Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

In re G-I Holdings

May 13, 2003

IN RE: G-I HOLDINGS, INC., ET AL. (F/K/A GAF CORP.) DEBTORS.
OFFICIAL COMMITTEE OF ASBESTOS CLAIMANTS, PETITIONER/MOVANT,
v.
G-I HOLDINGS, INC., RESPONDENT.
G-I HOLDINGS, INC. F/K/A GAF CORPORATION AND BUILDING MATERIALS CORPORATION OF AMERICA, PLAINTIFFS,
v.
RUDDLES A. BENNETT, JR., ET AL., DEFENDANTS.
LEGAL REPRESENTATIVE OF PRESENT & FUTURE HOLDERS OF ASBESTOS-RELATED DEMANDS, PETITIONER/MOVANT
v.
G-I HOLDINGS, INC., RESPONDENT.



Bankr. Case Nos. 01-30135 (RG) 01-38790 (RG) (Jointly Administered)

The opinion of the court was delivered by: Bassler, District Judge

OPINION

This Opinion involves three separate motions to withdraw the reference to the Bankruptcy Court. Each motion was assigned a civil proceeding docket number.

In Civil Action 02-3626, Petitioners Ruddles A. Bennett, Jr. et al ("Individual Defendants") move for withdrawal of reference to the Bankruptcy Court of the adversary proceeding regarding the issue of the successor liability of Building Materials Corporation of America ("BMCA") for the asbestos torts of GAF Corporation ("GAF Co.") (the "Adversary Proceeding").

In Civil Action 02-2735, Petitioners The Official Committee of Asbestos Claimants ("Committee") move for withdrawal of reference to the Bankruptcy Court of the estimation proceedings (the "Estimation Proceeding") in the ongoing chapter 11 bankruptcy case of G-I Holdings, Inc. ("G-I Holdings") currently being administered by the United States Bankruptcy Court for the District of New Jersey (the "Bankruptcy Court"). In re G-I Holdings, Inc., 01-30135 (RG).

In Civil Action 02-3971, Petitioner The Legal Representative of Future Asbestos Claimants moves for withdrawal of reference to the Bankruptcy Court of the estimation proceeding and for withdrawal of G-I Holdings, Inc.'s motion to set a bar date for filing of asbestos claims (the "Bar Date Motion").

This Court now withdraws the reference to the Bankruptcy Court of the Adversary Proceeding regarding the successor liability of BMCA and denies the request to withdraw the reference of the Estimation Proceedings and Bar Date Motions.

I. BACKGROUND

A. General History

G-I Holdings f/k/a GAF Co. ("Debtor") filed for chapter 11 bankruptcy on January 5, 2001, and continues to operate as a debtor in possession. *fn1 GAF Co. was a building materials company that produced asbestos products. Debtor's affiliate, ACI also commenced a chapter 11 case, and the two cases are being administered jointly. *fn2 Debtor owns substantially all the stock in Building Materials Co. of America ("BMCA") d/b/a GAF Materials. BMCA, which is not in bankruptcy, is a subsidiary of Debtor. BMCA was formed to own distinct assets and operations that never used asbestos. Through a series of internal restructuring transactions, BMCA purchased the operating assets of GAF Co. and a company, GAF BMC, was created, which contractually retained all liability for future asbestos-related liabilities and agreed to indemnify and defend BMCA against any claims. (Tr. 33:12-17). GAF BMC is a wholly owned subsidiary of G-I Holdings, Inc. Both GAF BMC and G-I Holdings, Inc. continued to be available to creditors to satisfy asbestos claims from the companies' prior operations. In fact, for seven years, GAF Co. and G-I Holdings, Inc. paid over $750 million to asbestos plaintiffs. No asbestos claims were filed against BMCA until G-I Holdings, Inc. was in danger of filing for bankruptcy. Indeed, the Personal Injury Tort and Wrongful Death ("PITWD") claims brought against G-I Holdings, Inc. were the main force which pushed Debtor to seek chapter 11 protection. After suing only GAF BMC and G-I Holdings, Inc. for years, claimants began naming BMCA as a defendant according to theories of successor liability and alter ego liability.

Shortly after G-I Holdings, Inc. filed for chapter 11 bankruptcy protection, on January 18, 2001, the United States trustee appointed The Official Committee of Asbestos Claimants (the "Committee"), a statutory committee of asbestos claimants. On October 10, 2001, upon Debtor's motion, C. Judson Hamlin was appointed by the Bankruptcy Court to serve as the Legal Representative within the meaning of Bankruptcy Code § 524(b) for present and future claimants.

B. Procedural History:

For purposes of clarity, the Court will separately outline the procedural history of each motion.

1. G-I Holdings, Inc. v. Ruddles et al, 02-CV-03626

On February 7, 2001 Debtor filed an adversary proceeding in the Bankruptcy Court seeking declaratory relief against seven asbestos claimants who sued Debtor and BMCA for PITWD claims. Although Debtor originally sought to certify a class of asbestos claimants similarly situated to the Individual Defendants, it subsequently decided not to pursue class certification. Debtor hopes to receive a favorable declaratory judgment in the adversary proceeding, insulating BMCA from liability for GAF Co.'s asbestos torts.

The Committee filed an application to intervene in the adversary proceeding and on November 9, 2001, the Court allowed the Committee to intervene as a defendant. The Committee filed an Answer and Counterclaim setting forth arguments for its contention that BMCA bears responsibility for GAF Co.'s asbestos torts. Debtor and BMCA filed their Answer to the Committee's Counterclaims on or about November 29, 2001. On May 3, 2002, Debtor and BMCA filed for summary judgment in the Bankruptcy Court seeking a dispositive ruling on both counts of the Complaint in the adversary proceeding. Debtor's summary judgment motion is still pending in the Bankruptcy Court. On July 1, 2002 the Individual Defendants filed a motion to withdraw the reference of the adversary proceeding regarding the issue of successor liability to this Court. *fn3 (This motion will be referred to as the "Adversary Proceeding").

2. G-I Holdings, Inc. v. Official Committee of AsbestosClaimants, 02-CV-02735

On May 23, 2002, the Committee filed a motion for partial withdrawal of reference as to Debtor's application for estimation of claims under 11 U.S.C. § 502(c). On June 19, 2002, Debtor filed its Estimation Motion. On July 19, 2002, Debtor filed its objection to the Committee's withdrawal motion, and the Committee filed its reply on August 7, 2002. On July 15, 2002, the Committee filed a motion to stay proceedings in the Bankruptcy Court. (This motion will be referred to as the "Estimation Proceeding").

3. Legal Representative v. G-I Holdings, Inc., 02-CV-03971

On August 9, 2002, the Legal Representative filed its own motion to withdraw the reference of Debtor's application for estimation, and in addition requested withdrawal of Debtor's motion to fix a final date for filing proofs of claim. ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.