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Kimberlee Williams v. BASF Catalysts LLC, 13-1089 (2014)

Court: Court of Appeals for the Third Circuit Number: 13-1089 Visitors: 76
Filed: Sep. 03, 2014
Latest Update: Mar. 02, 2020
Summary: PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT No. 13-1089 KIMBERLEE WILLIAMS, individually, as personal representative of the Estate of Charles L. Williams, deceased on behalf of said estate, and as representative of others similarly situated; NANCY PEASE, individually, as personal representative of the Estate of William Clark, deceased on behalf of said estate, and as representative of others similarly situated; MARILYN HOLLEY, as personal representative of the Estate of Kat
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                                           PRECEDENTIAL

         UNITED STATES COURT OF APPEALS
              FOR THE THIRD CIRCUIT

                         No. 13-1089


      KIMBERLEE WILLIAMS, individually, as personal
representative of the Estate of Charles L. Williams, deceased
     on behalf of said estate, and as representative of others
similarly situated; NANCY PEASE, individually, as personal
  representative of the Estate of William Clark, deceased on
behalf of said estate, and as representative of others similarly
situated; MARILYN HOLLEY, as personal representative of
   the Estate of Kathryn Darnell, deceased on behalf of said
estate, and as representative of others similarly situated; and;
 DONNA WARE, individually, as personal representative of
  the Estate of Jennifer Graham, deceased on behalf of said
    estate, and as representative of others similarly situated;
      DONNETTE WENGERD, individually, as personal
representative of the Estate of Jennifer Graham, deceased on
behalf of said estate, and as representative of others similarly
               situated; ROSANNE CHERNICK,
                                            Appellants
                               v.

   BASF CATALYSTS LLC; CAHILL GORDON AND
 REINDEL LLP; CAHILL GORDON AND REINDEL, A
Partnership including a Professional Corporation; THOMAS
  D. HALKET; ARTHUR A. DORNBUSCH, II; GLENN
HEMSTOCK; HOWARD G. SLOANE, a/k/a Peter Sloane;
   IRA J. DEMBROW; SCOTT A. MARTIN; JOHN DOE
BUSINESS ENTITIES 1 TO 100, are fictitious coporations,
 partnerships, or other business entities or organizations that
 BASF Catalysts LLC is responsible or liable for and whose
 identities are not presently known, which entities may have
   mined, milled, manufactured, sold, supplied; JOHN DOE
 BUSINESS ENTITIES 101 TO 200, are the fictitious firms,
           corporations, partnerships, limited liability
      companies/associations or other business entities or
organizations whose indentities are not presently known, and
who may have perpetrated, or are responsible for, are the alter
  egos; JOHN DOE LAWYERS 1 TO 500, are the fictitious
      names of lawyers and law firms, legal professional
     corporations, legal professional partnerships, or other
  professional business business entities or organizations, or
their agents, employees, or servants, acting within the course
    and; JOHN DOE 1 TO 500, are the fictitious names of
  individuals whose identities are not presently known, who
   may have perpetrated, aided and abetted, conspired with,
  acted in concert with and/or are secondarily responsible or
        liable under law for the conduct or activities of
                       _____________
      On Appeal from the United States District Court
             for the District of New Jersey
                 (D.N.J. No. 2-11-cv-01754)
        District Judge: Honorable Stanley R. Chesler
                       _____________
                  Argued: March 13, 2014
Before: McKEE, Chief Judge, and AMBRO and FUENTES,
                    Circuit Judges




                                2
                 (Filed: September 3, 2014)

Michael Coren, Esq,
Harry M. Roth, Esq.
Cohen, Placitella & Roth, P.C.
2001 Market Street
Two Commerce Square, Suite 2900
Philadelphia, PA 19103

Christopher M. Placitella, Esq.
Cohen, Placitella & Roth, P.C.
127 Maple Avenue
Red Bank, N.J. 07701

Jeffrey M. Pollock, Esq. [Argued]
Fox Rothschild LLP
Princeton Pike Corp. Center
997 Lennox Drive
Princeton Pike Corporate Center, Building 3
Lawrenceville, N.J. 08648
       Attorneys for Appellants

Stephen M. Orlofsky
David C. Kistler
Blank Rome LLP
301 Carnegie Center, 3rd Floor
Princeton, N.J. 08540

Eugene F. Assaf, Esq. [Argued]
Daniel A. Bress, Esq.
Peter A. Farrell, Esq.
Michael F. Williams, Esq.
Kirkland & Ellis LLP




                                  3
655 Fifteenth Street, N.W.
Suite 1200
Washington, D.C. 20005
       Attorneys for Appellee BASF Catalysts LLC

Robert E. Ryan, Esq.
Marc D. Haefner, Esq,
Craig S. Demareski, Esq.
Connell Foley LLP
85 Livingston Avenue
Roseland, N.J. 07068

John K. Villa, Esq.
David S. Blatt, Esq.
Kannon K. Shanmugam, Esq, [Argued]
Matthew B. Nicholson, Esq.
Richard A. Olderman, Esq.
Williams & Connolly LLP
725 Twelfth Street, N.W.
Washington, D.C. 20005
      Attorneys for Appellees Cahill Gordon & Reindel LLP,
      Howard G. Sloane, Ira J. Dembrow, and Scott A.
      Martin

Eric Tunis, Esq. [Argued]
Greenbaum, Rowe, Smith & Davis
99 Wood Avenue South
Iselin, NJ 08830

Olivier Salvagno Esq.
Greenbaum, Rowe, Smith & Davis LLP
Metro Corporate Campus One, Suite 4
P.O. Box 5600




                              4
Woodbridge, N.J. 07095
     Attorneys for Appellee Thomas D. Halket

Walter F. Timpone, Esq.
Walter R. Krzastek, Jr., Esq.
Michael B. Devins, Esq.
McElroy, Deutsch, Mulvaney & Carpenter, LLP
1300 Mt. Kemble Avenue
P.O. Box 2075
Morristown, N.J. 07962
      Attorney for Appellee Glen Hemstock

Kevin H. Marino, Esq.
John A. Boyle, Esq.
Marino, Tortorella & Boyle, P.C.
437 Southern Boulevard
Chatham, N.J. 07928
      Attorneys for Appellee Arthur A. Dornbusch, II


                         OPINION



FUENTES, Circuit Judge.
    This putative class action lawsuit alleges that BASF
Catalysts LLC and Cahill Gordon & Reindel conspired to
prevent thousands of asbestos-injury victims from obtaining
fair tort recoveries for their injuries. Decades ago, BASF’s
predecessor, Engelhard Corp, discovered that its talc products
contained disease-causing asbestos. Plaintiffs allege that,
rather than confront the consequences of this discovery,




                                5
Engelhard, with the help of its attorneys from Cahill, elected to
pursue a strategy of denial and deceit. According to the
complaint, Engelhard and Cahill collected the tests and reports
that documented the presence of asbestos in Engelhard talc and
they destroyed or hid them; when new plaintiffs focused on
Engelhard’s talc as a possible cause of their disease, Engelhard
represented that its talc did not contain asbestos and that no
tests had ever said otherwise.
    As pleaded, this lawsuit concerns years of purported deceit
by Engelhard and Cahill. This action is not itself an asbestos
injury case, but rather an action about Engelhard and Cahill’s
conduct when they confronted asbestos injury cases in state
courts around the country. The alleged scheme outlived most
of the original plaintiffs, whose diseases have since taken their
lives. It did not last forever. Spurred by recent testimony that
Engelhard’s talc contained asbestos and that the company
knew it, survivors and successors of the original asbestos-
injury suits have brought new claims against Cahill and BASF,
Engelhard’s successor. The crux of their complaint is that
BASF and Cahill defrauded them in their initial lawsuits and
caused them to settle or dismiss claims that they would
otherwise have pursued.
    The District Court dismissed plaintiffs’ complaint in its
entirety. Analyzing the claims individually, the District Court
determined that each was inadequately pled or barred by law.
Analyzing the various declarations and injunctions requested
by plaintiffs—ranging from an injunction against the future
invocation of res judicata based on past state court judgments
to a declaration that BASF and Cahill committed fraud—the
District Court dismissed them as beyond its power to grant.
The Court did, however, reject defendants’ argument that the
Rooker-Feldman doctrine deprived it of jurisdiction. Plaintiffs




                                 6
have appealed the dismissal of three claims: fraud, fraudulent
concealment, and violation of the New Jersey Racketeer
Influenced and Corrupt Organizations Act. Plaintiffs also
defend their requested relief.
    We conclude that the District Court erred when it dismissed
the fraud and fraudulent concealment claims. The Amended
Class Action Complaint properly alleges the elements of fraud
and fraudulent concealment—namely that BASF and Cahill
lied about and destroyed the asbestos evidence to plaintiffs’
detriment. Neither the New Jersey litigation privilege nor
pleading requirements stand in the way of these claims.
    The District Court did not err in dismissing the New Jersey
RICO claim. Plaintiffs, obliged to plead an injury to their
business or property, have not done so. They have alleged an
injury to the prosecution of their earlier lawsuits which, under
New Jersey law, does not constitute an injury to their property.
    Lastly, the District Court correctly discerned that it could
not grant plaintiffs all of their requested relief. To the extent
that plaintiffs attempt to have the District Court decide, at this
point, the statute of limitations, laches, and preclusion issues
that will likely arise in future cases, plaintiffs fail to present at
Court with a whole or ripe controversy. Plaintiffs may,
however, seek injunctive and declaratory relief aimed at
resolving the claims alleged.
    Accordingly, we reverse in part, affirm in part, and remand
for further proceedings.

I. Background of the Case
   We accept as true the Amended Class Action Complaint’s
well-pled allegations. That complaint alleges a sustained plot
by BASF and its law firm, Cahill Gordon, to mislead actual and




                                   7
potential asbestos-exposure plaintiffs into believing that
BASF’s talc products did not contain asbestos. In truth,
plaintiffs contend, BASF’s own tests and records proved that
its talc products contained asbestos.

    Defendants in this case include both Engelhard’s successor,
BASF, and Engelhard’s former employees and attorneys. For
much of the events of the case, the relevant BASF companies
operated under the Engelhard label.1 Thomas D. Halket was
BASF’s in-house counsel assigned to asbestos claims. Glenn
Hemstock was BASF’s Vice President of Research and
Development. Hemstock supervised those scientists who
“tested or conducted research on Engelhard’s talc.” Compl. ¶
42. Arthur A. Dornbusch II was BASF’s General Counsel. We
refer to these BASF defendants as “BASF” or “Engelhard.”
    Cahill Gordon & Reindel LLP represented BASF and its
predecessors in asbestos litigation from 1983 to 2010. During
that time, Howard G. Sloane, Scott A. Martin, and Ira J.
Dembrow worked for BASF as lawyers at Cahill. We refer to
these Cahill defendants as “Cahill.”
    The six named plaintiffs in this action represent the interest
of a deceased spouse or relative who had worked in proximity
to asbestos and died of asbestos disease. These plaintiffs—for
whom we will often use Kimberlee Williams as a
representative—assert fraud, fraudulent concealment, and
New Jersey RICO claims on behalf of their deceased relatives.


1
 The Engelhard businesses included Engelhard Corp.,
Engelhard Industries, Engelhard Mineral & Chemical Corp.,
and Eastern Magnesia Talc Co. BASF acquired the Engelhard
companies in 2006.




                                  8
   A. Engelhard mined talc containing asbestos.
   From 1967 to 1983, Engelhard operated a talc mine in
Johnson, Vermont. “Talc is a naturally occurring mineral that
is mined and then processed or used in manufacturing by
companies in numerous parts of the United States.” Compl. ¶
68. Engelhard processed the talc from the Johnson Mine into
products, such as “Emtal talc” and “G&S Talc.” Compl. ¶ 73.
These products found use in wall board, joint compound, auto
body “filler,” dusting agents, and children’s balloons. Compl.
¶ 74.
    Emtal talc and other Engelhard talc products “contained
chrysotile asbestos fibers, as well as other asbestos forms
including tremolite and serpentine asbestos.” Compl. ¶ 75.
During the 1970s and 1980s, multiple laboratory tests indicated
that Engelhard talc, including Emtal brand talc and talc from
the Johnson Mine, contained asbestos. Engelhard, and later
BASF, “had knowledge” of these tests and their results, and, in
fact, maintained “[t]he tests and assay results” in their records.
Compl. ¶¶ 76-80.
    Faced with unfavorable test results, Engelhard ignored
them. According to the complaint, Engelhard “represented to
its customers, industry trade groups and the Federal
Government that the Emtal talc was asbestos free and even
marketed the product as a viable asbestos substitute, thereby
causing wide spread [sic] and unknowing exposure to asbestos
to United States citizens, including workers and workers’
spouses and children, nationwide.” Compl. ¶ 83.

   B. Engelhard gets sued for the asbestos-related death of
       an employee.
  In 1979, David Westfall sued Eastern Magnesia Talc
Company, an Engelhard subsidiary, for exposing his deceased




                                  9
relative to asbestos. Cahill Gordon defended Eastern Magnesia
in the suit. The lawsuit turned-up “test and assay results”
confirming the presence of asbestos in Engelhard’s talc.
Compl. ¶ 91.
    Engelhard’s personnel and records demonstrated that the
talc had been contaminated. Glenn Hemstock, then an
Engelhard scientist and executive, gave two days of deposition
testimony in the Westfall case. Hemstock testified that Emtal
talc contained asbestos fibers. He “admitted that various tests
performed throughout the 1970s and 1980s, both by
[Engelhard] employees and by third parties, indicated the
presence of asbestos fibers in Emtal talc that was tested or
assayed.” Compl. ¶ 98. Emil J. Triglia, an Engelhard employee,
also testified that Emtal talc contained asbestos fibers. Peter
Gale, an Engelhard researcher, testified that he had conducted
analytical testing on talc ore samples obtained from the
Johnson mine. He recorded his results in lab notebooks stored
in Engelhard’s library.
     After these depositions, BASF, through Cahill, settled the
Westfall case. The settlement included a confidentiality clause
that prohibited the Westfall parties from discussing the case or
sharing the evidence. Much of the Westfall evidence has yet to
be seen again.

   C. Engelhard covers-up its asbestos exposure to mitigate
       future tort liabilities.
    Engelhard anticipated that the Westfall action would be the
first of many asbestos lawsuits. In March 1984, Hemstock
circulated a memorandum entitled “DOCUMENT
RETRIEVAL—DISCONTINUED OPERATIONS.” Compl.
¶ 128. The memorandum directed Engelhard employees to
collect for discard documents relating to Emtal talc. It stated




                                  10
that “[i]t is the policy of Engelhard Corporation to avoid the
undue accumulation of documents that are no longer likely to
be needed in our business operations.” Compl. Ex. 3. The
memorandum instructed employees to collect materials related
to Engelhard Minerals Ltd. and Emtal, among other
“discontinued operations.” Compl. Ex. 3. The employees
complied. “All documentary evidence relating to Engelhard’s
asbestos-containing talc[] was thereafter gathered up, collected
by the BASF Perpetrators or their agents, and subsequently
was either destroyed or secreted away . . . .” Compl. ¶ 131.
    Next, the complaint alleges, Engelhard manufactured
favorable evidence with Cahill’s help. Together, they
assembled “template and stock pleading, discovery and
motions documents for use by local counsel in asbestos injury
claim lawsuits” that contained false or misleading information
about Emtal talc products. Compl. ¶ 144(e). Engelhard and
Cahill procured “false unsworn and sworn representations,
including false affidavits, false and incorrect expert reports and
discovery response verifications by [Engelhard] employees,
[Engelhard] officers, and/or [Engelhard] consultants and
experts.” Compl. ¶ 144(h).
     Cahill and Engelhard, and later, BASF, used the absence of
inculpating evidence and the existence of false exonerating
evidence to frustrate asbestos injury suits. The complaint
charges that, when lawsuits materialized, BASF and Cahill
misled the claimants about the facts. “[W]henever an asbestos
injury claim or lawsuit was filed or came to BASF’s attention,”
BASF represented “systematically and uniformly
. . . that Emtal talc ore and products did not contain asbestos
and/or there was not any evidence that it did.” Compl. ¶ 138.
Indeed, BASF’s lawyers threatened claimants and their
lawyers “with the possibility of sanctions or penalties if




                                 11
asbestos claims or suits were not discontinued by questioning
counsels’ good faith basis to continue the claims” in light of
BASF’s representations that its talc products did not contain
asbestos. Compl. ¶ 144(i). Further, because BASF and its
lawyers made these misstatements “in correspondence,
responses to discovery and/or pleadings or motion papers,”
they misled courts as well as adversaries. See Compl. ¶¶ 144(f),
144(j).
   The scheme worked against the named plaintiffs.
Williams’s husband, Charles, for example, developed
asbestosis and lung cancer after a career at Goodyear Tire &
Rubber. The Williams sued Engelhard in Ohio state court.
Defendants told them that Engelhard’s talc did not contain
asbestos. In response, they voluntarily dismissed the claims
against Engelhard. Similarly, the other plaintiffs discontinued,
dismissed, or settled their asbestos-injury lawsuits against
BASF based on Engelhard and Cahill Gordon’s false
representations.

   D. A recent lawsuit revealed the long-standing scheme.
    The scheme collapsed a few years ago, during a New Jersey
Superior Court action. In that case, Paduano v. Ace Scientific
Supply Co., a former research chemist for Engelhard testified
that he had discovered asbestos in Engelhard’s talc while
working for the company many years ago. No. MID-L-2976-
09 (N.J. Super.). He further testified that Engelhard closed the
Johnson mine because it contained asbestos and that defendant
Hemstock instructed him to turn over all of his talc-related
records.
   The chemist’s testimony triggered discovery into what
documents BASF had destroyed or concealed in the litigation.
Many of these documents had been secretly kept in a Cahill




                                12
storage facility. The Paduano case settled and the
incriminating documents were placed in escrow pursuant to the
terms of the settlement agreement. Among the documents are
tests from 1972, 1977, 1978, and 1979 that establish the
presence of asbestos fibers in Engelhard talc. None had ever
been produced or disclosed in earlier litigation.

   E. Proceedings before the District Court
    In the aftermath of the Paduano case, Williams and the
other named plaintiffs commenced this action. The Amended
Class Action Complaint asserted claims of N.J. RICO, N.Y.
Judiciary Law § 487, fraudulent concealment, fraud, fraud-
upon-the-court, unjust enrichment, and civil conspiracy. For
these claims, Williams requests declaratory and injunctive
relief intended to constrain BASF and Cahill from asserting res
judicata, statute of limitations, or other defenses that may be
asserted in future or re-activated asbestos-injury suits.
Williams also requests a range of other relief, including class
certification, a notice “informing Class Members or their
representatives of the pendency of this action,” an injunction
against further spoliation or misrepresentations, and “[a]
determination of Defendants’ liability for punitive damages to
Plaintiffs and the Class relating to the spoliation of evidence
relevant and material to establishing asbestos injury claims
against BASF.” See Complaint Demand for Relief ¶¶ (d), (f),
& (i).
    BASF, Cahill, and the individual defendants moved to
dismiss the Amended Class Action Complaint. They argued
that (1) the District Court lacked jurisdiction over the case
because of the Rooker-Feldman doctrine, (2) the plaintiffs had
not adequately pled their claims, and (3) the District Court
lacked the authority, or jurisdiction, to order the requested
relief due to either the Anti-Injunction Act or principles of




                               13
justiciability. The District Court rejected the challenge to its
jurisdiction, but it accepted most of the other arguments. With
respect to the N.J. RICO and fraudulent concealment claims,
the Court concluded that Williams had not adequately pled
them. With respect to the fraud claim, the Court determined
that New Jersey’s litigation privilege immunized defendants
from tort liability. With respect to the requested relief, the
Court determined that it lacked the power to order much of the
requested relief because the relief would undermine state court
judgments in violation of the Anti-Injunction Act or because
the relief would decide issues to be raised in future lawsuits.
    Accordingly, the District Court granted BASF’s and
Cahill’s motions under Rule 12(b)(6) of the Federal Rules of
Civil Procedure, and dismissed the complaint in its entirety
with prejudice. Williams has appealed the dismissals of the
N.J. RICO, fraud, and fraudulent concealment claims, and
challenged the District Court’s conclusions regarding its power
to order her requested relief.

II. Jurisdiction
   Defendants renew their Rooker-Feldman challenge to
federal jurisdiction. The Rooker-Feldman doctrine strips
federal courts of jurisdiction over controversies “that are
essentially appeals from state-court judgments.” Great W.
Mining & Mineral Co. v. Fox Rothschild LLP, 
615 F.3d 159
,
165 (3d Cir. 2010). The District Court concluded that Williams
was not appealing from a state court judgment and, therefore,
exercised jurisdiction pursuant to 28 U.S.C. § 1332.
   We agree with the District Court that Williams’s suit does
not trigger Rooker-Feldman and thereby deprive federal courts
of jurisdiction. “Rooker-Feldman . . . is a narrow doctrine,
confined to cases brought by state-court losers complaining of




                                14
injuries caused by state-court judgments rendered before the
district court proceedings commenced and inviting district
court review and rejection of those judgments.” Lance v.
Dennis, 
546 U.S. 459
, 464 (2006) (quotation marks omitted);
see Great W. Mining & Mineral 
Co, 615 F.3d at 166
. Those
circumstances do not appear here.
    Williams does not complain of an injury caused by a state-
court judgment. She asserts claims for fraud, fraudulent
concealment, and N.J. RICO. Each of those claims hinges on
BASF and Cahill’s actions before and during earlier asbestos-
injury    lawsuits.   In     particular,  Williams     targets
misrepresentations made by BASF and Cahill regarding the
asbestos content of Emtal talc products as well as BASF and
Cahill’s destruction of material evidence. According to
Williams, it was BASF and Cahill’s misconduct that injured
her, not any state-court judgment. Because this suit does not
concern state-court judgments, but rather independent torts
committed to obtain them, the Rooker-Feldman doctrine does
not apply.
    We conclude the District Court validly exercised
jurisdiction. We exercise jurisdiction pursuant to 28 U.S.C.
§ 1291.

III.   Claims
    This Court reviews Rule 12(b)(6) dismissals de novo.
Mayer v. Belichick, 
605 F.3d 223
, 229 (3d Cir. 2010). “To
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim to
relief that is plausible on its face.’” Ashcroft v. Iqbal, 
556 U.S. 662
, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 
550 U.S. 544
, 570 (2007)).




                                  15
   We will consider the fraud, fraudulent concealment, and
N.J. RICO claims in turn. Before doing so, however, we must
decide which state’s law to apply to the tort claims.

    A. Choice-of-Law
   The parties here brief and rely on New Jersey’s common
law. But not all of the parties are from New Jersey, nor did all
of the events take place there. We, therefore, begin by
considering whether to apply the law of New Jersey, as briefed
and argued by the parties, or whether to undertake a choice-of-
law analysis.
   All U.S. Courts of Appeals to have addressed the issue have
held that choice-of-law issues may be waived.2 Our Court has
been inconsistent on this point. Decades ago, we refused to


2
 E.g., P.R. Hosp. Supply, Inc. v. Bos. Scientific Corp., 
426 F.3d 503
, 505-06 (1st Cir. 2005); Saks v. Franklin Covey Co., 
316 F.3d 337
, 349 (2d Cir. 2003); Bilancia v. Gen. Motors Corp.,
538 F.2d 621
, 623 (4th Cir. 1976); Fruge v. Amerisure Mut.
Ins. Co., 
663 F.3d 743
, 747 (5th Cir. 2011); Meridia Prods.
Liab. Litig. v. Abbott Labs., 
447 F.3d 861
, 865 (6th Cir. 2006);
Wachovia Sec., LLC v. Banco Panamericano, Inc., 
674 F.3d 743
, 751 (7th Cir. 2012); P & O Nedlloyd, Ltd. v. Sanderson
Farms, Inc., 
462 F.3d 1015
, 1017 n.3 (8th Cir. 2006); Johnson
v. Armored Transp. of Cal., Inc., 
813 F.2d 1041
, 1044 (9th Cir.
1987); Mauldin v. Worldcom, Inc., 
263 F.3d 1205
, 1211-12
(10th Cir. 2001); Pulte Home Corp. v. Osmose Wood
Preserving, Inc., 
60 F.3d 734
, 739 n.15 (11th Cir. 1995);
Jannenga v. Nationwide Life Ins. Co., 
288 F.2d 169
, 172 (D.C.
Cir. 1961); Warner v. Ford Motor Co., 
331 F.3d 851
, 856 n.2
(Fed. Cir. 2003).




                                 16
apply the doctrine of waiver to choice-of-law issues: “The
appropriate law must be applied in each case and upon a failure
to do so appellate courts should remand the cause to the trial
court to afford it [the] opportunity to apply the appropriate law,
even if the question was not raised in the court below.” United
States v. Certain Parcels of Land, 
144 F.2d 626
, 630 (3d Cir.
1944). For some time thereafter, this Court refused to apply
waiver to choice-of-law issues. See, e.g., Parkway Baking Co.
v. Freihofer Baking Co., 
255 F.2d 641
, 646 (3d Cir. 1958).
Then the Court, in Mellon Bank, N.A. v. Aetna Business Credit,
Inc., assumed that the parties had waived their choice-of-law
arguments without discussing their authority to do so. 
619 F.2d 1001
, 1005 n.1 (3d Cir. 1980). Thereafter, our Circuit, sitting
en banc, observed that “choice of law issues may be waived.”
Neely v. Club Med Mgmt. Servs., Inc., 
63 F.3d 166
, 180 (3d
Cir. 1995) (en banc). As a result, “it [has been] an open
question whether choice-of-law issues are waiveable [sic] in
this Circuit.” Pac. Emp’rs Ins. Co. v. Global Reinsurance
Corp. of Am., 
693 F.3d 417
, 431 n.7 (3d Cir. 2012); see also
Nuveen Mun. Trust v. WithumSmith Brown, P.C., 
692 F.3d 283
, 301 (3d Cir. 2012); Huber v. Taylor, 
469 F.3d 67
, 83 (3d
Cir. 2006) (Fuentes, J., dissenting).
    Our review of the law in this area convinces us that parties
may waive choice-of-law issues. Permitting waiver accords
with the law of every other circuit. It also makes sense.
Generally speaking, a party abandons any objection that it does
not make. See Puckett v. United States, 
556 U.S. 129
, 134
(2009). Of course, litigants may not waive issues that go to the
power of the courts to hear a case. See, e.g., Ins. Corp. of Ir.,
Ltd. v. Compagnie des Bauxites de Guinee, 
456 U.S. 694
, 702
(1982). But choice-of-law questions do not go to the court’s
jurisdiction. See 
Neely, 63 F.3d at 174-78
. Moreover, the
doctrine of waiver serves a functional purpose. By requiring




                                 17
litigants to identify and argue legal issues before the district
courts, we ensure that we have a record to review on appeal.
The same principles favor a rule that requires litigants to raise
choice-of-law issues to the District Court.

    The parties did not litigate the choice-of-law question
before the District Court. Further, neither plaintiffs nor
defendants have challenged the District Court’s use of New
Jersey law to analyze the tort claims. To the contrary—in
response to our request for supplemental briefing, plaintiffs
asserted that they “brought their case in New Jersey asserting
claims including New Jersey state law claims of fraud and
fraudulent concealment.” Williams Rule 28j Letter dated
March 20, 2014 at 1, Williams v. BASF Catalysts LLC, No. 13-
1089. BASF and Cahill both agreed that New Jersey law
applied and, moreover, that choice-of-law issues may be
waived. BASF Rule 28j Letter dated March 20, 2014 at 1, 3, 5;
Cahill Rule 28j Letter dated March 20, 2014 at 1, 3. Thus, to
the extent the parties may have sought the application of other
law to the tort claims, they have waived their right to do so.
Accordingly, we apply New Jersey law.

   B. The Complaint alleges a plausible claim for fraud.
    We next address the District Court’s dismissal of
Williams’s fraud claim on the basis of New Jersey’s litigation
privilege. The privilege often immunizes lawyers and parties
from recrimination based on their statements in judicial
proceedings, but the privilege has never applied to shield
systematic fraud directed at the integrity of the judicial process.
Nor should it be. Accordingly, we reverse the District Court’s
dismissal of this claim.




                                  18
       1. Standard
    New Jersey recognizes a common-law fraud cause of
action. A plaintiff seeking to recover for fraud must allege five
elements: “(1) a material misrepresentation of a presently
existing or past fact; (2) knowledge or belief by the defendant
of its falsity; (3) an intention that the other person rely on it;
(4) reasonable reliance thereon by the other person; and (5)
resulting damages.” Banco Popular N. Am. v. Gandi, 
876 A.2d 253
, 260 (N.J. 2005) (quotation marks omitted).
       2. Analysis
    Williams asserts that BASF and Cahill Gordon falsely
represented that “BASF and its predecessor companies’ talc
ore and talc products did not contain asbestos fibers” and “that
there was not any evidence BASF and its predecessor
companies[’] talc ore and talc products contained asbestos.”
Compl. ¶ 344. The complaint pleads many of these statements
precisely, quoting from various letters and faxes sent by Cahill
attorneys on behalf of BASF. It alleges that BASF and Cahill
offered these representations to Williams, for example, for the
purpose of “obstructing, impeding, impairing, [or]
terminating” asbestos-injury litigation. Compl. ¶ 347. And
Williams alleges that, after receiving these communications,
she and the other plaintiffs each altered their litigation
posture—settling, dismissing, or abandoning their claims
against BASF.
   Taken together, Williams has alleged that BASF and Cahill
obtained “an undue advantage by means of some act or
omission that is unconscientious or a violation of good faith,”
the essence of fraud. See Jewish Ctr. of Sussex County v.
Whale, 
432 A.2d 521
, 524 (N.J. 1981).




                                 19
    Nonetheless, the District Court dismissed the claim on the
ground that New Jersey’s litigation privilege foreclosed
liability for any statements made in the course of asbestos-
injury litigation. New Jersey’s so-called litigation privilege
functions as a form of civil immunity: it “generally protects an
attorney from civil liability arising from words he has uttered
in the course of judicial proceedings.” Loigman v. Twp.
Committee of Twp. of Middletown, 
889 A.2d 426
, 433 (N.J.
2006). The privilege reflects “the need for unfettered
expression” in adversarial proceedings. Hawkins v. Harris, 
661 A.2d 284
, 287 (N.J. 1995). Cahill and BASF urge the Court to
extend the privilege to the false statements and evidence given
to Williams and the other plaintiffs.
    We decline. New Jersey’s Supreme Court has interpreted
the privilege to “protect[] attorneys not only from defamation
actions, but also from a host of other tort-related claims.”
Loigman, 889 A.2d at 436
. But New Jersey’s Supreme Court
has never recognized the litigation privilege to immunize
systematic fraud, let alone fraud calculated to thwart the
judicial process. Thus, we are “charged with predicting how
that court would resolve the issue.” See Illinois Nat’l Ins. Co.
v. Wyndham Worldwide Operations, Inc., 
653 F.3d 225
, 231
(3d Cir. 2011). We believe that New Jersey’s Supreme Court
would not extend the privilege to this claim.
    First, the complaint describes conduct that impairs New
Jersey’s goals for the litigation privilege. “One purpose of the
privilege is to encourage open channels of communication and
the presentation of evidence in judicial proceedings.” 
Hawkins, 661 A.2d at 289
(quotation marks omitted). Another is to
afford parties “an unqualified opportunity to explore the truth
of a matter without fear of recrimination.” 
Id. at 289-90.
Here,
the claim is that lawyers and litigants actively frustrated the




                                20
search for the truth and purposefully misled their adversaries.
The purposes of the privilege are never served by allowing
counsel to practice deceit and deception in the course of
litigation, nor by permitting counsel to make false and
misleading statements in the course of judicial proceedings.
    Indeed, when this kind of misconduct has occurred in the
past, policy considerations have weighed against extending the
privilege. In Matsuura v. E.I. du Pont de Nemours & Co., for
example, the Supreme Court of Hawaii confronted claims that
DuPont and its attorneys withheld inculpating chemical
evidence from their adversaries and caused them to settle their
claims. 
73 P.3d 687
, 689-92 (Haw. 2003). The Court decided
that the law’s interest in resolving disputes fairly and on the
merits outweighed the competing interest in placing judgments
or parties beyond reproach. See 
id. at 700.
Although New
Jersey’s litigation privilege is similarly concerned with “giving
finality to judgments, and avoiding unending litigation,”
Hawkins, 661 A.3d at 292
, we think New Jersey would follow
Hawaii’s approach on these facts. The practice of allowing
attorneys and litigants to use unfettered expression to make
their cases is to serve the courts’ truth-seeking function; it is
not the goal in itself. Thus, when, as here, defendants have
uttered words that prevent a fair proceeding, the litigation
privilege provides no relief.
     Second, New Jersey’s Supreme Court has admonished that
“[t]he absolute privilege does not extend to statements made in
situations for which there are no safeguards against abuse.”
Hawkins, 661 A.2d at 291
(quoting Demopolis v. Peoples Nat’l
Bank, 
796 P.2d 426
, 430 (Wa. Ct. App. 1990) (quotation marks
omitted)). For defamation and the like, judicial oversight or
criminal or professional sanctions often adequately deter
litigation misconduct. 
Loigman, 889 A.2d at 438
. These




                                 21
deterrents prove inadequate for systematic fraud. For one
thing, the misconduct occurred in and out of courtrooms from
Ohio to Pennsylvania to New York. No single court had the
perspective or authority to mitigate the fraud or the ability to
detect it. For another, Williams has alleged that BASF—the
client—was responsible for “verifying the truth of [its]
discovery responses” and for “[s]uborning or otherwise
procuring false unsworn and sworn representations from its
employees, officers[,] consultants and experts.” Compl.
¶¶ 143(d), 143 (g). Professional sanctions have little deterrent
value against clients. Finally, this alleged fraud apparently
outlasted the careers of many of the perpetrators. However
appropriate professional discipline may have been (or may still
be), should the allegations be proven true, that discipline would
be too little and too late to do any good for the plaintiffs or the
courts.
     Third, the allegations of this case place the offending
conduct far from the core of the privilege. Although “[t]he
litigation privilege protects attorneys not only from defamation
actions, but also from a host of other tort-related claims,” the
privilege is “[t]ypically” invoked against defamatory remarks.
See 
Loigman, 889 A.2d at 435-36
. Indeed, the Restatement of
Torts identifies this type of privilege as a defense to a
defamation action. See Restatement (Second) of Torts §§ 586
(defense for attorney at law), 587 (defense for parties to
judicial proceedings). This case is not a situation where a
witness, lawyer, or agent made hurtful or defamatory remarks
about another, as in 
Hawkins. 661 A.2d at 287-290
. Rather, the
allegations here describe conduct calculated to thwart the
judicial process and, in that way, are more akin to malicious
prosecution, perjury, and spoliation. The judicial privilege will
not excuse malicious prosecution or criminal perjury. See
Dello Russo v. Nagel, 
817 A.2d 426
, 433 (N.J. Super. Ct. 2003)




                                  22
(malicious prosecution); Durand Equip. Co. v. Superior
Carbon Prods., Inc., 
591 A.2d 987
, 989 (N.J. Super. Ct. 1991)
(perjury). Nor will it apply to claims of spoliation, which
concerns a party’s conduct and not the party’s statements. See
Viviano v. CBS, Inc., 
597 A.2d 543
, 549-550 (N.J. Super. Ct.
1991). We conclude that it likewise would not apply here.
     Fourth, even a broad reading of the privilege fails to fit the
facts of this case. “The privilege shields any communication
(1) made in judicial or quasi-judicial proceedings; (2) by
litigants or other participants authorized by law; (3) to achieve
the objects of the litigation; and (4) that have some connection
or logical relation to the action.” 
Loigman, 889 A.2d at 437
(quotation marks omitted). Here, the complaint alleges, BASF
and Cahill engineered the false statements and evidence in
advance of litigation. Then, either directly or through local
counsel, BASF and Cahill deployed their prefabricated defense
against claimants as they arose. They did not merely use a
permissible procedural device in bad faith, as in 
Loigman. 889 A.2d at 437
. They rigged the game from the beginning. Thus,
we cannot accept, as BASF contends, that its statements were
made “to achieve the object of the defense” insofar as they
“were made with the aim of defeating Plaintiffs’ asbestos
personal injury claims and shielding BASF from liability.”
BASF Br. 39 (quotation marks omitted). The New Jersey
Supreme Court has observed that “[s]eeking truthful, accurate,
and non-tainted testimony certainly is the objective of every
litigated case.” 
Loigman, 889 A.2d at 429-31
, 437. How then
can calculated false and misleading statements serve the truth-
seeking function of the litigation? According to the complaint,
BASF and Cahill were not mischaracterizing the facts; they
were creating them.




                                  23
    Finally, the New Jersey Supreme Court has never
immunized systematic fraud designed to prevent a fair
proceeding. Neither have the trial or intermediate courts of
New Jersey. In Ruberton v. Gabage, the cornerstone of BASF
and Cahill’s assertion that the privilege extends to all fraud
torts, the New Jersey Superior Court, Appellate Division,
applied the privilege to a party’s claim that he had been
induced to settle by tortious threats of his adversary’s lawyer.
654 A.2d 1002
, 1004-05 (N.J. Super. Ct. 1995). But the
Appellate Division described the issue on appeal as whether
the threat “constitutes a malicious abuse of process” and, after
concluding it did not, alternatively held that the litigation
privilege would bar the claim. 
Id. Nothing in
Ruberton
persuades us that New Jersey’s Supreme Court would insulate
BASF, Cahill, or future defendants like them, from liability.
Neither does anything in Wately v. Shaler, also relied on by
defendants. See 
2013 WL 5299499
(N.J. Super. Ct. Sept. 23,
2013). In that unpublished opinion, the New Jersey Superior
Court, Appellate Division, affirmed the dismissal of a lawsuit
brought by a former criminal defendant against the expert
witness he had retained. 
Id. at *1.
The privilege applied to
defeat the claim that the criminal defendant had been misled
by the expert because the expert’s trial testimony did not match
his pre-trial description of how he intended to testify. 
Id. at *1-
2. Watley might create a basis for immunizing the expert
witnesses who filed affidavits in plaintiffs’ asbestos-injury
cases. It does not extend immunity to those who manipulate
their adversaries in and out of court over a period of decades.
    Williams has pled a claim for fraud. The viability of that
claim turns on whether New Jersey would extend its litigation
privilege to a claim of fraud directed at the integrity of the
judicial process. Based on the policies underlying the privilege
and the New Jersey cases applying it, we conclude that New




                                  24
Jersey’s Supreme Court would not extend the privilege to the
fraud claim alleged here. Accordingly, we reverse the District
Court’s dismissal of this claim.

   C. The  Complaint alleges a plausible claim for
      fraudulent concealment.
   The District Court erred when it concluded that Williams
had not alleged a plausible claim for fraudulent concealment.
Williams’s claim rests on well-pled factual allegations.
      1. Standard
     In law, spoliation refers to “the hiding or destroying of
litigation evidence, generally by an adverse party.” Rosenblit
v. Zimmerman, 
766 A.2d 749
, 754 (N.J. 2001) New Jersey
courts oppose it: “Such conduct cannot go undeterred and
unpunished and those aggrieved by it should be made whole
with compensatory damages and, if the elements of the
Punitive Damages Act are met, punitive damages for
intentional wrongdoing.” 
Id. at 758
(citation omitted).
    New Jersey permits plaintiffs to recover in an independent
action for harm caused in a prior proceeding by an adversary’s
spoliation: “[T]he tort of fraudulent concealment, as adopted,
may be invoked as a remedy for spoliation where those
elements exist.” 
Id. To prove
the tort, a plaintiff must establish five elements:
   (1) The defendant had a legal obligation to disclose
      evidence in connection with an existing or pending
      litigation;
   (2) the evidence was material to the litigation;
   (3) the plaintiff could not reasonably have obtained access
       to the evidence from another source;




                                25
      (4) the defendant intentionally withheld, altered, or
         destroyed the evidence with purpose to disrupt the
         litigation; and
      (5) the plaintiff was damaged in the underlying action by
          having to rely on an evidential record that did not
          contain the evidence defendant concealed.
Id. 2. Analysis
     Williams has alleged the first four elements of a spoliation
claim: As early as 1979, BASF faced actual or threatened
litigation over asbestos injuries caused by its products. BASF,
and its lawyers at Cahill, anticipated additional lawsuits in the
future. BASF possessed evidence that its talc products
contained asbestos, including assays, lab notes, and testimony.
Williams could not have accessed the evidence—most of
which was held exclusively by BASF and Cahill—through any
other means. And, Williams now claims, rather than maintain
the evidence, BASF and Cahill concealed or destroyed it.
Taken together, these facts, if proven, establish that BASF and
Cahill intentionally destroyed or withheld material evidence
that they were duty-bound to disclose and that their adversaries
could not otherwise access. Cf. 
Rosenblit, 766 A.2d at 758
.
    The parties dispute whether Williams has alleged the fifth
element of the spoliation claim, that she was “damaged in the
underlying action by having to rely on an evidential record that
did not contain the evidence defendant concealed.” 
Id. BASF and
Cahill contend that this element requires plaintiffs to
demonstrate that they would have prevailed in the underlying
action. Accepting this argument, the District Court determined
that




                                 26
              [t]here is no indication at all
              in the Amended Complaint
              that it was a lack of access
              to the allegedly destroyed
              evidence which resulted in
              the       termination       of
              Plaintiffs’ claims before
              obtaining      a    favorable
              verdict against BASF or in
              the settlement of such
              claims for amounts that did
              not fairly and sufficiently
              compensate         Plaintiffs’
              decedents for their injuries.
App’x 30.
    We believe the bar was set too high. New Jersey courts have
explained that a spoliation injury may exist when the conduct
affects the size or existence of a damages award at trial. See
Tartaglia v. UBS PaineWebber Inc., 
961 A.2d 1167
, 1190 (N.J.
2008). The injury may also take the form of expenses incurred
to litigate the case without the spoliated evidence. See 
id. And a
plaintiff may recover “whether [the] plaintiff succeeds on the
claim in the original litigation or not”; indeed, a plaintiff may
succeed in the underlying case and nevertheless bring a later
spoliation claim. See id.; Robertet Flavors, Inc. v. Tri-Form
Const., Inc., 
1 A.3d 658
, 671 (N.J. 2010).
    In addressing this issue, the District Court looked to a 1998
district court opinion that predicted that the New Jersey
Supreme Court would not allow an affirmative cause of action
for intentional spoliation, Larison v. City of Trenton, 
180 F.R.D. 261
, 266 (D.N.J. 1998). The New Jersey Supreme Court
has since authorized tort recovery for intentional spoliation.




                                 27
See 
Rosenblit, 766 A.2d at 758
. Moreover, when it did so, the
New Jersey Supreme Court did not adopt the strict causation
and damages theories propounded by Larison. Compare
Larison, 180 F.R.D. at 266
(predicting that a prima facie case
could not be established unless and until the plaintiff shows
that he failed to prove his original case because of the missing
evidence), with 
Tartaglia, 961 A.2d at 1190
(holding by New
Jersey Supreme Court that a plaintiff may recover from a
spoliator even if the plaintiff prevails in the original suit).
Accordingly, plaintiffs did not have to allege facts to show that
they “would have succeeded in proving their asbestos injury
claims against BASF,” as the District Court held, App’x 36,
but rather facts to show that BASF and Cahill’s destruction of
evidence harmed their case.
    Plaintiffs’ allegations that they received diminished
recovery, that their lawsuits were impaired, and that they
expended time and money to attempt to litigate around the
spoliated evidence, whether singly or in combination, suffice
to complete the concealment claim. Plaintiffs allege “that they
were materially hampered, impaired and prevented from
proving their claims that BASF’s and its predecessor
companies’ talc ore and talc products contained asbestos and
proximately caused their underlying asbestos injury.” Compl.
¶ 337. Plaintiffs allege that their personal injury suits suffered
as a result of the concealed and destroyed evidence—they
settled cases on unfavorable terms, decided not to bring cases
that appeared to be meritless, or failed to sustain cases for lack
of proof that BASF’s products contained talc. Additionally,
plaintiffs allege that they have “incurred pecuniary losses and
damages” due to BASF and Cahill’s conduct, including “the
expenses and costs of proceeding without” the spoliated
evidence and “the expenses and costs incurred in the effort to
replace, locate, or identify evidence.” Compl. ¶ 340. Taken




                                 28
together, these allegations, if proven, demonstrate that
plaintiffs were “damaged in the underlying action by having to
rely on an evidential record that did not contain the evidence
defendant concealed.” 
Rosenblit, 766 A.2d at 758
.
    We disagree with BASF and Cahill that plaintiffs
allegations are “conclusory and implausible.” See, e.g., Cahill
Br. 46. As a motion to dismiss, the Court takes as true “well-
pleaded factual allegations” and, after doing so, “determine[s]
whether they plausibly give rise to an entitlement to relief.”
Great W. Mining & Mineral 
Co., 615 F.3d at 177
(quoting
Iqbal, 556 U.S. at 679
).
    Commonsense and judicial experience underscore the
plausibility of Williams’s claims. Williams alleges that in the
asbestos-injury lawsuit, BASF and Cahill concealed,
destroyed, and lied about the presence of asbestos in their
products. What could be more important to a claim that talc
caused asbestos disease than proof that the talc contained
asbestos? True, even with that evidence, Williams still had
other elements to prove. All other things equal, however,
Williams’s case against BASF would have been much stronger
if she had evidence that BASF’s products contained asbestos.
Moreover, the complaint contains allegations that Williams
incurred costs and expenses attempting to litigate around the
missing evidence. That allegation is not a legal conclusion but
rather a fact from which one could conclude that Williams was
harmed in her underlying case.
    The allegations are not rendered implausible by reference
to the conduct of the plaintiffs’ lawyers in the underlying suit,
as defendants argue. The crux of this theory is that plaintiffs’
lawyers did not actually believe BASF’s representations that
its products did not contain asbestos and thus their clients could
not have relied on those representations. For example,




                                 29
notwithstanding the fact that BASF represented to Williams’s
lawyers that its products did not contain talc, Williams’s
lawyers filed subsequent asbestos-injury cases against BASF
on behalf of other plaintiffs. Thus, according to BASF and
Cahill, plaintiffs could not have relied on the misstatements in
prosecuting their cases because their lawyers did not rely on
them.
    We do not accept this argument. First, plaintiffs’ lawyers
are not the plaintiffs themselves. A plaintiff, not his or her
lawyer, must decide whether to initiate litigation or to end it.
See, e.g., N.J. Rules of Professional Conduct 1.2(a). So
whatever a lawyer does on behalf of another client proves little,
if anything, about the beliefs of a different client. Second, this
is a motion to dismiss. Courts must accept as true the plaintiffs’
allegations and draw inferences in the plaintiffs’ favor.
Inferring from plaintiffs’ choice of counsel unfavorable facts
about plaintiffs’ beliefs runs contrary to this rule. Third, as
noted, the tort of spoliation requires a plaintiff to prove he or
she was harmed in the underlying action by having “to rely on
an evidential record that did not contain the evidence defendant
concealed.” 
Rosenblit, 766 A.2d at 758
. The tort does not
require reliance on an adversary’s representations. Indeed, a
lawyer or litigant who destroys or conceals evidence may be
liable even if he or she makes no representations to his or her
adversaries at all.
    In sum, the plaintiffs have alleged far more than a “sheer
possibility” that BASF and Cahill injured them. Cf. 
Iqbal, 556 U.S. at 678
. Indeed, the complaint states enough facts
regarding the consequences of defendants’ spoliation that it has
raised “a reasonable expectation that discovery will reveal
evidence” that plaintiffs have been harmed by BASF and




                                 30
Cahill’s misconduct. See 
id. Accordingly, we
reverse the
District Court’s dismissal of this claim.

   D. The Complaint does not allege an actionable claim for
       N.J. RICO.
    The District Court correctly dismissed Williams’s N.J.
RICO claim. Williams contends that BASF and Cahill injured
her by operating a RICO enterprise and by conspiring to
operate a RICO enterprise. Because Williams and the other
plaintiffs have not alleged that they suffered an injury to their
property, as they must, we affirm.
       1. Standard
    In New Jersey, it is unlawful “to conduct or participate,
directly or indirectly, in the conduct of [an] enterprise’s affairs
through a pattern of racketeering activity.” N.J. Stat. § 2C:41-
2(c). The New Jersey RICO statute also forbids a person from
conspiring to do the same. N.J. Stat. § 2C:41-2(d). Further,
New Jersey confers a private right of action on “any person
damaged in his business or property by reason” of a RICO
violation. N.J. Stat. § 2C:41-4. Accordingly, those injured by
racketeering activity may recover in civil actions.
       2. Analysis
    New Jersey courts have not decided whether interference
with the litigation of personal injury claims amounts to an
injury to “business or property” within the meaning of New
Jersey’s RICO statute, N.J. Stat. § 2C:41-4. We believe that the
New Jersey Supreme Court would not construe “business or
property” to include interference with the litigation of personal
injury claims.




                                  31
    Injuries to one’s business or property differ from injuries to
one’s person. Thus, in construing the federal RICO law, this
Circuit has rejected the argument that personal injuries qualify
as RICO injuries to “business or property.” See, e.g., Maio v.
Aetna, Inc., 
221 F.3d 472
, 483, 492 (3d Cir. 2000). That said,
Williams does not contend that the asbestos injury gives rise to
a RICO claim, but rather that BASF interfered with her attempt
to recover for the earlier personal injury. Under New Jersey
law, this difference does not save the claim. New Jersey’s
Appellate Division has observed that “an inchoate personal
injury claim, unlike some other rights to sue, is not a property
right.” Amato v. Amato, 
434 A.2d 639
, 642 (N.J. Super. Ct.
1981). Indeed, “[t]he nonassignability of a right of action for
tortious personal injury, because it is not a property right, is an
ancient concept of the common law recognized in [New
Jersey].” Id; see also Landwehr v. Landwehr, 
545 A.2d 738
,
742-44 (N.J. 1988) (deciding that personal injury awards for
pain, suffering, and disability were not marital property
eligible for distribution in divorce).
    Because unliquidated personal injuries claims are not
“property” in New Jersey, interference with a personal injury
claim does not constitute an actionable harm under New
Jersey’s RICO statute. The parties point to no New Jersey state
court decision that uses a broader definition of property for
New Jersey’s RICO’s statute than used in Amato. And just as
the words “business or property” have “restrictive
significance” in the federal civil RICO statute, see 
Maio, 221 F.3d at 483
, so too do these words narrow the types of injuries
contemplated by New Jersey’s statute.
   Because Williams has not alleged an injury to “business or
property” as required by N.J. RICO, we affirm the District
Court’s dismissal of the N.J. RICO claim.




                                  32
   E. The claims against the individual defendants.
    Glenn Hemstock, Arthur A. Dornbusch, II, and Thomas
Halket, former Engelhard employees, separately contend that
the complaint should be dismissed as to them. In addition to
joining the other defendants’ arguments for dismissal, they
argue that the complaint has failed “to state with particularity
the circumstances constituting fraud or mistake.” Fed. R. Civ.
P. 9(b). The District Court, having dismissed the complaint on
other grounds, never considered these theories. Because the
parties have not focused on them on appeal, we decline to
decide them in the first instance.
    We do, however, reject the argument raised by Thomas D.
Halket that his innocence compels dismissal. That argument
rests on three assertions: First, Halket “separated from the
company in 1986, years before the plaintiffs even filed their
lawsuits.” Hr’g Tr. 105:09-11 (March 13, 2014). Second,
Engelhard did not conceal any evidence during the only
asbestos litigation that occurred during Halket’s tenure. Third,
“it’s only what happened later in litigation that was filed years
after he left the company that . . . the company’s conduct
becomes even arguably problematic.” Tr. 106:17-20.
    To accept Halket’s argument, however, is to reject the
factual allegations of the complaint. Plaintiffs have alleged that
Halket organized the effort to conceal and destroy evidence
after the Westfall case. Though Halket may have ended his
employment with Engelhard, the Complaint, construed in the
light most favorable to Williams, does not support the further
inference that Halket bears no responsibility for what he set in
motion. Of course, discovery may exonerate Halket and, in any
event, he will have the opportunity to contest the truth of those
allegations in a later stage of the lawsuit. But on a motion to
dismiss, a court may not accept a defendant’s factual




                                 33
representations that he has been wrongly accused when the
plaintiff has averred otherwise. See Fed. R. Civ. P. 8(a).
    Accordingly, we may not look past the pleadings to affirm
the dismissal of the claims against Halket. We leave it for the
District Court to determine whether the remaining fraud and
fraudulent concealment claims have been particularly pled
against Halket, Hemstock, and Dornbusch.

IV.    Relief
     The final issue on appeal concerns the appropriateness of
Williams’s requested relief. Recall that Williams requested a
wide variety of relief, ranging from an injunction against
further spoliation to a declaration that, in future cases, the
statute of limitations would not bar plaintiffs from recovery.
The District Court decided that certain of Williams’s requested
relief created jurisdictional or justiciability problems. The
District Court dismissed Williams’s request for declarations,
injunctions, rulings, or “orders intended to impact Plaintiffs’
ability to pursue as-yet unfiled claims.” App’x 25. The District
Court reasoned that the Anti-Injunction Act barred it from
entertaining much of the requested relief because it invited the
District Court to interfere with past lawsuits. In the alternative,
and specifically with respect to declarations or injunctions that
might affect future lawsuits, the District Court concluded that
it lacked a case or controversy to adjudicate.
    We consider both the District Court’s Anti-Injunction Act
ruling and its decision regarding justiciability.

   A. The Anti-Injunction Act
    The Anti-Injunction Act limits the power of federal courts
to interfere with state court proceedings:




                                  34
              A court of the United States
              may not grant an injunction
              to stay proceedings in a
              State court except as
              expressly authorized by Act
              of Congress, or where
              necessary in aid of its
              jurisdiction, or to protect or
              effectuate its judgments.
28 U.S.C. § 2283. “The statute . . . ‘is a necessary concomitant
of the Framers’ decision to authorize, and Congress’ decision
to implement, a dual system of federal and state courts.’” Smith
v. Bayer Corp., 
131 S. Ct. 2368
, 2375 (2011) (quoting Chick
Kam Choo v. Exxon Corp., 
486 U.S. 140
, 146 (1988)). As such,
the statute is designed to “forestall the inevitable friction
between the state and federal courts that ensues from the
injunction of state judicial proceedings by a federal court.”
Vendo Co. v. Lektro-Vend Corp., 
433 U.S. 623
, 630 (1977).
    The District Court viewed the Anti-Injunction Act as a bar
to “the Court’s very power over th[e] action” and, therefore,
considered its application from the outset. App’x 19. It need
not have done so. While the Act constrains federal courts,
“[t]he Act is not strictly jurisdictional; it merely deprives the
federal courts of the power to grant a particular form of
equitable relief.” Gloucester Marine Ry. Corp. v. Charles
Parisi, Inc., 
848 F.2d 12
, 15 (1st Cir. 1988) (citing Smith v.
Apple, 
264 U.S. 274
, 278-79 (1924)). Thus, the Anti-Injunction
Act would be an appropriate basis for dismissal only insofar as
it barred Williams from stating a claim upon which relief could
be granted.
    The Anti-Injunction Act does not bar Williams’s requested
relief. The Act applies to a narrow set of circumstances:




                                 35
“[W]hen (1) a court of the United States (2) grants an
injunction (3) to stay proceedings (4) in a state court.” U.S.
Steel Corp. Plan for Emp. Ins. Benefits v. Musisko, 
885 F.2d 1170
, 1175 (3d Cir. 1989). Those circumstances do not exist
here because there are no ongoing proceedings in a state court
with which the District Court’s judgment would interfere.
Accordingly, § 2283 “has no application.”3 Thus, while the
Supreme Court has admonished that “[p]roceedings in state
courts should normally be allowed to continue unimpaired by
intervention of the lower federal courts,” the named plaintiffs
in this case have no other proceedings pending anywhere. See
Atl. Coast Line R.R. v. Brotherhood of Locomotive Eng’rs, 
398 U.S. 281
, 287 (1970). Perhaps in the future the parties to this
case will return to state court in an effort to reactivate their
concluded proceedings. But they have not yet done so, and the
Act aims to avoid “needless friction between state and federal
courts” not to prevent a district court from deciding issues that



3
  17A CHARLES ALAN WRIGHT, ET AL., FED. PRAC. &
PROC. § 4222 (3d ed. 1998); see also Dombrowski v. Pfister,
380 U.S. 479
, 484 n.2 (1965) (noting that Anti-Injunction Act
does “not preclude injunctions against the institution of state
court proceedings, but only bar[s] stays of suits already
instituted”);    ERWIN       CHEMERINSKY,            FEDERAL
JURISDICTION 768 (6th ed. 2012) (“[T]he act applies only if
there are proceedings actually pending in the state courts; it
does not prevent federal courts from issuing injunctions in the
absence of ongoing state court litigation.”); LARRY W.
YACKLE, FEDERAL COURTS 492 (3d ed. 2009) (The Act
“protects judicial proceedings only if they are already pending
when a federal court is asked to take action.”).




                                 36
may affect future state court litigation. See Okla. Packing Co.
v. Okla., Gas & Elec. Co., 
309 U.S. 4
, 9 (1940).
    Acknowledging that no state court proceedings are
currently pending, BASF and Cahill assert that the Anti-
Injunction Act further prohibits the District Court from acting
to “deprive [past] state-court judgments of legal significance.”
(BASF Br. 18.) None of the decisional law cited by BASF and
Cahill supports this argument.
   First, in Hill v. Martin, cited by BASF, a pre-New Deal
Supreme Court opined that the Anti-Injunction Act “applies
not only to an execution issued on a judgment, but to any
proceeding supplemental or ancillary taken with a view to
making the suit or judgment effective.” 
296 U.S. 393
, 403
(1935) (footnote omitted). That comment appears to address
which types of state court proceedings may not be enjoined.
(The answer: any type.) But Hill does not constrain the District
Court because this case does not feature ongoing state court
proceedings of any type.
    Second, BASF and Cahill reference Atlantic Coast Line for
the idea that the district courts may not sidestep the Anti-
Injunction Act by preventing the parties from using “the results
of a completed state 
proceeding.” 398 U.S. at 287
. Atlantic
Coast Line did not, however, expand the Act to circumstances,
like this one, where the named plaintiffs have no ongoing state
court cases. Rather, Atlantic Coast Line focused on the
impropriety of a federal court nullifying an active and
continuing state-court order. 
Id. Neither BASF
nor Cahill has
identified any active orders from the asbestos-injury suit. To
the contrary, it appears that those cases simply ended with
dismissals. Accordingly, Atlantic Coast Line does not
constrain the District Court because there are no continuing
state court orders with which the District Court could interfere.




                                 37
    Third, in U.S. Steel, also cited by BASF and Cahill, this
Court disapproved of a district court’s declaratory judgment
that conflicted with a state appellate court’s ruling on the same
issue between the same parties. 
See 885 F.2d at 1176
. The
panel reasoned that “[t]he practical result of the district judge’s
order . . . was to cast doubt on the effectiveness of the [state
appellate court’s] ruling and on any judgment that might result
from it.” 
Id. at 1175.
Unlike this case, however, U.S. Steel
involved ongoing state litigation. The case there had traveled
from the state trial court to the appellate court and back again,
and the federal court intervened in the midst of the remand.
Thus, “[t]he district court’s order could [have] effectively
prevent[ed] the state trial judge from proceeding in accordance
with the Superior Court’s direction.” 
Id. The District
Court’s
orders in this case could not have such an effect because the
state court litigation ended long ago.
    At bottom, BASF and Cahill appear to construe § 2283 to
forbid federal courts from criticizing completed state
proceedings. The statute enshrines no such rule. Of course, as
defendants themselves note, a state-court loser may not appeal
his judgment to a federal district court. See Lance v. Dennis,
546 U.S. 459
, 464 (2006) (discussing Rooker-Feldman
doctrine). But § 2283 does not purport to displace doctrines,
such as res judicata, that might guide a federal court’s analysis
of the effect to be given a past ruling of a state court. It cannot
be, as BASF and Cahill imply, that when a federal court
decides that the claim before it has not been precluded by a
prior state court judgment, it has thereby violated the Anti-
Injunction Act by limiting the effect of the prior state court
judgment. Nor can it be that when a new federal suit seeks
redress for harms suffered during old state proceedings, but not
because of them, the Anti-Injunction Act stands in a federal




                                  38
court’s way. To use the Anti-Injunction Act in this way would
be new, burdensome, and incorrect.

   B. Justiciability
    In the alternative, the District Court concluded that
Williams could not obtain certain declaratory and injunctive
relief because she had not presented the court with a justiciable
controversy. With respect to the relief targeted at solely legal
issues anticipated in future cases, we affirm.
    A plaintiff must establish a justiciable case or controversy
with respect to each form of relief he or she seeks. See City of
Los Angeles v. Lyons, 
461 U.S. 95
, 102-03 (1983). Thus, even
when a plaintiff has a claim for damages, in order to obtain
prospective relief, he or she must establish standing to do so.
See Adarand Constructors, Inc. v. Pena, 
515 U.S. 200
, 210-11
(1995); see also 28 U.S.C. § 2201 (Declaratory Judgment Act
remedies). “To have standing to sue under Article III,” a
plaintiff must identify “(1) a cognizable injury that is (2)
causally connected to the alleged conduct and is (3) capable of
being redressed by a favorable judicial decision.” Pa. Family
Institute, Inc. v. Black, 
489 F.3d 156
, 165 (3d Cir. 2007); Lujan
v. Defenders of Wildlife, 
504 U.S. 555
, 560–61 (1992)).
Moreover, the judicial power does not extend to hypothetical
disputes, and federal courts may not “give opinions advising
what the law would be upon a hypothetical state of facts.”
Chafin v. Chafin, --- U.S. ----, 
133 S. Ct. 1017
, 1023 (2013)
(alterations and quotation marks omitted). And in order to be
justiciable, a claim must be ripe for review. Ohio Forestry
Ass’n v. Sierra Club, 
523 U.S. 726
, 732-33 (1998).
   We see two defects in William’s requested relief.
   First, Williams runs afoul of the rule that “a litigant may
not use a declaratory-judgment action to obtain piecemeal




                                 39
adjudication of defenses that would not finally and
conclusively       resolve     the     underlying    controversy.”
MedImmune, Inc. v. Genentech, Inc., 
549 U.S. 118
, 127 n.7
(2007). Williams requests declarations (or injunctions)
determining rights and defenses available to BASF and Cahill
in future proceedings. This relief, however, invites the District
Court to wade into a legal conflict that is not before it—the
viability of a particular plaintiff’s asbestos-injury claim against
BASF. Under Article III, plaintiffs may not seek a judgment
that “would merely determine a collateral legal issue governing
certain aspects of their pending or future suits.” Calderon v.
Ashmus, 
523 U.S. 740
, 747 (1998). A declaration from the
District Court about the preclusive effect of past judgments, for
example, might determine whether BASF’s past judgments
were “valid” and, therefore, preclusive. See, e.g., Mortgagelinq
Corp. v. Commonwealth Land Title Ins. Co., 
662 A.2d 536
, 346
(N.J. 1995) (noting that a judgment must be valid and final in
order to have preclusive effect). But that declaration would not
decide BASF’s liability to a particular plaintiff for a particular
asbestos injury. In this way, Williams’s request resembles that
of a prisoner who sued to prevent the state from invoking an
affirmative defense in an anticipated, but unfiled, § 1983 claim.
Ashmus, 523 U.S. at 747-59
. In this case and in that one, the
plaintiff asks the trial court to determine in part what would be
litigated in full on a later date.
    Second, and relatedly, issues that may arise in state court
asbestos-injury litigation are not ripe for review. BASF and
Cahill have not asserted any defenses to plaintiffs’ asbestos-
injury claims and, in fact, the named plaintiffs to this suit have
not brought any such claims. We see no hardship to parties
imposed by refusing to answer these questions now, as
plaintiffs likely will not face state court defenses until they file
or seek to re-active their state court cases. Moreover, these




                                  40
questions are abstact at this stage. The identity of the parties,
the nature of the claims and defenses, and the substantive law
to be applied are all unknown. Thus, although the parties
certainly have adverse interests on these matters, an injunction
or declaration about future legal defenses would not provide a
conclusive resolution of an existing controversy. The issues
are, therefore, unripe. See Pic-A-State Pa., Inc. v. Reno, 
76 F.3d 1294
, 1299-1300 (3d Cir. 1996); see also MedImmune,
Inc., 549 U.S. at 128
n.8 (observing that these sorts of
justiciability problems may be characterized as problems of
either “standing” or “ripeness”).
    We conclude that Williams may not seek in this suit a
determination of a legal issue anticipated in subsequent
proceeding. Accordingly, we affirm the District Court’s
dismissal of Williams’s claims to declaratory or injunctive
relief to the extent Williams seeks to enjoin BASF and Cahill
from invoking res judicata, laches, statute of limitation
doctrines, or other similar issues, in future proceedings before
other courts. That said, we see no constitutional barrier to the
District Court ordering a notice program or enjoining
defendants from further spoliation if the proofs warrant the
relief.

V. Conclusion
     The District Court dismissed each of Williams’s claims,
including the N.J. RICO, fraud, and fraudulent concealment
claims contested here. With respect to the fraud and fraudulent
concealment claims, the District Court erred. The New Jersey
litigation privilege does not immunize systematic fraud
directed at adversarial parties and the courts. The tort of
fraudulent concealment, which encompasses claims of
spoliation, does not require Williams to prove that she would




                                 41
have prevailed on the merits of her asbestos-injury case. The
alleged facts of harmful reliance suffice to state the claim.
     With respect to the District Court’s conclusion that it would
be unable to order Williams’s requested relief, we reverse in
part and affirm in part. To the extent that Williams’s relief
invites the District Court to decide matters to be raised in other
litigation, Williams has not presented a justiciable controversy
for which that relief would be appropriate. To the extent that
Williams seeks remedies for the alleged fraud and spoliation,
including declaratory and injunctive relief, the District Court is
not barred by the Anti-Injunction Act from providing them.
    We remand for further proceedings. We also direct the
parties to inform the District Court of any developments in
state court proceedings that might be pertinent to the exercise
or abstention of its jurisdictional authority.




                                 42

Source:  CourtListener

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