. It is for a stay of remand under Rule 62. A remand of an ongoing case is not a final judgment following a full adjudication of a claim, the result of which may be appealed. Even if the subject matter of the underlying litigation is solely money damages, there is no “money judgment” inherent in its remand. Accordingly, there is no basis in Rule 62 for such a stay. S ee City of New Orleans v. Nat’l Serv. Cleaning Corp. , No. 96-1601, 1997 WL 5915, at *1 (E.D. La.

Jan. 6, 1997).

Further, Rule 62 itself provides no authority to revoke a remand once it has become effective. S ee, e.g., Rivera-Perez v. Mass.

Gen. Hosp. , 193 F.R.D. 43, 45 (D.P.R. 2000).

On that basis, Garlock is not entitled to the Rule 62 automatic stay.

D. Effect of Remand. We have consolidated many of these cases according to date or by court, but as indicated in Part I, the orders are not entirely uniform. All of them include a remand for lack of subject matter jurisdiction, citing 28 U.S.C. § 1447(c). However, two of the courts did not make such a finding until after the debtor had been dismissed with prejudice from the plaintiffs§ 1447(c) is ordinarily barred from appellate review by 28 U.S.C. § 1447(d). S ee State of Rio de Janeiro v. Philip Morris, Inc. , 239 F.3d 714, 716 (5th Cir. 2001)(noting that as long as a district court§ 1447 (d); also referring to “the black hole force of a remand for want of jurisdiction”). There are few exceptions.

Notably, remand under a district court§ 1447(c) for a reason not embraced within that statute is subject to appellate review. I d. at 715 (citing Thermtron Produc ts, Inc. v. Hermansdorfer , 423 U.S. 336, 343 (1976)). That exception is inapplicable here.

Rather tha n fruitlessly attempting an appellate review of a district courtÂ’s remand order, we instead examine the steps leading from a district judgeÂ’s decision to remand to execution of the remand order.

A § 1447(c) order of remand is not self-executing. Section 1447(c) provides, in pertinent part, that upon determination that a case should be remanded, “[a] certified copy of the order of remand shall be mailed by the clerk to the clerk of the State court. The State court may thereupon proceed with such case.” S ee McClelland v. Gronwaldt , 155 F.3d 507, 514 n.5 (5th Cir. 1998).

This provision creates legal significance in the ma iling of a certified copy of the remand order in terms of determining the time at which the district court is divested of jurisdiction. I d. (citing the discussion and references in Browning v. Navarro , 743 F.2d 1069, 1078-79 (5th Cir. 1984)). On that basis, the federal court is not divested of jurisdiction until the remand order, citing the proper basis under § 1443(c), is certified and mailed by the clerk of the district court.

Once the re mand order is certified and mailed, however, the matter remanded is removed from federal jurisdiction. O f all the cases brought before us under GarlockÂ’s motions, most have already been certified and mailed by the respective district clerks. 2. Equitable remand. Of greater import in this particular case is the effect of an equitable remand.

The court to which [claim or cause of action related to bankruptcy cases] is rem oved may remand such claim or cause o f action on any equitable ground. An order entered under this subsection remanding a claim or cause of action, or a decision to not remand, is not reviewable by appeal or otherwise by the court of appeals under section 158(d), 1291, or 1292 of this title or by the Supreme Court of the United States under section 1254 of this title.

See 28 U.S.C. § 1452(b). This remand statute, unlike § 1447(c), carries no certification and mailing requirement, nor have we found authority to require such, as much as that would promote procedural consistency with § 1447(c). Whether such an equitable remand is self-executing is less important than the s tricture that, once a matter related to a bankruptcy case is equitably remanded, it is not subject to federal appellate review on any basis. S ee Hawking v. Ford Motor Credit Co. , 213 F.3d 540, 550 (5th Cir. 2000); Sykes v. Texas Air Corp. , 834 F.2d 488, 490 (5th Cir. 1987)(even an equitable remand based on a substantive law issue such as lack of subject matter jurisdiction is unreviewable, in part because of the likelihood of throwing matters into confusion months or years later after other proceedings, e.g., in state courts).

Garlock§ 157(b)(5) would seem to be the type of matter which could be readily decided without creating the type of confusion following an order of remand with which we were concerned in Sykes . The equitable remand of bankruptcy-related matters harbors no such opportunity.

Because some of the various subject-matter jurisdiction remands have not yet been certified and mailed, and because some have not been remanded equitably, we will proceed with an analysis of whether Garlock should otherwise be gra nted a stay pending appeal under our authority in F ED . R. A PP . P . 8 in those matters not barred from further review.

III. Merits of the Motion for Stay. When presented with a motion for a discretionary stay pending appeal, we employ a four-part test. S ee In re First S. Sav. Assoc. , 820 F.2d 700, 704 (5th Cir. 1987)(citing Ruiz v. Estelle , 666 F.2d 854, 856 ( 5th Cir. 1982)( “ Ruiz II” )). While each part must be met, the appellant “need not always show a ‘probability’ of success on the merits; instead, the movant need only present a substantial case on the merits when a serious legal question is involved and show that the balance of the equities weighs heavily in favor of granting the stay.” I d . (quoting Ruiz v. Estelle , 650 F.2d 555, 565 (5th Cir. Unit A June 1981)( “Ruiz I” )).

A. Whether the movant has made a showing of likelihood of success on the merits. Despite the possible a vailability of a discretionary stay pending appeal, even if Garlock had avoided remand, it could not show a probability of success on appeal.

First, there was no 11 U.S.C. § 362 automatic stay of actions available to the non-debtor co-defendants of the debtor, Federal- Mogul/Gasket Holdings. Therefore, while § 362 acted to stay any claims against the Federal-Mogul entities, including GarlockÂ’s putative claim of contribution, it carried no force to stay actions as between the remaining co-defendants, the debtor and the various plaintiffs. On that basis, the plaintiffs were free to dismiss Federal-Mogul and its associated en tities under F E D . R. C IV . P. 41(a)(1). Even if Garlock had filed a counterclaim against the plaintiffs in each such case, which Garlock does not assert, the district court would have been within its discretion to dismiss by order of the court under Rule 41(a)(2).

For those cases in which the debtor was formally dismissed, 10 such dismissal was with prejudice and, under Texas law, eliminated Garlock§ 3 3.011(6)(A)(iii)(Vernon 2001). Thus, no claim for contribution may lie in those cases wherein the district court dismissed the debtor with prejudice .

Second, the Texas code eliminates a debtor in bankruptcy as a § 33.011(6)(B)(ii). Garlock has addressed the issue of the debtorÂ’s insurance peripherally, but has not clearly represented whether the insured debtor is Federal-Mogul itself, Federal-MogulÂ’s subsidiary Gasket Holdings (successor to Flexitallic, another gasket-producing company), or whether either or both of them have liability insurance available to pay any claims.

Third, Garlock has relied in part on two past decisions transferring PITWD claims under § 157(b)(5) to the district in which a debtor was proceeding in bankruptcy. In A.H. Robins , the Fourth Circuit upheld an order of the United States District Court for the Eastern District of Virginia transferring, under § 157(b)(5), thousands of PITWD claims against a small number of non-debtor co-d efendants to itself for coordinated review while the debtor, A.H. Robins Co ., Inc., proceeded in bankruptcy in that district. A .H. Robins , 788 F.2d at 1016. 11 Robins was the manufacturer of the Dalkon Shield i ntrauterine device, a unique product. Its co-defendants were employees or other close associates who were contractually indemnified by Robins. Here, the various co-defendants manufacture, use, specify, or handle many d ifferent asbestos products without such close relationship. Additionally, Garlock makes no claim of indemnification here whatsoever. In In re Dow Corning , the Sixth Circuit reversed and ordered the United States District Court for the Eastern Dist rict of Michigan to transfer under § 157(b)(5) a relatively small number of non-debtor co-defendants who had asserted claims for contribution, or announced the intent of doing so, against the de btor manufacturer of silicone breast implants. I n re Dow Corning , 86 F.3d at 498. In that case, each of the co-defendants was closely involved in using the same material, originating with the debtor, to make the same, singular product, sold to the same market and incurring substantially similar injuries. This circumstance created a unity of identity between the debtor and the codefendants not present here, where the co-defendants variously use asbestos for brake friction products, insulation, gaskets, and other uses.

Therefore, while we do not disagree that certain mass tort claims in some circumstances might be consolidated with bankruptcy proceedings in a single district in accordance with § 157(b)(5), 12 the relationship of the co-defendants in A.H. Robins and In re Dow Corning is distinguishable from GarlockÂ’s asserted relationship, through a claim for contribution, to the debtor here.

Fourth, GarlockÂ’s con tribution claim against the debtor is based on universally-pled claims against all de fendants in all asbestos lawsuits in which Garlock appears as a co-defendant.

Garlock has never litigated a contribution claim to collection in any o f approximately 250,000 previous asbestos lawsuits in which Garlock was a co-defendant. In the face of this criticism, Garlock has made a late attempt t o color its failure to pursue an actual payment of contribution. 13 Garlock now asserts that in past lawsuits, the “larger” or “major” defendants, now in bankruptcy, had been present to pay their fair share of claims and that it was not costeffective for Garlock to litigate the relatively small amounts left in controversy. It is only since the Federal-Mogul entities proceeded to Chapter 11 protection that, Garlock contends, it must serio usly proceed with its claims for contribution.

Garlock has not, however, commenced discovery in any of these cases, but has spent its time seeking the § 157(b)(5) transfer addressed herein. The appellees characterize that as a dilatory intent and, if such, GarlockÂ’s actions are tantamount to being frivolous.

Additionally, the district judges ruling in the various cases before us found, on the facts befor e them, no merit in Garlock’s claims. One district judge, for example, noted that in his court, Garlock’s claims were “scantily asserted” and presented no facts to support them. As such, the contribution claims were “so tenuously related to the bankruptcy case” as to be “virtually immaterial.” All of the district judges ultimately found no verifiable basis in Garlock’s claims so as to justify a mass transfer to the District of Delaware.

We are not prepared to say that Garlock§ 157(b)(5). Given the preliminary analysis herein, Garlock would not succeed on the merits if granted a stay to appeal the § 157(b)(5) transfer issue.

Our determination in this element is sufficient t o deny the stay pending appeal; however, we will briefly address the remaining points of analysis.

B. Whether the movant has made a showing of irreparable injury if the stay is not granted. We have determined that Garlock has no valid claim for contrib ution against the debtor. Therefore, no irreparable harm will ensue if a stay is not granted.

C. Whether the granting of the stay would substantially harm the other parties. There may be a danger of inconsistent results in the various state and federal courts in which Garlock and the other parties appear if these cases are not consolidated in the District of Delaware. That is, however, the circumstance under which asbestos litigation has proceeded for nearly 30 years.

What is c ertain is that delay where plaintiffs have mesothelioma, asbestosis, or pleural disease, or where decedentsÂ’ survivors await compensation for support substantially harms those parties.

Additionally, delay in or lengthy interruption of state court proceedings already in progress f or months or years may substantially harm the ability of the state courts to resolve the cases.

We therefore hold that, in this circumstance, the harm to the plaintiffs in delay substantially outweighs the harm to Garlock if not delayed.

D. Whether the granting of the stay would serve the public interest. Consolidation of PITWD cases re lated to a bankruptcy would facilitate management of an e state in bankruptcy and potentially provide an even-handed and fair apportionment of the bankruptÂ’s estate to its creditors, including those claiming contribution in the mass tort scenario.

Such consolidation would also deprive states and state courts of their right to conduct proceedings brought under state law. In a mass tort case of the scope of asbestos litigation, transferring cases related to a bankruptcy could well result in depriving the states of cognizance over thousands of cases. Many of these cases are founded on well-developed state law and years of precedent and r epresent a significant amount of time in individual litigation.

The negative effect on comity between the federal and state court systems must be given some account.

Armstrong Work Industries, U.S. Gypsum, W.R. Grace and Owens Corning are all proceedin g through Chapter 11 in Delaware in addition to Federal-Mogul. The burden of these five asbestosrelated bankruptcies and the direct claims against them alone has resulted in the Third Circuit appointing a district judge full-time to stewarding those cases in coordination with a bankruptcy judge.

The transfer of all of the PITWD claims against asbestos codefendants to that court has the potential to overload the court with thousands of individual claims to resolve. It is difficult to see how the public interest is served in that manner.

At the bottom, there is justification for aggregation, but the tenuous relationship between Garlock and the deb tor and the insubstantial c laims of contribution reflected herein do not justify ignoring comity and loading thousands of cases on a single district in this case .

IV. Issue Preclusion. Garlock contends that a transfer of venue to the District of Delaware would obtain § 157(b)(5) and the autom atic stay feature of 11 U.S.C. § 362, “to avoid unnecessary repetition, confusion, inconsistent results in multiple trials of common issues, cost or delay where these many cases do not have to be multiplied.” 1 4 In addition to seeking a centralized forum under federal bankruptcy laws, which, we note, Garlock may desire as much for perceived protection from judgments in the stat e courts, Garlock appears to be contemplating the availability of coordinated federal court judgments for their preclusive effect in future actions. To the extent that GarlockÂ’s contention can be read to embrace one made more explicitly by the “ Big Three” automobile manufacturers 15that transfer to the District of Delaware bankruptcy court would facilitate a ruling on t he ability of friction products to be a producing cause of asbestos-related diseases, a ruling that would be used for purposes of issue preclusion in other casesGarlock faces formidable obstacles. As an initial matter, we note that Garlock has not attempted to certify as a class these and other asbestos casesthe only widely- credited medium for disposing of multiple claims while barring relitigation of resolved issue s. Less well-accepted is consolidation under Rule 42, but this approach is complicated by the cases involved having been filed in multiple courts in diffuse districts and by the absence of complete uniformity among parties and interests. Even more tenuous would be resort to judicial notice under F ED . R. E VID . 201. For a party to tee up an issue for decision in a selected court with the expectation that any rulings would not only be referenced by subsequent courts but also applied as bindingand in the face of inconsistent decisions pre viously rendered elsewhereis to hope for a most novel application of that rule indeed.

But no matter how creative the procedural avenue, and in spite of the fact that this litigation would benefit from a uniform approach, at almost every turn this circuit has rejected attempts at aggregation and issue preclusion in asbestos cases. Our adversity toward group resolution sounds in our concern that no one be depriv ed the right to a full and fair opportunity to litigate their claims. In C .A. Hardy v. Johns-Manville Sales Corp. , 681 F.2d 334 (5th Cir. 1982), we turned aside a district courtÂ’s order that nonparty asbestos companies were estopped from relitigating issues of dangerousness and causation as violative of the fundamental right to trial by jury. We reached this conclusion based on the manufacturersÂ’ each having an interest in the plaintiffs proving the same set of facts. Indeed, in H ardy we went so far as to conclude that the presence of inconsistent findings in other cases on the s ame questions at issue in H ardy made the applicati on of collateral estoppel highly problematic even as to the parties themselves. Of course Garlock need not be reminded of Hardy Â’s place in this circuitÂ’s jurisprudence for it was one of the defendants that opposed any attempt to bar the relitigation of key dispositive issues.

The passage of time has not weakened the teachings of Hardy .

In re Fi breboard , 893 F.2d 706 (5th Cir. 1990), saw this court issue a writ of mandamus against the trial of a representative group of plaintiffs on the issues of duty and damages. There, we said that adherence to state substantive law and to the Seventh Amendment right to trial by jury would not tolerate making the resolution of a handful of claims binding as to defendant asbestos manufacturersÂ’ liability with respect to all plaintiffs. In C imino v. Raymark Industries, Inc. , 151 F.3d 297 (5th Cir. 1998), we again revisited the same district courtÂ’s revised eff ort at mass resolution. There, we emphasized that federal rules providing for aggregation of claimsspecifically, F ED . R. C IV . P. 23 and 42 cannot override the necessity of proving causation as to each defendant, a requirement of the state law providing the cause of action and of the right to trial by jury. As we did in F ibreboard , we refused to tolerate deviation from fundamental principles of due process simply because asbestos cases threatened to swamp the resources of the federal courts.

The closest this circuit has come to utilization of issue preclusion in the asbestos context is Jenkins v. Raymark , 831 F.2d 550 (5th Cir. 1987). In that case, a certified class of 753 claimants were permitted to try common issues in a single trial, the result of which w as applicable to the class. The procedure approved i n J enkins , however, still required individual jury determinations of causation and damages. The efficiencies to be obtained from is sue preclusion, therefore, cannot in this circuit serve as a basis for the transfer of cases under 28 U.S.C. § 157(b)(5).

V. Abstention. A § 157(b)(5) motion ordinarily requi res an abstention analysis. I n re Dow Corning , 86 F.3d 482, 497 (6th Cir. 1996). 28 U.S.C. § 1334 provides for two types of abstention: discretionary abs tention under § 1334(c)(1) and mandatory abstention under § 1334(c)(2). S ee , e.g. , Broyles v. U .S. Gypsum Co. , 266 B.R. 778 (E.D. Tex. 2001) (finding both doctrines apply, as well as equitable remand, in circumstances not involving a transfer under 28 U.S.C. § 157(b)(5)).

We agree with the district judge in Corpus Christi. Any abstention issues remaining in these cases reg arding claims now before the bankruptcy court in the District of Delaware may be decided by that district court.

VI. Conclusion. We do not disagree that the transfer provisions of 28 U.S.C. § 157(b)(5) may be applicable to multiple, non-debtor co-defendants in a mass tort case. Our holding today is that Garlock, in these cases and under these circumstances, has not shown that such a transfer is appropriate.

It is hereby ORDERED that, The PetitionerÂ’s Motions for Stay under F E D . R. A PP . P. 8 are DENIED. It is further ORDERED that, The temporary stays issued in our consolidated Order s are hereby dissolved.

1 Two amici briefs have been filed. The first was “Brief Amici Curiae of Baron & Budd, P.C. and Provost Umphrey in Opposition to Garlock’s Motion to Stay” purporting to represent the interests of “thousands of victims of asbestos-rel ated disease with cases pending in the state c ourts of Texas and elsewhere” who could be adversely affected by a stay in Garlock’s ca se. The second was “Memorandum of Amicus Curiae the O fficial Committee of Asbestos Claimants of Federal-Mog ul Global, Inc., in Response to Garlock Inc.’s Motions for a Stay Pending Appeal,” also arguing that a stay in asbestos litigation would adversely affect plaintiffs in other cases and is not warranted here as a matter of law

Pending Appeal (hereinafter, “Appellees’ Additional Response”) at 2. Motions in additional cases have been filed since these figures were compiled. 3 The specifics of the claims in these cases are not in the record before us because we are considering only whether to place a stay on the various proceedings to permit a formal appeal and review of the individual records on appeal. There have been hundreds of thousands of asbestos-related lawsuits brought in T exas and throughout the country in the last three decades, however. A t ypical claim asserts that the numerous “named defendants either made, sold, marketed, brokered, i mported, specified or used asbesto s-containing products in Texas which were defective and unreasonably dangerous as designed, manufactured and marketed.” See, e.g., Broyles v. U.S. Gypsum Co. , 266 B.R. 778, 780 (E.D. Tex. 2001). The claims then generally assert causes of action for “negligence, gross negligence, fraud, deceit, misrepresentation, battery and defective products theories under Texas state law.” Id . at 780-81

6 Initially, Garlock filed documents titled “Petition for Writ of Mandamus to the United States District Court for the Southern District of Texas [Corpus Christi Divi sion] and Petitioner’s Emergency Motion for Stay Pursuant to Federal Rule of Appellate procedure 8(a)(1) Pending Appeal.” In later actions, Garlock has simply filed an “Emergency Motion for Stay Pending Appeal” from one or another federal district court. We treat all of Garlock’s motions as motions for stay

7 Se ction 157(b)(5) was the basis for transferring the PITWD claims in A.H. Robins v. Piccinin , 788 F.2d 994 (4th Cir. 1986) and In re Dow Corning , 86 F.3d 482 (6th Cir. 1996)

8 Such a stay would enable Garlock t o perfect an appeal of the district courts§ 157(b)(5) transfer motion without having to contend with an order of remand

9 Garlock’s references to F E D . R. C IV . P. 62, et seq. , in th e Petitioner’s Motions for Stay are primarily aimed at an argument to establish an appeal as a matter of right. Once Garlock discovered, however, that the federal district court in Corpus Christi had already mailed certified copies of the court’s remand orders without waiting the ten-day period specified in Rule 62(a), it filed a series of “Emergency Motion[s] for Supplement al Relief” asking this court to direct the district clerk’s office to, in effect, “de-certify” its certification

10 By our reckoning, this inclu des all of the cases ruled on by the district courts in Corpus Christi and Dallas

11 The circuit courtÂ’s ruling r emanded for clarification and to provide notice for claimantsÂ’ objections, but otherwise affirmed

12 Some writers and commentators would bar mass tort parties from being transferred for consolidated review under § 157(b)(5). S ee, e.g., Lori J. Forlano, Why Bankrup tcy “Related To” Jurisdiction Should Not Reach Mass Tort Nondebtor Codefendants , 73 N.Y.U. L. Rev. 1627 (1998)(arguing, generally, against consolidation on grounds of comity and federal ism). We would not go so far as to bar such consolidation in the face of a coordinated federal bankruptc y scheme. Instead, we would balance each case individually, as we have herein, for the relationship or unity of identity of the co-defendants and the debtor(s), the uniformity of source of the injury or wrongful death, and the general status of pending cases in the state courts and the effect a consolidation would have on them. 13 See Repl y of Garlock, Inc., to PlaintiffsÂ’ Response, filed December 19, 2001, at 7-8

14 See Petitioner§ 157(b) (5) of having all matters ‘related toÂ’ bankruptcy reviewed toward implementing centralized, efficient and expeditious proceedings conserving the debtorÂ’s resources and distributing the debtorÂ’s assets for the benefit of all creditors alike.” See PetitionerÂ’s Emergency Motion for Stay at 14 (for cases consolidated under Fifth Circuit Case No. 01-

51209). Regardless, all of the motions reflect the same underlying general facts, legal theory and intent. 15 The § 157(b)(5) for the specifically stated intent of conducting D aubert hearings for the admission of scientific evidence and a ruling that brake/friction products are conclusively not a possible source of disease-producing asbestos. See Daubert v. Merrell Dow Pharmaceuticals, Inc. , 509 U.S. 579, 589 (1993). Such a ruling would then be used for issue preclusion in future cases. Garlock and amici have briefed the auto manufa cturersÂ’ effort from their opp osing perspectives and counsel for Ford Motor Co., DaimlerChrysler Corp. and General Motors Corp. has further informed us by letter dated December 12, 2001, that the District of Delaware has provisionally transferred only those claims to that court for further determinations

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