Schmoll v. ACandS, Inc.
United States District Court for the District of Oregon
703 F. Supp. 868 (1988)
- Written by Lou Gambino, JD
Facts
Raymark Industries Inc. (defendant) was the manufacturer of various products that contained asbestos. Raymark Industries was a successful corporation, but by 1988 Raymark Industries had been sued in over 68,000 personal-injury cases, with approximately 1,000 additional cases being brought each month, in each case related to asbestos liability. These lawsuits resulted in continuously burdensome asbestos liabilities. However, not all of Raymark Industries’ products and business lines involved asbestos liability. Raymark Industries implemented a complex corporate reorganization plan to segregate its non-asbestos business from the asbestos-related business. Between 1982 and 1986, through a series of new entity formations and related transactions, the corporate reorganization resulted in Raytech Corporation (defendant) owning all of the stock of Raymark Corporation, which owned all of the stock of Raymark Industries. Raytech’s stock was owned by the former owners of Raymark Industries. In 1987, Raytech purchased Raymark Industries’ two most profitable business assets for approximately $85 million, the majority of which was paid for with unsecured notes. Neither business asset had ever been named in an asbestos claim. By 1988, Raymark Industries had approximately $33 billion in pending asbestos claims. In 1988, Raytech then sold Raymark Corporation, which included Raymark Industries, to an unrelated entity named Asbestos Litigation Management (ALM) for a $1 million purchase price that was nearly entirely paid for in unsecured notes. ALM was in the business of providing litigation services to companies involved in asbestos litigation. As a result of the transactions, the former shareholders of Raymark Industries became the owners of Raytech, which owned the lucrative and non-asbestos assets, and third-party ALM owned Raymark Industries, which carried the asbestos-related operations and asbestos liabilities. Raymond Schmoll (plaintiff) brought a products-liability claim against Raymark Industries and Raytech and alleged that Raytech had successor liability for Raymark Industries’ asbestos products.
Rule of Law
Issue
Holding and Reasoning (Panner, J.)
What to do next…
Here's why 832,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 46,500 briefs, keyed to 994 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.
