For Immediate Release: Wednesday, July 23, 1997

For More Information Contact: TLPJ, 202-797-8600

1997 Public Justice Achievement Award Presented to Cox Litigation Team

The attorneys who won the landmark polybutylene plumbing class action settlement in Cox v. Shell Oil Co. were presented the 1997 Public Justice Achievement Award at TLPJ's 15th Anniversary Gala in San Diego on July 22 for their outstanding work on behalf of consumers nationwide. The Public Justice Achievement Award is presented to volunteer attorneys who win major victories in TLPJ cases concluded during the past year.

The Cox litigation, which began with the filing of Beeman v. Shell Oil in 1993, charged Shell Oil Company, E.I. du Pont de Nemours, and Hoescht Celanese with manufacturing and marketing defective polybutylene pipes and plumbing systems. The unprecedented settlement agreement, which became final in late 1996, provides a minimum of $950 million in relief and a potentially unlimited maximum to property owners. It is the largest property damage class action settlement in U.S. history.

"The litigation team in Cox crafted an extraordinary settlement for consumers nationwide," said TLPJ Foundation President William Snead of Albuquerque, New Mexico. "We are proud to honor these dedicated attorneys for securing justice for nearly six million victimized homeowners and creating a new model for the resolution of mass tort property damage cases."

Beginning in the late 1970s, Shell worked with Celanese and DuPont in the development and marketing of a polybutylene plumbing (PB) system. The pipes were made of polybutylene, which is a resin by-product of a Shell oil-refining process, and the fittings were developed and manufactured by Celanese and DuPont. The systems were marketed to the residential home market.

The three companies claimed the PB systems would last the normal lifetime of most buildings, but, in fact, the products were likely to degrade or corrode and ultimately fail when exposed to chemicals found in drinking water. And that is exactly what happened -- the pipes and pipe fittings began to spring leaks, causing millions of dollars in property damage.

TLPJ's original class action suit, Beeman v. Shell Oil Co., was filed in Texas state court in 1993, seeking damages to pay for the removal and replacement of the defective systems nationwide, and to punish the defendants for their wrongful conduct. In October 1994, a tentative settlement worth a minimum of $750 million was reached, only to be rejected without explanation by a Texas state district judge in February 1995. TLPJ refiled the class action in Texas federal court in April 1995, and the state court action was dismissed.

Once the Texas state court judge refused to approve the proposed minimum $750 million settlement, other lawyers began filing class actions on behalf of PB plumbing system victims. In particular, national class actions were filed in both Alabama and Tennessee. A proposed settlement was reached in the Alabama case requiring DuPont to pay consumers eight percent of the cost of property damage and replacing systems, but only if the homeowners paid for their entire systems to be replaced first. TLPJ denounced this proposal, saying it did not provide victims with meaningful relief.

Meanwhile, in June 1995, the Tennessee state court certified Cox v. Shell Oil as a national class action. TLPJ's original Beeman team eventually agreed to work with the Cox team and, after months of intense negotiations, an improved settlement was obtained. In July, the settlement in the now-combined cases was preliminarily approved in Tennessee state court, with the final approval granted in November 1995. All final appeals were dismissed in 1996.

The final settlement creates a potentially unlimited fund of at least $950 million in relief to property owners. It provides 100 percent compensation for unreimbursed repair costs and property damages, ensures that class members who suffer just one "qualifying" leak can have their entire system replumbed at no cost, offers free replumbs up to 16 years after initial installation, creates a special "grace period" for the filing of claims for past property damage and repair costs without regard to the statute of limitations, and gives additional relief to class members in special circumstances.

To ensure that the settlement is properly administered and class members know of their rights, the settlement also created the Consumer Plumbing Recovery Center (CPRC), which has a toll free information number for class members -- 1-800-876-4698 -- and gives recurring notice to all class members. As of this writing, over 110,000 property owners have had their systems replaced for free.

Under the improved settlement, the unprecedented, open-ended funding structure originally negotiated by TLPJ's team stayed in place, but the defendants' initial commitment was increased to $950 million. The initial "free replumb" period was doubled, and the amount allocated for past damages was increased from $50 million to $75 million. The class was also expanded to cover two more years of homeowners, and the interest on the funds paid by the defendants was no longer counted toward their initial payment.

TLPJ lauds the extraordinary work of all members of the Cox litigation team, especially original Beeman co-lead counsel Michael Caddell of Houston's Caddell & Chapman and David Weinstein of Philadelphia's Weinstein, Kitchenoff, Scarlato & Goldman Ltd. We also congratulate the rest of TLPJ's original Beeman team: Robert Kitchenoff of Weinstein, Kitchenoff; Dennis Burns of Dallas; George Croner of Philadelphia's Kohn, Swift & Graf; Chuck Dorr of Duluth, Georgia; Houston attorneys Steve Hackerman of Bristow, Hackerman, Wilson & Peterson, Jim Moriarty of James R. Moriarty & Associates, Marc D. Murr of Marc D. Murr, P.C., and James B. "Skip" Warren of Caddell & Warden. And we honor and thank our co-counsel in Cox: Gordon Ball of Knoxville; Don Barrett of the Barrett Law Offices in Lexington, Mississippi; Bruce Conley and Steve Conley of Conley, Campbell, Moss & Smith in Union City, Tennessee; Phillip Feliciano of Kensington, Maryland; Robert Lieff, Elizabeth J. Cabraser, and Morris A. Ratner of San Francisco's Lieff, Cabraser, Heimann & Bernstein; Steve Martino of Mobile's Jackson, Taylor & Martino; Washington, D.C.'s Beverly Moore of Moore & Brown, and Michael D. Hausfeld and Gary E. Mason of Cohen, Milstein, Hausfeld & Toll; Eric Olson of Heins, Mills & Olson in Minneapolis; and Patrick Pendley of Plaquemine, Louisiana.