Pfizer, Inc. v. Law Offices of Peter G. Angelos (In re Quigley Co., Inc.)

Summarized by Robert Yan , Otterbourg P.C.
13 years 10 months ago

Citation:

Case Nos. 11-2635, 11-2767 (Decided April 10, 2012)

Tag(s):

Ruling:

The Court had jurisdiction to hear the appeal. Although the bankruptcy court order did not grant or deny relief from the automatic stay, the order was equivalent to a final order from that court on a motion for relief from the automatic stay because it resolved a dispute between the parties as to whether the automatic stay was applicable to the Angelos suits. The Court held that the bankruptcy court had jurisdiction to enjoin the Angelo suits. The Court concluded that Stern v. Marshall, 131 S. Ct. 2594 (2011), did not apply to the instant case because Stern was to be narrowly applied and the instant case concerned the stay of litigation during the bankruptcy case as opposed to the entry of a final judgment on a common law claim. Bankruptcy jurisdiction was appropriate under 28 U.S.C. § 1334. The bankruptcy court had jurisdiction over the third party non-debtor claims because the outcome of litigation of the claims could have a “conceivable effect” on Quigley’s bankruptcy estate. Here, Quigley and Pfizer were joint beneficiaries of a certain insurance trust and also shared a number of insurance policies relevant to the Angelos suits. The Court further held that the injunction, which incorporated language similar to section 524(g)(4)(A)(ii) of the Bankruptcy Code, did not bar the Angelos suits against Pfizer. The phrase “by reason of,” as used in section 524(g)(4)(A)(ii), requires that “the alleged liability of a third party for the conduct of or claims against the debtor arises, in the circumstances, as a legal consequence of one of the four relationships between the debtor and the third party enumerated in subsections (I) through (IV).” Here, Pfizer’s ownership interest in Quigley had no legal relevance to Pfizer’s alleged liability as an “apparent manufacturer” in the Angelos suits.

Procedural context:

Appeal by Pfizer Inc. (“Pfizer”) and Quigley Co., Inc. (“Quigley”) from a judgment of the United States District Court for the Southern District of New York reversing an order from the United States Bankruptcy Court for the Southern District of New York that an injunction issued in Quigley’s bankruptcy case applied to stay certain suits against Pfizer. Affirmed.

Facts:

In 2004, the bankruptcy court granted Quigley’s motion for a preliminary injunction enjoining all parties from taking any action in any and all pending or future “Asbestos Related Claims” against Pfizer during Quigley’s bankruptcy case. The preliminary injunction was later modified in 2007 to parallel the injunction contemplated in Quigley’s proposed plan of reorganization. The amended preliminary injunction contained language similar to section 524(g)(4)(A)(ii) of the Bankruptcy Code. Prior to Quigley’s bankruptcy filing, which occurred in 2004, the Law Offices of Peter G. Angelos (“Angelos”) commenced multiple suits in Pennsylvania against Pfizer on behalf of plaintiffs alleging asbestos-related injuries, with some suits seeking to hold Pfizer liable for its own conduct on an “apparent manufacturer” theory of liability recognized under Pennsylvania law. When Angelos moved for partial summary judgment against Pfizer on the issue of liability in many of those suits, Pfizer moved in bankruptcy court to enforce the amended preliminary injunction against Angelos. The bankruptcy court concluded that the amended preliminary injunction covered the liability for which Angelos sought summary judgment on. The district court reversed, finding the Angelos suits directed against Pfizer were outside the scope of the amended preliminary injunction. Pfizer and Quigley appealed.

Judge(s):

Walker, Straub, and Livingston, Circuit Judges

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