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FILE NAME Insurance Industry INS DATE 1992 May 19 DOC INS079 DOCUMENT DESCRIPTION Legal - Deposition of Harvey Lewis NO 0615 SHERMAN A. SEARLS JR VS. CORNING FIBERGLAS CORPORATION ET AL ] IN THE DISTRICT COURT OF ] BRAZORIA COUNTY TEXAS ] ] NO 1934 TOMMIE L. VS. HEATHMAN ET UX ] IN THE DISTRICT COURT OF ] BRAZORIA COUNTY TEXAS CORNING FIBERGLAS ] CORPORATION ET AL ] 23RD JUDICIAL DISTRICT as2E ew ee ee we we BOOS RB SBS wenn e eZ Ke ee eZee raer eee werererewenw enroenresrsem RICHARD B. VS. IN RE CONSOLIDATED JACKSON ET UX 1 ] NO 87-37068 IN THE DISTRICT HARRIS COUNTY COURT OF AS CORNING FIBERGLAS CORPORATION ET AL ] ] 165th JUDICIAL DISTRICT GLADYS VS. LORETTA NO STEELE ET 90-20663 AL ] IN THE HARRIS DISTRICT COUNTY COURT OF TEXAS FISCHBACH ET AL & MOORE INC ] ] 55TH JUDICIAL DISTRICT ee we ae ee ee wee eT ee eH OE eee ee Ew ewe eee ew mwa enereeaawn HAZEL WILKENING VS. NO ET AL 89-053547 1 IN THE ] HARRIS DISTRICT COUNTY COURT OF TEXAS FORD BACON AND DAVIS CONSTRUCTION CORP ET AL eee e wee em Ke ew ewe ew aw NE BE ee we ] ] 334TH eee Hew eee eee JUDICIAL ew ew SSS DISTRICT Hee LORETTA TURNER vs. NO 91-002902 ] IN THE ] HARRIS DISTRICT COUNTY COURT OF TEXAS ARMSTRONG WORLD INDUSTRIES INC ET AL ] 189TH JUDICIAL DISTRICT VIDEOTAPE DEPOSITION OF Between HARVEY G. LEWIS the May hours of 800 19 1992 10:00 a.m. Commerce and Houston Texas 2:30 p.m. Wanda Kelley Texas CSR No. 2007 Nell McCallum & Associates 2900 Smith Suite 104 NMA ORIGINAL Houston Texas 77006 713 523-3767 NELL MC CALLUM & ASSOCIATES INC TABLE OF CONTENTS EXHIBITS DESCRIPTION MARKED Portion of transcript of the June 24 1982 hearing 6 pages 55 10 Answer to Amended Complaint and Counterclaims filed by The Travelers Indemnity Company 15 pages vee tere ree w ee we cees seeesee 62 11 Plaintiffs Fifth Amended Original Petition 10 pages cece crccrcccesvecccrververesessveses 63 12 Motion to Seal 3 pages ccecccccercrcccecce 66 13 Consent Motion to Place Documents Under Seal 4 pages ecco vrecrnccaceccareceresccrrccccesseseee 67 14 Protective Order Concerning Exchange of Confidential Information 8 pages 68 15 Affidavit of Harvey G. Lewis 4 pages 70 16 Letter dated February 26 1991 from the Reed Smith firm to Mr. Griffith 2 pages 72 17 Portion of 1937 Engineering Manual 5 pages 76 18 Minutes of November 10 1976 meeting 10 pages 79 19 Robert Marshall lawsuit filed in 1929 9 pages 82 20 Anna Pirskowski lawsuit filed in 1929 9 pages 82 21 Defendant Commercial Union Insurance Company's Second Supplemental Answers to Plaintiffs Interrogatories 4 pages 87 NELL MC CALLUM & ASSOCIATES INC TABLE OF CONTENTS EXHIBITS EXHIB EXHI IBITT S S EXHIBITS NO DESCRIPTION MARKED 22 Defendants Expert Witness List 12 pages 91 23 Memorandum of the Meeting of April 21 1977 4 pages eseeeeees sem r ca recccsccscccoesenen 98 24 Memorandum dated March 15 1977 on the letterhead of Commercial Union Assurance Companies 2 pages 25 Amended Answer Action asserted by Pittsburgh Corning Corporation in the Searls case 13 pages .105 26 Portion of transcript from the hearing of June 24 1982 5 pages e .10 .1 8 08 .108 27 Asbestos Related Disease Claim Handling Procedures 41 pages 28 Commercial Union Insurance Companies Post Trial Brief 26 pa cccg ccccc cre eer 11 s 7 29 Portion of a document prepared by I. C. Sayers entitled Asbestos as a Health Hazard in the United Kingdo2 m pages ..122 ..122 30 Corning's Amended Complaint for Declaratory Judgment 32 pages 125 NELL MC CALLUM & ASSOCIATES INC - TABLE OF CONTENTS EXHIBITS NO DESCRIPTION MARKED 31 January 7 1942 correspondence on the letterhead of Corning Fiberglas Corporation 13 pages ] .126 32 Pittsburgh Corning v Travelers Indemnity et al docket sheet 1 pagee ee 130 33 June 13 1980 letter on the letterhead of the American Insurance Association 3 pages 34 Document entitled Estimates of Potential Liability from Asbestos and DES Related Injury 69 .. pages 139 er scveceveevcscrcsosersecsc NELL MC CALLUM & ASSOCIATES INC APPEARANCES For the Plaintiffs MR LAWRENCE MADeksho Attorney at Law Law Offices of Lawrence Madeksho 8320 Gulf Freeway Suite 218 Houston Texas 77017-4598 10 11 MR ROBERT E. BALLARD 12 Attorney at Law 13 Abraham Watkins Nichols Ballard & Friend 14 800 Commerce Street 15 Houston Texas 77002 16 17 For the Defendant Commercial Union Insurance 18 Company appearing for the Sherman S. Searls 22 Jr. lawsuit 22 21 MR DON MARTINSON 22 Attorney at Law 23 Fanning Harper & Martinson 24 8117 Preston Road Third Floor 25 Dallas Texas 75225 NELL MC CALLUM & ASSOCIATES INC APPEARANCES For the Defendant Corning Fiberglas Corporation appearing for the Tommie L. Heathman and Sherman A. Searls Jr. lawsuits MR RICK THAMM Attorney at Law Bean & Manning 10 5847 San Felipe Suite 1500 11 Houston Texas 77056 13 14 For the Defendant Pittsburgh Corning Corporation 15 appearing for the Sherman A. Searls Jr. Tommie L. 16 Heathman Richard B. Jackson Consolidation and 17 Gladys Loretta Steele lawsuits 18 19 MR MIKE WALZEL 20 Attorney at Law 21 Weller Wheelus & Green 22 Fifth Floor Petroleum Tower 23 550 Fannin Street 24 Beaumont Texas 77704 25 NELL MC CALLUM & ASSOCIATES INC TIse ey e 10 [ 11 12 Z| 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES For the Defendant ACands Inc. appearing for the Sherman A. Searls Jr Tommie L. Heathman Juanita Simpson which is part of the Richard Jackson Consolidation and Loretta Turner lawsuits MR KEN RHODES Attorney at Law Dunn Kacal Adams Pappas & Law 2600 America Tower 2929 Allen Parkway Houston Texas 77019 For the Defendant Allied Signal Inc MS LYNN G. HAUFRECT Attorney at Law Vinson & Elkins 3300 First City Tower 1001 Fannin Houston Texas 77002 NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES For the Defendant Aetna Casualty and Surety appearing for the Sherman A. Searls Jr. lawsuit and for the Defendant Ford Bacon & Davis Construction Corporation appearing for the Hazel Wilkening lawsuit MS BARCLAY MANLEY Attorney at Law Fulbright & Jaworski 1301 McKinney Houston Texas 77010 For the Defendant Travelers Insurance Company and Travelers Indemnity Company appearing for the Sherman A. Searls Jr. lawsuit MR J. WILEY GEORGE Attorney at Law Strasburger & Price 4300 NCNB Plaza 901 Main Street Dallas Texas 75202 NELL MC CALLUM & ASSOCIATES INC CENS et om e 10 11 12 13 14 15 16 bane 17 18 tem 19 20 21 22 23 24 25 10 APPEARANCES For the Defendant Owens Illinois Inc. appearing for the Richard B. Jackson Consolidation and the Tommie L. Heathman lawsuit MR MARK D. RAYBURN Attorney at Law Strong Pipkin Nelson & Bissell 1400 San Jacinto Building 595 Orleans Beaumont Texas 77701 For the Defendant Foster Wheeler Corporation appearing for the Gladys Loretta Steele and Hazel Wilkening lawsuits MR JAMES M. RILEY JR Attorney at Law Holmes Ryman & Lee 800 First City Tower 1001 Fannin Houston Texas 77002 NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 11 APPEARANCES For the Defendant M. W. Kellog Company appearing for the Hazel Wilkening lawsuit MR DOUG S. GRIFFITH Attorney at Law Hutcheson & Grundy 3300 Citicorp Center 1200 Smith Street Houston Texas 77002-4579 For the Defendant Brown & Root Inc. appearing for the Loretta Turner lawsuit MS CYNTHIA HOOPER INGLET Attorney at Law Alenik & Associates 12 Greenway Plaza Suite 1200 Houston Texas 77046 Also present Ray Blackstone - Legal Media NELL MC CALLUM & ASSOCIATES INC 12 EXHIBIT NO 1 MARKED VIDEOGRAPHER Today is May 19th 1992 The time is 10:05 a.m. On the record HARGV . LE EWY IS being duly sworn testified as follows 10 11 12 13 14 16 17- 18 19 20 21 22 23 24 25 EXAMINATION BY MR MADEKSHO Q Would you state your full name for the record please sir A Harvey G. Lewis Q Mr. Lewis how are you doing this morning so far A Fine Thank you Q Mr. Lewis in regard to today's proceedings we have noticed the deposition of Commercial Union Insurance Company concerning certain areas of inquiry And you understand that sir A I do Q And you have been designated by Commercial Union to make an appearance for that testimony here this morning A Yes sir NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 13 Q Mr. Lewis if we could back up for just a second and if you would please give us the benefit of your educational background we would appreciate that MR MARTINSON Mr. Madeksho if I might interrupt just for a second We were noticed in Cause No. 0615 which is the only case we're a party to We're not taking a position regarding these other depositions but I wanted you to know that's the only case in which we're a party and that we know that we're here MR MADEKSHO We understand that A I'm a 1966 graduate of Northeastern University in Boston Massachusetts a 1969 graduate of Suffolk University Law School in Boston | where I received a J.D. degree Massachusetts Q And in 1969 after you received your law degree did you take the bar exam there in the state of Massachusetts A I did sir Are you a practicing lawyer at this time A I am admitted before the Bar of the Commonwealth of Massachusetts and the United States District Court for the First Circuit Q Are you admitted to practice in the courts of any other state besides the state of Massachusetts NELL MC CALLUM & ASSOCIATES INC 14 A No sir I am not 0 In 1969 upon receiving your law degree -- did you receive your license in the same year A 1970 Q 1970. Upon receiving your law degree and your license in 1970 could you tell us what your work history has been since that time A Prior to being admitted to the bar I was an am a employee of the Massachusetts Defenders Committee and 10 continued on after being admitted into the bar In ey 11 1970 I left the Massachusetts Defenders Committee and 12 went on active duty in the United States Army until the 13 middle of January 1972 when I was relieved of military 14 service 15 16 17 18 19 20 21 22 23 24 25 I then became an associate in a small defense firm in Boston Massachusetts The name of the firm was Galvin Smith & Nordlinger I practiced with that firm until sometime in 1976. I left that firm and for a period of approximately three years practiced as a sole practitioner in Boston and then became associated with Commercial Union Insurance Company in June of 1979 Q And since June of 1979 in your employment with Commercial Union Insurance Company could you give us the various positions and duties and responsibilities you have held up to the present time NELL MC CALLUM & ASSOCIATES INC 15 A In June of 1979 upon my first employment I was a Fidelity Surety claim attorney in the home office claim department until approximately 1981 when I transferred to the claims counsel's office of the home office claims department In 1984 I officially transferred into the environmental issues area and remained in environmental issues in one capacity or another until the present time 10 Q And when is the first time that you became 11 involved with the asbestos litigation on behalf of , weed 12 Commercial Union = noce i Hq Be 13 A Approximately the spring and summer of 1983 14 I was asked to participate with other personnel at 15 Commercial Union involved in a document production that 16 arose out of the California coordinated asbestos 17 proceedings 18 Q Okay And we're talking about the California 19 insurance litigation between Commercial Union and a 20 number of asbestos manufacturers and then also some 21 other insurance companies besides Commercial Union 22 A That's correct sir 23 Q And do you have a specific title with 24 Commercial Union at this time 25 A I do NELL MC CALLUM & ASSOCIATES INC 16 0 And what is that title sir A I am vice president of specialty litigation Q And as vice president of specialty litigation for Commercial Union Insurance Company what do you do A My responsibility is the management and supervision of three areas which primarily involve the handling of environmental claim matters and all moey litigation involving environmental claims So basically your sole expertise and your 10 sole duties and responsibilities surround the 11 environmental arena 12 A That is correct 13 Q And in regard to the environmental arena -- 14 as the in your position that you presently hold 15 approximately how much of your time do you spend in the 16 asbestos litigation 17 A By virtuoef my management responsibilities 18 and administrative responsibilities only a small 19 portion of my current time is involved with asbestos 20 litigation 21 Q Could you give us an idea in regard to a 22 percentage of that time or how many days a week or a 23 month or anything of that nature 24 A My sense would be approximately 10 percent 25 of my time is involved in direct involvement with the NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 17 asbestos litigation 0 And in your management position with Commercial Union do you control and direct other individuals there at Commercial Union concerning the asbestos litigation A I do Q control And how many people are under your management A Approximately 40 people Q And in regard to these 40 people what do they do for Commercial Union in regard to the asbestos litigation A Some of those personnel are clerical personnel file personnel claims technicians who handle the underlying claims if there are in fact underlying asbestos claims or hazardous waste claims There are attorneys who are involved in the declaratory judgment litigation They are responsible for managing and directing that declaratory judgment litigation There are paralegals involved with searching for documents and providing answers for various discovery responses There is a reinsurance claims unit which deals with the reinsurance portion of the company's operation Q And in regard to the management of the various accounts what are the various active accounts NELL MC CALLUM & ASSOCIATES INC 18 for Commercial Union at this time concerning the ,, asbestos litigation of the insureds A Of the insureds Q Yes A Dealing with active insureds Q That's correct A I would venture to say that there are less ad than half a dozen of active insureds Q And could you tell us who that might be at 10 this time 11 A Offhand I can't recall any of the names of 12 the insureds involving underlying claims is what we're 13 referring to I presume 14 Q At this time yes sir 15 A Yes sir 16 Q You can't recall one of those at this time 17 A No sir I'm sorry I cannot 18 Q In regard to the reinsurance that you had 19 mentioned could you tell us as to which of the asbestos 20 manufacturers that Commercial Union has some type of 21 reinsurance coverage with 22 A I would venture to say in most instances 23 there is some element of reinsurance involved with each 24 of the insureds Whether or not that is active at this 25 point in time by virtue of the level of payments or NELL MC CALLUM & ASSOCIATES INC 19 negotiations that are ongoing I can't state Q Okay We'll get to some of that information in just a little bit that I believe that you had covered and responded to concerning the answers to interrogatories that Commercial Union had filed in this case A Yes sir Have you had an opportunity Mr. Lewis to review the answers to interrogatories that Commercial 10 Union had filed in these cases 11 A I did 12 Q Could you tell us what else that you have had 13 the opportunity to review preparatory for your testimony 14 here this morning 15 A I reviewed the deposition notice and the 16 items that were to be covered I reviewed the answers 17 to interrogatories supplemental answers to 18 interrogatories briefly reviewed the testimony of 19 Arthur Lynn with reference to the deposition notice I 20 believe I reviewed some of the responses to notices to 21 produce involved in this litigation as well 22 Q And that's all that you have reviewed that 23 you can recall at this time 24 A Yes sir that's correct 25 10 In regard to area of inquiry number one to NELL MC CALLUM & ASSOCIATES INC 20 today's notice of deposition Mr. Lewis we had requested that Commercial Union produce someone to discuss the corporate history of Commercial Union And could you briefly tell us as to when Commercial Union was first -- when it first came into existence A Perhaps I can explain it to you in this fashion sir In approximately 1968 or '69 Commercial 4 Union and the Employers group of insurance companies r which are both United States groups of companies merged 10 and ultimately the end result was the Commercial Union 11 Insurance Companies of today 12 Prior to that time the Employers group of 13 insurance companies went back into the early 1900s with 14 Employers Liability Assurance Corporation Limited The 15 United States brancohf that operation was operating in 16 this country from the early 1900s on 17 During the 1920s Thirties and Forties there 18 were other companies as part of the Employers group 19 including American Employers Insurance Company 20 Employers Fire Insurance Company 21 In 1957 there was incorporated the Employers Surplus Lines Insurance Company all part of the 23 Employers group The Northern Assurance Company of 24 America 25 And then as I said in 1968 or 1969 there NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 21 was a merger with the Commercial Union group of companies I have much less information as to the origins of Commercial Union in the United States than I do with the Employers group Suffice it to say that as of 1968 or '69 during the merger Commercial Union was the end result of that merger along with all the subsidiary companies and that remains today Q At the time that the merger occurred between Commercial Union anda number of these companies that you had just mentioned from the Employers group did Commercial Union assume the assets and the liabilities of those insurance companies A It did sir And Commercial Union their origination was it in England A There is a Commercial Union in England which is the parent company There was a United States branch of Commercial Union which was the branch that ultimately became domesticated as a United States based operation and ultimately merged with the Employers group in the . late Sixties Q In regard to Commercial Union's origination in England was that sometime in the 1800s A I couldn't tell you the exact date sir Q Are you familiar with an individual by the NELL MC CALLUM & ASSOCIATES INC 23 10 11 12 13 14 16 17 18 19 20 21 22 23 24 25 opportunity to review this as part of the documentation that was produced to the plaintiffs in these cases subject to a request for production to Commercial Union A No sir I don't believe I have read this document Q On the second page of what has been marked as I believe Exhibit 2 to your testimony here this morning there are some statements concerning the testimony of Mr. Martens that Commercial Union is an lines property insurance company and that their parent company is based in London England and does business in almost all of the countries of the world Is that a true statement to the best of your knowledge A Well I can certainly read what Mr. Martens has to say here I have no reason to disagree with it His written description of it is probably more succinct and has more basis in fact than I have knowledge Q Is Commercial Union also ranked as one of the largest property and casualty insurance carriers doing business on a worldwide basis to your knowledge A It's my understanding that Commercial Union is a large composit insurance company that does business throughout the world NELL MC CALLUM & ASSOCIATES INC 24 Q Is it also your understanding that Commercial Union was the company which introduced the forerunner of workers compensation insurance to the United States market back in 1886 A I am not aware of that Q Could you tell us as to whether or not that you're aware that Commercial Union was writing workers compensation insurance in this country before the turn of the century pony 10 A I'm not aware of that either sir 11 Q Could you tell us as to whether or not 12 Commercial Union was writing workers -- the equivalent 13 of workers compensation coverage in England before the 14 turn of the century 15 A I'm sorry I couldn't tell you 16 Q Could you tell us as to whether or not 17 Commercial Union was writing the equivalent of workers 18 compensation coverage in England by the 1920s or the 19 1930s 20 A No sir I don't know exactly when they 21 started to write workers compensation coverage 22 Q Are you familiar with a company called 23 Employers Mutual Insurance Company . 24 A No sir I'm not 25 Now as I understand your earlier NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 25 testimony ~-- and I want to make sure we've got it straight -- in regard to a merger or acquisition that took place between Commercial Union and the Employers group that was sometime around 1968 or 1969 A I believe so Q And in regard to the companies that Commercial Union had merged with which were the subsidiaries to the Commercial group there were a number of them Or there were just a number of insurance companies that made up the Commercial group MR MARTINSON You mean Commercial Union group MR MADEKSHO Well the Employers group I'm sorry Thank you A You are referring to the Employers group Q Yes sir A Yes sir there were a number of companies that made up the Employers group And I believe I alluded to a number of them Q Let me see if I can go down the line and see if these are the same ones that you covered or not The Employers Liability Assurance Corporation Limited A Yes sir Q Now was that based in England A No sir That was a United States branch of NELL MC CALLUM & ASSOCIATES INC 26 the London company but it was authorized to do business in the United States and was licensed in the United States Okay Now this branch this Employers Liability Assurance Corporation Limited was a branch of a home office in England in London England A That's what I'm led to understand At some point in time it became domesticated in the United States of America 10 Q Do you know when the Employers Liability 11 Assurance Corporation Limited first came into existence 12 A No I do not sir 13 Q Let me ask you about another company being 14 American Employers Insurance Company Is that also one 15 of the group of companies that comprised the Employers 16 group to your knowledge Co 17 A It did 18 Q And would another company be the Employers Ce 19 Fire Insurance Company : 20 21 A Yes sir Q And would another company be the Northern 22 Assurance Company of America 23 A Yes sir 24 Q And would another company be Employers 25 Surplus Lines Insurance Company NELL MC CALLUM & ASSOCIATES INC 27 A Yes sir Can you think of any other companies at this time other than those five that we just went over A No sir Those are the five that I'm familiar with MR MADEKSHO Mr. Lewis another area of inquiry for today's testimony surrounded the answers to interrogatories that Commercial Union had filed in these cases 10 And let me ask this to be marked as 11 plaintiffs next in order 12 EXHIBIT NO 3 MARKED 13 MR MADEKSHO 14 Q Mr. Lewis let me hand you what has been 15 marked as Exhibit 3 to your testimony here this morning 16 sir and see if that is the same set of interrogatories 17 that you have previously answered and previously 18 reviewed prior to today's testimony 19 A It is sir 20 Q That's one of the sets that you reviewed 21 A That's correct 22 Q Mr. Lewis in regard to Interrogatory Nos 1 23 and 2 and 3 these are the interrogatories that related 24 to Commercial Union's participation as far as having 25 insurance coverage for asbestos products manufacturers NELL MC CALLUM & ASSOCIATES INC 28 and also in regard to hiring and paying for the defense lawyers and also in regard to whether or not there had been any settlements between Commercial Union Insurance Company regarding insurance coverage with any of the manufacturers Is that correct first three A That's essentially correct sir Now in Interrogatory No. 1 this relates solely to Commercial Union's participating in the hiring and paying of the defense lawyers in whole or in part we 10 for any of the asbestos products manufacturers Is that 4 ay 11 correct 12 A That are named as the defendants in this _ 13 case 14 Q Yes sir _ 15 A Yes sir 16 And the ones that you indicated -- well one 17 of them that you indicated was Pittsburgh Corning 18 Corporation 19 A That's correct 20 Q And for the years 1983 to 1984 21 A Yes sir 22 Q And then also there is a footnote to that 23 answer at the bottom stating that In 1990 Commercial 24 Union Insurance Company started reimbursing Pittsburgh 25 Corning Corporation for the expenses it incurred in NELL MC CALLUM & ASSOCIATES INC 29 hiring and paying for its own defense lawyers Is that your understanding still A | Q It is sir And in regard to Commercial Union's hiring of the defense counsel for Pittsburgh Corning was 1983 the earliest that you're aware of A That's my recollection Q Okay Now when Commercial Union hired the defense lawyers did Commercial Union also control the 10 defense that would be used in the asbestos products 11 cases that were filed against Pittsburgh Corning 12 A That was not my understanding 13 Q What is your understanding as to who 14 controlled or directed that and made those decisions 15 A In most instances with reference to the 16 Pittsburgh Corning litigation Commercial Union was an 17 excess carrier and took over the defense of cases that 18 had originally been handled by the primary carrier 19 involved 20 Q Who was the primary carrier to your 21 knowledge 22 A My recollection is it was Travelers 23 Q Okay Travelers Insurance Company or 24 Travelers Indemnity or both 25 A I can't recall which it was I can't recall NELL MC CALLUM & ASSOCIATES INC 30 Q Just Travelers A I just recall it as being Travelers I can't recall if it was Travelers Insurance or Travelers Indemnity They had been defending Pittsburgh Corning and they had claimed exhaustion of their policies and tendered the defense of those claims to Commercial e Union Commercial Union continued with the defense of Tad those claims paid defense and indemnity on those claims and new claims that were filed during the period of time M we 10 '83 to '84 meow, 11 Q In regard to paying for the defense and the 12 hiring of the lawyers for Pittsburgh Corning did 13 Commercial Union have any say whatsoever in regard to 14 what evidence or what testimony would be presented in 15 cases filed by the asbestos victims against Pittsburgh 16 Corning 17 A For the most part I would say that that was 18 not the case that the defense was handled between 19 Pittsburgh Corning and the lawyers directly and 20 Commercial Union basically paid settlements and paid 21 defense costs 22 Q You say that was handled between the lawyers 23 Which lawyers would that be for Pittsburgh Corning 24 A Pittsburgh Corning's liaison counsel and 25 counsel for Pittsburgh Corning would direct the defense NELL MC CALLUM & ASSOCIATES INC 31 counsel That was my understanding Okay And then Commercial Union would they have any involvement in regards to overseeing what the defense counsel either -- are you talking about the National Coordinating Counsel for Pittsburgh Corning A My sense would be that's correct Q And was it your understanding that the Reed Smith firm and the Danaher firm were the National Coordinating Defense Counsel for Pittsburgh Corning 10 during this period of time 11 A I recall the Danaher firm being involved 4sce 12 yes sir =pe 13 Q Okay Cornelius Danaher Neal Danaher 14 A I can't recall which one 15 Q Did you ever meet with any representatives 16 from Pittsburgh Corning yourself 17 A Not during this period of time and not 18 dealing with the defense of the underlying claims 19 Q Okay So in other words as I understand 20 the situation Commercial Union did they simply give a 21 carte blanche to Pittsburgh Corning's lawyers to present 22 whatever defense and put on whatever evidence they 23 wanted to put on 24 A Essentially that was my understanding that 25 we only became involved in the claims when the NELL MC CALLUM & ASSOCIATES INC 32 settlements were upon us And the claim technicians reviewed the nature of the settlements the value of the settlements and basically approved the settlements and made the payments Q Did Commercial Union also review the extent of the defense costs that the defense lawyers for Pittsburgh Corning were running up in the asbestos ry cases A To the extent that we had the ability to 10 review those and make comment on those yes sir 11 Well those bills would be forwarded to 12 Commercial Union Is that correct 13 A During that period of time that's correct 14 Q And what would happen if Commercial Union 15 made a determination that the defense lawyers bills 16 were excessive or that there was needless litigation 17 going on in the asbestos litigation What would be 18 Commercial Union's position on that 19 A I don't know what the manner in which 20 Commercial Union dealt with those bills in those days 21 I do know what the situation is today In handling 22 defense attorney bills Commercial Union does review 23 those bills does review the type of work that is being 24 done for justification of payment 25 Q Okay So you can't tell us what was going on _ NELL MC CALLUM & ASSOCIATES INC 33 necessarily in 1983 or 1984 but you can tell us what's going on today A Yes sir Q The bills that are presently submitted by the defense counsel for Pittsburgh Corning are they submitted directly to Commercial Union A There are no bills being submitted today to Commercial Union from Pittsburgh Corning Q Okay In regard to this footnote to the 10 answers to interrogatory it states In 1990 11 Commercial Union started reimbursing Pittsburgh Corning 12 for the expenses incurred in hiring and paying for 13 Pittsburgh Corning's defense lawyers 14 A I'm sorry Your question 15 Q Could you explain that footnote then 16 A There were a number of coverages that were 17 the subject of litigation between Pittsburgh Corning and 18 Commercial Union A large block of that coverage dealt 19 with second and fourth layer excess policies during the oe Qane 20 Sixties up through the late part of the Sixties That 21 was the subject of the payments that were made during 22 1983 and 1984. When Commercial Union exhausted those 23 coverages it tendered its outstanding files back to 24 Travelers who was the next excess carrier or in the 25 alternative to Pittsburgh Corning NELL MC CALLUM & ASSOCIATES INC 34 As the days went along there were other coverages that had not been resolved by the original litigation between Commercial Union and Pittsburgh Corning that were reached coverages in the early Sixties that were high excess and coverages beyond 1970 When those coverages were reached Commercial Union negotiated with Pittsburgh Corning on those coverages Pittsburgh Corning had already established its own nationwide network was no longer a part of any 10 facility was handling its own cases And upon 11 submission of bills from Pittsburgh Corning Commercial 12 Union agreed to pay defense and indemnity to the 13 extent of their agreed upon limits 14 So that's why the footnote was placed in 15 there to make it perfectly clear that there was a 16 period of time when we were not handling the defense 17 of Pittsburgh Corning directly but we were merely 12 indemnifying and paying the defense costs submitted by 19 Pittsburgh Corning 20 Q Okay So does that situation still exist as 21 of today 22 A No it does not 23 Q Okay When is the last time that Commercial 24 Union has paid any money in regard to the defense of 25 Pittsburgh Corning in the asbestos litigation NELL MC CALLUM & ASSOCIATES INC 61 that's why they didn't put other kinds of warnings And then he also told the Federal Court that there was in fact on the part of many of the manufacturers a deliberate attempt to conceal the fact that they knew that those party users were at risk NOW aren't those the exact words of Commercial Union's representatives A Yes sir During the argument in this matter I agree with you that those are the exact 10 words 11 And there again in regard to the last page 12 of that exhibit Mr. Griffith told the Federal Court 13 again that the industry scheme not to tell the 14 people about what they knew of the risk not just to 15 their employees which is what they have been 16 contending but of what they actually knew to the people 17 who were going to use the products Isn't that exactly 18 what he said to the Federal Court 19 A It is sir 20 0 In 1982 21 A Yes sir 22 Q Thank you 23 Now is it also your understanding that 24 Commercial Union was a party to the other action that 25 was filed in the Federal Court in Philadelphia in the NELL MC CALLUM & ASSOCIATES INC 62 case styled Pittsburgh Corning v Travelers Indemnity Company Wasn't Commercial Union a party to that . litigation also A I believe that was subsequent litigation and I can't recall whether or not Commercial Union was a named party in that one as well Are you familiar with the statements made by the Travelers Insurance Company the Travelers Indemnity Company in that same case that Pittsburgh Corning had 10 sponsored perjurious testimony under oath calculated to 11 convince claimants and courts that Pittsburgh's conduct 12 was not negligent 13 A No six I'm not familiar -- 14 Are you aware of those representations 15 A I'm not familiar with that testimony 16 Q Were you also aware that Travelers had made 17 statements in that same case that despite the 18 overwhelming evidence discrediting the state 19 defense Pittsburgh Corning continues to sponsor 20 perjurious testimony consistent with this defense 21 A No sir I'm not aware of that 22 MR MADEKSHO Let me ask that this be marked 23 as plaintiffs next in order 24 EXHIBIT NO 10 MARKED 25 MR MADEKSHO NELL MC CALLUM & ASSOCIATES INC 63 NOW Mr. Lewis you have been following the Searls case this litigation yourself have you not sir A Yes sir Q Is there any particular reason that you have taken a special interest in this litigation as opposed to having one of the other claims people Why is it EN that you the supervisor for Commercial Union has taken an interest in this case _ 10 A At this point in time my understanding is as 11 that this is a -- this is not a claims matter This is J 12 a matter involving Commercial Union as a corporate 13 insurance carrier and an entity and that is the reason 14 that I have taken control of this particular piece of 15 litigation 16 Okay Now of course you're familiar with 17 the plaintiffs contentions in this litigation are you 18 not You have had the opportunity to review the 19 petition that's been filed by the plaintiffs in this 20 case 21 A I had opportunity recently to review I 22 believe it was Paragraph 5 of the amended petition 23 MR MADEKSHO Yes sir Let me ask that 24 this be marked as next in order 25 EXHIBINTO 11 MARKED NELL MC CALLUM & ASSOCIATES INC 64 MR MADEKSHO Q Mr. Lewis let me hand you what has been marked as plaintiffs next in order to your testimony here this morning and see if this is the same information that you had reviewed previously in regard to Paragraph 5 of the amended petition in this action A I believe this is the same Paragraph 5 that I [ reviewed sir ey wm Q Mr. Lewis during the course of your review 10 of that particular petition did you see where the 11 allegations have been made by the plaintiffs the 12 allegations have been made by the plaintiffs that the 13 defendants have conspired and acted in concert among 14 themselves and with others including their insurance 15 companies to suppress the truth concerning their 16 liability for and the effect of asbestos 17 diseases 18 19 20 21 22 23 24 A I see that Q And did you also notice in your review of that that the plaintiffs have alleged in furtherance of the conspiracy and concert of action that these defendants denied their actual knowledge suppressed information provided false information and misleading information 25 A I see that NELL MC CALLUM & ASSOCIATES INC 65 Q And that during the conspiracy and concert of action these defendants or some of them have utilized the offices of the courts in attempts to hide damaging information under courts seals and protective orders Did you see that allegation too A I do sir Q And then with that ww plaintiffs have also alleged with that knowledge they have actually had together with what has been furnished to them by their 10 insurance companies defendants began to affirmatively 11 misrepresent the truth and perpetuate a fraudulent 12 state defense while concealing and 13 suppressing damaging evidence under court seals and 14 protective orders Do you see that 15 A Yes I do sir 16 Q Now of course yourself you are familiar 17 with the court seals and protective orders that 18 Commercial Union has been involved with are you not 19 A To the extent that I've been personally 20 involved with them yes 21 Q And you have been personally involved with 22 reviewing the court seals and the protective orders in 23 the Commercial Union case in the Federal Court in the 24 Eastern District of Pennsylvania Isn't that true 25 A I am sir NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 66 MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 12 MARKED MR MADEKSHO Q Mr. Lewis for identification purposes this is a motion to seal that has been filed -- that was filed by Commercial Union in the Federal Court in Philadelphia in the Commercial Union v Pittsburgh Corning et al case A I believe it is Q And there again we've talked about the representative of Commercial Union a little bit earlier James Griffith and the motion to seal was prepared by Mr. Griffith where they requested the court to seal certain information| A Yes sir Q As a matter of fact Commercial Union's representative asked the court to even seal their motion for a protective order Isn't that what that motion to seal is about A I believe that's what the motion requests Q And didn't also Commercial Union's representative represent to that court that by agreement of counsel the subject matter disclosed during the course of the discovery is to remain confidential NELL MC CALLUM & ASSOCIATES INC 35 A 1991 Q And could you give us the approximate date in 19917 The middle of the year Latter part of the year First of the year A My sense would be approximately the middle of the year it was resolved Q Sometime during the summer of 1991 would be a fair estimate A A fair estimate That's all 10 Q And you testified a little bit earlier that 11 Commercial Union controlled the defense of Pittsburgh 12 Corning simply for the years 1983 to 19847 13 A Yes with the qualification as the fact that 14 the defense really was controlled by the insured with 15 defense counsel 16 Q And Commercial Union was simply paying for 17 the defense that was -- that you indicated was 18 controlled by the defense counsel for Pittsburgh 19 Corning 20 A Yes sir 21 Q And that would be the National Defense 22 Counsel that would set those policies the National 23 Defense Counsel for Pittsburgh Corning 24 A I believe there was involvement of the 25 coordinating counsel with Pittsburgh Corning during that NELL MC CALLUM & ASSOCIATES INC 36 period of time Q Okay And the coordinating counsel there again that would have been the Reed Smith firm out of Pittsburgh and also the Danaher firm out of Hartford Connecticut A My recollection is more with the Danaher firm in Connecticut than the Reed Smith firm but it might have been combined Q Did you ever have the opportunity to meet oa regional 10 with any of the counsel for Pittsburgh Corning [ [ 11 A I did not 12 Q Do you know who any of the regional counsel ce 13 were or presently are for Pittsburgh Corning in the 14 asbestos litigation 15 A No I do not sir 16 Q West Coast East Coast 17 A I'm not aware of any of their names sir 18 Q Now in regard to the amount of money that 19 was being paid on behalf of Pittsburgh Corning and 20 Raymark another area of inquiry could you tell us what 21 your understanding is as to the amount of money that was 22 paid by Commercial Union on behalf of Pittsburgh Corning 23 say during this period of time up through 1983 or 1984 24 MR MARTINSON Mr. Madeksho are you 25 limiting it to those two years or cumulative to that NELL MC CALLUM & ASSOCIATES INC 37 point in time MR MADEKSHO Well however it would be most comfortable for Mr. Lewis to handle that situation up through this period of time when Commercial Union was actually controlling the defense of Pittsburgh Corning om And I think that was limited to '83 and '84 up through that period of time A Approximately 73 million dollars was expended 10 Q Okay That was the total that was paid out ... 11 by Commercial Union on behalf of Pittsburgh Corning for 12 defense and indemnity 13 A That's right somewhere between 73 million 14 and 74 million I don't have the exact number in mind 15 Q Okay Now in regard to the area of inquiry 16 it stated the sums of money paid on behalf of <-- by 17 Commercial Union for Pittsburgh Corning in defense and 18 to asbestos victims Now in regard to this 73 to 74 19 million dollars that Commercial Union paid out 20 concerning the Pittsburgh Corning account could you 21 tell us as to how much was paid to the asbestos victims 22 and how much was paid to Pittsburgh Corning's defense 23 lawyers 24 A I do not have that information available to 25 me at this point in time NELL MC CALLUM & ASSOCIATES INC to i 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 38 MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 4 MARKED MR MADEKSHO Q Mr. Lewis what I have handed you and what has been marked as Exhibit 4 to your testimony is part of a transcript -- and I have the full transcript here if you need to refer to it -- concerning a hearing that took place on February 25 1985 in the United States District Court for the Eastern District of Pennsylvania in the case styled Commercial Union Insurance Company v Pittsburgh Corning Corporation and others Is that correct A Yes sir Q And are you familiar with a lawyer by the name of James Lewis Griffith A Yes sir Q And who is Mr. James Lewis Griffith A At the time Mr. Griffith was representing Commercial Union in the declaratory judgment litigation referenced by the heading in this case And what I needed to ask you about it looks like Mr. Griffith was he representing Commercial Union A He was representing Commercial Union in the declaratory judgment litigation NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 22 24 25 39 Q With the permission and the authority of Commercial Union I assume A Yes sir Q And in regard to Mr. Griffith's statements to the court -- and see if this comports with your recollection of the history of this coverage -- that Mr. Griffith was telling the court that Commercial Union had exhausted the 74 million dollars of coverage that had been agreed upon between Commercial Union and Pittsburgh Corning and that of that 74 million dollars approximately 50 million dollars went to the defense Is that correct A That's what Mr. Griffith had testified to the court Q And does that refresh your recollection as to how much money that Commercial Union had been paying on behalf of Pittsburgh Corning to the defense lawyers for Pittsburgh Corning and how much was going to the asbestos victims A It doesn't refresh my recollection I have no reason to disbelieve that this was a misstatement by Mr. Griffith Q It was a -~ A I have no reason to believe it was a misstatement by Mr. Griffith NELL MC CALLUM & ASSOCIATES INC 40 Q there So you have no reason to doubt those figures | A No sir Q Now in regard to the other portion of the information in that area of inquiry under area of inquiry No. 11 the amount of money that Commercial Union had paid on behalf of Raymark Industries and ocd ~ essentially the same question as to how much money that Commercial Union had paid to the defense lawyers for rec pane Industries 10 Raymark Raybestos Manhattan and how much 74 11 was paid to the asbestos victims Could you tell us oremmae) 12 what those figures were for approximately that same time 13 period running up through the early 1980s to the mid 14 1980s 15 A By 1984 Commercial Union's limits on behalf 16 of Raymark had been exhausted to the extent of 2.495 17 million dollars Those were indemnity limits So 2.495 18 million dollars was paid to asbestos victims as a 19 indemnity . 20 Q Give me that figure again two point -- 21 A 2,495,000 22 Q And could you tell us as to how many millions 23 of dollars that were paid to the defense lawyers for 24 Raymark and Raybestos Manhattan in regard to the 25 asbestos litigation for that same period NELL MC CALLUM & ASSOCIATES INC 41 A Up until the time that the court relieved Commercial Union of its obligation to pay defense costs which went well beyond the exhaustion of Commercial Union's indemnity limits the amount that had been expended in behalf of Raymark was in the area of six million dollars 3.6 million of that was an amount which had been expended in excess -- beyond the time that Commercial Union had exhausted its indemnity limits but the court was still ordering Commercial 10 Union to provide a defense 11 Q Are you familiar with some litigation that 12 Commercial Union was involved with in the state of 13 Illinois concerning Raymark Industries Raybestos 14 Manhattan and Commercial Union 15 A Yes sir 16 MR MADEKSHO Let me ask that this be marked 17 as plaintiffs next in order 18 EXHIBIT NO 5 MARKED 19 MR MADEksho 20 Q Mr. Lewis what I would ask you to do is 21 first of all do you recognize the style of this lawsuit 22 in which Commercial Union was involved with 23 A I recognize the style of the case sir 24 Q And I believe this is headed up Memorandum 25 and Final Judgment Order And it was filed in it looks NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 20 21 22 23 24 25 42 like August 29 1984 on the front of it There are two file dates on it One of them appears to be August 29 1984 and another one appears to be June 15. And I can't make out the other one A I can notice the filings on here sir H cannot notice any date in that second filing as well Q Now in regard to this litigation that was ongoing in the state of Illinois this is where the court had ordered Commercial Union to continue with the defense payments to the lawyers for Raymark and Raybestos Manhattan A Yes sir. Q And if you would turn to Page 7 at the bottom of Page 7 A Yes sir Do you see that where the court in this order had stated From information supplied to the court up to Februar8 y 1984 then they're talking about some defense costs A Yes sir 0 And continuing over onto the top of Page 87 A Yes sir Q And the defense costs to Commercial Union was 32,958,000 A I see what it says but I can't agree with NELL MC CALLUM & ASSOCIATES INC 43 that Q You don't agree with the figures that are included in the court's Memorandum and Final Judgment Order in that litigation A My sense was that was a scrivener's error when the judgment was prepared sir Q And so as opposed to what the court has in this particular Memorandum and Final Judgment Order of the 32,958,000 was paid to Raymark's defense lawyers 10 you indicate that to the best of your understanding it 11 was how much 12 A My recollection was it was somewhere in the 13 neighborhood of six million dollars sir 14 Q And so then also in regard to what Commercial 15 Union had paid out to the asbestos victims who had made 16 claims against Raymark Industries I believe that figure s ooo o 17 was 2,495,000 18 A Yes sir which was the total sum of 19 Commercial Union's indemnity limits 20 Q Now in regard to the insurance coverage that 21 Commercial Union had for all asbestos products 22 manufacturers could you tell us as to who all they 23 might have been or can you remember any of them today 24 MR MARTINSON By identity of asbestos 25 manufacturers NELL MC CALLUM & ASSOCIATES INC 44 MR MADEKSHO Asbestos products manufacturers A I can only remember those that I have dealt with recently or historically involved in the litigation Q Okay Which ones have you dealt with recently A Pittsburgh Corning Manville Raymark or Raybestos Manhattan as it was previously known GAF 10 Flintkote Fibreboard Standard Generally those are 11 the ones that I have dealt with over the past number of 12 years 13 Q 14 A What about Armstrong World Industries I'm sorry Yes sir Armstrong World : 15 Industries 16 0 Used to be known as Armstrong Cork Company 17 A Yes sir 18 Now what is your understanding as to the 19 years that Commercial Union had provided coverage to 20 Pittsburgh Corning Corporation as far as the asbestos 21 litigation 22 MR MARTINSON Including both primary and 23 excess 24 MR MADEKSHO Both right 25 A With reference to Pittsburgh Corning there NELL MC CALLUM & ASSOCIATES INC 45 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 was no primary coverage I believe it was excess coverage at a number of layers commencing sometime in 1961 and running through not continuously but running through up until sometime in 1972 I believe MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 6 MARKED MR MADEKSHO Q Mr. Lewis I would like to hand you what has been marked as Exhibit 6 to your testimony sir And this is identified as a March 20 1978 letter on the letterhead of Commercial Union Assurance Company directed to Pittsburgh Corning Company to the attention of their legal department from a claims representative of Commercial Union Is that correct A This appears to be that Q Now in regard to this correspondence from Commercial Union to Pittsburgh Corning's legal department in 1978 there is an indication toward the bottom of that first and basically the only paragraph that states that As you know Commercial Union provided coverage for your company -- being Pittsburgh Corning -- from July 15 1959 to December 1 1972. And I think it's your testimony a little bit earlier that you thought it was sometime in the early NELL MC CALLUM & ASSOCIATES INC 46 Sixties up through 1972 A Yes sir I believe it was sometime mid 1961. And the reason I state that is that's the extent of the coverage or the involvement of Pittsburgh Corning in asbestos production There may very well have been coverage prior to that time but my understanding was Pittsburgh Corning was not involved in any asbestos activity prior to sometime in 1961 Q Did you have any understanding as to whether or not Pittsburgh Corning was actually manufacturing selling or distributing containing products 12 prior to 1961 Were you aware that they were 13 A No I was not 14 MR MADEKSHO Let me also have this marked 15 as Mr. Lewis Exhibit No. 7 to his testimony this 16 morning 17 EXHIBIT NO 7 MARKED 18 MR MADEKSHO 19 Q Mr. Lewis let me ask you to take a look at 20 what has been marked as Exhibit No. 7 and which is 21 identified as a Chart of Relevant Parties in Each 22 Included Action in the California Asbestos Litigation 23 Have you seen a chart either that chart or 24 chart similar to that concerning your involvement with 25 what is known as the California Asbestos Insurance NELL MC CALLUM & ASSOCIATES INC 47 Litigation A No sir I have not Q In your earlier testimony -- well of course what this chart reflects are the insurance companies and then a certain number of asbestos products manufacturers that were involved with that litigation Is that correct A It would appear to be Q And as we go down the list I think that 10 Commercial Union is listed about the fourth one from the 11 bottom 12 A Yes sir I see that 13 Q And this chart reflects what you had 14 testified to earlier about Commercial Union having the 15 coverage for Armstrong World Industries used to be 16 known as Armstrong Cork and for the GAF Corporation 17 Manville and then also there is some coverage 18 on the second page through Employers Surplus for 19 Fibreboard at the top 20 A Yes sir I see that 21 In reviewing this list of insurance 22 companies are there any insurance companies that 23 Commercial Union is associated with besides Commercial 24 Union and Employers Surplus What about Employers 25 Reinsurance NELL MC CALLUM & ASSOCIATES INC 48 A No sir they are not Q What about Employers Insurance A No sir Q Could you just take a minute to look at that list and see if you recognize any other insurance companies MR MARTINSON Take your time MR MADEKSHO Yeah don't rush yourself A I do not find any of the other companies on [ 10 this list 11 Q Okay Fair enough 12 Mr. Lewis in regard to -- let me ask you 13 something about a couple of companies listed on Page 3 14 And the fourth and fifth ones down it's got London 15 Assurance is the fourth one and then the fifth one is 16 London 1978 and 1979. Now based on your knowledge and 17 experience would that indicate some syndications from 18 the London Market for the years 1978 and 1979 19 A I have no idea what those mean 20 Q Now of course another area of inquiry for 21 this morning's testimony was in regard to Commercial 22 Union's involvement with the London Market through 23 syndication or otherwise regarding coverage for 24 asbestos disease claims 25 And could you tell us the extent of NELL MC CALLUM & ASSOCIATES INC 49 Commercial Union's involvement with the London Market concerning coverage for asbestos disease claims A The only association or relevance that might have would be in the event that through a brokerage house representing a manufacturer the brokerage house ' sought out participation of a number of companies for a block of coverage at some particular level And in that case there perhaps might have been a participation by Commercial Union with a London Market company for a 10 percentage of a particular layer of coverage 11 Q Okay Well are you prepared to provide 12 testimony on that area this morning though 13 A To that extent that would be the only 14 involvement I can see Commercial Union having with the 15 London Market would be in the event that on a particular 16 layer for a particular insured Commercial Union might 17 be participating with other carriers including the 18 London Market for a portion of the coverage limits in 19 particular layer of coverage 20 Q Okay Now for the benefit of the court and 21 jury in regard to the London Market could you go ahead 22 and explain what the London Market actually is and how 23 it's comprised and who it's made up of including the 24 domestic and foreign insurance companies 25 A I am not -- I am not privy to the exact NELL MC CALLUM & ASSOCIATES INC 50 manner in which the London Market is formulated I don't deal with them Q Okay Who at Commercial Union would deal with the London Market MR MARTINSON In relationship to asbestos- related disease claims MR MADEKSHO As far as coverage right writing coverage A That would have been handled by underwriters 10 at the time the coverage was negotiated 11 Q Okay Well is there anybody within 12 Commercial Union that was involved with that 13 negotiations or in contact with the underwriters and the 14 brokers from the London Market concerning that type of 15 coverage 16 A No sir not today 17 wa Q. Have you made or asked anybody in your 18 supervisory capacity to check the records for 19 Commercial Union to see as to whether or not Commercial 20 Union was involved in any of these syndications 21 concerning the insurance coverage for asbestos 22 diseases and any involvement with the London Market 23 MR MARTINSON Other than he's described ; 24 already 25 MR MADEKSHO That's correct NELL MC CALLUM & ASSOCIATES INC 51 A For asbestos disease claims there are none sir Q Okay As far as Commercial Union A Yes sir Q Now Mr. Lewis I believe that Commercial Union they also have insurance coverage primary or excess concerning other manufacturers of products that have asbestos as a component to the product as well Is that correct 10 A That may very well be yes sir 11 Q For an example Foster Wheeler Commercial 12 Union has had insurance coverage for Foster Wheeler 13 MR RILEY Object to the predicate for that 14 question as presuming facts not in evidence and possibly 15 being inaccurate 16 A I don't have any specific knowledge of proces mens 17 involvement of Foster Wheeler rs 18 [ 19 MR MADEKSHO Q Do you know an individual by the name of 20 Michael Sommerville spelled 1-1 21 A Yes sir I do 22 Q And who is Michael Sommerville 23 A Michael Sommerville was the manager of the 24 special claims unit at Commercial Union 25 Q And have you with your involvement with the NELL MC CALLUM & ASSOCIATES INC 52 processing of the asbestos claims and supervising the asbestos claims ever had an opportunity to review the Asbestos Related Disease Claim Handling Procedures that was created by Michael Sommerville A I reviewed that at one time sir Q And during the course of your review of that information do you recall seeing the lists of identified insureds of Commercial Union A That document was prepared by Michael 10 Sommerville a number of years ago I recall reviewing 11 it a numbeorf years ago And I know that there must 12 have been a list attached to it if I recall 13 MR MADEKSHO Let me ask that this be marked 14 as plaintiffs next in order 15 EXHIBIT NO 8 MARKED 16 MR MADEKSHO 17 Q Mr. Lewis in regard to Exhibit No. 8 this 18 is a portion of the Asbestos Related Disease Claim 19 Handling Procedures manual that had been prepared by 20 Mr. Sommerville And the portion that I have handed you 21 is the list of the insureds of Commercial Union Now 22 does that look familiar now Does that refresh your 23 recollection 24 A I recall there was a list I have no reason 25 not to believe that this was part of that presentation NELL MC CALLUM & ASSOCIATES INC 53 that Mr. Sommerville had made sir Q Now in regard to this list of various insureds -- and I think we had identified a number of these earlier in your testimony Armstrong Cork which is now Armstrong World Industries of course we've talked about Raybestos Manhattan Raymark we've got the GAF Corporation Then do you also see the Foster Wheeler name on that list as well A I do sir Q Now in regard to the coverage that was provided to Pittsburgh Corning on the list there is 12 PPG And do you know what the PPG stands for 13 A I believe there were a number of additional 14 named insureds I cannot remember who the primary 15 insured was But suffice my memory to say that it was 16 PPG PPG Industries Pittsburgh Corning They were all 17 related My recollection is that that's the manner in 18 which the policies were issued with additional named 19 insureds 20 Q Okay Now Pittsburgh Corning to your 21 understanding was an additional named insured under 22 the policies of PPG Industries Pittsburgh Plate Glass 23 A That's my recollection at this point I 24 don't have a specific memory of that but my sense would 25 be that's what it was NELL MC CALLUM & ASSOCIATES INC 54 Q Would they also have been an additional named insured under the policies of Corning Glass Works Corning Glass A No sir It was simply limited to PPG mr A That's my recollection Q Now has Commercial Union Insurance Company ever prepared or made any calculations or come up with any figures in regard to the total amount of defense 10 costs and the total amount that was actually paid to the 11 asbestos victims say as far as up to the year around 12 1985 13 MR MARTINSON Are you asking that question 14 as to all insureds all circumstances 15 MR MADEKSHO As to all insureds including 16 the ones we had talked about a little bit earlier 17 18 19 20 21 22 Armstrong World Industries Armstrong Cork GAF Corporation right on down the line A I can't recall seeing any document that would have a summary such as that Q Now could you tell the court and jury as to when Commercial Union either first knew or alleged that 23 there was an industry scheme on the part of 24 Pittsburgh Corning and the other manufacturerosf 25 asbestos products to deliberately conceal facts of what NELL MC CALLUM & ASSOCIATES INC 55 the manufacturers actually knew about the risks to the users of the asbestos products in order that the manufacturers could go into courts all over the country and argue a state defense that the manufacturers didn't know of the risks to the users and that's why they didn't put on warning labels Could you tell us as to when Commercial Union first knew or alleged that MR MARTINSON I'm going to object to the roy 10 form of the question It assumes facts that he's not 11 testified to 12 A I don't recall Commercial Union ever taking 13 that position as you stated 14 MR MADEKSHO Let me hand you and ask to be 15 marked as plaintiffs next in order 16 EXHIBIT NO 9 MARKED 17 MR MADEKSHO 18 Q This is a portion -- and there again I have 19 got the entire hearing transcript from this entire 20 hearing if you need to refer to it Mr. Lewis -- but 21 what has been handed to you and marked as plaintiffs 22 next in order is a portion of the transcript from June 23 24 1982 in the Federal Court in the Eastern District 24 of Pennsylvania in the case styled Commercial Union 25 Insurance Company v Pittsburgh Corning PPG Industries NELL MC CALLUM & ASSOCIATES INC 56 Corning Glass Works and Travelers Indemnity Company | et cetera Now there again if you would look to the counsel page in regard to who's representing whom at this hearing and in this litigation Do you see the name James Lewis Griffith A I do Q That's the same Mr. Griffith that we had talked about a little bit earlier 10 A Yes sir 11 Q Do you know Mr. Griffith personally 12 r _ 13 A I do Q Have you dealt with him on a regular basis 11 14 over a period of years 15 A I did 16 2 Did he represent Commercial Union Did he 17 have the authority to represent Commercial Union in this 18 litigation 19 { 20 A He did sir Q Now if you would turn to Mr. Griffith's 21 Commercial Union's statements the representative of 22 Commercial Union See on Page 187 23 A Yes sir 24 Q Do you see where Mr. Griffith was telling the 25 court the Federal Court in Philadelphia that For NELL MC CALLUM & ASSOCIATES INC 57 years Manville PC and all these manufacturers have been going into courts all over the country standing before the court and arguing a state defense based upon the fact that they did not know that this product was a risk to the individual in the capacity of a third user and that's why they didn't put labels on their bags and they didn't put other kinds of warnings Do you see those statements A I see statements similar to that I'm 10 reading them exactly as they appear on the record right 11 now sir 12 What I just recited was that accurate 13 A Yes sir 14 Q Do you also see that Mr. Griffith on behalf 15 of Commercial Union is alleging that there was in fact 16 on the part of many of these manufacturers a deliberate 17 attempt to conceal the fact that they knew that those __ 18 party users were at risk Do you see those [ [ 19 statements 20 21 22 23 24 A I see them sir Q And if you would turn over to the two pages over from where you are MR MARTINSON What page is that MR MADEKSHO 25 Q It would be the last page where Commercial NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 58 Union's representative Mr. Griffith was telling the court also that there was an industry scheme not to tell the to their people about what they knew of a risk not employees which is what they have been just contending but of what they actually knew who were going to use the product Do you statements to the people see those A I see them Q And isn't it true that these statements were made by Commercial Union's representative in the Federal Court in Philadelphia on June 24 1982 what A That appears to be the case context they were made in from this I do not copy know Q - Do you have any doubt in your mind that Commercial Union's representative Mr. Griffith lawyer Commercial Union's made those statements to that Federal Court in 1982 A Sir I have no doubt that that's what the attorney said according to this exhibit but again I don't know in what context that | was said Q There is no question as to what those words are though is there A record No sir They are very apparent on the Q Do you know that as of 1991 that of course NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 59 Pittsburgh Corning was still alleging this state art defense in this litigation along with other manufacturers of asbestos products talking MR MARTINSON This about the Searls case litigation you're MR MADEKSHO That's correct A I'm not aware of that are the Q Were you aware that Commercial not the only insurance company that's state defense is a fraud Union they alleged that A I'm sorry Are you aware that Commercial Union is not the only insurance company that's made allegations to the effect that the state defense is a fraud A Well first of all I can't agree with your statement The only thing that we've had to go on so far is this statement by counsel out of context Q Okay Well -- have A I stated don't | know what other insurance companies Q I tell you what I'm going to do for you Mr. Griffith let me go ahead -- I mean Mr. Lewis Pardon me I tell you what I'm going to do Mr. Lewis I'm going to hand you that entire transcript if you think that I have taken something out of context in regard to NELL MC CALLUM & ASSOCIATES INC 60 Commercial Union's representative's statements MR MARTINSON want the witness to do Mr. Madeksho what do you MR MADEKSHO Basically we need to straighteunp the situation concerning as to whether or not I have Commercial taken something out of context concerning Union's representative's statements to the Federal Court in Philadelphia in 1982 10 11 12 MR MARTINSON It will not suffice for Mr. Lewis to acknowledge that the statements that you read from the Exhibit No. 9 were correctly read MR MADEKSHO 13 Q Well let's go back to Exhibit No. 9 right 14 quick Mr. Lewis 15 A Yes sir 16 Q Let's get No. 9 before you There again I 17 think we had a little bit earlier agreed that Mr. | 4 ima 18 Griffith the representative of Commercial Union the 19 lawyer for Commercial Union had represented to the 20 court that the manufacturers had been going into the 21 courts all over the country standing before the court 22 and arguing a state defense based upon the 23 fact they did not know that this product was a risk to 24 an individual in the capacity of a party user and 25 that's why they didn't put labels on their bags and NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 61 that's why they didn't put other kinds of warnings And then he also told the Federal Court that there was in fact on the part of many of the manufacturers a deliberate attempt to conceal the fact that they knew that those party users were at risk Now aren't those the exact words of Commercial Union's representatives A Yes sir During the argument in this matter I agree with you that those are the exact words And there again in regard to the last page of that exhibit Mr. Griffith told the Federal Court again that the industry scheme not to tell the people about what they knew of the risk not just to their employees which is what they have been contending but of what they actually knew to the people who were going to use the products Isn't that exactly what he said to the Federal Court A It is sir - In 19822 A Yes sir Q Thank you Now is it also your understanding that Commercial Union was a party to the other action that was filed in the Federal Court in Philadelphia in the NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 62 case styled Pittsburgh Corning v Travelers Indemnity Company Wasn't Commercial Union a party to that . litigation also A I believe that was subsequent I can't recall whether or not Commercial named party in that one as well litigation Union was a and Q Are you familiar with the statements made by the Travelers Insurance Company the Travelers Indemnity Company in that same case that Pittsburgh Corning had sponsored perjurious testimony under oath calculated to convince claimants and courts that Pittsburgh's conduct was not negligent A No sir I'm not familiar -- Q Are you aware of those representations A I'm not familiar with that testimony ,, Were you also aware that Travelers had made statements in that same case that despite the overwhelming evidence discrediting the state defense Pittsburgh Corning continues to sponsor perjurious testimony consistent with this defense | A No sir I'm not aware of that MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 10 MARKED ] MR MADEKSHO NELL MC CALLUM & ASSOCIATES INC 63 Q Now Mr. Lewis you have been following the Searls case this litigation yourself have you not sir A Yes sir Q Is there any particular reason that you have taken a special interest in this litigation as opposed to having one of the other claims people Why is it that you the supervisor for Commercial Union has taken an interest in this case 10 A At this point in time my understanding is 11 that this is a -- this is not a claims matter This is 12 a matter involving Commercial Union as a corporate 13 insurance carrier and an entity and that is the reason 14 that I have taken control of this particular piece of | 15 litigation 16 Q Okay Now of course you're familiar with 17 the plaintiffs contentions in this litigation are you 18 not You have had the opportunity to review the 19 petition that's been filed by the plaintiffs in this 20 case 21 A I had opportunity recently to review I 22 believe it was Paragraph 5 of the amended petition 23 MR MADEKSHO Yes sir Let me ask that 24 this be marked as next in order 25 EXHIBINTO 11 MARKED NELL MC CALLUM & ASSOCIATES INC 64 MR MADEKSHO Q Mr. Lewis let me hand you what has been marked as plaintiffs next in order to your testimony here this morning and see if this is the same information that you had reviewed previously in regard to Paragraph 5 of the amended petition in this action A I believe this is the same Paragraph 5 that I | reviewed sir Q Mr. Lewis during the course of your review 10 of that particular petition did you see where the 11 allegations have been made by the plaintiffs the 12 allegations have been made by the plaintiffs that the 13 defendants have conspired and acted in concert among 14 themselves and with others including their insurance 15 companies to suppress the truth concerning their 16 liability for and the effect of asbestos 17 diseases 18 A I see that 19 Q And did you also notice in your review of 20 that that the plaintiffs have alleged in furtherance of 21 the conspiracy and concert of action that these 22 defendants denied their actual knowledge suppressed 23 information provided false information and misleading 24 information 25 A I see that NELL MC CALLUM & ASSOCIATES INC 65 Q And that during the conspiracy and concert of action these defendants or some of them have utilized the offices of the courts in attempts to hide damaging information under courts seals and protective orders Did you see that allegation too A I do sir Q And then with that -- plaintiffs have also alleged with that knowledge they have actually had together with what has been furnished to thebmy their 10 insurance companies defendants began to affirmatively 11 misrepresent the truth and perpetuate a fraudulent 12 state defense while concealing and 13 suppressing damaging evidence under court seals and 14 protective orders Do you see that 15 A Yes I do sir 16 Q Now of course yourself you are familiar 17 with the court seals and protective orders that 18 Commercial Union has been involved with are you not 19 A To the extent that I've been personally 20 involved with them yes 21 Q And you have been personally involved with 22 reviewing the court seals and the protective orders in 23 the Commercial Union case in the Federal Court in the 24 Eastern District of Pennsylvania Isn't that true 25 A I am sir NELL MC CALLUM & ASSOCIATES INC 66 MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 12 MARKED MR MADEKSHO Q Mr. Lewis for identification purposes this that is a motion to seal that has been filed -- was filed by Commercial Union in the Federal Court in Philadelphia in the Commercial Union v Pittsburgh oe Corning et al case 10 A I believe it is 11 Q And there again we've talked about the 12 representative of Commercial Union a little bit earlier sed 13 James Griffith and the motion to seal was prepared by 14 Mr. Griffith where they requested the court to seal 15 16 17 18 19 20 21 22 23 24 25 certain information| A Yes sir Q As a matter of fact Commercial Union's representative asked the court to even seal their motion for a protective order Isn't that what that motion to seal is about A I believe that's what the motion requests Q And didn't also Commercial Union's representative represent to that court that by agreement of counsel the subject matter disclosed during the course of the discovery is to remain confidential NELL MC CALLUM & ASSOCIATES INC 67 A That's what it says Q And then are you also familiar with the Consent Motion to Place Documents Under Seal in that case between Commercial Union Pittsburgh Corning and Travelers and the other parties A No I'm not MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 13 MARKED 10 MR MADEKSHO 11 Q Mr. Lewis what has been handed to you is a 12 Consent Motion to Place Documents Under Seal that was 13 filed in the Federal Court there in Philadelphia in the 14 case styled Commercial Union Insurance Company v 15 Pittsburgh Corning Travelers Indemnity and others and 16 that's headed up Consent Motion to Place Documents Under 17 Seal Is that correct 18 A Yes sir 19 Q And do you see that there again that this 20 was action that was taken by Commercial Union through 21 its lawyers and James Lewis Griffith being one of them 22 A Yes sir 23 Q And do you see under No. 1 where it states 24 and represents to the court that The parties to this 25 litigation being that case in Philadelphia that they NELL MC CALLUM & ASSOCIATES INC 68 have agreed to be bound by a protective order and under the terms of which depositions and documents produced in discovery are confidential and that materials filed with the clerk of the court may be designated as confidential and placed under seal Correct A I see that yes sir Q And do you also see on the second page of that exhibit in Item No. 3 that Commercial Union Insurance Company is authorized to advise the court that 10 this motion is consented to by all the parties Do you 0 11 see that 12 A I do 13 Q Now in regard to the protective order C C 14 itself the consented protective order have you had 15 an opportunity to review that in regard to the 16 protective order concerning the exchange of confidential i] rowen! 17 information 18 (2 19 A No sir MR MADEKSho Let me ask that this be marked 20 as plaintiffs next in order 21 EXHIBIT NO 14 MARKED 22 MR MADEKSHO 23 0 Now Mr. Lewis what has been handed to you 24 as Exhibit 14 to your testimony is entitled Protective 25 Order Concerning the Exchange of Confidential NELL MC CALLUM & ASSOCIATES ING 69 Information filed in the United States District Court There again we're talking about the Philadelphia case involving Commercial Union Pittsburgh Corning Travelers and others Is that correct A Yes sir Q In No. 1 do you see where it was ordered that all testimony information documents or materials resulting from or disclosed through formal or informal discovery in the course of that litigation shall be 10 regarded as confidential acy 11 12 A Yes sir Q And if you could turn to the Page No. 4 And -- 13 in the middle of the page there do you see where the 14 various undersigned parties had consented to the entry 15 of the protective order 16 A I do 17 Q And do you see the signature of James Lewis 18 Griffith counsel for Commercial Union 19 20 21 22 23 24 25 A Yes sir I do Q Do you also see where there is a signature for the counsel for Pittsburgh Corning . A Yes sir And likewise for PPG Industries and Corning Glass Works and if you will turn over to the next page also the counsel for Travelers Indemnity Company NELL MC CALLUM & ASSOCIATES INC 70 A Yes sir I do Q And is today the first time that you have had an opportunity to review this consented protective order concerning the exchange of confidential information A Yes sir it is Q Now of course you are also familiar with the attempts by Commercial Union and Pittsburgh Corning to get an injunction in that same Federal Court in 4 10 Philadelphia to prevent the production of the 1937 J comes - - 11 Commercial Union engineering manual to the plaintiffs | 12 are you not 13 A Yes sir 14 Q As a matter of fact I believe that you had 15 executed an affidavit for that purpose Is that 16 correct 17 A Yes sir 18 MR MADEKSHO Let me ask that this be marked 19 as plaintiffs next in order 20 EXHIBIT NO 15 MARKED 21 MR MADEKSHO 22 Q Mr. Lewis I would ask you to look at Exhibit 23 15 to your testimony and see if you recognize that 24 affidavit that you signed on February 28 1991 Do you 25 recognize that NELL MC CALLUM & ASSOCIATES INC 71 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Yes I do sir Q Now in regard to the purpose for executing this affidavit was to get the Federal Court there in Philadelphia to issue an injunction prohibiting the production of Commercial Union's 1937 engineering manual Is that correct A Yes sir And of course the reason that Commercial Union did not want that 1937 engineering manual produced is because it felt like it could be damaging evidence in cases against Commercial Union's insureds in the asbestos litigation Correct A No sir Q Let's take a look at your affidavit Let's look at Item No. 3. Item No. 3 that you filed in that affidavit is -- and see if this is a correct recitation of your affidavit that you executed The discovery sought -- now the discovery sought of course we know that's the 1937 engineering manual Correct A I can't recall if that was the only thing that was sought through Pittsburgh Corning I'm not -- I can't recall that MR MADEKSHO Okay Let's back up just a hair then Let's do this then Let me ask that this be marked as plaintiffs next in order NELL MC CALLUM & ASSOCIATES INC 72 | 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 EXHIBIT NO 16 MARKED MR MADEKSHO Q Mr. Lewis what I have just handed you is a February 26th 1991 letter on the letterhead of the Reed Smith Shaw & McClay firm in Pittsburgh Pennsylvania to James L. Griffith there in Philadelphia Correct A Yes sir Q And as a matter of fact you received a copy of this letter didn't you A I believe I did Q Does this refresh your recollection now in regard to what the affidavit was executed for as far as getting the injunction Of course this is a letter from the lawyers that represent Pittsburgh Corning to the lawyer representing Commercial Union Correct A Yes sir Q And it states very clearly that the issue has arisen in this underlying related case concerning plaintiffs request that Pittsburgh Corning produce the 1937 group engineering manual of Commercial Union Correct A Yes sir Q So does that refresh your recollection at this point as to what document was incontroversy NELL MC CALLUM & ASSOCIATES INC 73 A Yes sir it does Q Okay We can pass on this one then Now getting back to this affidavit Mr. Lewis in regard to Item No. 3 -- and these were your statements under oath on February 28 1991 two days after this letter we just went over Correct A Yes sir C Q And in regard to your sworn affidavit you're stating that The discovery sought -- and that 10 discovery sought being the 1937 engineering manual -- 11 may severely prejudice Pittsburgh Corning Corporation 12 and other insureds in their defense of the many 13 thousands of claims past and present which have been 14 filed against them and potentially expose them to 15 inflated compensatory and punitive damages 16 Correct Isn't that what you stated 17 A That's what I stated sir 18 Q Now and you also stated that The discovery 19 sought -- being the 1937 engineering manual -- will 20 immediately and irreparably harm other insureds in 21 connection with the underlying asbestos claims 22 Correct 23 A That's what it says 24 Q And of course the reason that that could 25 jeopardize those claims is because of the knowledge that NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 74 Commercial Union had in 1937 concerning the hazards of exposure to asbestos Correct A That was not my reason for approving counsel to seek the injunction in this case Q Is there any doubt in your mind that you had authorized the efforts to seek the permanent injunction in the Federal Court there in Philadelphia to prevent the plaintiffs from getting their hands on the 1937 engineering manual A To the extent that that was the subject of a protective order entered by a Federal Court judge I believe in 1981 or 1982 to which I was not a party and privy based upon the fact that that protective order had been entered by the parties at the time I was reluctant to do anything that would be in violation of that protective order Q In other words you knew that the Commercial Union 1937 engineering manual had been placed under seal and made part of a protective order in that case in the Federal Court in Philadelphia Correct A Yes sir I was aware of that fact Q And then when you found out or Commercial Union found out that the plaintiffs wanted to get the information contained in that 1937 engineering manual Commercial Union along with Pittsburgh Corning went to NELL MC CALLUM & ASSOCIATES INC 75 the Federal Court to see about getting an injunction to keep the plaintiffs from getting it Correct A That's my understanding Q Now of course the 1937 engineering manual that clearly demonstrated that an asbestos hazard was to be looked for wherever asbestos dust is created Correct A I recall reading words similar to that in the manual but I can't -- I'm not sure if you are quoting 10 it correctly If you have a copy I'll be more than 11 happy to verify that that's what it did say sir 12 Q Yes sir Let's take a look at the answers 13 to interrogatories that you filed in this case And if 14 you would Mr. Lewis turn to Interrogatory No. 14 15 And of course you have a sworn affidavit attached to 16 these answers to the interrogatories on behalf of 17 Commercial Union Insurance Company as the vice president 18 of specialty litigation Correct 19 A Yes sir 20 Q In regard to Interrogatory No. 14 the 21 question is Is it true that this defendant being 22 Commercial Union Insurance Company knew by no later 23 than 1937 that a potential asbestosis hazard was to be 24 looked for wherever asbestos dust was created 25 Correct And tell us what your answer was NELL MC CALLUM & ASSOCIATES INC 76 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A My answer was yes sir Q Now of course that 1937 engineering manual told us a little bit more than just simply that asbestos -- that an asbestos hazard could be looked for wherever asbestos dust was created didn't it A Yes sir Q As a matter of fact it told us that anytime that there was a visible concentration of dust it was a hazardous situation and that if you couldn't see the dust that you needed to take dust counts Correct A I can't recall that specifically being stated MR MADEKSHO Let me hand you a copy of that 1937 engineering manual those portions of it And I've got the entire manual here for you Mr. Lewis if you need it And ask that this be marked as plaintiffs next in order EXHIBIT NO 17 MARKED MR MADEKSHO Q Mr. Lewis do you recognize that as the 1937 engineering manual that we've been discussing A I recognize this as a portion of it sir yes Q Yes sir And like I said I've got the entire thing here if you need it But the portions NELL MC CALLUM & ASSOCIATES INC 77 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 that we're concerned about relate to the occupational disease hazards in 1937 and under the heading of Asbestosis Do you see that A I do sir Q And of course we've already discussed a little bit earlier about the potential asbestosis hazard is to be looked for wherever asbestos dust is created And of course under that same section it mentions various industries including brake lining and gaskets and insulation Correct A Yes sir Q And also in regard to the portion -- if you would turn over to the next to the last page where it talks about dust control Are you under that section A I am sir Q And at the bottom of the hand column there as a matter of fact where it starts at A dust cloud may be composed do you see the start of that sentence A Yes sir Q Where it states that A dust cloud may be composed of billions of particles of varying sizes and shapes A Q Correct Yes sir And then at the bottom of that page on the NELL MC CALLUM & ASSOCIATES INC 78 right side do you see that statement by Commercial Union in 1937 that When dust in the area is visible we know a hazard exists when not visible dust counts should be employed Correct A Yes sir And this was known in 1937 by Commercial Union Correct A This was the manual that the loss prevention engineering department utilized in workers compensation 10 type loss reports [ tw 11 Q And that information was known in 1937 12 Correct 13 A Yes it was 14 MR MADEksho Did you want to take a quick 15 break or do you want to keep marching on 16 MR MARTINSON We're going to break at lunch 17 in the next 30 minutes We might as well go on unless 18 you wanted to take a break 19 THE WITNESS No I'm fine 20 MR MADEKSHO 21 Q In regard to discussing some of the -- pardon 22 me Strike that 23 Now another portion of these interrogatories 24 related to the meetings of the American Insurance 25 Association back in 1976. Is that correct NELL MC CALLUM & ASSOCIATES INC 79 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A I believe so MR MADEKSHO Do you remember that Let me hand you and ask that this be marked as next in order and ask you to take a look at that EXHIBIT NO 18 MARKED MR MADEKSHO - Mr. Lewis you recall in the answers to interrogatories that there were some questions asked of Commercial Union relating to these minutes from these minutes of the American Insurance Association back in 19767 Do you remember those interrogatories A I recall them sir Q And if you would turn over to the second page of that exhibit and you will see that that's entitled that Minutes of the Enterprise Liability Discussion Group November 10 1976 American Insurance Association in New York City Right A Yes sir Q And present at this meeting there were representatives from the Commercial Union Insurance Companies Correct A That's correct Q And they had two representatives there A I believe so Q And also present were other insurance NELL MC CALLUM & ASSOCIATES INC 80 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 companies the Aetna and the Travelers Insurance companies MR GEORGE I'll object to the form of the question to the extent this witness has personal knowledge of who was present and who wasn't present I don't believe the witness has testified that he knows who was there and who wasn't there MR MADEKSHO Does the document reflect Mr. Lewis that Travelers Insurance Company had a representative at that meeting of the American Insurance Association in November of 1976 A The document indicates that sir Q And if you recall in regard to the interrogatories we were wanting to find out what Commercial Union's position was concerning the information in these minutes Do you remember that A I recall the question in the interrogatories about this Q As a matter of fact we had asked Commercial Union if they had agreed or not concerning the information about when the dangers of asbestos were known Do you recall that A Yes sir Q And if you would turn over to Page 3 of this NELL MC CALLUM & ASSOCIATES INC 81 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 particular document where Commercial Union had two representatives at this 1976 meeting and you see under the section Asbestosis Medical Program ' A I do sir Q And do you see there that where it's stated that In 1900 medical research linked the mineral asbestos with asbestosis and 1935 brought the first direct linkage of asbestos to cancer A I see where it says that Q And do you have any reason to dispute this information from the American Insurance Association of which Commercial Union was a member A I have no reason one way or another Q Now also we had asked Commercial Union about some of the asbestos lawsuits that were filed by -- filed against manufacturers of asbestos products in the 1920s Do you remember that interrogatory A Yes sir I do And of course Manville was one of the insureds of Commercial Union Correct A It was Q And have you since had the opportunity to go back and see some of the lawsuits that were filed against Manville in the 1920s and concerning asbestos diseases NELL MC CALLUM & ASSOCIATES INC 82 A We were unable to locate any that go back to the 1920s I believe in responses to the discovery we did provide information on a 1949 I believe workers comp claim Q Were you aware that there were asbestos disease claims alleging malignancies in the 1920s against manufacturers of asbestos products poy A No I wasn't MR MADEKSHO Let me ask that -- and see if ae 10 we can speed this up just a little bit I'm going to 11 ask that these two be marked consecutively as 12 plaintiffs next in order these two exhibits 13 EXHIBIT NO 19 MARKED 14 EXHIBIT NO 20 MARKED 15 MR MADEKSHO 16 Q I believe the first exhibit that you have 17 before you is a lawsuit styled Robert Marshall 18 Administrator of the Helen Marshall - of Helen Marshall 19 deceased 20 A Yes sir 21 Q Filed in the New Jersey Supreme Court against 22 Manville 23 A Yes sir 24 Q Do you see that where it's alleged that Helen 25 Marshall was employee of the defendant corporation NELL MC CALLUM & ASSOCIATES INC 83 under Allegation No. 1 and that under Allegation No. 2 that the defendant corporation was engaged in the manufacture of asbestos products A Yes sir And also in regard to -- in Allegation No. 3 that the defendant employed the intestate being the deceased Ms. Marshall in its manufacture of asbestos om products and that the said defendant not only knew but should have known that the said asbestos products 10 contained certain dangerous insidious and harmful 11 agencies composed of asbestos fibers and other particles 12 that were destructive to life and health in the human 13 14 15 16 17 18 19 20 21 22 23 24 25 body A I see that in Paragraph 3 Q Is this the first time that you have become aware of this particular lawsuit that was filed against Manville in 1929 A Yes sir it is Take a look at the next exhibit if you would please This is a 1929 lawsuit is it not A Yes sir it's dated 1929 Q And this is a lawsuit that's filed in the United States District Court for the District of New Jersey styled Anna Pirskowski w v Manville NELL MC CALLUM & ASSOCIATES INC 84 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Yes sir Q And in regard to this lawsuit in the 19 -- in 1929 do you see that the allegation is made against Manville that Anna Pirskowski that she was in the employ of the defendant under No. ? A Yes sir Q And that defendant was engaged in the manufacture of asbestos and particles of asbestos and other dangerous articles used in its business of manufacture were inhaled by her that she became diseased sick and poisoned that her body became infected and weakened so as to cause her to suffer permanently with a malignant disease A That's what it says Q Is this the first time that it's come to your attention that asbestos lawsuits were filed against manufacturers for malignant diseases in the 1920s A Yes sir Q Now in regard -- let me back up for just one second if I could please Mr. Lewis There was another insured that we perhaps didn't touch on that was on that list that Mr. Michael Sommerville's Commercial Union claims handling manual concerning asbestos diseases Do you remember that list we had looked at A Yes I do NELL MC CALLUM & ASSOCIATES INC 85 .Q Do you recall and do you know for a fact that also that Union Carbide was one of the insureds of Commercial Union or would you need to go back and take a look at that exhibit A Well I'll accept -- I'll accept your statement that Union Carbide was on that list Q I'll represent to you that it is and if we __ _ need to find it we can get it fine 9 A That's H om 10 Q Also that Corning was one of 11 Commercial Union's insureds as well correct concerning 12 asbestos diseases 13 A I'm not sure that Corning was on that 14 list 15 0 16 A What about W. R. Grace Yes sir they are an insured of Commercial 17 Union 18 Q Okay Now let me ask you about Employers 19 Liability Assurance Corporation Limited Is that 20 Commercial Union 21 A The U.S. branch ultimately became 22 domesticated and merged into Commercial Union and is 23 Commercial Union today 24 Q Were you aware that the Employers Liability 25 Assurance Corporation Limited that portion of NELL MC CALLUM & ASSOCIATES INC 86 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Commercial Union that they had paid out its policy limits for payment in the asbestos cases filed against Corning A I can't recall specifically that taking place but it may very well have happened if it was in fact an insured of Commercial Union Q When did Commercial Union first begin negotiations with the Asbestos Claims Facility the Wellington group A I can't recall specifically when that took place Q Now in regard to those negotiations was there a follow of Commercial Union becoming a signatory to the Wellington agreement the Asbestos Claims Facility A My recollection is that a formal presentation was made by representatives of -- I'm not sure if it was the Asbestos Claims Counsel prior to the creation of the Asbestos Claims Facility Q Well did Commercial Union become a signatory to the Asbestos Claims Facility the Wellington agreement A No they did not Q And in regard to the Center for Claims Resolution called the CCR did Commercial Union have NELL MC CALLUM & ASSOCIATES INC 87 negotiations with the CCR A No they did not Q Now in regard to the second set of answers to interrogatories you have reviewed those too have you not Well not the second set I apologize In regard to Commercial Union's supplemental answers A I believe I did MR MADEKSHO Okay Let me ask to have this marked as plaintiffs next in order and see if that's 10 what you had reviewed 11 EXHIBIT NO 21 MARKED 12 A Yes sir this is -- I reviewed this 13 14 15 16 17 18 19 20 21 document MR MADEKSHO Q Now in regard to Interrogatory No. 6 where it's requested to provide certain names of individuals having knowledge of relevant facts A Yes sir Q You're listed number one there Right A I am sir Q Vice president specialty litigation 22 division 23 A Yes sir 24 Q Commercial Union Insurance Company out of 25 Boston Massachusetts NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 88 A Yes sir Q Now also there is a listing for Mr. Michael Sommerville that we had discussed a little bit earlier in regard to he being the one who had prepared the Asbestos Disease Claims Handling manual and procedures for Commercial Union A Yes sir Q Do you know Mr. Sommerville personally A Yes I do - Is he still with Commercial Union A No he is not Q Who does he work with now A He's employed by a law firm in Boston Q Is he an attorney A He is And do you know when he was first licensed to practice law A Sometime after 1987 Q Do you know which law firm that he is employed with at this time there in Boston A Q firm The law firm is designated on the responses Okay The Peabody That's a law A Peabody & Arnold yes sir Q Okay What about Mr. John Schreiber Do you NELL MC CALLUM & ASSOCIATES INC 89 know Mr. Schreiber personally A I do Q And how long have you known Mr. Schreiber A I have known Mr. Schreiber since I came to the company in 1979 Okay Now he is a vice president of claims in the specialty litigation division He's in the same os iam division as you Is that correct A I'm sorry That's an error That line is an 10 error 11 12 Q That's not correct there then A No. 13 Q Okay 14 A Mr. Schreiber was the vice president of 15 technical claims other than environmental 16 . What does he do now 17 A He sleeps late feeds the birds He's . 18 retired oes toe 19 Q I see What was his involvement with the 20 asbestos litigation prior to his retirement from 21 Commercial Union 22 A I would say from approximately 1982 or 1983 23 until 1988 Mr. Schreiber also had the responsibility 24 during that period of time for the environmental area 25 Q Including the asbestos arena NELL MC CALLUM & ASSOCIATES INC 90 A Including the asbestos arena In 1988 I was given the good fortune of being promoted to assistant vice president and a new division was created called the specialty litigation division and I became responsible for the environmental arena at that point in time Q Let's turn over to the next page There is another name mentioned here a Mr. John Bullock A Yes sir - 10 Q Who is John Bullock A Mr. Bullock is a Commercial Union retiree vey 11 who during the Sixties and Seventies was an | 12 underwriter in the home office of the company a Lanes 13 Q Okay Now you're talking about the home ! neg 14 office are you talking about the home office here in 15 the United States or in England 16 A No One Beacon Street 17 Q In Boston Massachusetts 18 A Yes sir 19 - Do you know if he was -- when did he retire 20 r 21 A Within the past five years Q Did he have any supervisory control in regard 22 to the asbestos litigation to your knowledge 23 A No supervisory control as to litigation He 24 was an underwriter 25 Q In regard to the last page concerning names NELL MC CALLUM & ASSOCIATES INC 91 do you know a Mr. John L. McConn A No I don't sir Q Do you know a Mr. Roy Welch A No I don't Q Now do you see that also that Commercial Union has -- they designated all other expert witnesses designated by all other parties in this case | ime too A Yes sir 10 MR MADEKSHO Could you tell us as to why -- 11 well first of all let me make sure that you're 12 familiar with what Commercial Union is designating as 13 other witnesses in this litigation 14 EXHIBIT NO 22 MARKED 15 MR MADEKSHO 16 Q Now this is the list of witnesses on behalf 17 of Armstrong World Industries GAF Corporation National 18 Gypsum Company United States Gypsum Company and Union 19 Carbide Corporation Correct 20 A That's what the designation indicates sir 21 Let me ask you to turn over to what is 22 identified as Page 2 of the list of those witnesses Do 23 you see there about a third of the way down in regard to 24 the mention of certain names of individuals 25 A Yes sir NELL MC CALLUM & ASSOCIATES INC 92 Q Dr. Weill Demopoulos Hinshaw et cetera A Yes sir Q Let me make sure that we're clear on this in regard to what this list says This list that we're both looking at right now states It is expected that Dr. Weill Demopoulos Hinshaw and Gaensler will testify that the medical community became aware that insulators oes rSoeue with prolonged intense exposure might be at risk for |ne) asbestos diseases in the late 1960s or early 10 1970s Do you see that 11 A Yes sir 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q Could you tell us as to why Commercial Union would designate a witness to come in to testify that these risks might be known in the late 1960s or early 1970s when it's already indicated in its answers to interrogatories that these risks were known wherever asbestos dust was created they knew that in 1937 MR THAMM Objection as to that being a misstatement of facts and assumes facts not in evidence MR MARTINSON I join in that objection A My understanding of my statements with reference to the 1937 engineering manual indicate that the engineering manual describes occupational disease hazards in the workplace that it was designed for the engineering department when they were doing loss reports NELL MC CALLUM & ASSOCIATES INC 93 and loss investigations for workers compensation type involvements in the manufacturing of containing products By virtue of that there's no doubt that Commercial Union had a 1937 engineering manual that did state in fact that the asbestos hazard is to be looked for wherever asbestos dust was created for an occupational disease ~- Penren MR MADEKSHO Q By 1937 10 A -- by 1937 occupational disease in the 11 workplace in the manufacturing environment 12 MR MARTINSON The question had a lot of 13 stuff in it but really the question is Why did you 14 designate designate the folks that are listed in 15 this exhibit as expert witnesses if you know That's 16 the question 17 A First of all counsel I authorized counsel 18 to take care of designations and I was not aware 19 of the actual names of some of the medical experts 20 That's actually the real reason 21 MR MADEKSHO 22 Q Okay Now when you provided the sworn 23 answer for Commercial Union to Interrogatory No. 14 -- 24 do you remember Interrogatory No. 14 25 A If you can refresh my recollection as to NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 94 which one it is or I can get out the answer to Interrogatory No. 14 Q That relates to when Commercial Union knew that an asbestos hazard was to be looked for anyplace where asbestos dust was created anyplace Do you remember that MR MARTINSON Why don't you find the answer to the interrogatory It speaks for itself A The statement I affirmatively responded to was Is it true that this defendant knew no later than 1937 that a potential asbestosis hazard was to be looked for wherever asbestos dust was created Q no MR MADEKSHO And your answer your sworn answer was yes or A Yes sir It was yes MR MADEKSHO Thank you Let's go off the record It's time to change the tape VIDEOGRAPHER This is the end of Tape No. 1 Going off the record at 11:57 a.m. p.m. LUNCH RECESS VIDEOGRAPHER On the record This is Tape No. 2. It's 1:06 MR MADEKSHO Q Mr. Lewis in your capacity and supervisory NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 95 position with the Commercial Union Insurance Company and along with your involvement with the asbestos litigation have you become aware or have you personally been involved with various meetings of the insurance carriers or meetings with the asbestos products manufacturers to discuss asbestos litigation A No I have not Q Are you aware of instances where other supervisory personnel from the Commercial Union Insurance Company have been involved with meetings such as I have just mentioned A Yes sir Q And who would those individuals be that would attend those meetings ordinarily A I know that over the past number of years before his departure prior to the creation of the Asbestos Claims Facility Michael Sommerville had attended a number of meetings of the Asbestos Claims Counsel I presume that there were representatives of the manufacturers attending those meetings as well Q And is it your understanding that in regard to these meetings that various defense strategy would be discussed concerning the litigation A Not at the meetings concerning the creation of the Asbestos Claims Facility I don't believe I do NELL MC CALLUM & ASSOCIATES INC 96 know from previous experience that there were meetings of the American Insurance Association and there were representatives at times of Commercial Union employees attending Q And also in regard to those meetings do you recall that there were discussions concerning as to whether or not to admit liability in the asbestos litigation MR RILEY Objection to the form of the 10 question to the extent that any questions asked by 11 counsel invade any privilege whether attorney 12 or work product which may be possessed by my client 13 I would have a running objection to all similar 14 questions and to any information being given by this 15 witness And I will put counsel on notice of that 16 objection and that no privilege material is being waived 17 by my client And I would object to this question and 18 any future questions pertaining to -- the question is 19 very broad don't know what it relates to but any 20 information pertaining to my client I would object to 21 this question if it's privileged 22 MR THAMM I join in that objection or those 23 objections 24 MR WALZEL I join in those objections as 25 well NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 97 MR MADEKSHO Q I believe the question that we were discussing and the answer that you had started to give related to various meetings with the American Insurance Association A Yes sir Q And the question being as to whether or not that you are familiar with the meetings at the American Insurance Association discussing as to whether or not the insurance industry should go ahead and admit liability in the asbestos litigation MR RILEY Objection since the question is not specific as to who was at the meeting and going into the content of what was discussed same objection as previously stated Also instructing counsel that my client does not waive any privilege and requesting the witness not to divulge any privileged information MR THAMM I join in that also THE WITNess back sir Sir could I have the question MR MADEKSho Read the exact question back to Mr. Lewis if you would please COURT REPORTER And the question being as to whether or not that you are familiar with the meetings at the American Insurance Association NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 98 discussing as to whether or not the should go ahead and admit liability insurance industry in the asbestos litigation A I am familiar to the extent that the company has produced in this litigation and I have read a summary of the minutes of a meeting that took place in 1977 where that subject was discussed MR MADEKSHO Q And those minutes that you have read and you are familiar with they reflect do they not that the insurance rejection industry made the of the suggestion determination of a unanimous that liability in the asbestos cases be admitted MR MARTINSON Object to the question that the document speaks for itself If you know specifically what it says you are certainly entitled to Otherwise answer the question I would ask you to refer to the document A I don't have a specific recollection as to what it said concerning that MR MADEKSHO as next in order Let ny me ask that this be marked EXHIBIT NO 23 MARKED MR MADEKSHO Q Mr. Lewis what has been handed to you is a NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 - 99 memorandum of the meeting of April 21 1977 of the American Insurance Association Study Group Correct the Enterprise Liability A That is correct sir And Q this is the document that you are familiar with Is that true A I believe so Q And in regard to the first page where there is a listing of the attendees at that meeting do you see that Commercial Union companies were represented by Mr. D. O. Ellis A I do sir Q And do you also see that the Aetna companies were present and that also that the Travelers Insurance Company was present at this meeting MR GEORGE I'll object to the form of the question to the extent you are doing anything other than asking the witness to reflect what the document says MR MADEKSHO You can answer the question A The document does indicate that there were representatives present Q And of course you recall earlier in regard to our discussions concerning the other information from the American Insurance Association where they discussed concerning when the dangers of asbestos were known Do NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 100 you recall that line of questioning A NoI don't sir Q could Let me refresh your recollection then if I Let me ask you to take another look at this document I'm not going to ask that this be marked because it's been previously marked And if you would to refresh your recollection turn over to Page 3 where it's marked at the top A Yes sir I recall this now this You recall now where there was the mentioning and discussion that in 1900 that the medical research linked the mineral asbestos with asbestosis and 1935 brought the first direct linkage of asbestos to cancer A I recall that appearing in the memorandum Q And in regard to the other memorandum that as has been marked an exhibit that is present before you this is in regard to the meetinogf April 21 the next year 1977 A It's apparently that sir Q And in regard to the meeting was closed with a unanimous rejection of a suggestion that liability in asbestos cases be admitted Is that correct statement A That's part of what the says Q And in regard to the liability in the NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 101 asbestos litigation as far as the victims filing lawsuits against the manufacturers you are aware that the liability defense centers around state of the art Correct A I'm not aware that that is the only defense that manufacturers have asserted but I think this was something a little bit different from what I understand of the rejection in this case Q not You are familiar with the Borel case are you A To the extent that I have recollections of the case when it came down MR MADEKSHO Let me ask that this be marked as plaintiffs next in order EXHIBIT NO 24 MARKED MR MADEKSHO what Mr. Lewis has been handed to you is a memo dated March 15 1977 on the letterhead of the Commercial Union Assurance Companies Is that correct A Yes sir Q And the subject being Asbestosis Meetings A Yes sir Q And this is from a Mr. Bruno -- and it's spelled w Cyzowski Cyzowski A I would say it's Cyzowski NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 23 24 25 102 - Are you familiar with this gentleman A I have heard the name years ago Q And if you -- would you notice in the top paragraph where there is a mention of the Borel case A Yes sir in the second sentence Q Where there is a mention of the Borel case where the manufacturers in the asbestos products are liable inasmuch as they put a dangerous product on the market without adequate warning Is that correct A That's what this statement does say Q And you have had an opportunity to read the Borel decision or memos concerning the Borel decision yourself A Over the years I'm not currently familiar with exactly what the holdings were on it 0 Now you have also seen documents in the files of Commercial Union relating to the state art defense have you not sir A I have seen mention in documents of the state defense Q And of course the state defense is that the manufacturers they just didn't know and it couldn't have been known about the dangers of the asbestos products that they put on the market and so therefore they had no duty to warn the users and the NELL MC CALLUM & ASSOCIATES INC 103 consumers of those products Is that in essence what the state defense is A it I guess that could be one interpretation of Q In your involvement with the Pittsburgh Corning account were you aware of Pittsburgh Corning's defense that they alleged that the state of the medical and scientific knowledge prior to the late 1960s as it me related to the exposure of the asbestos insulation 10 worker to asbestos dust was such that the medical and 11 scientific community were of the opinion that the 12 exposures to which the asbestos insulation workers was 13 subjected was safe and that the asbestos insulation 14 occupation was a reasonably safe occupation and as a 15 result the manufacturers of asbestos insulation products 16 were charged with no greater knowledge than that of the 17 medical and scientific community and such manufacturers 18 had no reason to reasonably foresee injury to insulators 19 or other workers from application of their insulation 20 products which contained asbestos and therefore had no 21 duty to warn regarding their products prior to such 22 time Are you familiar generally with that type of 23 defense statements by Pittsburgh Corning 24 A No I'm not sir 25 Q Are you aware that they are alleging that 1 NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 defense in this case 104 MR MARTINSON MR MADEKSHO Searls Q In the Searls case A Not particularly Q Are you also aware of Pittsburgh Corning's statements in regard to the allegations against Commercial Union back in June of 1982 where they were telling -- where Pittsburgh Corning was telling the Federal Court that it couldn't have been more clear by the year 1937 that an asbestos hazard was to be looked for wherever asbestos dust was created A My recollection is that those were some of the allegations by Pittsburgh Corning Q Do you have any understanding in the position of a supervisor or a supervisory position with Commercial Union Insurance Company and your experience in the asbestos litigation as to why they would allege in this case that these dangers were not known until the late 1960s or early 1970s and they were telling the Federal Court in Philadelphia in 1982 that it couldn't have been more clear in 1937 MR WALZEL Object to the question I believe his previous testimony was he was not involved in the defense of Pittsburgh Corning NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 105 MR MARTINSON I'm going to object -- MR WALZEL . Or the decisions MR MARTINSON I'm going to object to the form of the question in that he's testified he was not familiar with the allegations Pittsburgh Corning was making in the Searls case and your question assumes that he is familiar with that MR MADEKSHO next in order Let me have this marked as EXHIBIT NO 25 MARKED MR MADEKSHO Q Mr. Lewis first of all this document is entitled the Amended Answer Action asserted by Pittsburgh Corning Corporation and it's in the Searls case Is that correct A Yes sir it appears to be that Q And could you turn over to the last page to see that this was -- has a certificate of service on the 20th day of December 1989. In 1989 was Commercial Union still paying for the defense of Pittsburgh Corning in the asbestos litigation MR MARTINSON You can look at your answers to interrogatories if you need to A I don't believe that was a period of time sir in which we had been asked to come back in to get NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 106 involved again with Pittsburgh Corning on those other | excess layer policies I believe it might have been subsequent to that MR MADEKSHO Q Well this is M if this were the current pleading on file by Pittsburgh Corning would it stand to reason that if it were filed in December 1989 that it would have been on file in 1990 and 1991 A It certainly would stand to reason And was Commercial Union paying for the defense of Pittsburgh Corning in the asbestos litigation during 1990 and 1991 A Commercial Union was reimbursing Pittsburgh Corning for its defense costs pursuant to an agreement Q If you would look on that next to the last page of this filing by Pittsburgh Corning Do you see that this was actually filed by the attorneys for Pittsburgh Corning Corporation A Yes sir I see that Q Are you familiar with the law firm of Weller Wheelus & Green A No I am not sir Q Do you know a Lyn Stevens a lawyer A No I don't Q Do you know a lawyer by the name of David NELL MC CALLUM & ASSOCIATES INC Tolin 107 A The name David Tolin does ring a bell in the most recent litigation involving Commercial Union in this Searls case yes sir Q If you would look on Page 6 of the allegations made by Pittsburgh Corning under Paragraph Roman Numeral XIX And just read that to yourself essentially om 10 Have you read it A Yes sir te ee ee 11 Q Is it a fair statement Mr. Lewis that 12 Pittsburgh Corning is alleging in this case that the 13 state of the medical and scientific knowledge prior to 14 the late 1960s was such that they had no duty to warn 15 regarding their asbestos products 16 MR WALZEL I'm going to object The 17 document speaks for itself 18 MR MARTINSON Same objection But you can 19 answer the question 20 A It would appear generally that that was the 21 allegation that Pittsburgh Corning was making in this 22 paragraph 23 MR MADEKSHO 24 Q Of course you are very familiar with the 25 litigation between Pittsburgh Corning and Commercial NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 108 Union in the Federal Court up in Philadelphia not are you A No sir I was not that familiar with the declaratory judgment litigation I only became further involved in it as a result of my involvement with this later date petition for the injunction I was not involved in the settlement or the litigation between Commercial Union and Pittsburgh Corning Q Okay But of course you are familiar with that case though A Generally speaking sir Q And was that an important case to the Commercial Union Insurance Company A As all cases are yes sir Q And in regard to that case and part of the notice for the deposition today relates to the allegations made back and forth between Pittsburgh Corning and Commercial Union Insurance Company in that case Correct A Yes sir MR MADEKSHO And as part -- well let me just ask you if you're familiar with the allegations -let me just do it this way Let me ask that this be marked as next in order EXHIBIT NO 26 MARKED NELL MC CALLUM & ASSOCIATES INC MR MADEKSHO 109 Q Mr. Lewis if you would turn over -- you are already turning over to the first and second pages et cetera There again this is a portion of the transcript from the hearing of June 24 1982 in the case styled Commercial Union Insurance Company v Pittsburgh Corning in the Federal Court in Philadelphia Correct A Yes sir 10 ee 0 And in regard to the appearances as far as we 11 the lawyers representing the various parties of course tee 12 we have earlier discussed that James Lewis Griffith was 13 representing Commercial Union Right 14 A Yes sir 15 Q And do you also see that in regard to the 16 representation of Pittsburgh Corning Corporation there 17 was a lawyer representing them by the name of Mr. John 18 McN.Cramer 19 A Yes sirI see that 20 And if you would turn to the -- you are 21 already looking at it 22 A Yes sir 23 Do you see the underscored portions of that 24 transcript in regard to the representations that were 25 made by the Pittsburgh Corning lawyetro the Federal NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Court there in June of 1982 110 A I note what's on Page 173 here yes sir Q And in regard to what is in the transcript that is all put on that first page of that exhibit A Well I think you have taken some statements partially out and put them on this summary exhibit on the top Q Corning The statements by the lawyers from that June 1982 hearing for Pittsburgh A . Yes I presume so sir Q Now for the benefit of the court and jury is it a correct recitation that the statements made by the lawyer for Pittsburgh Corning in June of 1982 was that First Commerical Union had knowledge that exposure to asbestos could produce asbestos disease manual Commercial Union's own 1937 engineering states quote Asbestosis is a disease caused by the inhalation of asbestos fibers close quote Commercial Union's own 1937 engineering manual states quote A potential asbestos hazard is to be looked for wherever asbestos dust is created close quote and finally that same manual states Industries which have this exposure to asbestos dust include insulation close quote NELL MC CALLUM & ASSOCIATES INC 111 And then the lawyer states to the court does he not that Now it's all there all you need to know it could not be more clear that Commercial Union knew that an asbestos hazard was to be looked for wherever asbestos dust was created and insulation was an industry in which the exposure existed Is that correct Is that in that 1982 hearing before the Federal Court _ _ A These are apparently representations of in 10 counsel They do appear the transcript 11 Q Now based upon Commercial Union's experience 12 in the asbestos litigation do you have any idea as to 13 why Pittsburgh Corning states in cases filed against 14 Pittsburgh Corning by asbestos victims that these 15 dangers could not be known until the late 1960s and why 16 Pittsburgh Corning's representatives were telling the 17 Federal Court in Philadelphia in 1982 that these hazards 18 were known by 1937 19 20 21 A You would have to ask the attorneys for Pittsburgh Corning sir statements as they did I don't know why they made the 22 Q You are familiar with Pittsburgh Corning's -- 23 I mean -- pardon me Strike that 24 You are familiar with Commercial Union's own 25 Asbestos Related Disease Claim Handling Procedures NELL MC CALLUM & ASSOCIATES INC 112 manual by Mr. Sommerville A I am familiar with the fact that Mr. Sommerville issued such a document MR MADEKSHO Let me ask that this be marked as next in order EXHIBIT NO 27 MARKED MR MADEKSHO se Q Does this appear to be the same claim handling procedures manual that you have reviewed 10 previously 11 A Yes sir 12 Q And it appears that on the bottom right 13 column or the right corner that there's a 14 Pittsburgh Corning exhibit sticker of August 13 1981 15 A I have no idea that that's Pittsburgh Corning 16 or otherwise 17 18 19 20 21 22 23 24 25 Q Let's turn over to the first page of Commercial Union's asbestos claims handling manual in regard to the introduction Do you recall reading the introduction before Mr. Lewis A Quite a while ago yes sir Q With your experience in the environmental claims section which included -- which includes asbestos have you formed the opinion that scientific studies have demonstrated that asbestos creates an NELL MC CALLUM & ASSOCIATES INC 113 especially high risk of lung cancer and other serious lung disease for workers who have been heavily exposed to this toxic substance as Commercial Union's manual states A I am not a medical person sir I have never formed that opinion I don't have the ability to form that opinion > ome Now this was prepared by a representative of Commercial Union though Correct 10 A Apparently so 11 Q Mr. Sommerville 12 at fae 13 A Yes sir Q Could you turn to the next page please and 14 under the section A Hazard to Human Health 15 A Yes sir 16 Q Do you recall Mr. Sommerville discussing with 17 you the fact that Commercial Union's own manual stated 18 that asbestos is a hazard to man's health and this was 19 recognized quite early 20 A I don't believe he ever discussed that with 21 me 22 23 24 25 Q Have you reviewed other documents in the files that have been prepared by Commercial Union stating that the cancer producing potential of asbestos was not established until 1949 NELL MC CALLUM & ASSOCIATES INC ) woes 114 10 11 12 13 14 15 16 17 18 19 20 21 22 24 25 A I haven't read that anywhere else Q Do you recall the other documents that we had reviewed earlier today that the first direct link to asbestos and cancer was 19357 A There were documents that had statements in | it of that nature Q And for how many decades had Commercial Union Insurance Company been in effect prior to 1935 A I believe you indicated at least three decades before that sir Q Have you had the opportunity to become familiar with allegations made by Commercial Union in regard to Pittsburgh Corning other than what we discussed earlier today about Mr. Griffith's allegation about the scheme and the concealing of the facts -- A No sir I have not Q -- by the manufacturers A I'm sorry No sir I have not Q Has Commercial Union ever taken the position that the asbestos products manufacturers have deliberately concealed facts and evidence from Commercial Union A Yes sir I believe there have been positions like that asserted in the past Q And could you tell us as to whom which NELL MC CALLUM & ASSOCIATES INC 115 manufacturers that Commercial Union has alleged that those particular asbestos products manufacturers concealed deliberately concealed facts and evidence from Commercial Union A Facts in evidence I'm sorry Q Facts and evidence A Oh facts and evidence My understanding was ey that those were some allegations that were made in Pittsburgh Corning and I believe they were also made in 10 litigation involving Eagle Picher 11 Q So the only ones that you are familiar with 12 is in regard to those allegations being made by 13 Commercial Union against Pittsburgh Corning and Eagle 14 Picher 15 A That's my recollection 16 Q And when the answers to interrogatories were 17 filed initially by Commercial Union there was no 18 mention I don't believe about the coverage that was in 19 effect for Armstrong World Industries Armstrong Cork 20 and we discussed that a little bit earlier today 21 concerning the California litigation 22 A Yes sir I don't believe that -- if they 23 weren't one of the individuals mentioned in your 24 complaint that's what you referred to 25 Q Right Armstrong is a party to this NELL MC CALLUM & ASSOCIATES INC 116 litigation A Okay Then the reason Armstrong World Industries is not mentioned I believe is because no payments have been made to or on behalf of Armstrong Q Okay Now of course we have determined that Commercial Union had coverage for Armstrong -- do you recall exactly how many years back that the coverage by Commercial Union goes for Armstrong Cork now known as Armstrong World Industries 10 A I believe it was a three period in the 11 mid Sixties It was an excess cover 12 Q Are you familiar with the allegations by 13 Commercial Union that Armstrong produced highly 14 dangerous containing products as early as the 15 1940s which gave rise to injury and death among its 16 employees and third users 17 A That may have been an allegation or an answer 18 in response to the original complaint in Armstrong I 19 don't believe it went much further than a defense that 20 was asserted 21 Q Let me ask you if you're familiar with this 22 allegation by Commercial Union against Armstrong Cork 23 now known as Armstrong World Industries Armstrong was 24 acutely aware of the deadly propensities of asbestos as 25 early as 1952 and increasingly thereafter but took NELL MC CALLUM & ASSOCIATES INC 117 absolutely no substantive steps to protect its own workers or third parties or to in any way curtail its own use of asbestos products Are you familiar with those allegations by Commercial Union A No I'm not sir MR MADEKSHO Let me ask you to take a look at this particular document and have that marked as next in order EXHIBIT NO 28 MARKED 10 MR MADEKSHO 11 Q Mr. Lewis what you presently have before you 12 is Commercial Union Insurance Company's post trial brief a[- 13 that was filed in the Superior Court of the State of 14 California during the trial of the California insurance 15 16 17 18 19 20 21 22 23 " 24 25 litigation A Yes sir MR MARTINSON Mr. Madeksho if I might intercede just for a moment certainly you are welcome to question the witness on this area but the specifics about allegations against or in favor of specific companies did not include Armstrong so for that reason we were not prepared MR MADEKSHO That's fine He can take his time But Armstrong wasn't answered on the interrogatories and I've since determined that there was NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 118 coverage by Commercial Union and that's the reason MR MARTINSON I have no quarrel with it I have no quarrel with you asking I want you to be aware that we weren't prepared to answer that because again it's not a specific item on your topic of inquiry MR MADEKSHO All right It would have been if they had been answered in the interrogatories MR MARTINSON Right MR MADEKSHO Q Let me ask you to turn to Page 19 of Commercial Union's allegations against Armstrong and the trial court there in California Do you see the section there where Commercial Union states that Armstrong intended to cause injury when they purposefully employed men to work with products they knew would result in asbestos disease and death A Yes sir I do Q And do you also see further starting approximately Line 18 -- the lines are numbered on the hand side -- where it states that From the early 1940s through the early 1970s Armstrong continued a course of conduct which was unrelenting in its quest for profit over the health concerns of its employees or third parties A The trial brief does so state NELL MC CALLUM & ASSOCIATES INC 119 Q Do you have any reason to dispute Commercial Union's allegations that were filed in the trial court in California A Sir I cannot recall what the testimony was that gave rise to this statement in the trial brief Q What I'm asking you about are the allegations that you have before you right now MR MARTINSON What is the question again MR MADEKSHO If you will just read back the 10 exact question for Mr. Lewis wen 11 COURT REPORTER Do you have any reason to 12 dispute Commercial Union's allegations that were filed _ 13 in the trial court in California 14 A The document does indicate that these 15 statements were made 16 MR MADeksho 17 Q And let's turn over to Page 21 in regard to 18 the allegations made by Commercial Union starting on 19 Line 6. Do you see there where it states that -- 20 Commercial Union states that Wegman admits that 21 documents refreshed his recollection that he was aware 22 in the early 1950s that Armstrong products could 23 contribute to asbestos diseases 24 A Yes sir it is so stated 25 Q Do you have any reason to dispute Commercial NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 120 Union's allegations concerning that particular bit of information A No sir I don't Q Do you see the next sentence there concerning Commercial Union's allegation that George W. Nichol who was a plant chemist for Armstrong during the mid 1950s likewise admits that he understood sometime between 1956 and 1957 that asbestos was a toxic material And would you have any reason to disagree with Commercial Union's allegations concerning that information A No sir Q Have you become aware during the course of your duties with Commercial Union that one of Commercial Union's insureds Manville had claims by the users of asbestos products that were filed against them by no later than 1935 A No I was not personally aware of that Q And you have been following this case fairly closely A The Manville case sir No this case here A No I haven't I have not been following the underlying matter at all NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 121 Q In regard to the case that we're here today you haven't been following that A Only to the extent of Commercial Union's involvement in this case Q Commercial Union was one of the insurance companies for Manville A Yes sir it was Q Had you become aware during the course of your -- any of your activities on behalf of Commercial Union in the asbestos litigation that by 1935 that users and installers of containing insulation products had filed claims against Manville A party claims Q party claims A I can't recall that having happened Q Had you become aware during the course of your duties that Manville started to put labels on its containing products in 1944 and didn't A sir I'm sorry I didn't follow that question Q Yes sir During the course of your duties with Commercial Union and Commercial Union's insuring and defending Manville have you become aware or did you become aware that Manville started to put warnings on its containing products by 1944 and NELL MC CALLUM & ASSOCIATES INC 121 Q In regard to the case that we're here today you haven't been following that A Only to the extent of Commercial Union's involvement in this case Q Commercial Union was one of the insurance companies for Manville A Yes sir it was od cm Q Had you become aware during the course of your -- any of your activities on behalf of Commercial - 10 Union in the asbestos litigation that by 1935 that 11 users and installers of containing insulation 12 products had filed claims against Manville 13 A Third claims 14 Q party claims 15 A I can't recall that having happened 16 Q Had you become aware during the course of 17 your duties that Manville started to put labels 18 on its containing products in 1944 and didn't 19 A I'm sorry I didn't follow that question 20 sir 21 Yes sir During the course of your duties 22 with Commercial Union and Commercial Union's insuring 23 and defending Manville have you become aware or 24 did you become aware that Manville started to put 25 warnings on its containing products by 1944 and NELL MC CALLUM & ASSOCIATES INC then didn't 122 A And then did not Q And then did not A No I don't recall that Q Now of course another one of Commercial Union's insureds has been Union Carbide Correct A Yes sir oan Q And during the course of your activities and involvement with the asbestos litigation on behalf of 10 Commercial Union have you become aware of when Union 11 Carbide states that the dangers of asbestos were known 12 A No sir 13 MR MADEKSHO Let me have this marked as 14 plaintiffs next in order 15 EXHIBIT NO 29 MARKED 16 MR MADEKSHO 17 18 19 20 21 22 23 24 25 Q Mr. Lewis I've got the entire document if you need to refer to it But the section I want to ask you about is in regard to this document that was prepared by Mr. I. C. Sayers entitled Asbestos as a Health Hazard in the United Kingdom turned over to that chart there And have you A I have Q Do you see the perspectives and the associated diseases relating to the asbestos industry NELL MC CALLUM & ASSOCIATES INC 123 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Yes sir Q And do you see that date 1900 when asbestosis was known A I do sir Q And that's the same date that we saw a little bit earlier in regard to the American Insurance Association documents 1900 Correct A There was a reference made to the year 1900 0 And do you also see in regard to the association of asbestosis and lung cancer approximately 1935 A Yes sir I see it on here Q And is that the same date of 1935 that we saw in the American Insurance Association documents that we looked at earlier A My recollection is it is the same date Q And do you also see in regard to the associated diseases relating to asbestos concerning insulation workers A Yes sir 0 And do you see when it was known in regard to insulation workers looks like around 1930 '31 A That's what the graph indicates Q And you are aware that Union Carbide mined asbestos was a miner of asbestos are you not NELL MC CALLUM & ASSOCIATES INC 124 A No I'm not sir Q Are you aware that the GAF Corporation mined asbestos A No sir I was not During the course of your involvement on behalf of Commercial Union Insurance Company did you become aware that the GAF Corporation had stated that as early as 1934 the United States knew that exposure to the asbestos dust released during the construction or 10 repair of its ships and other facilities including 11 particulartlhye installation or removal of thermal 12 insulation products posed a serious health risk to its 13 workers 14 A I don't recall that statement 15 Q During the course of your involvement with 16 Commercial Union and Eagle Picher in the asbestos 17 litigation did you become aware that Eagle Picher had 18 alleged that the government has since the turn of the 19 century possessed substantial direct knowledge of the 20 hazards of containing insulation products 21 A I don't recall that statement 22 Q Now Eagle Picher was one of the companies 23 that Commercial Union had accused of concealing 24 deliberately concealing facts even from Commercial 25 Union Correct NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 125 A That's correct They moved for rescission a And the other company was Pittsburgh Corning A I recall that's correct - During the course of your involvement on behalf of Commercial Union and its coverage for the Fibreboard Corporation did you become aware that Fibreboard had known since 1930 about exposure to asbestos dust being capable of producing asbestosis A I didn't know that it was particularly applicable to Fibreboard no sir| MR MADEKSHO Let me ask that this be marked as next in order EXHIBIT NO 30 MARKED MR MADEKSHO Q Mr. Lewis what you have before you is Corning's Amended Complaint for Declaratory Judgment that was filed in Ohio And what I would like you to do -~ well first of all let me see if I recall correctly You were not sure one way or the other as to whether or not that Commercial Union had insurance coverage for Corning A I think when you asked me that question originally I was not aware of it I believe that after givinigt some thought that there had been one policy period where Commercial Union had issued a NELL MC CALLUM & ASSOCIATES INC 126 year policy to Corning I don't recall whether or not it was for -- the settlement was as a result of asbestos bodily injury claims My recollection is though that if that's what it was there was a million dollar settlement on one policy on Corning and we were not really involved in any litigation with Corning Q Well during the course of your involvement with Commercial Union did you ever become aware of any 10 of the documents of Corning that threatened to 11 send information to the asbestos workers the insulators 12 about asbestos diseases being asbestosis and lung 13 cancer they started to send out in 1942 and then 14 didn't 15 MR THAMM Objection misstatement of facts 16 assumes facts not in evidence 17 A I'm not aware of that 18 MR MADEKSHO Let me ask that this be marked 19 as next in order 20 EXHIBIT NO 31 MARKED 21 MS CYNTHIA HOOPER INGLET ENTERED THE 22 DEPOSITION ROOM 23 MR MADEKSHO 24 Q Mr. Lewis what I need to find out sir is 25 as to whether or not you ever saw this 19 -- this NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 127 January 7 1942 correspondence on the letterhead of Corning Fiberglas Corporation A No sir I have never seen this Q If you would turn over to the second page And of course the subject of this is the ce on the front page is the Asbestos Workers Union Is that the subject matter of this 1942 correspondence A This company correspondence does refer to a subject as asbestos workers union Q And if you would on Page 2 do you see toward the bottom where there is a statement about the threat to distribute to all members of the union copies of the U.S. Public Health Bulletin No. 241 on Asbestosis A That's what the document says Q Were you aware sir that the Public Health Bulletin No. 241 is the 1938 publication known as the Dreessen report A No sir Q Were you familiar that the 1938 Dreessen report had numerous listings concerning references to the diseases of asbestosis and asbestosis and lung cancer A No sir I was not Q Mr. Lewis was Commercial Union did they NELL MC CALLUM & ASSOCIATES INC 127 January 7 1942 correspondence on the letterhead of Corning Fiberglas Corporation A No sir I have never seen this Q If you would turn over to the second page And of course the subject of this is the -- on the front page is the Asbestos Workers Union Is that the subject matter of this 1942 correspondence A This company correspondence does refer _________ to a subject as asbestos workers union __ 10 Q And if you would on Page 2 do you see 11 toward the bottom where there is a statement about the 12 threat to distribute to all members of the union copies 13 of the U.S. Public Health Bulletin No. 241 on 14 Asbestosis 15 A That's what the document says 16 Q Were you aware sir that the Public Health 17 Bulletin No. 241 is the 1938 publication known as the 18 Dreessen report 19 A No sir 20 Q Were you familiar that the 1938 Dreessen 21 report had numerous listings concerning references to 22 the diseases of asbestosis and asbestosis and lung 23 cancer 24 A No sir I was not 25 100 Mr. Lewis was Commercial Union did they NELL MC CALLUM & ASSOCIATES INC 128 know anything at any time concerning the plaintiffs request to Pittsburgh Corning concerning the second and third requests in the Searls case which related to documents of Travelers A I recall reviewing the requests but with reference to the documents sought I was not familiar with that To your knowledge then that Commercial Union had no involvement in regard to whatever occurred 10 concerning those documents after the plaintiff had 11 requested them in this case 12 MR MARTINSON If you can just give him a 13 second to take a look at that to refresh his memory 14 about what you asked for for Travelers Pittsburgh 15 Corning 16 A Both of these requests refer to documents 17 that referenced the litigation involving Pittsburgh. 18 Corning and Travelers which was an action that I don't 19 believe Commercial Union was a party to In 1984 it 20 was commenced 21 MR MADEKSHO 22 Okay Now you are referring to the 23 Pittsburgh Corning v Travelers Indemnity case 24 A Yes sir I believe that's the reference in 25 here NELL MC CALLUM & ASSOCIATES INC 129 Actually Commercial Union was a party to that litigation Take a look if you would at the front page of the docket sheet and that's headed up Pittsburgh Corning v the Travelers Indemnity Company and others And if you go down you see Commercial Union Insurance Company as successor to Employers Liability Assurance Corporation Limited A Yes sir it is listed My understanding was we were dismissed out of that case And I don't know 10 whether or not we would have received any pleadings 11 thereafter 12 Q Now you see the question being -- the 13 plaintiff had requested documents to be produced by 14 Pittsburgh Corning out of this case that you're 15 presently looking at the docket sheet And the question 16 being Do you or Commercial Union know anything about 17 what happened to those documents -- | 18 A I see 19 Q -- that the plaintiff requested that 20 Pittsburgh Corning produce to the plaintiffs in this 21 case 22 A No sir 23 I don't believe that was an exhibit 24 MR MADEksho Let's go ahead and have that 25 marked as next in order just for the record NELL MC CALLUM & ASSOCIATES INC 130 EXHIBIT NO 32 MARKED MR MADEKSHO Q Now we also wanted to discuss with Commercial Union its past or present medical directors and assistant medical directors and we had stated the names of several of them A Yes sir cow 0 Do you recall that A I do sir 10 And could you tell us as to when Commercial 11 Union first had medical directors 12 A I can't give you a specific date but my 13 sense would be that for any period of time that 14 Commercial Union or one of its subsidiary companies had 15 a life insurance company there would have been a medical 16 director attached to that company 17 Q And this would have gone back in time to 18 approximately what year to your knowledge 19 A I can't even speculate on that I don't know 20 when 21 Q At least 1930s 22 A My sense would be if there was a life company 23 attached at that point in time that's my only 24 contingency 25 Q In regard to the medical directors that were NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 131 mentioned in the notice of the deposition have you had an opportunity to review any affidavits that they have prepared previously in the asbestos litigation A I was unable to locate any affidavits prepared by Dr. Revotskie I could not locate any information on Mr. Kent as being a director of Commercial Union Q Union Is Dr. Revotskie is he still with Commercial | A In a semiretired capacity yes sir he is 0 Who the present medical director for Commercial Union A I believe Dr. Revotskie remains in that capacity Q And who would be the names of any assistant medical directors presently employed by Commercial Union .. A I'm not aware of any although in the past that there were associate medical directors Does Dr. Revotskie operate out of Commercial Union's home office in Boston | A Yes he does sir Q But you think ~-- it's your impression that he might be semiretired at this point A Yes sir NELL MC CALLUM & ASSOCIATES INC 132 131 mentioned in the notice of the deposition have you had an opportunity to review any affidavits that they have prepared previously in the asbestos litigation A I was unable to locate any affidavits I prepared by Dr. Revotskie could not locate any information on Mr. Kent as being a director of Commercial Union Q Is Dr. Revotskie is he still with Commercial . Union _10 A In a semiretired capacity yes sir he is 11 Q Who the present medical director for 12 Commercial Union 13 14 15 16 17 18 19 20 21 22 23 24 25 A I believe Dr. Revotskie remains in that capacity And who would be the names of any assistant medical directors presently employed by Commercial Union A I'm not aware of any although in the past that there were associate medical directors Does Dr. Revotskie operate out of Commercial Union's home office in Boston | A Yes he does sir Q But you think -- it's your impression that he might be semiretired at this point A Yes sir NELL MC CALLUM & ASSOCIATES INC 132 Q Does Commercial Union have any prospects of hiring a new medical director or have they interviewed anyone as a new medical director A Not to my knowledge Q Have you ever reviewed any of the papers manuals any documents that Dr. Revotskie has prepared previously relating in whole or in part to asbestos or asbestos diseases A When I searched for any affidavits of Dr. 10 Revotskie I would have also come up with any memoranda 11 that he might have prepared and I located none 12 MR MADEKSHO Why don't we take a short 13 break We're doing real well 14 RECESS] 15 VIDEOGRAPHER Going off the record 2:01 16 17 RECESS] 18 MS MANLEY My name is Barclay Manley I'm 19 with Fulbright & Jaworski and I'm appearing at this 20 deposition of Mr. Lewis on behalf of Aetna solely in the 21 Searls case identified in the notice and I am 22 appearing on behalf of Ford Bacon solely in the 23 Wilkening case appearing on the notice I am not 24 making an appearance on behalf of any of those entities 25 in any other case identified in the notice NELL MC CALLUM & ASSOCIATES INC  10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 133 MR MADEKSHO Do you want us to state our position on the record about that Barclay MS MANLEY No. MR MADEKSHO Of course obviously it's the plaintiffs position that Aetna is here for all purposes and all cases MS MANLEY And since he stated that on the record we strenuously disagree with that and I have made it clear my appearance RECESS VIDEOGRAPHER MR MADEKSHO 2:13 p.m. on the record Q Mr. Lewis in regard to the area of inquiry concerning the engineering manuals and the risk control and loss from loss department those type of manuals A Yes sir Q And when that information is prepared does Commercial Union use the most current available information in the preparation of such information for its own uses A I have no knowledge about how they go about preparing those manuals sir Q Does Commercial Union have any updated manuals other than the 1937 manual that we lookeadt earlier today NELL MC CALLUM & ASSOCIATES INC 134 A My sense would be that they do sir * Q Did you have an opportunity to check on that like you had checked on the affidavits for Dr. Revotskie et cetera a little bit earlier A No sir I did not Q Okay Would we need to talk to somebody from the engineering department about that or somebody from the risk control or the loss department concerning those manuals 10 A 11 sir As far as the availability of those manuals 12 Q Well in regard to the manuals when they 13 were prepared how they were prepared and who prepared 14 them when they were prepared et cetera 15 A If it's a question my sense is of whether 16 or not such current manuals are available and would they 17 be made available to you I can make that inquiry and 18 counsel can provide those if that's the issue 19 Q We would also want to know as to whether or 20 not there were some manuals that were dated from 1938 21 through 1963 that type of information 22 A 1938 through '63 23 Q Yes sir Could we ask that there be someone 24 make that inquiry and then let us know as to whether or 25 not that information would be available Is that NELL MC CALLUM & ASSOCIATES INC 10 11 23 13 14 15 16 17 18 19 20 21 22 23 24 25 135 permissible MR MARTINSON Mr. Madeksho I have no quarrel with you asking Mr. Lewis and certainly Mr. Lewis can do that if he would like But it would be subject to the attorneys objections if any that we might have MR MADEKSHO Certainly I understand MR MARTINSON I believe he can do the search for you THE WITNESS Yes sir MR MADEKSHO That was one of the areas of inquiry obviously for today's testimony and that's the reason I was making that inquiry MR MARTINSON I apologize We didn't read it in that fashion We assumed you were talking about the '37 manual MR MADEKSHO Oh okay MR MARTINSON But I'll be glad to have him make that search THE WITNESS Up through 1963 MR MADEKSHO That's correct THE WITNESS Yes sir MR MADEKSHO Q In regard to the area of inquiry concerning Commercial Union's environmental issues task force are NELL MC CALLUM & ASSOCIATES INC 136 you familiar with that particular task force A Yes sir task Q force And what is would do generally the things | that the A As initially constituted the task force was designed to be the central receiving point within Commercial Union for all types of environmently related claims to provide expertise on the handling of those claims and in the event there were coverage issues to 10 also provide research and litigation assistance in any 11 areas where there might be coverage issues involved 12 Q Are you familiar with a gentleman by the name 13 of William Bailey 14 A Yes sir I am 15 Q And who is William Bailey 16 A William Bailey was a senior vice president of 17 the claim department from approximately 1979 through 18 perhaps 1982 and it was during his tenure that the 19 environmental issue task force was created 20 Q Do you know as to whether or not Mr. Bailey 21 is still with Commercial Union Insurance Company in any 22 capacity 23 A He is not sir 24 Q Do you know when he left the employ of 25 Commercial Union NELL MC CALLUM & ASSOCIATES INC 137 A I believe it was 1982 or 1983 Q Did you personally know Mr. Bailey when he was with Commercial Union during that period of time A Yes I knew Mr. Bailey personally during that period yes sir Q Did y'all work together A We worked -- I worked in the claims department and Mr. Bailey was the senior claims officer at the time So I guess you could say I worked with him 10 and for him 11 Q Did he also represent Commercial Union at the 12 meetings for the American Insurance Association 13 A He could have been in attendance at those 14 meetings representing Commercial Union I don't know of 15 any specific meetings that he attended 16 Q Do you know as to whether or not he was 17 actually an officer in the American Insurance 18 Association 19 A No I don't know sir 20 MR MADEKSHO Let me ask that this be marked | 21 as next in order 22 EXHIBIT NO 33 MARKED 23 MR MADEKSHO 24 Q Mr. Lewis what you have before you is a June 25 13 1980 letter on the letterhead of the American NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 138 Insurance Association and at the bottom of the page it's got William O. Bailey vice president Is that William Bailey from Commercial Union A No sir it's not - That would not be the same A No sir it is not Let's turn over to the next page It's got the task force and then it has members and it's got William E. Bailey Would that be the William Bailey from Commercial Union A That is the William Bailey from Commercial Union Q - And he was a senior vice president in 1980 A Yes sir he was Q In regard to this task force from the American Insurance Association that Mr. Bailey from Commercial Union was -- appeared to be the -- was he -- appeared to be the chairman of the task force on the basis of the letter attached to the list of members A Yes sir it does appear that Q Did you ever have an opportunity to review the report that was prepared by the American Insurance Association the task force that Mr. Bailey was the chairman of A No sir NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 139 MR MADEKSHO Let me ask that this be marked as next in order EXHIBIT NO 34 MARKED MR MADEKSHO Q I believe this record is entitled the Estimates of Potential Liability from Asbestos and then also DBS Related Injuries A Yes sir it is Q Are you familiar with any estimates that have been made by Commercial Union as to the number of cancer deaths that can be expected from human beings that have been exposed to containing products A I'm not familiar with any specific numbers sir I understand that some type of a study had been performed an initial study in a rough draft form by Commercial Union Do Q __ you recall as to whether or not that that rough draft form that had been prepared by Commercial Union had numbers somewhere in the area of 65,000 lung cancer and mesothelioma claims as a result of asbestos exposure A No sir I only reviewed that document once many years ago when I became first involved and I have never seen or had an opportunity to review it again Q Do you know where that document is at this NELL MC CALLUM & ASSOCIATES INC 140 time A No sir Q Do you know of any independent studies that Commercial Union has made on its own about how many asbestos disease cancer deaths or deaths from asbestosis itself that can be anticipated from prior exposure to asbestos products A Well as I say I believe some type of a study a draft study was done in the early Eighties H 10 don't know what ever came of that study or whether or 11 not it was ever approved or used elsewhere 12 Q Take a look at the first page You see on 13 the hand corner of that document it's got draft 14 A Yes sir I do 15 Q And this was dated in the early 1980s 16 obviously because it's dated September 17 1980 17 A Yes But this was done by the research and 18 policy development department of the AIA I was 19 suggesting to you that people at Commercial Union had 20 attempted something internally 21 Q Okay So in other words we have one from 22 the American Insurance Association then Commercial 23 Union had their own 24 A And I don't know which came first 25 Q Okay Do you recall as to whether or not the NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 141 estimated thousands of deaths from cancer from prior asbestos exposure if those numbers were higher or lower in the Commercial Union's own study as opposed to the study that was done by the American Insurance Association A No sir I have absolutely no idea MR MADEKSHO One second Mr. Lewis thank you I have no further questions at this time Thank you That concludes this ~- MR MARTINSON We haven't heard from our -- MR BALLARD I can tell Corning is getting ready to open up an area of inquiry MR THAMM No no no I wouldn't do that Do I need a microphone or something MR MARTINSON He's got one for you EXAMINATION BY MR THAMM Q Mr. Lewis my name is Rick Thamm I've got just a few questions for you Earlier Mr. Madeksho mentioned something about an Corning Fiberglas policy Do you recall that A Yes I do sir NELL MC CALLUM & ASSOCIATES INC 142 Q A policy that apparently Commercial Union had issued for approximately a year period of time Is that right A That was my recollection sir Q issued Okay Do you know when that policy was A No I don't ... ' Do you know what that policy covered 01 A It was probably an excess liability policy 10 That's all I can recall 11 12 then You don't really know much about that policy 13 A None whatsoever 14 And also earlier Mr. Madeksho asked you 15 about a document that was purportedly on Corning 16 Fiberglas letterhead Is that right 17 MR MADEKSHO That's correct 18 MR THAMM 19 Do you recall Mr. Madeksho asking you about 20 that document 21 A I do sir It was Exhibit No. 31 22 Q Okay Would you have had any reason to see 23 that document before today 24 A I don't believe so 25 MR THAMM That's all I have Thanks very NELL MC CALLUM & ASSOCIATES INC much 143 MR MARTINSON Anybody else MR MADEKSHO That concludes this deposition VIDEOGRAPHER 2:25 p.m. end of deposition RRKKKRKKEEK 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NELL MC CALLUM & ASSOCIATES INC 144 SIGNATURE OF WITNESS I HARVEY G. LEWIS solemnly swear or affirm under the pains and penalties of perjury that the foregoing pages contain a true and correct transcript of the testimony given by me at the time and place stated with the corrections if any and the reasons therefor noted on a separate sheet of paper and attached hereto and that I am signing this before a Notary Public 10 11 12 13 HARVEY G. LEWIS 14 15 THE STATE OF MASSAChusetts I 16 17 Subscribed and sworn to before me the 18 undersigned by the said HARVEY G. LEWIS on authority 19 this the day of , 1992 11th JJuneune 22 22 22 Ulla 23 Notary Public in and for Imo 24 Commenuralt the Somasachu of Sommassachu Mas achuset s 25 My Commission Epires Jan. 31 1997 NELL MC CALLUM & ASSOCIATES INC THE STATE OF TEXAS CERTIFICATE 145 I Wanda Kelley a Certified Shorthand Reporter hereby certify that the foregoing testimony was given before me after the witness had been duly sworn F ore I further certify that this deposition was ... prepared under my direction and is a complete and correct transcript of the proceedings moe 10 I further certify that I am neither attorney 11 for related to nor employed by any of the parties or 12 any attorney of record in this cause nor do I have a __ 13 financial interest in the matter 14 Witness my hand in Houston Texas on this 15 the 21st day of May 1992 16 17 Wanda Kelley 18 19 Wanda Kelley CSR RPR 20 Certificate No. 2007 21 Nell McCallum & Associates 22 2900 Smith Suite 104 23 Houston Texas 77006 24 713 523-3767 25 My Certificate Expires December 31 1992 NELL MC CALLUM & ASSOCIATES INC 146 10 11 12 13 14 15 16 NO 0615 SHERMAN A. VS. SEARLS JR CORNING FIBERGLAS CORPORATION ET AL NO j IN THE DISTRICT COURT of ] BRAZORIA COUNTY TEXAS ] J 23RD JUDICIAL DISTRICT 1934 TOMMIE L. HEATHMAN ET UX } VS. ] CORNING FIBERGLAS } CORPORATION ET AL ] IN RE CONSOLIDATED IN THE DISTRICT COURT OF BRAZORIA COUNTY TEXAS 23RD JUDICIAL NO 87-37068 DISTRICT RICHARD B. VS. JACKSON ET UX CORNING FIBERGLAS CORPORATION ET AL NO ] IN THE DISTRICT COURT OF ] HARRIS COUNTY TEXAS ] ] 165th JUDICIAL DISTRICT 90-20663 GLADYS LORETTA STEELE ET AL IN THE DISTRICT VS. ] HARRIS COUNTY FISCHBACH & MOORE INC ] ET AL ] 55TH JUDICIAL NO 89-053547 COURT OF A DISTRICT HAZEL WILKENING ET AL ] IN THE VS. ] HARRIS FORD BACON AND DAVIS ] CONSTRUCTION CORP ET AL } 334TH NO 91-002902 DISTRICT COUNTY JUDICIAL COURT OF A DISTRICT LORETTA TURNER VS. ARMSTRONG WORLD INDUSTRIES INC ET AL REPORTER'S CERTIFICATE ] ] ] TO IN THE HARRIS DISTRICT COUNTY COURT OF TEXAS 189TH JUDICIAL DISTRICT THE DEPOSITION OF 17 HARVEY G. LEWIS 18 I Wanda Kelley a Certified Shorthand 19 Reporter for the State of Texas hereby certify 20 pursuant to the Texas Rules of Civil Procedure and 21 agreement of the parties present to the following 22 That this deposition transcript is a true 23 record of the testimony given by HARVEY G. LEWIS the 24 witness named herein on May 19 1992 after said 25 witness was duly sworn by me NELL MC CALLUM & ASSOCIATES INC 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 147 That $ 501.75 is the charge for the preparation of the completed deposition transcript and any copies of exhibits charged to Lawrence Madeksho Texas Bar Associatio Non. 12797500 That notification of the submission of the deposition transcript was received by the witness or the record attorney of for a party who was the witness on examined 22 , 1992 that same was to be and signed within 20 days of said date The attached Correction Sheet contains any changes made by the witness and the reasons therefor That the original deposition transcript together with copies of all exhibits was delivered or mailed in a postage addressed wrapper certified with return receipt requested on Sume 29 , 1992 for safekeeping and use at trial and hearings to the attorney or party who asked the first question appearing in the transcript That pursuant to Texas Rules of Civil Procedure 21a a copy of this certificate was served on all parties made known to me wit MR LAWRENCE MADEKSHO Law Offices of Lawrence Madeksho 8320 Gulf Freeway Suite 218 Houston Texas 77017-4598 NELL MC CALLUM & ASSOCIATES INC