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In re School Asbestos Litigation

filed: June 6, 1995.

IN RE: SCHOOL ASBESTOS LITIGATION; SCHOOL DISTRICT OF LANCASTER; MANHEIM TOWNSHIP SCHOOL DISTRICT; LAMPETER-STRASBURG SCHOOL DISTRICT; AND NORTHEASTERN SCHOOL DISTRICT
v.
LAKE ASBESTOS OF QUEBEC, LTD.; THE CELOTEX CORPORATION; RAYMARK INDUSTRIES, INC.; UNION CARBIDE CORP.; ASBESTOSPRAY CORP.; SPRAYO-FLAKE COMPANY; NATIONAL GYPSUM CO.; SPRAYED INSULATION, INC.; ASBESTOS FIBRES INC.; DANA CORPORATION; U.S. GYPSUM; U.S. MINERAL PRODUCTS COMPANY; SPRAYON INSULATION & ACOUSTICS, INC.; SPRAYON RESEARCH CORP.; KEENE CORP.; WORBEN CO., INC.; WILKIN INSULATION COMPANY; W.R. GRACE & CO.; OWENS-CORNING FIBER-GLAS CORPORATION; STANDARD INSULATION, INC.; NORTH AMERICAN ASBESTOS CORPORATION; CASSIAR RESOURCES LTD.; BELL ASBESTOS MINES, LTD.; ASBESTOS CORPORATION LIMITED; SOUTHERN TEXTILE CORP.; OWENS-ILLINOIS, INC.; TURNER & NEWALL LIMITED; THE FLINTKOTE CO.; FIBREBOARD CORPORATION; GAF CORP.; UNIROYAL, INC., CAPE ASBESTOS; PFIZER, INC.; KAISER CEMENT CORPORATION; BES-TEX, INC.; GEORGIA-PACIFIC CORP.; KAISER GYPSUM COMPANY, BOARD OF DIRECTORS OF CITY TRUSTS, APPELLANT



On Appeal from the United States District Court For the Eastern District of Pennsylvania (No. 83-CV-00268).

Before: Becker, Scirica and Wood, Jr.,*fn* Circuit Judges.

Author: Wood

Opinion OF THE COURT

WOOD, Jr., Circuit Judge.

The Board of Directors of City Trusts [Board] appeals the district court's order finding that the Board and Girard College [College] were included in a certified class involving a nationwide class action suit against Uniroyal and numerous other defendants in regard to the presence of asbestos in public and private schools. Because the district court found the appellants were members of the class, the Board was enjoined from pursuing its own state asbestos lawsuit against Uniroyal. The district court held that the Board, as a member of the class, was bound by the Uniroyal settlement, and under the Anti-Injunction Act, 28 U.S.C. § 2283, it was necessary in aid of the court's jurisdiction to enjoin the appellant's state court action. The Board appeals.

I.

The Board was created by a Pennsylvania statute in June 1869 to act as a trustee in administering a number of estates and trusts for the benefit of the City of Philadelphia.*fn1 The estate involved here is the Estate of Stephen Girard, which came into existence in 1831. The Girard Estate is the largest estate and trust owned and administered by the Board. After making numerous gifts to various institutions and individuals, Mr. Girard devised and bequeathed his entire residuary estate to the City of Philadelphia in trust for the creation of an "orphan establishment." In furtherance of the deceased's wishes, Girard College was established as an institution for orphan children in Philadelphia. The Board acts as trustee in managing the Girard Estate and the College. The Board also manages approximately 110 other estates and trusts, which it administers according to the wishes of its benefactors.

Girard College initially admitted only white male orphans, but has since expanded its admission criteria to include all minorities and children not considered orphans in the traditional sense (only one absent parent).*fn2 The primary mission of Girard College is to act as a guardian to orphaned children by providing for their full development and nurturing needs. Pursuant to this mission, the orphans not only receive food, clothing, health care and a caring place to live, but in addition, the Board provides them with an education at the College through grade twelve. Most children live on the school grounds only through the school year, while some remain all year. Except for Girard College, the Board does not own or operate any estate or trust which requires the Board to provide educational services to children incident to its primary mission of administering estates and trusts pursuant to its statutory and fiduciary duties.

Therefore, due to the Board's unique status in reference to Girard College, many regulatory statutes do not apply, including the Pennsylvania Public School Code. The Board in the past, however, has voluntarily chosen to follow various regulatory standards to protect and benefit the orphan children. In 1988, and in compliance with the Asbestos Hazard Emergency Response Act [AHERA], 15 U.S.C. § 2641 et seq., the Board voluntarily submitted an "Asbestos Management Plan." The Board submitted the Plan on AHERA forms and listed Girard College as an "LEA."*fn3

In 1983, the first case was filed in regard to asbestos in public and private schools. In 1984, under the Federal Rules of Civil Procedure Rule 23(b)(3), the district court certified, and the Third Circuit affirmed, the following class:

All entities which own or operate in whole or in part any public educational facilities, as defined in Section 198(a)(10) of the Elementary and Secondary Education Act of 1965, 20 U.S.C. § 2854, throughout the United States; and all entities which own or operate in whole or in part any non-public, non-profit elementary or secondary educational facilities, including entities with religious affiliations, in the United States, to the extent that such non-profit entities are owned or operated by one or more non-profit corporations or associations no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual.

Pretrial Order 20. See also In re Asbestos Litigation, 104 F.R.D. 422 (E.D. Pa. 1984), aff'd, 789 F.2d 996 (3d Cir.), cert. denied, 479 U.S. 852 (1986).

In 1988, the class definition was amended and limited to exclude certain schools which were operated by the states:

The definition of the litigation class certified in this matter is limited and excludes any elementary or secondary facilities owned or operated by Ohio or Maryland or any other state as a service incidental to ...


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