In the case of Barraford v. T&N Limited, the plaintiff was the executrix of a man who had died from mesothelioma in 2002. Believing that her husband’s death was the result of his exposure to asbestos, the executrix filed suit against several asbestos manufacturers in 2004. She did not include the defendant manufacturer in her suit because it had gone into Chapter 11 bankruptcy in 2001.
In late 2007, a reorganization plan was entered in the defendant manufacturer’s bankruptcy case. Under the plan, the defendant manufacturer transferred certain assets (including rights under a liability insurance policy) to a personal injury trust. The trust was supposed to use the assets to pay asbestos claims that injured persons and their representatives would have been able to bring against the defendant manufacturer but for the automatic stay triggered by the bankruptcy proceeding. The plan also provided that the defendant’s asbestos liability would continue post-confirmation and that the trust would bring suit against the defendant manufacturer as the agent of potential claimants.
The Filing of the Plaintiff’s Product Liability Suit
In 2011, nine years after her husband’s death and more than three years after the defendant manufacturer’s reorganization plan became effective, the executrix brought suit, through the trust as her agent, against the defendant manufacturer in Massachusetts state court, asserting claims for negligence, breach of warranty, wrongful death, and various other causes of action.
The Federal District Court’s Decision
The defendant manufacturer removed the case to federal district court, where it was dismissed on the grounds that the executrix’s claims were barred by the three-year statute of limitations set forth by Massachusetts law.
The Issue on Appeal
The issue to be determined by the United States Court of Appeals for the First Circuit was whether the defendant manufacturer’s bankruptcy stay terminated on the date of its reorganization plan in 2007.
The Appellate Court’s Opinion
Affirming the district court’s dismissal of the executrix’s suit, the court of appeals agreed with the trial court that the bankruptcy stay terminated on the effective date of the defendant manufacturer’s reorganization plan. Therefore, the executrix’s claim became time-barred some 30 days thereafter. In so holding, the court rejected the executrix’s argument that the plan modified and extended the stay indefinitely. The trust, arguing on behalf of the executrix, had urged the court to hold that the plan’s unconditional allowance to sue in the ordinary course was a “modification” of the bankruptcy stay rather than a “termination.” The court found that, under the plain language of the stay itself, this was not the intent.
Schedule an Appointment to Discuss Your Massachusetts Product Liability Case
Product liability claims can be rife with difficult issues, as this case demonstrates. To have one of our experienced injury attorneys review your claim and give you an honest appraisal of your chances of success in court, contact the Law Office of John C. Manoog, III at (888) 262-6664 for an appointment. Please be prepared to provide detailed documentation of both the product that you believe injured you and the damages that you have suffered (such as medical bills, lost wages, disfigurement, pain and suffering, etc.) from the product’s dangerous propensities. The initial consultation is free, and many cases are accepted on a contingency fee basis, which means you wouldn’t pay us until your case is concluded. We are currently reviewing cases throughout the Cape Cod area, including Hyannis and Plymouth.
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