RICHMOND -- The 4th U.S. Circuit Court of Appeals says a complaint filed by 14 women contesting the new Dalkon Shield claimants' committee created by a U.S. trustee was neither timely nor valid.
"Despite their adamant opposition to the new claimants' committee, appellants did not file their motion until seven weeks after the appointment of the new committee," a three-judge panel of the appeals court said in rejecting the claim last Friday. "Obviously, the initial weeks of a creditors' committee's existence are crucial."
The court noted that the appellants offered no explanation for their delay.
The panel also rejected as unfounded the appellants' contentions regarding alleged improprieties in the selection process and claims that they were denied adequate discovery by a lower court because it did not allow them to take depositions from the U.S. trustee and the lawyers for the new claimants' committee.
"These arguments are meritless," the appeals court wrote. "The district court repeatedly asked appellants' counsel to provide a reason for why it should be allowed to depose a U.S. trustee and counsel for the claimants' committee.
"Appellants never adequately explained why this information was necessary, nor did appellants ever suggest any facts which could be developed through these depositions."
The lower court presented the appellants with opportunities to delay the hearing until they could take depositions from the new committee members, the appeals court wrote, but the lawyer for the appellants did not avail themselves of the opportunities.
The lawyers argued that the appellants did not take depositions from all committee members because it would have been prohibitively costly to pay for the depositions, expenses and fees incurred by the lawyers for the committee.
"This argument is absurd," the appeals court rejoined. "Appellants' counsel are protesting because the court refused to require the claimants' committee and, ultimately, A.H. Robins, to finance their fishing expedition."
The U.S. trustee, William C. White, initially appointed the pre-existing 38-member ad hoc claimants' committee as the official claimants committee to represent the interest of unsecured creditors who alleged they were injured by the Dalkon Shield, an intrauterine contraceptive device marketed by the A.H. Robins Co. of Richmond in the early 1970s.
From the beginning, the appeals court said, it was apparent that this committee, composed primarily of lawyers for a variety of clients with differing interests, was unwieldy and had difficulty making decisions.
In February 1986, the appeals panel wrote, the problems became acute. The committee and its bankruptcy counsel, Murray Drabkin, had a disagreement, and Drabkin sought to resign.
Meanwhile, White filed a motion to dissolve the committee. The U.S. District Court in Richmond dissolved the committee but denied Drabkin's motion to withdraw as counsel, requiring Drabkin to stay on until a newly appointed committee could retain counsel.
Ultimately, a new committee was appointed consisting of three Dalkon Shield claimants, a San Francisco lawyer who represents numerous claimants and a Fargo, N.D., lawyer who represents about 380 claimants.
Drabkin ultimately was retained as counsel.endqua