%1

A Montana Roman Catholic diocese has asked a judge to approve a bankruptcy reorganization plan that includes a $16.4 million settlement for hundreds of adults claiming childhood sexual abuse by clergy and lay workers, Reuters reported yesterday. The Helena diocese, serving nearly 44,500 Catholics in 57 parishes and 38 missions in western Montana, including the state capital, is the 11th U.S. diocese to file for chapter 11 protection since 2004 due to liabilities stemming from abuse claims. Under the agreement, which must be approved by a bankruptcy court, the church would contribute $2 million and its insurance carriers $14.4 million to settle claims brought by 362 people who filed two lawsuits against the diocese in 2011, said Dan Fasy, an attorney with one of four firms representing the plaintiffs. The settlement was reached after years of negotiated mediation between the church and victims of childhood sexual abuse.

General Motors Co.’s compensation expert extended by one month the deadline for death and injury claims linked to the auto maker’s faulty ignition switches amid pressure from families, safety advocates, politicians and lawyers, the Wall Street Journal reported today. Families of those killed or seriously injured in an accident involving the switches have until Jan. 31 to file their claims, Washington, D.C., attorney Ken Feinberg said yesterday. The claim period originally ran from Aug. 1 through Dec. 31. Feinberg said that the decision was being made “out of an abundance of caution.”

A long-secret trove of court filings that bankrupt gasket maker Garlock Sealing Technologies says illustrates a pattern of fraud in asbestos litigation is expected to be opened to public view this week, possibly as soon as today, Forbes.com reported on Friday. The files, Garlock says, will show how plaintiff lawyers withheld evidence their clients were exposed to multiple asbestos products in order to extract higher settlements and court verdicts from Garlock. In one case that generated a $37 million verdict in California, Garlock says, a lawyer with prominent Dallas asbestos firm Waters & Kraus flatly denied exposure to dangerous insulation that his client had already admitted, under penalty of perjury, in another proceeding. The records in racketeering lawsuits Garlock filed against several asbestos law firms are to be unsealed after a fierce battle by plaintiff lawyers to keep them secret. In January, Bankruptcy Judge George Hodges in Charlotte, North Carolina slashed Garlock’s estimated liability for asbestos exposure from $1.4 billion to $125 million after determining that the higher estimates were based upon court cases “infected by the manipulation of exposure evidence by plaintiffs and their lawyers.”

Raymond DeGiorgio was just another obscure engineer at General Motors — until the company blamed him for starting the worst safety crisis in its history, the New York Times reported today. But even after being identified as the employee who approved a deadly defect in millions of cars, DeGiorgio has remained an enigmatic figure at the heart of GM’s recall scandal. GM dismissed him in June, and he went into seclusion, refusing interviews. When questioned by House investigators and company lawyers, he repeatedly said that he could not recall events or interactions with co-workers. GM has offered a litany of reasons for its inability to fix a defective part in its small cars for more than a decade, including a dysfunctional bureaucracy and a toxic culture that shunned accountability. But it has consistently focused blame on DeGiorgio, who approved the substandard switch in 2001 and secretly changed it five years later, leaving dangerous vehicles on the road and frustrating efforts within GM to investigate the problem.

The lawyer handling General Motors Co.’s compensation for victims of accidents tied to faulty ignition switches said that he’ll consider a safety advocate’s suggestion that he comb regulators’ files for relevant crashes, Bloomberg News reported yesterday. Kenneth Feinberg said that he received the request today from Clarence Ditlow, executive director of the Center for Auto Safety, a Washington, D.C.-based advocacy group. Ditlow said that Feinberg should be processing claims faster and should look at regulators’ files to help identify victims. “I have read Ditlow’s letter and have taken it under advisement,” Feinberg said today in an e-mail. “I want to make sure that the notice program and our outreach efforts reach the right people. We are considering Clarence’s suggestions.” Feinberg disagreed with Ditlow’s statement that claims are being handled too slowly, saying he has so far processed more than 800 requests for payment.

General Motors said in a court filing yesterday that it should not have to face lawsuits based on safety issues in cars made before its 2009 bankruptcy, including a faulty ignition switch that led to the recall of 2.6 million cars earlier this year, Reuters reported yesterday. The brief, filed in Manhattan bankruptcy court, lays out GM's legal arguments and is the opening salvo in litigation from GM drivers who say the automaker should make them whole for losses related to recalls this year. The ignition switch recalls, which began in February, have since grown to encompass numerous problems affecting millions of vehicles. The company is facing some 130 lawsuits over accidents and lost vehicle value. In April, GM asked Judge Robert Gerber of the U.S. Bankruptcy Court in Manhattan, who oversaw the bankruptcy, to bar claims related to vehicles made before 2009 based on the terms of the sale order that created the so-called "New GM." Liabilities related to older vehicles were largely retained by a shell company now known as "Old GM." Plaintiffs' lawyers have asked Gerber to rule that bankruptcy protection does not apply because their clients were not informed about the problems at the time and had no chance to argue their cases during the proceedings. GM said yesterday that plaintiffs' lawyers were trying to re-litigate issues that had been aired fully and settled five years ago.

Nearly nine months after General Motors began recalling millions of its cars for a dangerously defective ignition switch, almost half of the vehicles still have not been fixed, the New York Times reported today. The automaker said that it was increasing its outreach to owners through social media and a new call center staffed with 72 employees dedicated to contacting those who have not scheduled repairs. But even owners who requested repairs months ago have been waiting, with dealers managing wait-lists and dozens of drivers writing to federal regulators in recent weeks asking why it was taking so long. Some of them are also raising safety concerns about the drawn-out timetable, as a recent fatal accident here suggests. GM faces multiple investigations, including a federal criminal inquiry, over its decade-long delay in ordering a recall of the cars with the defective switch, which has been linked to 30 deaths. But less attention has been paid to the company’s oversight of the recall itself and the critical task of fixing the 2.36 million cars — of the 2.6 million originally recalled — that it estimates are still in use.

The U.S. Treasury says confidential information it got in the bailout of General Motors Co. should stay secret, otherwise at-risk companies needing government help in the future might not be willing to share data, Bloomberg News reported today. The Center for Auto Safety, now researching GM’s ignition-switch defects, sued in 2011 to gain access to information the government obtained before investing $49.5 billion in the automaker. It received more than 50,000 documents and wants additional records on the U.S. role in a judge’s ban on lawsuits over older GM cars. The Treasury asked a judge to throw out the lawsuit. “Disclosure of the disputed information would also impair Treasury’s ability to obtain necessary information from companies in the future,” the U.S. said in an Oct. 29 filing in Washington federal court. “Treasury’s ability to act as a lender would be hampered.”

A Delaware bankruptcy judge has scheduled a confirmation hearing in the Bondex International bankruptcy settlement agreement, LegalNewsline.com reported yesterday. Bankruptcy Judge Peter J. Walsh filed an Oct. 20 order scheduling a hearing on confirmation of the proposed joint plan and approved related notice procedures for Dec. 10 in the U.S. District Court for the District of Delaware. In his order, Walsh approved the debtors’ disclosure statement, the solicitation and tabulation procedures, the certified plan solicitation directive and the ballots. On July 28, RPM International Inc. announced its agreement with the bankruptcy representatives of current and future claimants in order to resolve Bondex-related asbestos liability. According to the agreement, RPM would pay $797.5 million over four years and resolve all present and future asbestos personal injury claims related to its subsidiary Bondex.

A North Carolina resin manufacturer and its affiliates that have been named in numerous asbestos lawsuits have filed for chapter 11 protection in order to address its current and future asbestos liability, the Washington Examiner reported yesterday. Reichhold Holdings US, Inc. voluntarily filed its petition for relief on Sept. 30 and is joined by affiliates Reichhold, Inc., Canadyne Corp. and Canadyne-Georgia Corp. The company announced that it has arranged $130 million in financing from its bondholders to fund continuing operations, of which $100 million will be available to Reichhold, Inc., in the form of debtor-in-possession financing if the court approves.