In the early 1980s, it came to light that Johns-Manville, one of the largest asbestos manufacturers, had been fully aware of the connection between exposure to asbestos dust and the development of serious respiratory disease for at least fifty years.

During that fifty-year period, Johns-Manville not only failed to warn potential victims of the risks associated with its product, but it also actively concealed that information in order to safeguard company profits. As one particularly egregious facet of a large-scale cover-up, the company routinely withheld x-ray results from periodic employee physical exams – refusing to inform their employees that a serious respiratory disease had been diagnosed.[5]

In a 1949 company memorandum, Dr. Kenneth W. Smith, the medical director of Canadian Johns-Manville, stated that the employees "have not been told of the diagnosis, for it is felt that as long as the man feels well, is happy at home and at work and his physical condition remains good nothing should be said."[6]

For the unwitting employee, this unconscionable practice subjected him to additional exposure to the deadly dust, substantially contributing to the seriousness of his illness. For Johns-Manville, however, this practice was win-win. Not only did the company benefit from the additional years of labor by experienced employees, but they also increased the likelihood that they would escape all liability for their intentional misconduct. Often, employees would not discover their illness until after retirement, when the statute of limitations had elapsed on their workers compensation and tort claims.[7]

In a further attempt to conceal the dangerous nature of their product, Johns-Manville and other manufacturers persuaded scientists to delay publication of findings that would be detrimental to the asbestos industry, or to soften the impact of such reports by obscuring their results.[8]

The asbestos manufacturers also manipulated the legal system in order to conceal the risks of asbestos. When asbestos victims finally realized that their respiratory diseases were caused by exposure to asbestos and sued the manufacturers, the companies always settled out of court - eliminating the potential of publicly-accessible trial records.[9]

Further, as a condition of these out-of-court settlements, manufacturers demanded strict confidentiality and assurance from plaintiffs' lawyers that they would forgo all future asbestos suits and withhold from other plaintiffs' lawyers any evidence that had been obtained.[10]

The cases that actually reached trial encountered an additional hurdle in the form of a highly effective "state of the art" defense, which asserted that asbestos manufacturers could not be held liable for claims arising from asbestos exposure that occurred before the release of a certain epidemiological study in 1965,[11] because manufacturers had no prior knowledge of the risks of asbestos.[12]

This defense was later crippled by plaintiffs' lawyers who, working together, were able to pool evidence which conclusively revealed that Johns-Manville had known about the dangers of asbestos since the early 1930s.[13]

After this revelation, asbestos manufacturers quickly scrambled back to settling most disputes out-of-court, in order to avoid exposure to large compensatory and punitive damages awards – which were being awarded with greater frequency.[14] In the late spring of 1982, however, Johns-Manville puzzled plaintiffs' attorneys by allowing a number of cases that would have formerly settled out-of-court, to go to trial.[15]

It soon became apparent that this was yet another calculated maneuver designed to minimize Johns-Manville's financial losses when the company filed for Chapter 11 bankruptcy, automatically staying all pending litigation.[16]

The tort system with its prospect of punitive damages is an indispensable tool for uncovering and combating outrageous corporate misconduct, like that engaged in by Johns-Manville and other asbestos manufacturers. In the absence of punitive damages, asbestos manufacturers could not have been punished for their callous actions and the public would remain at the mercy of companies who could coldly calculate that they could profit from failing promptly to disclose known risks in the future. By deterring such "outrageous misconduct," punitive damages awards help ensure that, in the future, the public is warned of potential dangers and that guilty parties are punished. However, our tort system, which is the best vehicle for addressing such intentional misconduct, is currently under attack by the so-called "tort reform" movement. Representatives of business interests are promoting federal and state legislation to limit tort liability and to restrict damages awards, including awards of punitive damages, by focusing the public's attention on anecdotes of alleged abuses. These so-called abuses are unrelated to the field of environmental torts, but they are cleverly designed to dupe citizens into relinquishing their best protection against outrageous and intentional misconduct by the industries the tort reformers represent.

By Candace Howard 

[4] Health Central, General Health Encyclopedia available at http://www.healthcentral.com/mhc/top/000115.cfm.

[5] Paul Brodeur, Outrageous Misconduct 242-3 (Pantheon Books 1985).

[6] Id.

[7] David Rosenberg, The Dusting of America: A Story of Asbestos – Carnage, Cover-up, and Litigation, 99 Harv. L. Rev. 1693, 1698 (1986) (reviewing Paul Brodeur, Outrageous Misconduct (1985)).

[8] Id. at 1700.

[9] For instance, out of thirty-five hundred lawsuits that Johns-Manville had disposed of, thirty-four hundred were settled out-of-court. Brodeur, supra note 1 at 4.

[10] Brodeur, supra note 1 at 90.

[11] Selikoff, Churg, & Hammond, The Occurrence of Asbestosis Among Insulation Workers in the United States, 132 ANNALS N.Y. ACAD. SCI. 139 (1965).

[12] Brodeur, supra note 1 at 136-37.

[13] Id. at 216-19.

[14] Id. at 216.

[15] Id. at 278-79.

[16] Id.