On Appeal From the United States District Court for the Eastern District of Pennsylvania, D.C. Civil No. 83-0268.
Higginbotham and Becker, Circuit Judges, and Barry, District Judge*fn*
A. LEON HIGGlNBOTHAM, JR., Circuit Judge.
These consolidated appeals arise out of class action litigation that is currently pending in the United States District Court for the Eastern District of Pennsylvania. In that suit, public and private elementary and secondary schools nationwide have sued former manufacturers and suppliers of asbestos-containing materials. The plaintiff schools seek to recover the costs of removing, repairing, containing and maintaining asbestos-containing materials in school buildings.
Relying on its authority under Fed.R.Civ.P. 23(d) to control communications between class action litigants, the district court entered the order challenged in these appeals. The order requires appellant corporations and their organization, the Safe Buildings Alliance ("SBA"), "prominently [to] display" a prescribed notice concerning the litigation whenever they communicate "in any manner" with members of the plaintiff class or with any group reasonably believed to include a class member or representative of a class member. In re Asbestos School Litig., 115 F.R.D. 22, 26 (E.D.Pa. 1987). Appellants challenge the order on two grounds. They claim that the order exceeds the district court's authority under Rule 23(d), and that the order imposes an unconstitutional restraint on their free speech rights under the first amendment. Because we find that the district court's order was not proper under Rule 23(d), we will vacate it and remand this matter for proceedings consistent with this opinion.
A. The Safe Buildings Alliance
Appellants National Gypsum Company, United States Gypsum Company, W. R. Grace & Co., The Celotex Corporation and Owens-Corning Fiberglas Corporation ("the corporate-defendant-appellants" or "the SBA members") are manufacturers of building products. These companies formerly produced and supplied asbestos-containing materials for use in buildings, and they are among the approximately fifty defendant companies in the underlying litigation, which was commenced in 1984.*fn1 SBA, though not a party to the litigation, is an association whose membership consists entirely of the corporate-defendant-appellant.*fn2 Joint Appendix ("Jt. App.") at 240, 384. SBA readily admits that it is funded almost exclusively by the corporate-defendant-appellants, and that its executive committee and board of directors are composed entirely of representatives of those companies.
SBA was formed in April 1984, in part to assist its members in organizing to participate in a United States Environmental Protection Agency ("EPA") proceeding concerning asbestos in buildings. The formation of SBA also coincided with the initiation of this litigation.
By 1984, the asbestos-in-buildings issue had been a focus of public attention and debate for several years. Asbestos in schools has been a particular focus of public concern since the early 1980s, and litigation constitutes only one forum in which this debate has taken place. At the time the SBA was formed numerous state legislatures and regulatory agencies were investigating the issue, and some state asbestos-related laws had been enacted. The United States Congress was actively considering the problems posed by the presence of asbestos in buildings, and had passed two statutes that concerned asbestos in schools.*fn3 Several federal regulatory agencies, including the EPA,*fn4 had also turned their attention to the asbestos-in-buildings issue.
According to the corporate-defendant-appellants they formed the SBA to communicate their point of view more effectively to government officials and the general public. They describe the SBA as "a lobbying and public education organization with four goals: (1) development of practical alternatives to dangerous, indiscriminate asbestos removal; (2) adoption of objective standards of asbestos abatement; (3) development of a responsible building inspection process; and (4) establishment of training and certification programs for removal contractors." Brief of Appellants National Gypsum Co., United States Gypsum Co., W.R. Grace & Co., The Celotex Corp., and Owens-Corning Fiberglas Corp. ("Brief of Appellant Corporations") at 6. SBA, responding to what it describes as a "public misperception . . . about the hazards of asbestos in buildings," id. at 7, has since its formation represented its members' views before Congress,*fn5 the EPA,*fn6 state legislatures and regulatory agencies.*fn7 SBA has also presented its views to the general public through a self-initiated "public education campaign."
The corporate-defendant-appellants stress that the SBA is not "a litigation-oriented, litigation-related, or litigation-support organization. [Jt.App. at] 320-30, 385, 409." Brief of Appellants Corporations at 9. They note that the SBA has never been involved in any product liability litigation. The SBA members acknowledge, however, that "as the record indicates, existence of litigation was one factor promoting SBA's formation. [Jt.App. at] 90, 287-88." Id. at 10 n. 7. In addition, SBA itself notes that concerns regarding member companies' potential liability in this and other products liability litigation has been central to its lobbying efforts and public education campaign.
The costs and risks of asbestos control fall in the first instance on the building owner. But the suppliers' risk of liability to building owners in lawsuits like the School Asbestos Litigation also puts them in a position of possible responsibility for the owners' response costs. Building owners and former suppliers thus share a similar interest in addressing potential asbestos risks promptly and efficiently, in order to minimize the costs of the control strategy without compromising safety.
Brief of Appellant Safe Buildings Alliance ("SBA Brief") at 10. One of the main goals of the SBA's "public education campaign" has been to disseminate information concerning what the SBA members describe as "the growing body of scientific evidence concerning the very low level of risk to building occupants from installed asbestos-containing products, the possibility that removal could increase exposure levels, and the need for careful, expert consideration and appropriate responses to asbestos in buildings. [Jt.App. at] 153, 294." Brief of Appellant Corporations at 8.
The SBA describes its "public education campaign" as being directed at "architects, abatement contractors, environmental engineers, building owners and managers (including school officials) , public health officials, building contractors, home owners, and the general public. [Jt.App. at] 295-389." Brief of Appellant Corporations at 8 (emphases added). It has participated in a variety of seminars on the asbestos-in-schools issue attended by these individuals, Jt.App. at 335-36, 338-89, 408, and it has otherwise contacted them directly through mailings and telephone conversations.
The order underlying this appeal was prompted, in large part, by SBA's distribution of a booklet entitled What You Should Know About Asbestos in Buildings ("the SBA booklet"). The booklet, which was mailed by SBA to school officials, state and federal officials and building owners,*fn8 presents the SBA's view on the asbestos-in-buildings (including school buildings) issue and summarizes scientific evidence supporting the SBA's position. After identifying the SBA on the first page as "an association of former manufacturers of asbestos-containing products," the booklet goes on to state SBA's view that the presence of asbestos in buildings rarely poses a health hazard, that asbestos removal often is not an appropriate response and may increase risks, that alternatives to removal should be seriously considered, and that expert assistance should be sought by building owners. The SBA booklet does not mention this or any other litigation.
Of the 45,000 copies of the SBA booklets printed in 1984, approximately 70 % (over 31,000 copies) were sent to school officials. Jt.App. at 295. The booklet was revised in 1986, and approximately 1,800 of the 9,000 copies of this revised booklet were ...