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MONTGOMERY, McCRACKEN, WALKER & RHOADS, LLP


437 Madison Avenue, 29th Floor
New York, New York 10022
Phone
212-867-9500
Facsimile 212-599-1759
Natalie D. Ramsey
Mark A. Fink
and
DEAN, OMAR, & BRANHAM, LLP
3900 Elm Street
Dallas, Texas 75226
Phone
214-722-5990
Facsimile 214-722-5991
Charles W. Branham, III
Jessica M. Dean
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK

In re:
JOHNS-MANVILLE CORPORATION, et al.,
Debtors.
In re
MANVILLE FOREST PRODUCTS
CORPORATION,
Debtor.

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Chapter 11
Case No. 82B 11656 (CGM) through
82 B 11676 Inclusive
Jointly Administered
In Proceedings for a Reorganization
Under Chapter 11
Case Number 82 B 11659

RESPONSE AND OBJECTION OF LYNDA BERRY TO EMERGENCY


MOTION OF GRAPHIC PACKAGING INTERNATIONAL, INC.
FOR AN ORDER ENFORCING THE MFP CONFIRMATION
ORDER AND THE MANVILLE CONFIRMATION ORDER

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TABLE OF CONTENTS
Page
PRELIMINARY STATEMENT ....................................................................................................1
RELEVANT FACTS......................................................................................................................4
Mrs. Berrys Diagnosis and Commencement of the State Suit ..........................................4
The Underlying Bankruptcy Cases and Confirmation Orders............................................5
The Defendant is the Successor in Interest to All Liabilities of Manville Forest
Products Corporation..............................................................................................6
Asbestos Remained at the Paper Mill from 1982 Until at Least Mr. Berrys
Retirement in 2010 .................................................................................................7
LEGAL ARGUMENTS .................................................................................................................8
I.

THE MFP PLAN DOES NOT DISCHARGE OR ENJOIN MS. BERRYS


ASBESTOS CLAIM ..........................................................................................................8
A.

The MFP Plan (and its treatment of asbestos claims against MFP) Was
Separate and Independent From the JM Plan (and the treatment of asbestos
claims against the JM Debtors) ..............................................................................8

B.

The JM Injunction bars only claims arising by reason of an act or omission


of the JM Debtors ...................................................................................................9

C.

Ms. Berrys Claim is not Discharged or Enjoined by the MFP Plan and
Confirmation Order ..............................................................................................11
1.

The MFP Plan Does Not Contain a Channeling Injunction .....................11

2.

The MFP Plan and Confirmation Order Do Not Purport to Release,


Discharge or Enjoin Claims Arising Post-Confirmation..........................12

3.

Graphic Seeks to Have this Court Ignore its Jurisdictional


Limitations................................................................................................14

4.

The Attempted Discharge of Unmanifested Asbestos Claims


Contained in the MFP Confirmation Order Did Not Comply with
Due Process, and Certainly Did Not Satisfy the Requirements of
Due Process With Respect to Ms. Berrys Claim.....................................14

5.

Ms. Berry Did Not Receive Constitutionally Adequate Notice ...............18

D.

Mr. Berrys Filing of a Claim Against the Trust Established by the JM


Confirmation Order is Irrelevant ..........................................................................18

E.

Waiver of Alleged Defense ..................................................................................18

CONCLUSION ............................................................................................................................20

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TABLE OF AUTHORITIES
Page(s)
Cases
Amchem Products, Inc. v. Windsor,
521 U.S. 591, 117 S.Ct. 2231 (1997) ......................................................................................15
Burgos v. Metro-North Commuter R. R.,
836 N.Y.S.2d 76 (N.Y. App. Div. 1st Dept 2007) ...................................................................9
In re Chance Industries, Inc.,
367 B.R. 689 (Bankr. D. Kan. 2006).................................................................................16, 17
In re Chateaugay Corp.,
944 F.2d 997 (2d Cir. 1991) ....................................................................................................13
Combustion Engineering,
295 B.R. 459 (Bankr. D. Del. 2003)........................................................................................13
Edwards v. ABC Auto Parts, et al.
No. 637,867, 19th ....................................................................................................................19
Findley v. Falise (In re Joint E. & S. Dist. Asbestos Litig.),
878 F. Supp. 473 (E.D.N.Y. & S.D.N.Y. 1995) ......................................................................17
In re Flintkote Company,
486 B.R. 99 (Bankr. D. Del. 2012)....................................................................................15, 16
Graves v. Riverwood International Corporation, et al,
Docket 00-1748, 4th ................................................................................................................19
Hexcel Corp. v. Stepan Co. (In re Hexel Corp.),
239 B.R. 564 (N.D. Cal. 1999)................................................................................................17
In re HRH Const. LLC,
No. 09-23665, 2011 WL 3359576 (Bankr. S.D.N.Y. August 2, 2011).....................................9
Hughes v. Long Is. Univ.,
305 A.D.2d 462 (N.Y, App. Div. 2003) ..................................................................................13
Hunt v. Mobile Oil Corp.,
654 F. Supp. 1487 (S.D. N.Y. 1987) .......................................................................................13
In re Kewanee Boiler Corp.,
198 B.R. 519 (Bankr. N.D. Ill. 1996) ......................................................................................17

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Mullane v. Cent. Hanover Bank & Trust Co.,


339 U.S. 306 (1950) ................................................................................................................14
In re Neptune World Wide Moving, Inc.,
111 B.R. 457 (Bankr. S.D.N.Y. 1990) ....................................................................................14
Olin Corporation, Appellant, v. Riverwood International Corporation (In Re:
Manville Forest Products Corporation)
(2nd Cir., 4/7/2000) .................................................................................................................12
Olin Corporation v. Riverwood International Corporation (In re Manville-Forest
Products Corp.),
209 F.3d 125 (2d Cir. 2000)....................................................................................................12
In re Park Ave. Radiologists, P.C.,
450 B.R. 461 (Bankr. S.D.N.Y. 2011) ....................................................................................14
In re Patenaude,
210 F.3d 135 (3d Cir. 2000) cert. denied, 531 U.S. 1011 (2000) .............................................4
State of New York v. Industrial Site Servs., Inc.,
862 N.Y.S.2d 118 (N.Y. App. Div.3d Dept 2008)...................................................................9
Waterman S.S. Corp. v. Aguiar (In re Waterman S.S. Corp.),
141 B.R. 552 (Bankr. S.D.N.Y. 1992), vacated on other grounds, 157 B.R.
220 (S.D.N.Y.).........................................................................................................................16
Statutes
11 U.S.C. 524(g)(4)(A)(ii)................................................................................................9, 10, 11
11 U.S.C. 1142 ...........................................................................................................................14
28 U.S.C. 157(b)(5) ....................................................................................................................14
Section 105(a) of the Bankruptcy Code ........................................................................................11
Section 524(g) of the Bankruptcy Code ..............................................................................9, 10, 11
Section 1141 of the Bankruptcy Code...........................................................................................11
1141(d)(1)(A) of the Bankruptcy Code ......................................................................................12

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Lynda Berry, by and through her attorneys, Montgomery, McCracken, Walker & Rhoads,
LLP and Dean, Omar, & Branham, LLP, submits this response and objection (the Objection)
in opposition to Graphic Packaging International, Inc.s (Graphic) Emergency Motion for an
Order Enforcing the MFP Confirmation Order and the Manville Confirmation Order (the
Emergency Motion). For the reasons set forth herein, Mrs. Berry respectfully requests that the
Emergency Motion be denied.
PRELIMINARY STATEMENT
Graphics Emergency Motion is an emergency only in name and is, in fact, an
eleventh-hour attempt to have this Court pre-judge and protect from liability a substantial
defendant which is responsible for Mrs. Berrys mesothelioma diagnosis. Specifically, Graphic
asks this Court to determine that it should not be a party to litigation commenced against it in
August, 2015 (the State Suit) because of certain orders entered in the bankruptcy cases of the
above-captioned Debtors (as herein defined) decades before certain of the exposures that resulted
in Mrs. Berrys illness even occurred.
This Court should deny Graphics motion because (1) Manville Forest Product (MFP)
is not a beneficiary of the Johns Manville (JM) Confirmation Order and channeling
injunction; (2) Mrs. Berrys claim was not discharged, released or enjoined under the MFP
Confirmation Order; (3) even if the Court were to find that certain of Mrs. Berrys claims were
addressed by the MFP or JM Confirmation Orders, to the extent that Mrs. Berrys exposures
occurred after the respective confirmation dates in those cases, her claims cannot be and are not
discharged, released, channeled or enjoined by the MFP or JM Confirmation Orders; and (4)
Graphic has waived its right to seek the relief it now seeks.
As set forth in greater detail herein, claims against MFP for its own conduct and liability
are not enjoined and channeled under the JM Confirmation Order. The MFP Confirmation Order

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was entered separately and nearly three years before the JM Confirmation Order. Graphics
papers make no attempt to explain how a subsidiary that was undergoing its own case with its
own Confirmation Order and treating its creditors in one way can somehow obtain additional
relief affecting those creditors in a separate case. But even if MFP were a beneficiary of the
injunction entered in connection with the JM Confirmation Order (the Injunction), claims
against it would only be discharged to the extent that they were claims arising from one of the
Johns Manville Debtors conduct. However, Mrs. Berrys claim against MFP is based on MFPs
acts and omissions.
Additionally, assuming, arguendo, that MFP benefits from the JM Injunction, or
contends that Mrs. Berrys claims were discharged or released under the MFP Plan, such relief
would apply only to injuries resulting from pre-confirmation exposures. Despite devoting a
substantial amount of ink to trace the history of the Manville Trust and the Confirmation Orders,
Graphic does not devote a single sentence to explain how it contends that post-confirmation
exposures are enjoined. The reason is simple there is no support for such a broad proposition.
If and to the extent that JM or MFP obtained relief limiting their liability for asbestos injuries
that manifested in the future, that relief is limited to exposures which occurred, at the latest, as of
the date of the Confirmation Orders. As made clear in her deposition, Mrs. Berrys exposure as a
result of contact with her husband, who worked at Graphics West Monroe, Louisiana paper mill
(the Paper Mill) continued for approximately twenty-four years after the entry of the JM
Confirmation Order and twenty-six years after the MFP Confirmation Order. Accordingly,
Graphic remains responsible for Mrs. Berrys injuries.
Graphics assertion that Mrs. Berry should only file a claim under the procedures
established pursuant to the JM Confirmation Order because Mr. Berry did so is at best a red

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herring. Mrs. Berrys claim for pre-petition exposure to JMs asbestos-laden products would be
channeled. However, Mrs. Berrys premises liability claim against MFP is distinct and not
channeled. Mrs. Berry contracted mesothelioma, a universally fatal disease associated only with
asbestos exposure. The cause of this disease is clear: Mrs. Berry was exposed - through
unprotected contact with Mr. Berrys clothing - to the asbestos-laden products present
throughout the Paper Mill until Mr. Berrys retirement in 2010.
Finally, assuming, arguendo, that this Court accepts all of Graphics arguments as a basis
to halt litigation of the State Suit, this Court should still deny the request because its right to seek
to enjoin and channel Mrs. Berrys claim has been waived. The State Suit commenced in
August, 2015 and Graphic was served with the State Suit in September, 2015 six months prior
to the filing of the Emergency Motion. Since the commencement of the State Suit, Graphic has
actively participated in all parts of the State Suit including filing an answer (attached as Exhibit
1), asserting cross claims, propounding and delivering discovery, negotiating an exhaustive
scheduling order (the deadlines of which Graphic used as a sword to obtain an expedited hearing
from this Court), and producing a witness who was deposed for approximately two full days.
Now, with a trial looming on April 4, 2016, Graphic is grasping to avoid liability to Mrs. Berry.
Graphic now presents this Court with a novel theory that it has never raised in the State
Suit or in any other litigation arising from the Paper Mill. Not one of the thirty-three (33)
affirmative defenses raised by Graphic to the complaint mentioned this alleged defense that an
injunction could not only channel pre-confirmation exposures but also look prospectively to
exposures that occurred post-confirmation. See Exhibit 1. Even if Graphics view regarding the

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limits of the injunctions entered pursuant to the Confirmation Orders was accurate which it is
not the defense should be barred as waived.1
RELEVANT FACTS
Mrs. Berrys Diagnosis and Commencement of the State Suit
In 2015, Mrs. Berry was diagnosed with malignant mesothelioma. Mesothelioma is an
invariably fatal cancer for which asbestos exposure is the only known cause In re
Patenaude, 210 F.3d 135, 138 (3d Cir. 2000) cert. denied, 531 U.S. 1011 (2000). Unlike
individuals who became exposed to asbestos as part of their jobs, Mrs. Berry was a homemaker
and her diagnosis with this fatal disease is the result of exposure to asbestos from her husband,
William Berry. Mr. Berry worked for decades at the Paper Mill including around the equipment
that various manufacturers supplied to Graphic for the Paper Mill.2
Mr. Berry worked around asbestos daily while working at the Paper Mill.3 Mr. Berry
worked on and around asbestos containing boilers made by Foster Wheeler4, turbines
manufactured by General Electric5, valves manufactured by Crane Co.6, Dezurik7, and others,

Though counsel for Mrs. Berry attempted to delay hearing on the Emergency Motion, its request was denied unless
every other deadline on in the State Suit could be similarly delayed. Though counsel for Ms. Berry would have been
willing to adjourn the deposition of Dr. Francis Weir (Graphics tendered Industrial Hygienist), Mrs. Berrys
counsel could not, on an expedited schedule, rearrange the schedules of the myriad other depositions of other
defendants to the State Suit to accommodate Graphics demands.
2

Deposition of William Berry at 10:14-16; 13:9-17; 15:15-170:24 attached as Exhibit 2; see also Deposition of
Lynda Berry at 22:05-16; 34:05-45:09 attached as Exhibit 3.
3

Id attached as Exhibit 2.

Id. at 77:01-77:25; 80:01-90:07; 101:06-102:03; 160:04-15.

Id. at 17:6-29:23; 59:01-60:17; 73:01-76:21; 160:04-15.

Id. at 90:11-108:06.

Id.

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pumps manufactured by Goulds8, Warren9, Gardner Denver10, Northern11, and others.12 In


addition to working on and around this asbestos containing equipment, Mr. Berry worked around
insulators removing and installing asbestos-containing insulation at the Paper Mill during these
decades.13 Mrs. Berrys exposures from her husbands work began at least as early as 1973
when they were married and continued, unabated, until Mr. Berrys retirement in 2010.14 Mr.
Berry would come home from the Paper Mill covered in asbestos dust. Mrs. Berry would take
Mr. Berrys dusty and dirty work clothes, shake them out before washing them and breathe the
fatal asbestos dust.15 It was these exposures from the Paper Mill that caused Mrs. Berrys
mesothelioma.16
The Underlying Bankruptcy Cases and Confirmation Orders
On December 1, 1983, this Court entered the Order Confirming the First Amended and
Restated Plan of Reorganization Dated December 1, 1983 of Manville Forest Products
Corporation a copy of which is attached to the Affidavit of J. Eric Lockridge in Support of the
8

Id. at 108:08-141:19.

Id.

10

Id.

11

Id.

12

Id.

13

Id. at 142:14-152:22; also see supra.

14

Id. at 15:01-14; 39:4-14; 42:24-43:12; 49:10-24; 50:01-16; 52:24-53:08; 69:06-14; 88:19-89:4; 97:10-97:23;
101:10-102:03; 117:14-17; 143:20-144:03; 146:24-147:20; 148:08-148:17; 152:11-22; 156:14-157; 160:17-161:04;
Moreover, it would be expected that Mr. Berrys work prior to 1973 would have also caused him to bring asbestos
into his home that Mrs. Berry would subsequently breathe. See Deposition of Edwin Holstein at pp. 24-25 attached
as Exhibit 4.
15

Exhibit 2, Deposition of William Berry at 14:17-15:10; Exhibit 3, Deposition of Lynda Berry at 22:05-16; 34:0545:09.
16

See Report of James Strauchen, M.D. attached as Exhibit 5.

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Emergency Motion (the Lockridge Affidavit) as Exhibit M (the MFP Confirmation Order).
The MFP Confirmation Order approved the First Amended and Restated Plan or Reorganization
for Manville Forest Products Corporation (the MFP Plan), a copy of which is attached to the
Lockridge Affidavit as Exhibit L.
On December 22, 1986, this Court entered the Order Confirming the Debtors Second
Amended and Restated Plan of Reorganization a copy of which is attached to the Lockridge
Affidavit as Exhibit O (the JM Confirmation Order and with the MFP Confirmation Order, the
Confirmation Orders). The JM Confirmation Order approved the Manville Corporation
Second Amended and Restated Plan of Reorganization (the JM Plan) attached to the Lockridge
Affidavit as Exhibit N.
MFP was not an identified Debtor in the Manville Confirmation Order. Indeed, the JM
Confirmation Order makes no reference to MFP. Exhibit A to the Manville Plan is a Glossary of
Defined Terms. The section does include a definition for Subsidiary but the definition is
generic and does not include an explicit list. See Lockridge Affidavit, Exhibit N at page C-57.
In fact, in none of the thirty (30) Schedules, Annexes, or Exhibits referenced in the Manville
Plan is there a single explicit reference to a list of Subsidiaries the parties that will be the
direct beneficiaries of the terms of the Manville Plan. See Lockridge Affidavit Exhibit N at page
C-39.
The Defendant is the Successor in Interest to All Liabilities of Manville Forest Products
Corporation
As set forth in the Lockridge Affidavit and the documents attached thereto, Graphic is the
ultimate successor to MFP as a result of a number of changes in corporate ownership as well as
name changes beginning in 1978 when JM Capital Corporation entered into an Agreement and
Plan of Merger with Olinkraft, Inc. with JM Capital Corporation being the surviving entity

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though its name was changed to Olinkraft, Inc. See Lockridge Affidavit, Exhibit I pages 14, 17
and 20. Olinkraft, Inc. was later renamed Manville Forest Products Corporation. Id. at 35.
Manville Forest Products Corporation was renamed Riverwood International Corporation.
Lockridge Affidavit, Exhibit I at 45; Lockridge Affidavit, Exhibit J at 12.17 On or about August
8, 2003, Graphic Packaging International, Inc. was merged into Riverwood International
Corporation with Riverwood International Corporation as the surviving corporation though
Riverwood International Corporation then changed its name to Graphic Packaging International,
Inc. at the completion of the merger. Lockridge Affidavit, Exhibit J at 40.
Asbestos Remained at the Paper Mill from 1982 Until at Least Mr. Berrys Retirement in 2010
Graphic mistakenly focuses on the time when asbestos-laden products were either
produced, or actively brought to the Paper Mill. See Memorandum in Support of Emergency
Motion at 15 16 (no new asbestos was brought to the Mill after the MFP Plan was confirmed
and The federal government banned the manufacture and sale of asbestos in the 1970s.).
When a product was produced or made available is not relevant to the inquiry before this
Court (or to Mrs. Berrys underlying claim). Instead, the relevant inquiry is when the injured
party was exposed to the product. The testimony is uncontroverted that asbestos remained in the
Paper Mill long after the commencement of the Debtors bankruptcy cases as well as long after
entry of the Confirmation Orders. See footnote 14 supra citing to Mrs. Berrys deposition. The
same way that radioactive material remains dangerous for years, the asbestos which remained in
the Paper Mill after entry of the Confirmation Orders still posed a health risk to individuals
exposed to it. Graphic does not assert that all asbestos was removed from the Paper Mill on or
17

A number of documents included in Exhibit J to the Lockridge Affidavit appear to be duplicates of those contained
in Exhibit I. Out of an abundance of caution, we have included citation to both documents when duplicates were
filed with the Court.

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prior to entry of the Confirmation Order instead they play a game of semantics and assert that
no additional asbestos was brought into the Paper Mill.
Because neither Graphic nor its predecessors devoted the resources necessary to remove
asbestos from the Paper Mill, Mr. Berry was directly exposed to asbestos, and Mrs. Berry
through contact with her husband, was indirectly exposed to a product everyone particularly
Graphic and its predecessors - knew was dangerous and present.
LEGAL ARGUMENTS
I.

THE MFP PLAN DOES NOT DISCHARGE OR ENJOIN MS. BERRYS ASBESTOS
CLAIM
A.

The MFP Plan (and its treatment of asbestos claims against MFP) Was Separate
and Independent From the JM Plan (and the treatment of asbestos claims against
the JM Debtors)

As set forth in the Disclosure Statement accompanying the JM Plan:


Manville Forest Products Corporation was among the original debtor
corporations filing for reorganization with Manville Corporation on
August 26, 1982. The severability of most of the claims against this
corporation from the claims filed against the other original debtor
corporations allowed Manville Forest Products Corporation to address its
claims independently and emerge from reorganization in 1984.
See Lockridge Affidavit, Exhibit S (Johns-Manville Disclosure Statement), at M-44 (emphasis
supplied).
Accordingly, despite the broad definition that Graphic seeks to have this Court adopt in
connection with the injunctive language of the JM Plans use of the term Subsidiary, creditors
of MFP were expressly informed that the MFP case had addressed the claims against MFP
independently and that those claims were not addressed by the JM Plan.
The JM Confirmation Order and indeed the underlying JM Plan is itself vague. For
example, the references to subsidiary in the plan which Graphic asserts provides it a successor
interest is generic and fails to include a specific list of the entities ascribed as subsidiaries. The
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Johns Manville Confirmation Order includes a list of Debtors none of which is MFP.
Graphics convenient use of a perceived lack of clarity in the documents should not be used as a
sword against Mrs. Berry but rather should provide her a shield as any ambiguities in a document
are construed against the drafter. In re HRH Const. LLC, No. 09-23665, 2011 WL 3359576, at
*9 (Bankr. S.D.N.Y. August 2, 2011) (citing Matter of Liberty Mut. Fire Ins. Co. v. Malatino, 75
A.D.3d 967, 96970 n. 4 (N.Y. App. Div.3d Dept 2010) (citing Guardian Life Ins. Co. of Am. v.
Schaefer, 70 N.Y.2d 888, 890 (1987)); State of New York v. Industrial Site Servs., Inc., 862
N.Y.S.2d 118, 124 (N.Y. App. Div.3d Dept 2008) (citations omitted); Burgos v. Metro-North
Commuter R. R., 836 N.Y.S.2d 76, 77 (N.Y. App. Div. 1st Dept 2007) (citing Jacobson v.
Sassower, 66 N.Y.2d 991, 993 (1985)).
Graphics attempt to fall within the Johns-Manville injunction contained in the JM Plan
and Confirmation Order (the JM Injunction) is also contrary to section 524(g) of the
Bankruptcy Code (the section enacted to codify the JM Injunction). Section 524(g)(4)(A)(ii),
which was intended to provide comfort with respect to at least certain aspects of the JM
Injunction, provides that any third parties protected by the injunction must be identifiable from
the terms of such injunction (by name or as part of an identifiable group) . . . . 11 U.S.C.
524(g)(4)(A)(ii).
B.

The JM Injunction bars only claims arising by reason of an act or omission of the
JM Debtors

Not only is MFP not identifiable from the terms of the injunction, but more importantly,
MFPs liability is not derivative of Johns-Manville. See Combustion Engineering, 295 B.R.
459, 481 (Bankr. D. Del. 2003). Mrs. Berry seeks compensation against Graphic based on its
separate and independent liability as the successor to MFP.

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The JM Plan enjoined only asbestos claims arising or allegedly arising, directly or
indirectly, from acts or omissions prior to the Confirmation Date of one of more of the
Debtors . . . See Lockridge Affidavit, Exhibit N (Manville Plan), p. 55 (emphasis supplied).
Section 524(g)(4)(A)(ii) provides that conduct may be enjoined only against non-debtor entities
to the extent that the third party is alleged to be directly or indirectly liable for the conduct of,
claims against, or demands on the debtor . . . . 11 U.S.C. 524(g)(4)(A)(ii) (emphasis supplied).
Even if MFP had been protected by the JM Injunction, Ms. Berry does not seek compensation
from MFP for the conduct of or claims against one of the JM Debtors, instead, Mrs. Berry seeks
compensation from MFP and its successors for the continuing exposures to asbestos which
occurred as a result of Mr. Berrys work at Graphics Paper Mill.
Finally, it is important to note that MFP does not fall within any of the categories of
third-parties that may be released under section 524(g). Specifically, section 524(g)(4)(A)(ii)
permits non-debtor relief only for certain limited persons with specified relationships with a
debtor that could make it or make it alleged to be responsible for the debtors liability. Section
524(g) authorizes third party relief only to the extent such alleged liability of such third party
arises by reason of
(I) the third partys ownership of a financial interest in the debtor, a past or present
affiliate of the debtor, or a predecessor in interest of the debtor;
(II) the third partys involvement in the management of the debtor or a predecessor in
interest of the debtor, or service as an officer, director or employee of the debtor or a related
party;
(III) the third partys provision of insurance to the debtor or a related party; or

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(IV) the third partys involvement in a transaction changing the corporate structure, or in
a loan or other financial transaction affecting the financial condition of the debtor or a related
party, including but not limited to
(aa) involvement in providing financing (debt or equity), or advice to a entity
involved in such a transaction; or
(bb) acquiring or selling a financial interest in an entity as part of such a
transaction.
11 U.S.C. 524(g)(4)(A)(ii) (emphasis supplied).
The relief afforded by the Johns-Manville injunction and its progeny, as codified by
section 524(g), is extraordinary and a narrow exception to the limitation provided by section
524(e), restricting discharge to a debtor.
C.

Ms. Berrys Claim is not Discharged or Enjoined by the MFP Plan and
Confirmation Order
1.

The MFP Plan Does Not Contain a Channeling Injunction

Although well aware of its existing and potential asbestos liability, and well aware of the
contemporaneous JM bankruptcy where the JM Debtors were seeking a channeling injunction to
obtain relief from future claims, the MFP Plan and Confirmation Order do not contain a
channeling injunction under section 105(a) of the Bankruptcy Code, and did not create a pool of
funds available for persons injured by exposure to asbestos at MFPs mill. Instead, MFP
obtained a standard Chapter 11 discharge under section 1141 of the Bankruptcy Code:
The Debtor is discharged and released from any and all unsecured debts
which arose before the date of confirmation of the Plan, including but not
limited to any and all Class 3 Claims (as defined in the Plan) held by a
person who had commenced a suit, action or other proceeding against the
Debtor before the filing of the Debtors chapter 11 petition on August 26,
1982 for damages for, relating to or arising by reason of, directly or
indirectly, physical, emotional or other personal injuries or property
damage caused or allegedly caused, directly or indirectly, by asbestos or
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asbestos-containing products and by formaldehyde or formaldehydecontaining products and arising or allegedly arising, directly or indirectly,
from acts of omissions of the Debtor (or another person, firm, corporation
or other entity for or with which the Debtor is liable), and any and all
debts of a kind specified [sic] 502(g), 502(h) or 502(i) of the Code
whether or not (i) a proof of claim based on such debt is filed under 501
of the Code; (ii) such claim is allowed under 502 of the Code; (iii) such
claim is listed on the Debtors Schedules and Lists heretofore filed herein;
or (iv) the holder of such claim has accepted the Plan.
See Lockridge Affidavit, Exhibit M, at p. 6.
Accordingly, the MFP Plan and Confirmation Order do not provide for channeling Ms.
Berrys claim to any trust for payment.
2.

The MFP Plan and Confirmation Order Do Not Purport to Release,


Discharge or Enjoin Claims Arising Post-Confirmation

The Second Circuit has held that [a] valid pre-petition claim requires two elements. See
Olin Corporation v. Riverwood International Corporation (In re Manville-Forest Products
Corp.), 209 F.3d 125, 128 (2d Cir. 2000) (citing LTV Steel Co. v. Shalala (In re Chateaugay
Corp.), 53 F.3d 478, 497 (2d Cir.1995)). First, the claimant must possess a right to payment.
Second, that right must have arisen prior to the filing of the bankruptcy petition. Whether a
claim exists is determined by bankruptcy law, while the time a claim arises is determined under
relevant non-bankruptcy law. Id.
The Bankruptcy Code provides debtors with a fresh start, releasing a debtor from its
current liabilities. Id. Under 1141(d)(1)(A) of the Bankruptcy Code, the confirmation of a
plan of reorganization discharges the debtor from any debt that arose before the date of such
confirmation.... 11 U.S.C. 1141(d)(1)(A) (emphasis added). By statutory definition, if there is
no debt (i.e. no right to payment), there is nothing to discharge. Therefore, claims resulting from
post-petition exposure may not be released in a bankruptcy case.

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The Second Circuit clarified that to expect bankruptcy claims to be filed by those who
have not yet had any contact whatever with the tortfeasor has been characterized as absurd. In
re Chateaugay Corp., 944 F.2d 997, 1003 (2d Cir. 1991) (citing Thomas H. Jackson, The Logic
and Limits of Bankruptcy Law 34-35 (1986) and Vanston Bondholders Protective Committee v.
Green, 329 U.S. 156, 170 (1946) (Frankfurter, J., concurring) (non-bankruptcy law determines
existence of a claim)). A post-confirmation exposure claim, by definition, would be deemed
absurd should it be deemed to be released through a debtors bankruptcy proceedings.
Accordingly, when post-confirmation claims arise, the claimants recourse is to file and litigate
under state law against the reorganized entity, or as in this case, the solvent successor to such
entity which expressly assumed all such liabilities through the underlying corporate documents
discussed supra.
Consistent with applicable jurisprudence, the MFP Confirmation Order explicitly
addresses only unsecured debts which arose before the date of confirmation of the Plan. See
Lockridge Affidavit, Exhibit M (MFP Confirmation Order), at p. 6. There is, therefore, no basis
for Graphic to contend that exposures that occurred after confirmation of its Plan are discharged
or enjoined.
To allow Graphic to have Mrs. Berrys claim barred as a result of post-confirmation
exposures would be tantamount to allowing a prospective release for future wrongs. However,
Graphic does not explicitly request such relief. The reason is simple, absolving a party from
liability for future violations is against public policy. See Hunt v. Mobile Oil Corp., 654 F. Supp.
1487, 1516 (S.D. N.Y. 1987) (finding that new practices constituted future violations and thus
not subject to covenant not to sue); Hughes v. Long Is. Univ., 305 A.D.2d 462 (N.Y, App. Div.
2003) (A release may not be read to cover matters which the parties did not desire or intend to

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dispose of.) (citation omitted). Nowhere in the Bankruptcy Code does it allow a proactive
release of a claim.
3.

Graphic Seeks to Have this Court Ignore its Jurisdictional Limitations

What is before this Court is not the simple implementation of the a plan, but rather an
attempt to have this Court adjudicate a post-confirmation claim that was not addressed in the
underlying bankruptcy cases and which did not arise until post-confirmation. As other courts in
this jurisdiction have recognized, 11 U.S.C. 1142 confers limited post-confirmation
jurisdiction upon the bankruptcy court for the purpose of implementing the plan. In re Neptune
World Wide Moving, Inc., 111 B.R. 457, 462 (Bankr. S.D.N.Y. 1990); see In re Park Ave.
Radiologists, P.C., 450 B.R. 461, 467-68 (Bankr. S.D.N.Y. 2011) (once confirmation occurs,
the bankruptcy courts jurisdiction shrinks) (citations omitted).
Further, this is a matter arising in tort. Under 28 U.S.C. 157(b)(5), the Bankruptcy
Court does not have jurisdiction to determine personal injury claims. While personal injury
claims may be heard in the District Court, the determinations of fact regarding post-confirmation
exposure should be made by the court where the State Suit is pending, where Graphic has been
defending its position for over half a year, and under the schedule that Graphic helped to create.
Graphic should not be allowed to use this Court in an attempt to forum shop, or avoid its
liabilities.
4.

The Attempted Discharge of Unmanifested Asbestos Claims Contained in


the MFP Confirmation Order Did Not Comply with Due Process, and
Certainly Did Not Satisfy the Requirements of Due Process With Respect
to Ms. Berrys Claim

As the Supreme Court has stated, notice is a[n] elementary and fundamental
requirement of due process in any proceeding which is to be accorded finality . . . . Mullane v.
Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950). Asbestos injuries have a very long

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latency period injury can first manifest more than fifty (50) years following exposure. Because
future claimants are unaware that they have been injured, and unable to determine that they have
been injured even through appropriate diligence, it is impossible to provide them with adequate
due process notice of the need to assert a claim (which they do not now know that they have).
In Amchem Products, Inc. v. Windsor,18 in the context of a mass tort class action, the
Supreme Court discussed the impossibility of providing due process notice to individuals who
had not yet manifested an injury, stating:
Impediments to the provision of adequate notice, the Third Circuit emphasized,
rendered highly problematic any endeavor to tie to a settlement class persons with
no perceptible asbestos-related disease at the time of the settlement. Many
persons in the exposure-only category, the Court of Appeals stressed, may not
even know of their exposure, or realize the extent of the harm they may incur.
Even if they fully appreciate the significance of class notice, those without current
afflictions may not have the information or foresight needed to decide,
intelligently, whether to stay in or opt out.
Family members of asbestos-exposed individuals may themselves fall prey to
disease or may ultimately have ripe claims for loss of consortium. Yet large
numbers of people in this category future spouses and children of asbestos
victims could not be alerted to their class membership. And current spouses and
children of the occupationally exposed may know nothing of that exposure.
Amchem, 521 U.S. at 628.
Judge Judith Fitzgerald, a bankruptcy judge who presided over some of the largest and
most complex asbestos cases that have sought to reorganize through a Chapter 11 case,
addressed this issue directly in In re Flintkote Company,19 responding to the suggestion that the
fact that a future claimant possesses a 101(5) claim allowed those claims to be subjected to a
bar date, stating:
The fact of the matter is that regardless of whether an exposed asbestos creditor
who has not yet manifested an injury is said to have a claim or a future
18

521 U.S. 591, 117 S.Ct. 2231 (1997).

19

486 B.R. 99 (Bankr. D. Del. 2012).

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demand that creditor is not a known creditor entitled to actual notice, and is one
who is impossible to identify, such that providing actual notice is, itself,
impossible. Furthermore, there is no bar date for asbestos personal injury claims,
there is an FCR to represent the interests of the exposed yet unimpaired creditors,
and, if and when such creditor becomes ill, there will be a trust in place to address
claims for compensation. There is nothing to be gained by requiring Flintkote to
provide additional notice from what this Court has already approved.
486 B.R. at 128.
Other cases that have addressed this issue have reached the same inescapable conclusion
when considering the issue of whether notice that satisfies due process can be given to a
population of future claimants that the Debtor knows exist. For example, the court in Waterman
S.S. Corp. v. Aguiar (In re Waterman S.S. Corp.), 141 B.R. 552 (Bankr. S.D.N.Y. 1992), vacated
on other grounds, 157 B.R. 220 (S.D.N.Y.), stated [w]e find that [the debtor] was unreasonable
in its attempt to notify future Asbestos Claimants of the existence of their claims, and find that
the claims were not discharged. 141 B.R. at 558. The Waterman court continued:
Notice to these [future] Asbestosis Claimants is not cured by this Courts Order
authorizing notice by publication; at its best, publication notice is an emaciated
form of minimal due process. First, the notice was not reasonably calculated to
apprise these claimants of the pendency of this bankruptcy. Second, no future
Asbestosis Claimant could be deemed to have relinquished substantive rights
when, even if that individual had read the notice, those individuals would have
remained completely unaware that their substantive rights were affected.
Id,
The United States Bankruptcy Court for the District of Kansas reached a similar
conclusion in In re Chance Industries, Inc., 367 B.R. 689 (Bankr. D. Kan. 2006) explaining:
If they are alive and actually see the notice, they could not recognize themselves
as affected in any way by the bankruptcy case and will, therefore, take no action
to ensure their interests are represented. Such a notice by publication is an
exercise in futility as applied to creditors who are not only unknown to the debtor,
but are also unknown to themselves. It cannot possibly define the requirements of
the Due Process Clause.

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Id. at 708. See also Hexcel Corp. v. Stepan Co. (In re Hexel Corp.), 239 B.R. 564 (N.D. Cal.
1999):
[The Debtor] may be correct that this publication was sufficient to satisfy its
notice obligation to creditors who could contemplate that they might have a claim.
It is difficult to imagine, however, how the announcement of a bankruptcy
proceeding published in the Wall Street Journal could possibly satisfy due process
concerns for a potential creditor who had no way of knowing that it may have a
claim against the debtor some time in the future.
Id. at 571. See also In re Kewanee Boiler Corp., 198 B.R. 519, 530 (Bankr. N.D. Ill. 1996):
Giving notice to future tort claimants is of course hampered by the reality of
having to discern who specifically will be injured in the future. Without knowing
today who will perceive themselves hurt tomorrow and then press claims, notice
to particular individuals cannot be given and the amount of future liability cannot
be ascertained except through reference to projections. However accurate such
projections, no meaningful notice can be given to individuals who do not yet
know they suffer from injury.
Mrs. Berry had no pre-confirmation nexus with MFP. Because her exposures arose from
exposure to her husbands clothing, she was unaware of the potential that she would develop an
asbestos injury, or that she would have a claim against MFP.
The only way to protect such future claimants is through representation, representation
that they did not have in the MFP bankruptcy. See Findley v. Falise (In re Joint E. & S. Dist.
Asbestos Litig.), 878 F. Supp. 473, 565 (E.D.N.Y. & S.D.N.Y. 1995), ([F]uture interests are best
protected by requiring that fair and just recovery procedures be made available to future
claimants and by ensuring that they receive vigorous and faithful representation.) (quoting Ivy
v. Diamond Shamrock Chems. Co. (In re Agent Orange Prod. Liability Litig.), 996 F.2d 1425,
1435 (2d Cir. 1993)). It is for precisely this reason that the Court in the Johns-Manville case
appointed a future claimants representative and established an asbestos trust.
No future representative or sufficient notice was provided in the MFP case to provide any
future creditor with adequate notice of the attempted discharge of their claim. This is even more

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egregious because the record is clear that MFP was solvent and could have provided for payment
of those with pre-confirmation exposures who would later develop an asbestos injury.
5.

Mrs. Berry Did Not Receive Constitutionally Adequate Notice

Critically, Mrs. Berry never received any notice relating to the MFP bankruptcy case.
See Declaration of Lynda Berry attached as Exhibit 11. Accordingly, even if MFP could
somehow satisfy this Court that it had provided constitutionally adequate due process notice to
future claimants, Mrs. Berry was not provided with adequate due process notice in the MFP
bankruptcy case of the need to protect her rights against MFP.
D.

Mr. Berrys Filing of a Claim Against the Trust Established by the JM


Confirmation Order is Irrelevant

Graphics assertion that Mrs. Berry should only file a claim under the procedures
established pursuant to the JM Confirmation Order because Mr. Berry did so is at best a red
herring. Mrs. Berrys claim for pre-petition exposure to JMs asbestos-laden products would be
channeled. However, Mrs. Berrys premises liability claim against MFP is distinct and not
channeled.
E.

Waiver of Alleged Defense

Graphic comes to this Court more than six months after the State Suit was filed20, more
than three months after it agreed to a scheduling order setting this case for trial on April 4,
201421, and more than a week after its corporate representative was deposed for two days.22
Graphic cannot assert that this case is novel or extraordinary. Graphic is in litigation over
other asbestos cases arising from this same Paper Mill.23 Indeed, Graphics immediate
20

See File Stamped Original Complaint dated August 14, 2015 attached as Exhibit 6.

21

See Scheduling Order attached as Exhibit 7.

22

See Deposition of Vance Stark vol. I and II (cover pages only) attached as Exhibit 8.

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predecessor tried a case very similar to the one at bar in 2005 for the same Paper Mill and took a
verdict in excess of $3 million.24 Indeed, none of the thirty-three affirmative defenses raised by
Graphic in its answer to the complaint raised this potential bankruptcy issue. Due to its conduct
and active participation in the State Suit as well as its repeated participation in litigation over this
Paper Mill, assuming any of its injunctive arguments had merit (which they do not) Graphic is
precluded from now asserting a bankruptcy shield against this victim.

.Continued
23
See Graphic Packaging International, Inc.s Answer, Edwards v. ABC Auto Parts, et al. No. 637,867, 19th Judicial
District, Baton Rouge, June 1, 2015 attached as Exhibit 9.
24

See Judgment, Graves v. Riverwood International Corporation, et al, Docket 00-1748, 4th Judicial District,
Ouachita Parrish, 2005 attached as Exhibit 10.

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CONCLUSION
For the reasons set forth herein, Movant, Lynda Berry, respectfully requests that the
Emergency Motion for an Order Enforcing the MFP Confirmation Order and the Manville
Confirmation Order be Denied.

Dated: New York, New York


March 3, 2016
MONTGOMERY, McCRACKEN,
WALKER & RHOADS, LLP
/s/ Mark A. Fink
Natalie D. Ramsey, Esq. (NY Bar No. 5242730)
Mark A. Fink, Esq. (NY Bar No. 4261574)
437 Madison Avenue, 29th Floor
New York, New York 10022
Phone
212-867-9500
Facsimile
212-599-1759
Email:
nramsey@mmwr.com
mfink@mmwr.com
and
DEAN, OMAR, & BRANHAM, LLP
Charles W. Branham, III (pro hac vice motion to be filed)
Jessica M. Dean (pro hac vice motion to be filed)
3900 Elm Street
Dallas, Texas 75226
Phone
214-722-5990
Facsimile
214-722-5991
Email:
tbranham@dobllp.com
jdean@dobllp.com
Counsel for Lynda Berry

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