his side and showed the filing clerk her badge so that the file could be
removed from the clerk's view. Aguilar also requested a document log book
for a certain time period, which the clerk gave her.
Aguilar and the paralegal took the file, the logbook, and the documents
to a space near the copy machine. Aguilar stamped the amended complaint
with the court's Filed Stamp to reflect falsely that it had been filed at
an earlier date, before the statute of limitations ran on the newly added
claims. Aguilar then added a false entry to the court's log book. The
entry Aguilar placed in the log book falsely indicated that the amended
complaint had been filed on the false filing date. At Aguilar's
instruction, the paralegal then took the case file to the copy machine,
copied a document in it (so as to suggest that was the reason he had
requested it) and then placed the falsely stamped pleading in the case
file. The log book and case file were then returned to the filing clerk.
This was not an isolated incident. On several other occasions, the
paralegal was instructed by Weitz & Luxenberg attorney Ochigrassi or Weitz
& Luxenberg paralegal Ostracher to take blue-backed documents to Aguilar
so that false Filed Stamps could be affixed on them. Once Aguilar took
the paralegal upstairs at the courthouse at 60 Centre Street and made him
wait on a bench. She then took the documents into another room and
brought them back, all with back-dated Filed Stamps newly affixed. On
another occasion, they met at the court's rotunda on the first floor. At
that time, Aguilar simply ducked behind a column and quickly stamped the
documents with the earlier, but false, filing dates. On yet another
occasion, Aguilar met the paralegal outside the side entrance to 60
Centre Street to effectuate the falsification of filing stamps on case
documents generated by Weitz & Luxenberg. On every occasion, Aguilar took
steps to ensure that her conduct was not being observed by others.
Under Rule 3025 of New York's Civil Practice Law & Rules, amended
complaints must be served on each party to the action, including each
named defendant, and each named defendant must serve and file a response
thereto. Weitz & Luxenberg's filing of fraudulently time-barred claims
increased the litigation costs for all defendants in those cases.
The Producer Agreement
Prior to December 17, 1999, GAF had a valid, written contract with CCR
known as the Producer Agreement Concerning Center for Claims Resolution
(the "Producer Agreement"). The express purpose of the Producer Agreement
was to "provide for the administration, defense, payment, and disposition
of asbestos related claims" for the benefit of its participating
members. Under the terms of the Producer Agreement, CCR could only
terminate its contract with GAF under certain conditions and subject to
certain restrictions enumerated therein.
Pursuant to the terms of the Producer Agreement, GAF designated CCR as
its sole agent to administer and arrange on its behalf for the
evaluation, settlement, payment or defense of all asbestos-related claims
against it. In this capacity, CCR investigated claims, tried cases, and
negotiated settlements on behalf of all of its members, thereby
substantially reducing GAF's transaction costs in the asbestos claim
As lawyers who routinely negotiated such settlements with CCR on behalf
of their asbestos liability clients, Defendants were aware of GAF's
contract with CCR and the benefits GAF derived from the contract. As
alleged in the FAC, Defendants intentionally caused CCR to expel
GAF in breach of the Producer Agreement, thereby deliberately and
wrongfully interfering with GAF's ongoing economic and contractual
relationship with CCR.
By causing CCR to expel GAF, Defendants maliciously and without
justification carried out the extortionate threats made in Defendants'
campaign to coerce GAF to cease its efforts to lobby Congress for passage
of the Fairness in Asbestos Claims Act, depriving GAF of the ongoing
benefits of CCR membership and causing GAF special damages and other
From January 17, 2000 to January 5, 2001, GAF was forced to establish
and fund a free-standing network of defense counsel and to litigate
asbestos bodily injury cases on its own. These expenses exceed the sum of
Counts V and VI
These counts allege mail and wire fraud in association with a number of
claimants. In the first complaint, Holdings had not identified the cases
in which the claimants were plaintiffs. The Complaint now asserts that
the claimants were plaintiffs in five cases: Beverly Jean Brown v. Keene
Corp., No. 93-10952 (98th Judicial District Court of Travis Co., TX);
Jimmy Leon Smathers v. Owens-Corning Fiberglas Corp., No. 95-06329 (126th
Judicial District Court of Travis Co., TX); Kenneth Shirley v.
Owens-Corning Fiberglas Corp., No. 95-10495 (250th Judicial District
Court of Travis Co, TX); C.J. English v. Owens-Corning Fiberglas Corp.,
No. 96-06308 (134th Judicial District Court of Dallas Co., TX); Edwin Ray
McCray v. Owens-Corning Fiberglas Corp., No. 95-3109 (28th Judicial
District Court of Neuces Co., TX). Further, Holdings alleges that Baron &
Budd submitted false and fraudulent affidavits, and that GAF justifiably
and reasonably relied upon these false and fraudulent affidavits to its
detriment in the amount of several hundred thousand dollars.
Holdings has amended its pleading to allege specifically that
Defendants intended to prevent GAF; Samuel J. Heyman, the former chairman
and chief executive officer of GAF ("Heyman"); and other members of the
Coalition for Asbestos Resolution from testifying before Congress in
support of FACA, or to cause their testimony to be less favorable to
Holdings has included specific examples of attempts by Defendants to
intimidate, threaten, or corruptly persuade former asbestos producers
with the intent of preventing their testimony before Congress and causing
them to withhold their testimony from Congress. With respect to GAF and
Heyman, Holdings now alleges that Defendants had actual knowledge that
Heyman was expected to be a witness in Congressional hearings on FACA.
The conduct alleged above was undertaken with the specific intent of
causing Heyman not to appear or, if he did appear, to moderate his
testimony to be less unfavorable to the Defendants. Further, with respect
to the other former asbestos producers, Defendants actually and correctly
believed that some of their number would be called (or would voluntarily
appear) as witnesses in those hearings. The conduct alleged above was
undertaken with the specific intent of causing these individuals not to
appear or, if they did appear, to moderate their testimony to be less
unfavorable to the Defendants.
The Futures Agreement
Holdings now alleges that Ness Motley, Weitz & Luxenberg and the
Affiliated Law Firms used the Futures Agreements and their explicit and
implicit (but false and fraudulent) promises to perform thereunder to
induce CCR's agreement to settle
some 50,000 pending asbestos cases for approximately $750 million.
I. Motion To Dismiss
A. Standard for a Motion to Dismiss
In reviewing a motion to dismiss under Rule 12(b)(6), courts must
"accept as true the factual allegations of the complaint, and draw all
inferences in favor of the pleader." Mills v. Polar Molecular Corp.,
12 F.3d 1170, 1174 (2d Cir. 1993) (citing IUE AFL-CIO Pension Fund v.
Herrmann, 9 F.3d 1049, 1052 (2d Cir. 1993)). Review must be limited to
the complaint and documents attached or incorporated by reference
thereto. Kramer v. Time Warner, Inc., 937 F.2d 767, 773 (2d Cir. 1991).
In this context, the Second Circuit has held that a complaint is deemed
to "include . . . documents that the plaintiffs either possessed or knew
about and upon which they relied in bringing the suit." Rothman v.
Gregor, 220 F.3d 81, 88 (2d Cir. 2000). However, "legal conclusions,
deductions, or opinions couched as factual allegations are not given a
presumption of truthfulness." L'Eureopeenne de Bangue v. La Republica de
Venezuela, 700 F. Supp. 114, 122 (S.D.N.Y. 1988). "The issue is not
whether a plaintiff will ultimately prevail but whether the claimant is
entitled to offer evidence to support the claims." Villager Pond, Inc.
v. Town of Darien, 56 F.3d 375, 378 (2d Cir. 1995) (quoting Schener v.
Rhodes, 416 U.S. 232, 236 (1974)). A complaint may only be dismissed when
"it appears beyond doubt that the plaintiff can prove no set of facts in
support of his claim which would entitled him to relief." Conley v.
Gibson, 355 U.S. 41, 45-46 (1957). See also Allen v.
WestPoint-Pepperell, Inc., 945 F.2d 40, 44 (2d Cir. 1991); Berheim v.
Litt, 79 F.3d 318, 321 (2d Cir. 1996)
B. Count II: Tortious Interference with Economic Advantage May Be
Pleaded in the Alternative
In Count II of its First Amended Complaint, Holdings pled claims for
both tortious interference with contract and tortious interference with
prospective economic advantage, based on the existence of an alleged
contractual relationship between GAF and the CCR. It was held that
Holdings had adequately pleaded a claim for tortious interference with
prospective contractual relations. G-I Holdings, 179 F. Supp.2d at
253-54. However, the claim for tortious interference with contract was
dismissed as Holdings failed to satisfy the requirement that it plead the
existence of a "valid, existing contract" between itself and the CCR.
Id. at 252-53.
In the Complaint, Holdings has restated its claim for tortious
interference with prospective economic advantage without change (Count
II) and repleaded its previously dismissed claim for tortious
interference with contract (Count III). With respect to the latter
claim, Holdings no longer relies on the ill-defined "contractual
relationship" referred to in its prior pleading, but identifies the
specific contract with which the Defendants purportedly interfered, the
Producer Agreement, by which GAF designated CCR to act as its agent in
the "evaluation, settlement, payment or defense of all asbestos-related
claims." Compl. ¶ 188. Defendants do not contest that this allegation
cures the defect identified in the earlier opinion.
However, the Defendants argue that by sufficiently pleading Count III,
Holdings has undermined its claim for interference with prospective
economic advantage. To Defendants' argument that Count II is
duplicative of Count III,*fn2 Holdings states that Count II is merely
a claim pleaded in the alternative as permitted under the Federal Rules.
Rule 8 of the Federal Rules of Civil Procedure states, in pertinent
A party may set forth two or more statements of a
claim or defense alternatively or hypothetically,
either in one count or defense or in separate counts
or defenses. When two or more statements are made in
the alternative and one of them if made independently
would be sufficient, the pleading is not made
insufficient by the insufficiency of one or more of
the alternative statements. A party may also state as
many separate claims or defenses as the party has
regardless of consistency and whether based on legal,
equitable, or maritime grounds.
Fed. R. Civ. P. 8(e)(2); see also Aiena v. Olsen, 69 F. Supp.2d 521,
531 (S.D.N.Y. 1999) (permitting alternative pleading for ERISA claim made
in the alternative to state law claims because plaintiff not bound by
alternative allegations at motion to dismiss stage) New York law is also
in accord. CPLR § 3014; see also Raglan Realty Corp. v. Tudor Hotel
Corp., 149 A.D.2d 373, 374, 540 N.Y.S.2d 240, 241 (1St Dep't 1989)
(reversing dismissal in action for specific performance and fraud because
plaintiff was allowed to plead alternative theories) (citing Mitchell v.
New York Hosp., 61 N.Y.2d 208, 218 (1984)).