This American Tort Reform ranking adds to the multiple calls by SC AG, the Governor, and 1st Circuit Solicitor David Pascoe for judicial reform in S.C.
The American Tort Reform Foundation names South Carolina’s asbestos litigation environment the top 5 Judicial Hellhole® in its annual 2023 report.
It highlights the ongoing concerns surrounding South Carolina’s asbestos docket since it landed on the Judicial Hellholes® list in 2020.
There are biases against corporate defendants, unwarranted sanctions, low evidentiary requirements, the tendency for jury verdicts to be modified to favor plaintiffs, unfair trials, and severe verdicts in asbestos litigation in the Palmetto State, according to ATRF. Many of these controversies have been overseen by retired South Carolina Supreme Court Chief Justice Jean Hoefer Toal who was appointed in 2017 to oversee asbestos litigation.
“South Carolina’s asbestos docket has become a hotbed of claims, raising serious questions about the fairness and reliability of the legal process,” said Tiger Joyce, president of the American Tort Reform Association.
Pending asbestos cases, such as Edwards v. Scapa Waycross, Inc. and Jolly v. General Electric Co., give the South Carolina Supreme Court an opportunity to restore balance to the state’s asbestos law.
As a result of lawsuit abuse and excessive tort costs, South Carolinians pay an annual $738 “tort tax,” which results in nearly 36,000 jobs lost annually.
“The abuse within South Carolina’s asbestos litigation system is a betrayal of justice, where opportunistic legal practices are more important than fairness,” Joyce said. The economic consequences of asbestos exposure, many of which are unrelated, lead to job losses and closures for local businesses.
Asbestos cases in South Carolina are also seeing more high-dollar, “nuclear” verdicts, such as a $29.1 million verdict against Whittaker Clark & Daniels. Nuclear verdicts exceed $10 million.
Toal appointed a receiver to “take over its operations.”
Toal was approved and qualified to the SC Supreme Court by the Judicial Merit Selection Committee which Horry S.C. Senator Luke Rankin is a member. Rankin also heads the S.C. Judiciary. It was Alex Murdaugh who helped get Rankin the head position on the Senate Judiciary Committee.
There is a palpable erosion of trust in the legal system, according to Joyce. “Manipulating the system for financial gain undermines citizens’ confidence in the fairness and integrity of the legal system.”
The state’s No. 5 ranking in the Judicial Hellholes® report should serve as a wake-up call. Reform is crucial for protecting businesses, restoring faith in the legal system, and ensuring justice for those impacted directly.
The comprehensive report on asbestos litigation in South Carolina can be found at JudicialHellholes.org.
South Carolina’s asbestos docket will be presided over by retired South Carolina Supreme Court Chief Justice Jean Hoefer Toal. Toal has a record of ruling in favor of plaintiffs, including imposing severe and unwarranted sanctions.
Judge Toal has imposed unfair sanctions in asbestos cases, overturned or substantially modified jury verdicts she disagreed with, and referred to insurance carriers as their “alter egos.”.
The Zurich American Insurance Company asked the South Carolina Supreme Court to recuse Judge Toal from its litigation in 2020, claiming that “factually unsubstantiated and procedurally irregular findings raise questions about Chief Justice Toal’s impartiality and create a risk of actual bias.”
Several of Judge Toal’s expansive rulings have been affirmed by the South Carolina Court of Appeals, contributing to the state’s reputation as an asbestos outlier.
It is a good opportunity for the Palmetto State’s high court to return some elements of asbestos jurisprudence to the mainstream through Edwards v. Scapa Waycross, Inc. and Jolly v. General Electric Co.
OUT-OF-STATE LAW FIRMS DESIRE SC COURTS
There has been a dramatic increase in asbestos filings in South Carolina since 2018, especially due to the activity of out-of-state plaintiffs’ firms like the Law Offices of Dean Omar Branham Shirley, LLP, headquartered in Dallas, Texas. Those familiar with South Carolina asbestos litigation say that Judge Toal typically sides with the Dean Omar firm and its local counsel, Kassel McVey Attorneys at Law.
After news broke in 2021 that a paralegal signed and filed Dean’s out-of-state-attorney applications without Dean’s knowledge, Jessica Dean, the lead partner of the Dean Omar firm, withdrew from several South Carolina cases. A Minnesota judge sanctioned Dean’s firm $78,000 in defense fees and costs after a plaintiff’s witness flouted a court order and denied Dean’s requests to participate in cases in those states.
The Dean Omar firm’s portion of total South Carolina filings has decreased, as more firms are joining in. In recent years, multiple plaintiff firms from various locations such as New York City and Florida, St. Louis, Houston, Tampa, and southern Illinois have filed asbestos cases in South Carolina, including Meirowitz & Wasserberg, LLP, Maune Raichle Hartley French & Mudd, Bailey Cowan Heckaman PLLC, Shrader & Associates, LLP, Vinson Law Office, Flint Cooper LLC and Simmons Hanly Conroy.
Defendants named in large numbers
With the roughly twofold increase in filings from 2018 to 2023, filing behaviors have changed. Between 2018 and 2019, the number of defendants named in South Carolina cases hovered around 50-60, then skyrocketed. As of 2020, South Carolina asbestos lawsuits named over 105 defendants on average. As a result, 70 companies are expected to be named in asbestos lawsuits in 2022, much higher than the national average.
A WEAK CAUSE STANDARD WAS APPLIED
The South Carolina Court of Appeals dealt significant blows to the state’s asbestos litigation environment in recent years. In April 2023, Glenn v. 3M Company, in August 2022, Edwards v. Scapa Waycross, Inc., and in September 2021, Jolly v. General Electric Co. affirmed verdicts based on a controversial “cumulative dose” theory of causation favored by plaintiffs’ experts. This theory suggests that every exposure to asbestos contributes to the development of asbestos-related disease, making it easier for plaintiffs to prove causation. It stems from the discredited “each and every exposure” theory, which holds that any level of exposure to asbestos is a substantial factor in contracting related diseases. The U.S. Court of Appeals for the Seventh Circuit has denounced both theories as incompatible with the substantial factor standard required for causation. Despite this, the South Carolina Court of Appeals considers cumulative dose testimony necessary background information for jurors’ understanding of medical causation.
The South Carolina appellate court’s holdings stand in stark contrast to jurisdictions such as New York, which affirmed in Nemeth v. As Brenntag North America explained in 2022, plaintiffs must provide expert opinions that establish a scientific expression of dose with sufficient, case-specific, specificity to establish that a particular defendant’s product caused their injuries. “Conclusory or qualitative statements are not sufficient.”
As part of ATRA’s amicus brief, filed with a number of allies in Edwards, the South Carolina Supreme Court granted review to clarify the state’s causation standard.
In distinguishing between the widely rejected every exposure theory and Plaintiff’s cumulative exposure testimony, the Court of Appeals made a mistake. There is no difference between the foundation or application of the two theories—neither excludes minor workplace or bystander exposures. Even the most limited exposure can be turned into a legally “substantial” exposure by lumping it under the category of “cumulative” by plaintiff’s experts.
According to South Carolina and many other jurisdictions, “every exposure” and “cumulative exposure” theories are in conflict with substantial factor causation standards. As with many other courts, the Court should reject plaintiff experts’ attempts to repackage the rejected every exposure approach as “cumulative exposure.”
SANCTIONS THAT ARE SEVERE AND UNWARNED
Asbestos attorneys say Judge Toal’s discovery orders are more frequent, broader, and severe than any other court jurisdiction. According to one defense firm, “Justice Toal has ordered monetary sanctions, additurs, and the strike of pleadings on several occasions.”
Asbestos sanctions are rare outside of South Carolina, and lawyers familiar with asbestos litigation in South Carolina say sanctions motions were not filed in the seven years before Judge Toal took over the asbestos docket from Judge D. Garrison Hill.
When businesses are required to submit excessive, irrelevant, and often impossible to produce documents in conjunction with corporate defendant depositions, the Dean Omar firm routinely demands overbroad discovery. In a 2020 sample of five cases, Dean Omar filed 22 motions for discovery-related sanctions, including eight in one case, when defendants failed to comply or Dean Omar did not like the answers at the deposition.
In three cases involving bankrupt defendant Covil Corp., Judge Toal issued what is known as a “doomsday sanction,” striking all of the insulation company’s pleadings. In its appeal, Covil described the sanctions as a “hydrogen bomb” and claimed the judge abused her discretion in imposing such a punishment that was disproportionate to the alleged litigation misconduct, which the company denied.
The defendants hoped the South Carolina Supreme Court would curb Judge Toal’s extraordinary habit of imposing sanctions in asbestos cases when it agreed to review “the largest monetary sanction ever reported in South Carolina jurisprudence—over $300,000.” In Howe v. Air & Liquid Systems Co., a jury returned a defense verdict.
Cleaver-Brooks, Inc. was sanctioned for its production of documents during trial that refuted a surprise theory sprung by the plaintiff’s attorneys that turned out to be inaccurate.
Cleaver-Brooks argued that the documents “were never the subject of any discovery request, and they were irrelevant to the case prior to the Plaintiff’s surprise in-court questioning.” She described Judge Toal’s sanction as an “historic injustice.”
Despite winning the case at trial, Cleaver-Brooks has been slapped with the largest monetary discovery sanction in this state’s history-over $300,000-without any explanation from a court as to what it did wrong or what it could have done better.
In Howe, the South Carolina Court of Appeals affirmed the trial court’s order without explanation or even oral argument.
In June 2023, the South Carolina Supreme Court dismissed the appeal after the parties agreed to end the fully briefed dispute.
In 2023, the South Carolina appellate court affirmed another post-trial sanctions order.
In August 2022, the South Carolina Supreme Court ruled in Kovach v. Whitley, a non-asbestos case, that Judge Toal was wrong to impose a sanction on a plaintiff for filing a lawsuit that contradicted statements made in a previous criminal case. The Court determined that there was no justification for the sanction and mentioned numerous possible explanations for why it may have been an “abuse of discretion.” However, the Court did not address the specific amount of the sanction as the previous matter resolved the case.
American Tort Reform: JURY AWARDS ADDED TO DEFENSE VERDICT
She has overturned or modified jury verdicts she disagrees with in the past.
For example, in a 2018 case, after Covil Corp. said it could not produce old documents because the papers had been destroyed in a fire, the court found that spoliation occurred and sanctioned the company with an adverse instruction telling the jurors to presume the company exposed the plaintiff to asbestos at work.
This was done even though the plaintiff did not identify Covil in his deposition, and Daniel Construction’s representative testified that his company did not have any records indicating that Covil supplied insulation for the plaintiff’s workplace and was unable to identify Covil as a contractor or supplier.
After receiving the judge’s instruction and hearing all testimony, the jury ultimately reached a defense verdict. However, three months later, Judge Toal utilized South Carolina’s “thirteenth juror” doctrine to overturn the decision. This doctrine, as clarified by the South Carolina Supreme Court, effectively functions as a mistrial in which neither the judge nor jury are required to provide reasons for their ruling. In Crawford, Judge Toal exercised this extraordinary authority as the “thirteenth juror,” granting the plaintiff another opportunity to pursue a favorable outcome in a case that was previously lost.
When the juries did not award the plaintiffs enough money, Judge Toal increased jury awards at least twice.
In Edwards v. Scapa Waycross, Inc., Judge Toal increased a jury’s survival damages award to $1 million. The judge also refused to reallocate plaintiff’s internal apportionment of settlement proceeds to be more reasonable under the facts. The South Carolina Court of Appeals affirmed both issues.
In the case of Jolly v. General Electric Co., Judge Toal significantly augmented the compensation for a worker and his wife by an additional $1.6 million. The jury had initially granted $200,000 to the worker for actual damages and $100,000 to his wife for loss of consortium. However, Judge Toal deemed it appropriate to increase the worker’s award to $1.58 million and his wife’s award to $290,000. Furthermore, she rejected the idea of reducing the amount based on previous settlements that were designated by the plaintiff’s counsel for future losses. The South Carolina Court of Appeals upheld these decisions, stating that they are highly respectful of the circuit court and will not overturn its rulings unless there is clearly an abuse of discretion present.
The combined effect of the trial court’s additur and setoff rulings in Jolly is that, unless reversed by the South Carolina Supreme Court, the plaintiffs will recover more than $3 million ($2.27 million in settlements and $823,333.33 from Fisher and Crosby after partial setoffs), plus interest significantly above the prime rate, for claims that the jury determined were worth only $300,000.
ATRA filed amicus briefs in both the Edwards and Jolly appeals. ATRA stated in its Jolly amicus brief that “[t]he trial court and Court of Appeals rulings give the trial court absolute discretion to replace a jury’s damage determination with the trial court’s subjective view of what should have been awarded.”
Outside of South Carolina, additur is virtually nonexistent. In Mealey’s Asbestos Litigation Reporter database, which regularly reports on asbestos lawsuit rulings nationwide, a Lexis+ search on the term “additur” returns only two examples of courts outside of South Carolina awarding additur for asbestos cases in over 30 years. The state of South Carolina, on the other hand, boasts two recent examples: [Jolly] and Edwards….
Moreover, additur is rarely used in non-asbestos cases in South Carolina and nationally.
American Tort Reform: Verdicts on nuclear weapons
A woman won a $29.1 million verdict against Whittaker Clark & Daniels in March 2023, alleging asbestos exposure caused her mesothelioma. As a result of the verdict, the company filed for bankruptcy, and Judge Toal appointed a receiver to take over its operations.
In 2021, Judge Toal presided over a case in which a worker, Robert Weist, was awarded $32 million after his wife passed away from mesothelioma. Allegedly, she was second-handly exposed to asbestos through Weist’s work at the Metal Masters turkey processing facility owned by Kraft Heinz in the 1980s. Along with exposure from her husband’s clothing, she also encountered asbestos through her father and uncle who worked as insulators in other places. The jury ordered Kraft Heinz and Metal Masters to pay $11 million for survival damages, $10 million for wrongful death damages, and $1 million for loss of consortium. Additionally, the jury imposed an extra $10 million in punitive damages against Kraft Heinz.
In Glenn v. 3M Co., the South Carolina Court of Appeals affirmed a $5.125 million award in 2023.
DEFUNCT ENTITIES’ “ALTER EGO” INSURERS
Judge Toal has expanded the asbestos docket by appointing a receiver over various entity defendants, including those who supplied, installed, and manufactured asbestos products. She has implemented a practice of designating insurers as the “alter ego” of defunct entities in order to subject them to lawsuits alongside other asbestos defendants. According to one defense firm, this approach has been consistently utilized by Justice Toal in appointing receivers for defunct companies and ruling that their insurance policies can be used to cover claims in South Carolina. This technique has led to at least twenty-one receiverships being established in the circuit court, all of which have used the same receiver and receiver counsel. It should be noted that these appointments are made without any substantive hearing and have extended to companies outside of South Carolina, including non-U.S. entities that are no longer operational.
ASBESTOS TRIALS ARE IMPROPERLY CONSOLIDATED
A motion for consolidation of two vastly dissimilar cases in which the plaintiffs claimed they contracted cancer after exposure to asbestos in talc products was granted by Judge Toal in 2020.
The plaintiff in one case died at 70 of pleural mesothelioma, a cancer of the lungs caused by asbestos exposure. The plaintiff testified before his death that he also worked with asbestos at a factory that manufactured asbestos-containing products. Johnson & Johnson argued the man’s cancer was more likely to have been caused by his occupational exposure.
The other case involved a 20-year-old woman who was diagnosed at the age of 14 with peritoneal mesothelioma, which affects the lining of the abdomen and is less strongly associated with occupational asbestos. J&J cites studies that show approximately 95-99% of mesothelioma in women is caused by naturally occurring genetic errors during cell replication. After surgery and chemotherapy, the woman was cancer-free.
In its appeal of the consolidation order, J&J pointed out that South Carolina juries have heard three asbestos cases against the company and had yet to return a plaintiff’s verdict. There was a defense verdict in one case, and two hung juries in two others. The company claimed plaintiffs wanted to combine the above two cases to “tilt the scales of the trials in their favor.”
South Carolina’s Supreme Court agreed to review Judge Toal’s consolidation order immediately, but the case was settled before the appellate court could rule.
American Tort Reform: A DOOR HAS BEEN OPENED FOR MORE LAWSUITS
In the year 2021, the South Carolina Supreme Court, in Keene v. CNA Holdings, LLC, validated a $16 million judgment for the family of a maintenance worker who passed away after prolonged exposure to asbestos at a polyester fiber facility. The company being sued had been contracted by the plant’s owner to employ all maintenance and repair staff at the site. However, the successor of the plant’s owner contended that the plaintiff was considered a statutory employee and thus subject to the state’s workers’ compensation law as his sole legal recourse.
A landmark decision by the South Carolina Supreme Court narrowed the state’s “statutory employee” doctrine, making it easier for workers to file lawsuits for workplace injuries.
If a business manager reasonably believes her workforce is not equipped to handle a certain job, or that outsourcing the work will serve the financial or other business interests of her company, and if she is not motivated by the desire to avoid the cost of insuring workers, then the business manager has legitimately restricted that work from the scope of her company’s business.
To summarize, the practitioner clarifies that if a company chooses to have work done by someone who is not an employee, they are protected from the statutory employee doctrine and can be held liable for any injuries the worker may sustain. The South Carolina Supreme Court also noted that this ruling goes against the intended purpose of the statute, as stated by Dissenting Justice George C. James, Jr., who believes there will likely be an increase in lawsuits against employers in light of this decision.
This American Tort Reform ranking adds to the calls for Judicial reform in S.C.