APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA
Before: Adams, Gibbons, and Weis, Circuit Judges.
This asbestos diversity case presents several issues under the Pennsylvania Joint Tortfeasors Act. We hold that payments made to plaintiffs by defendants who are not determined to be joint tort-feasors do not diminish the damages plaintiffs are entitled to recover. However, a release in favor of joint tort-feasor who files a petition in bankruptcy before paying the agreed settlement amount does act to reduce the plaintiffs' verdict pro rata. We hold further that Pennsylvania delay damages may be assessed against a non-settling defendant only on its pro rata share of a verdict. Because claims against a potential joint tort-feasor remain open in the district court we will affirm in part and remand.
The plaintiffs' complaint named eighteen defendants. At various times, up until closing argument to the jury, settlements were reached with a number of them. Plaintiffs went to the jury on their claims against defendants Pittsburgh Corning and Johns-Manville, recovering verdicts against both. The jury also determined that six of the settling defendants contributed to the plaintiffs' injuries.
After denying post-trial motions for judgment n.o.v. and new trial, the district court reduced the verdicts because of pro rata releases executed by plaintiffs and added delay damages as provided by Pennsylvania state practice. Plaintiffs and defendant, Pittsburgh Corning, have appealed.
Plaintiff John Rocco was employed at the New York and the Philadelphia Naval shipyards from 1943 to 1981. During that time, he was exposed to asbestos products and dust which led to asbestosis. The complaint against the defendants, manufacturers and suppliers of asbestos products, asserted a claim for damages based on strict liability, specifically failure to warn. Some of the defendants filed cross-claims and third-party actions against other manufacturers. At some point before trial, the plaintiffs' claims and defense cross-claims against Kenne Corporation, one of the original defendants, were served and assigned to another judge for disposition.*fn1
Before the case reached the jury, plaintiffs settled with most of the defendants and signed pro rata releases. Because differing releases and procedures were used, the legal effect to be given these settlements varies.
The jurors determined that the conduct of Johns-Manville and Pittsburgh Corning was a proximate cause of the plaintiffs' injuries and awarded $500,000 to John Rocco and $50,000 to his wife Antoinette. In answering special interrogatories submitted in conjunction with the defendants' cross-claims, the jury found that six of the settling defendants had also proximately caused the plaintiffs' injury. The defendants in that category will be referred to hereafter as Group C. The jurors were not told that other companies, designated here as Group A and B, had been defendants and that they too had settled.
The post-trial proceedings were complex. Johns-Manville and Pittsburgh Corning moved for judgments n.o.v. and new trial based on insufficiency of the evidence and excessiveness of the verdicts. Plaintiffs filed motions for directed verdict nunc pro tunc and for judgment n.o.v. on behalf of three of the Group C cross-claim defendants, alleging that there was insufficient evidence to support the jury's findings against them. Plaintiffs also moved to add delay damages to the verdict, pursuant to Pennsylvania Rule of Civil Procedure 238. Johns-Manville and Pittsburgh Corning moved to mold the verdict because plaintiffs had signed pro rata releases that would reduce the amount of the verdicts.
On September 9, 1982, the district court filed an opinion and order denying the motions for judgment n.o.v. and new trial. The motions to mold the verdicts were granted in part and denied in part. As part of the order, plaintiffs were directed to furnish the court with the amounts paid by the Group C defendants for the pro rata releases. The plaintiffs' motion to add delay damages was granted, but entry of the amounts due was reserved until the court modified the verdicts. Johns-Manville and Pittsburgh Corning both appealed the September order.*fn2 Later, the district court conducted a hearing and on December 15, 1982, filed another memorandum and order. The court computed the delay damages at 10 percent per year on John and Antoinette Rocco's awards. The court then proceeded to reduce the verdicts by giving effect to the various settlements.
The court divided the settling defendants into three categories. Group A was composed of eight defendants who had paid a total of $47,500.*fn3 The culpability of these defendants had not been submitted to the jury, and the releases signed by plaintiffs did not acknowledge these defendants to be joint tort-feasors. However, the court decided that "on principles of equity and fairness," the amount paid by the Group A defendants should be deducted from the verdicts to prevent double recovery by plaintiffs.
Group B was composed of one defendant, Owens Corning Fiberglass. It was acknowledged to be a joint tort-feasor by the terms of a release signed by plaintiffs and reciting a consideration of $25,000.
The third group was the Class C defendants -- those who were adjudicated joint tort-feasors by the jury. The six companies in this group had paid a total of $65,750.*fn4
After classifying the settling defendants, the district court concluded that there were nine joint tort-feasors; Johns-Manville, Pittsburgh Corninng, and the Group B and C defendants. That being so, the court held that a pro rata share of each defendant was one-ninth. Accordingly, Johns-Manville and Pittsburgh Corning were jointly and severally liable for two-ninths of the total verdict.
After performing the various calculations, the court entered judgment in favor of plaintiff John Rocco against Johns-Manville and Pittsburgh Corning, jointly and severally in the amount of $127,482.63. Judgment was entered in favor of Antoinette in the amount of $12,747.12.*fn5 The plaintiffs' claims against the remaining defendants, with the exception of the severed count against Keene Corporation, were dismissed.
Plaintiffs and Pittsburgh Corning appealed the December judgment but Johns-Manville did not. After the appeals had been taken, the parties secured an order from the district court, stating that the December order was final as to all parties except Keene Corporation. Therefore, only the appeals of plaintiffs and Pittsburgh Corning from the December order are currently before us. Even though obtained after the appeal had been filed, the 54(b) certification permits us to reach the merits of these appeals. See Feather v. United Mine Workers of America, 711 F.2d 530 (3d Cir. 1983); ...