Pfizer Inc. v. Law Offices of Peter G. Angelos (In Re Quigley Co.)
676 F.3d 45
| 2d Cir. | 2012Background
- Pfizer and Quigley share Insurance Policies and an Insurance Trust used to fund asbestos-related defense, settlements, and judgments.
- The Insurance Policies and Trust are joint assets of Pfizer and Quigley’s estate and can be drawn on to satisfy claims, potentially affecting the estate’s liquidation.
- Quigley sought to reorganize under Chapter 11, and the bankruptcy court issued the OPI to stay asbestos claims against Pfizer pending the case.
- In 2007 the bankruptcy court issued the Clarifying Order to align the injunction with § 524(g)(4)(A)(ii) guidance, staying certain actions against Pfizer.
- Angelos filed multiple suits in Pennsylvania asserting apparent manufacturer liability under Pennsylvania law against Pfizer based on Pfizer’s logo/name on Quigley products; the suits were enjoined under the API; Pfizer and Quigley appealed the district court’s reversal finding API applicable?
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the bankruptcy appeal is properly before the court. | Pfizer/Quigley argue jurisdiction exists. | Pfizer/Quigley contend jurisdiction under 28 U.S.C. § 158(d). | Yes; the panel has jurisdiction. |
| Whether the bankruptcy court had jurisdiction to issue the Clarifying Order. | Angelos argues lack of Article III or § 1334 jurisdiction. | Appellants contend bankruptcy court had jurisdiction to enjoin under § 524(g). | Bankruptcy court had jurisdiction to issue the Clarifying Order. |
| Whether § 524(g)(4)(A)(ii) permits enjoining the Angelos suits. | Liability arises by Pfizer ownership/financial interest in Quigley. | Liability must arise as a legal consequence of enumerated relationships, not mere ownership. | API does not enjoin the Angelos suits. |
| What is the correct interpretation of "by reason of" in § 524(g)(4)(A)(ii)? | Pfizer argues factual causation suffices (but-for relation). | Angelos argues legal causation tied to enumerated relationships. | “By reason of” requires a legal consequence arising from an enumerated relationship. |
| Is the liability under § 400 of the Restatement derivative for § 524(g) purposes? | Angelos argues § 400 liability is non-derivative. | Pfizer argues liability is derivative through ownership/management. | Not reached; because Angelos suits do not arise by reason of ownership, API does not apply. |
Key Cases Cited
- In re Lomas Fin. Corp., 932 F.2d 147 (2d Cir.1991) (exclusive appellate jurisdiction for bankruptcy orders; finality principles for stay orders)
- In re Chateaugay Corp., 880 F.2d 1509 (2d Cir.1989) (finality of stay-related orders for appealability)
- Pacor, Inc. v. Higgins, 743 F.2d 984 (3d Cir.1984) (test for related-to bankruptcy jurisdiction; “conceivable effect” on estate)
- In re Combustion Eng'ng, Inc., 391 F.3d 190 (3d Cir.2004) (scope of § 524(g); channeling orders; jurisdictional issues)
- Manville III, 517 F.3d 57 (2d Cir.2008) (derivative vs. non-derivative liability; jurisdiction to enjoin third-party suits)
- Manville IV, 600 F.3d 135 (2d Cir.2010) (clarified derivative liability discussion; estate-focused jurisdiction)