Findley v. Blinken (In Re Joint Eastern & Southern District Asbestos Litigation)

TABLE OF CONTENTS

I. INTRODUCTION. 732

II. HISTORY and PROCEDURAL BACKGROUND. 734

A. Asbestos; Scientific Developments and Knowledge. 734

1. History of Asbestos Use. 735

2. Discovery of Health Hazards Associated with Asbestos. 737

3. Current Asbestos Studies and Medical Knowledge. 739

B. Johns-Manville Corporation. 742

C. Proof of Industry Knowledge of Health Hazards. 743

D. Litigation. 745

E. Bankruptcy of Johns-Manville. 751

F. Second Amended and Restated Plan of Reorganization. 752

G. Problems with the Trust. 754

1. Inaccurate Estimates of Claims and Values. 754

2. Massive Impleading of Trust Leading- to High Transaction Costs, Expensive Settlements and Litigation Costs. 758

3. Operational Problems. 759

4. Trust Payment Plan Promulgated on April 6, 1990 . 760

H. Stay of Payments; Stay of Litigation; Orders and Opinions of the Courts 762

I. Rule 706 Expert to Project Future Claims. 763

J. Appointment of Hon. Marvin E. Frankel; Limited Fund Hearings. 764

K. Negotiations. 766

L. Stipulation of Settlement; Financing Agreement Between Manville and the Trust. 767

1. Stipulation of Settlement. 767

2. Distribution Process. 768

3. Master Agreement Between Trust and Manville. 770

M. Appointment of Representative of Future Claimants; Appointment of Laurence Gold. 771

1. Factual Setting Necessitating Appointment. 771

2. Legal Basis of Appointment... 772

3. Amicus Curiae Appointment. 773

N. Courts’ Orders of November 23; Notice of Hearings. 773

O. Fairness Hearings. 775

P. Order and Partial Judgment. 776

III. POSITIONS OF THE PARTIES ON THE FAIRNESS OF THE SETTLEMENT. 776

A. Majority Claimants. 776

*731 B. Minority Claimants. 777

1. Henderson & Goldberg. 777

2. Peter G. Angelos. 778

C. Mississippi Claimants . 779

D. Steven Kazan for Asbestos Victims of America. 779

E. Organizations Representing Asbestos Victims. 780

F. Parties Who Continue to Support FIFO Represented by Hal C. Pitkow and Others. 781

G. Laurence Gold. 782

H. Leslie Gordon Fagen, Legal Representative of Future Claimants. 783

I. Codefendants. 784

J. Distributors. 785

1. Pacor. 786

2. MacArthur. 787

3. E.J. Bartells. 788

4. General Refractory Company. 789

K. Shipowners. 789

L. The Trust. 790

M. Manville Corporation. 791

N. Cimino Plaintiffs. 791

O. Claimants from Massachusetts Represented by Edward Dangel. 791

P. Selected Claimants Represented by James Gavin. 792

IV. JURISDICTION. 792

A. Subject Matter Jurisdiction. 792

1. Diversity Jurisdiction. 792

2. Bankruptcy Jurisdiction; Jurisdiction Retained Under Plan. 794

B. Personal and In Rem Jurisdiction. 795

1. In Personam Jurisdiction. 795

2. In Rem and Quasi in Rem Jurisdiction. 798

C. Notice. 800

V. CLASS ACTIONS. 802

A. Class Action and Mass Torts; Aggregation Problems . 803

B. Asbestos Litigation: A Unique Mass Tort. 811

C. Statutory Requirements. 816

1. Numerosity. 817

2. Commonality. 817

3. Typicality. 819

4. Adequacy of Representation. 820

a. Class Representatives. 821

b. Class Counsel. 823

D. Rule 23(b)(1)(B). 824

1. Standards for Certification . 824

2. Application of Standards to Manville Facts. 828

3. Mandatory Non-Opt-Out Class. 830

4. Binding Future Claimants. 834

E. Participation of Claimants; Voting not required. 837

F. Effect of Anti-Injunction Act. 839

VI. POWER OF BANKRUPTCY COURT AND DISTRICT COURT TO INTERPRET THE PLAN AND REVISE PAYMENTS MADE BY A NEW YORK TRUST CREATED PURSUANT TO A BANKRUPTCY. 840

A. Bankruptcy Law. 840

1. Settlement Does Not Modify Plan. 840

2. Power Under Bankruptcy Code to Issue Injunctions. 842

B. New York Law Governing Trusts. 843

VII. FAIRNESS OF SETTLEMENT. 846

A. Law and Criteria under Rule 23(e). 847

B. Factual Basis for the Settlement. 848

1. Arms’ Length Negotiations. 849

2. Good Faith Negotiations Without Collusion. 850

3. Probability of Success on Merits. 850

4. Settlement Prior to Certification of Class. 851

*732 5. Alternatives to Settlement. 00

6. Class Members’ Reaction to Settlement. 00

7. Workability. 00

a. Master Agreement Between Manville and the Trust. 00

b. Distribution Process. 00

C. Response to Objections and Disagreements. 00

1. Distinction Between Level One and Two Claimants. 00

2. Prior Settlements with Insurers During. 00

3. Treatment of Settlements and Judgments. 00

4. Attorneys Fees . 00

D. Conflict of Laws and Interpretation of Section H of the Settlement... 00

Should a Single Federal Common Law Govern? 00

a. Standard. 00

b. Application of Standard. 00

2. Choice of Law Generally. 00

a. Constitutional Limitations. 00

b. Modern Choice of Law. 00

3. New York Conflicts Rules. 00

a. Choice of Law: Contracts_ 00

b. Choice of Law: Torts. 00

i. Joint and Several Liability. 00

li. Tort Reform Statutes and Policies Relevant to Settlement ... 00

Application of Law to Case; Interpretation of Provision. 00

a. Value of Level One and Level Two Claims. 00

b. Contribution and Set Offs. 00

i. Codefendants . 00

ii. Distributors and Shipowners. 00

c. Evidence Bar. CO

d. Impleader Bar. CO

VIII. NEED TO OPERATE TRUST WITH MINIMAL COSTS IN MANNER THAT WILL ENSURE SUCCESS OF RESTRUCTURING. CO o Ol

IX. RELATION OF SETTLEMENT TO OTHER ASPECTS OF ASBESTOS PROBLEM. 05

A. Need For Overall Solution. 05

B. Flexibility of Plan to Permit Integration; First Step to Integrate Bankruptcy Facilities and Rule 23(b)(1)(B) Class Action Funds. <£ o CO

X. CONCLUSION. CO i-1 H-1

APPENDICES. O i-* >-*

A. Manville Trust s Share of Total Payments by All Defendants. <N H

B. Feasibility of Projections. <£> 03

C. Total Value of Asbestos Claims.. 03 CO

D. Claims Settled with Trust By Law Firm. CO lO

Dl. Unsettled Claims Pending Against Trust by Law Firms With More Than 100 Claims.

E. Injunction Protecting Trust.

F. Injunction Protecting Manville Corporation.

AMENDED MEMORANDUM, ORDER AND FINAL JUDGMENT

I. INTRODUCTION

This class action seeks approval of a method for the resolution of a large number of present and prospective claims for compensation from the Manville Personal Injury Settlement Trust (the “Trust”) for personal injuries resulting from exposure to asbestos dust. The proceedings were precipitated by the virtual failure of the Trust. By May of 1990 the Trust had committed its current assets to only a small portion of the claims it was obligated to pay, leaving it without the capacity to pay anything to the vast majority of injured persons.

*733 A proposed settlement (the “Settlement”) of the action has been presented. With some reservations, the relief sought in the complaint is granted and the Settlement is approved. This action effectively removes from case-by-case litigation against the Trust in state and federal courts billions of dollars in claims by hundreds of thousands of people.

A more effective distribution scheme reducing transaction costs substantially and giving much more to claimants could have been devised. Nevertheless, given the institutional and other inhibitions on a wholly new plan created by the courts, what has been proposed must be approved as practicable and fair.

The Bankruptcy Court for the Southern District of New York and the District Courts for the Eastern and Southern Districts of New York (the “courts”) are presented with a series of complex factual and legal issues arising from present and prospective claims of those who have or will allege injury (“claimants”) from exposure to products manufactured or distributed by Johns-Manville and its affiliates (“Johns-Manville”). By 1982, Johns-Man-ville had filed for bankruptcy under Chapter 11 and changed its name to the Man-ville Corporation (“Manville”). In 1988, pursuant to the Second Amended and Restated Plan of Reorganization of Johns-Manville, et al. (the “Plan”), the legal obligations of both Johns-Manville and Man-ville to those injured by their asbestos-containing products were assumed by the Trust.

After appeals, the Trust commenced operations in 1988. It promptly committed all of its current cash and much of its future income for payments to, and settlements with, a relatively small percentage of claimants. Its financial and operational inadequacies lead to the need for intervention by the courts.

Some claimants have obtained, now seek or will seek, compensation for asbestos-related injuries from other companies who manufactured or distributed asbestos-containing products (“codefendants”). As a result of these multiple claims, the code-fendants may have claims against the Trust and the Trust may have claims against codefendants. Litigation between claimants and codefendants and the effect of the Trust’s actions on the relationship of these two groups present the most difficult issues in resolving this class action.

Among the questions now posed are the following: (1) does the Plan prevent approval of the Settlement modifying payments from Manville to the Trust and from the Trust to beneficiaries; (2) do the courts have the power to grant the relief sought by the complaint against various parties; (3) is there a limited fund as described by Rule 23(b)(1)(B) and are the other requirements of Rule 23 sufficiently satisfied to warrant certification of the class as requested in the complaint; (4) is the Settlement approved by Manville, the Trust and a majority of present claimants fair, reasonable and adequate under Rule 23(e); (5) do the courts have the power to stay claimants, codefendants and others from proceeding against Manville and the Trust except in accordance with the Settlement; (6) do the courts have the power to approve a Settlement that modifies litigation relationships between claimants and codefendants and others; and (7) can the method of compensating those injured by asbestos be substantially improved while reducing attorneys fees and other transactional costs?

Each of these questions encompasses su-bissues discussed in the body of this Amended Memorandum, Order and Final Judgment. For the reasons stated below, we answer each question in the affirmative with a reservation as to the sixth. The class as defined in the complaint and final judgment is certified. The parties are stayed and enjoined from acting except consistently with the Settlement as interpreted by the courts to avoid unfairness and illegality. The courts request that the parties expedite any appeals so that payments under the Settlement can promptly be made. The courts will retain power to supervise the Trust during appeals.

Citations supporting factual statements in the body of this opinion are kept to a minimum. The courts rely on information *734 obtained by the district judge in trying to completion more than four score asbestos jury trials and in participation in the settlement negotiations of more than a thousand asbestos cases before and during trial and in participating with state and federal judges across the nation in attempting to resolve legal aspects of the nation’s asbestos disaster. The Bankruptcy Judge relies on information obtained during extensive Johns-Manville bankruptcy proceedings. Both judges have held exhaustive independent and joint hearings in this proceeding and are fully familiar with the voluminous record in this and related proceedings.

In the more detailed analysis which follows, we have in Part II described the history of asbestos use and asbestos litigation generally to provide a context for understanding the role of Manville. This is followed by a description of the history of the Trust and events leading to the need for this class action and for more precise projections of future asbestos claims. Part III sets forth the positions of the various parties involved in the litigation. Part IV details the law providing jurisdiction to decide the case. Part V contains an analysis of the law and facts controlling the power of a federal court to certify a national class action which does not permit its members to withdraw and proceed independently when there is insufficient money available to pay all claimants. In Part VI the power of the courts under federal bankruptcy and state trust law to approve a Settlement after a trust has been created in a bankruptcy reorganization is analyzed. Part VII provides the factual and legal underpinnings for declaring the Settlement fair, as interpreted, between plaintiffs and code-fendants; it necessarily includes an extensive discussion of federal common law and choice of law decisions since a critical issue is the extent to which federal courts can or should override state tort law. Part VIII emphasizes the need for the Trust to control its costs and operations. In Part IX we touch on some of the implications of the Settlement in connection with the national asbestos compensation crisis. Part X briefly summarizes the conclusions reached in the Memorandum. A number of appendices containing relevant factual analysis and two injunctions follow. We are not relying on any of the Appendices attached to this Memorandum for their accuracy but as illustrative of the difficulties of acquiring the necessary quantitative data and of making appropriate projections.

On May 16, 1991 we issued an earlier version of this Memorandum and Order, inviting those interested to point out any inaccuracies. We are most grateful for the generous additional assistance of those who responded to the invitation. They included: Andrew T. Berry (letter dated May 22, 1991); Elihu Inselbuch (letter dated May 24, 1991); John H. Faricy, Jr. (letter dated May 28, 1991); Leslie Gordon Fagen (letter dated May 29, 1991); David T. Aust-era (letter dated May 29, 1991); Roger E. Podesta, John D. Aldock, Andrew T. Berry (letter dated May 29, 1991); Roberta A. Golden (letter dated May 29, 1991); Sheila L. Birnbaum (letter dated May 30, 1991); Mark A. Peterson (letter dated June 6, 1991); Paul Safchuck (letter dated June 7, 1991); John Sawhill (letter dated June 6, 1991); Margaret A. Berger (by telephone) and Matthew Gluck (by telephone). Appropriate changes have been made in this Amended Memorandum, Order and Final Judgment.

II. HISTORY and PROCEDURAL BACKGROUND

A. Asbestos; Scientific Developments and Knowledge

Asbestos is a general term given to two main varieties of natural, fibrous minerals, amphibole and serpentine, which have been used in a multitude of products for over 4500 years. G. Peters and B. Peters, Sourcebook in Asbestos Diseases: Medical, Legal and Engineering Aspects A1 (1980) [hereinafter “Sourcebook”]. Chry-sotile is the only serpentine mineral that contains asbestos, but more than 90% of the asbestos production in the United States and worldwide utilized this asbestos fiber. G. Peters and B. Peters, Asbestos Disease Update 38-39 (1989) [hereinafter “Update”]; Sourcebook, supra, at A1-A2.

*735 1. History of Asbestos Use

Several properties distinguish asbestos from other minerals and explain its widespread use over a long period of time: its tensile strength, its heat and acid resistance and its flexibility. Sourcebook, supra, at Al. The seemingly magical qualities of the mineral have inspired awe:

Asbestos is one of the most marvelous productions of inorganic nature. It is a physical paradox, a mineralogical vegetable, both fibrous and crystalline, elastic and brittle: a floating stone, as capable of being carded, spun, and woven as wool, flax, or silk. Occupying the apparent position of a connecting link between the mineral and vegetable kingdoms, it would appear to possess some of the characteristics of both while being altogether different from either. In appearance, it is as light and feathery as thistle or eiderdown, while, in fact, it is as dense and heavy as the rock which carries it. Ostensibly as perishable as grass, it is actually older than any animal or vegetable life on earth. So little, indeed, is it affected by the dissolving influences of time that the action of unnumbered centuries, by which the hardest rocks are worn away has had no perceptible effect on the asbestos found embedded in them.

Ozonoff, “Failed Warnings: Asbestos-Related Disease and Industrial Medicine,” at 143 in The Health and Safety of Workers: Case Studies in the Politics of Professional Responsibility (R. Bayer ed. 1988) [hereinafter “Ozonoff”] (quoting R. Jones, Asbestos and Asbestic: The Properties, Occurrence and Use 1-2 (1897)).

The earliest uses capitalized on the unique fire resistant qualities of asbestos, as in lamps with incombustible wicks made by the Greeks about 430 B.C. The Romans had asbestos-containing cremation cloths. The writings of Pliny the Elder, Dioscor-ides, Plutarch, Marco Polo and Charlemagne indicate that asbestos was woven into garments to shield against fire. Update, supra, at 6, 38; Sourcebook, supra, at A4.

Knowledge of the potential health hazards of asbestos also dates back to ancient times. Pliny the Elder, the Roman historian, and Strabo, the Greek geographer, reported a lung disorder in slaves weaving asbestos. Update, supra, at 7. Pliny also referred to the use of transparent bladder skin as a respirator to prevent dust inhalation by slaves. B. Castleman, Asbestos: Medical and Legal Aspects 1 (2d ed. 1986) [hereinafter “Castleman”].

Modem industrial use of materials containing asbestos began in the 1860’s. See generally Ozonoff, supra, at 143-210 (provides succinct but comprehensive analysis of manifold social, economic, political and moral aspects of growth of use of asbestos and failures to protect workers and others when knowledge of danger was manifest). The first modern asbestos mine was opened in Lombardy, Italy in 1866 and the first Canadian mine in approximately 1877. Sel-ikoff and Seidman, Asbestos-Associated Deaths Among Asbestos Insulation Workers, presented at “The Third Wave of Asbestos Disease Exposure to Asbestos in Place” (conference in New York, June 7-9, 1990) (citing Jones, Asbestos and Asbestic: With Some Account of the Recent Discovery of the Latter at Danville, in Lower Canada, 45 J.Soc.Arts 3-15 (1897)). According to some sources, asbestos was used for heat insulation as early as 1866. H. Berger, Asbestos Fundamentals. Origin, Properties, Mining, Processing, Utilization (1963).

The rapid expansion in the use of steam power at higher and higher temperatures in the 1870’s greatly increased the need for efficient insulation materials. Ozonoff at 143-45. Seeking to take advantage of its fire retardant qualities, Dr. Richard Matti-son decided to replace shredded hemp, which deteriorated rapidly, with asbestos fibers in reinforcing insulation materials, molded-pipe coverings, block insulation and magnesium cement. Bettes, The History of Asbestos in the Textile Industry in the United States, 52 Asbestos 2-12 (1971). “[T]hus was bom ‘85% magnesia’ insulation, destined to become the standard high temperature thermal insulation for many years.” Id. Thereafter, Mattison along *736 with Henry G. Keasbey became leading manufacturers of asbestos products.

Sources of asbestos have been plentiful. The multitude of applications, many without competitive substitutes, led to its increasing presence in construction and products. Asbestos lined partitions in schools, office buildings, hospitals and ships. Writing in 1897, one source observed “hundreds of buildings plastered with asbestic.” Jones, supra, quoted in Selikoff. Other well-known uses of asbestos included: insulation around cold or hot air or liquid conductors or boilers, noise absorption in wall insulation and acoustic tile ceilings, covering of structural steelwork of large buildings to guard against fire and linings for brakes. Its dielectric properties resulted in many electrical equipment uses; it had such applications as ironing board covers, stove linings and table pads. Theatrical audiences were once comforted by the thought that huge asbestos curtains between the audience and stage protected against the spread of fire. Cement products constituted the single largest service for asbestos in the United States; asbestos-containing cement was utilized as filler in resins, plastics, grouts and even cosmetics. Asphalt surfaced roads occasionally contained asbestos fibers as well.

These wide-ranging applications plus ample and accessible supplies of asbestos account for its pervasiveness in many sectors of the American economy during the twentieth century. Federal Judicial Center, Trends in Asbestos Litigation 7-8 (1987). In the years between 1934 and 1964, the world’s annual use of raw asbestos increased from 500,000 tons to 2,500,000 tons. Selikoff, Churg & Hammond, Asbestos Exposure and Neoplasis, 188 J.A.M.A. 22, 142 (1964).

Massive and unrestrained use of asbestos in industrial, commercial and household contexts has exposed millions of people to its insidious dangers. The main groups at risk were those in the plants which shaped and wove asbestos products and those who cut and installed it in the field as insulators, boilermakers or those in other trades laboring in close proximity to asbestos workers. In the naval shipyards, for example, workers of all trades in small compartments breathed the heavy asbestos dust created by insulators and boilermakers and brought it home on their clothing. Carpenters and metal workers who may not have worked directly with asbestos were nonetheless heavily exposed to its hazards. Workers in the oil fields of Texas, the tire factories of the mid-West and the shipyards of our coasts as well as in building construction in all parts of the country were at some degree of risk.

Exposure is not limited to those employed in the mining of asbestos or in the manufacture or use of asbestos products, but it affects those removing in-place asbestos, consumers who used asbestos-containing products such as hair-dryers and persons exposed to a family member’s contaminated clothing. See, e.g., Selikoff & Levin, Radiographic Abnormalities and Asbestos Exposure Among Custodians of the New York City Board of Education (Dep’t of Community Medicine, Mount Sinai School of Medicine, March 1990); Selikoff & Lilis, “Radiological Abnormalities Among Sheet Metal Workers in the Construction Industry in the United States and Canada: Relation to Asbestos Exposure” 11-14 (Dep’t of Community Medicine, Mount Sinai School of Medicine 1989). Residents of communities near asbestos mines and manufacturing facilities have an increased chance of illness from exposure to airborne asbestos fibers. Sourcebook, supra, at A4-A25. Every resident in New York and other urban areas breathes small amounts each day.

An independent study performed for the Department of Labor estimated that the number of Americans significantly exposed to asbestos is 21 million. See Occupational Health Hazards Compensation Act of 1982: Hearings Before Subcomm. on Labor Standards of the House Comm, on Education and Labor, 97th Cong., 2d Sess. 132 (1982) (statement of Harry Martens, Exec. Vice-President, Commercial Union Insurance Companies) (cited in Special Project, An Analysis of the Legal, Social, and Political Issues Raised by Asbestos Litigation, 36 Vand.L.Rev. 573, 580 n. 13 (1983)).

*737 Because of the increased awareness of dangers and new government regulations, use of new asbestos essentially ceased in the United States in the early 1970’s. See, e.g., Federal Occupational Safety and Health Act of 1970, S.Rep. 91-1282, 91st Cong., 2d Sess., reprinted in 1970 U.S.Code Cong. & Admin.News 5175, 5179; “Asbestos Ban and Phasedown Regulations,” 40 C.F.R. 763.160 et seq. (promulgated by EPA in July 1989). Yet, as a consequence of the long latency of asbestos diseases, some experts have predicted asbestos-related deaths will peak in the 1990s and early twenty-first century. Insidious asbestos is slowly working in the lungs of millions of workers and others.

Before the crisis subsides, some experts suggest that more than one half million asbestos-exposure deaths will occur. See I. Selikoff, Disability Compensation for Asbestos-Associated Disease in the United States (1981). Their estimates for morbidity are in the millions, many times that for mortality. Other experts sharply dispute these projections, claiming that the death and disability rates will be far lower. As noted below, because it is necessary to project future claims in assessing the fairness of the Settlement and in executing it, the district courts have authorized a study under Rule 706 of the Federal Rules of Evidence to assess the likelihood of future diseases and claimants. See Part II.I, infra.

2. Discovery of Health Hazards Associated with Asbestos

The potential dangers of asbestos exposure have been clearly recognized by the experts and manufacturers — but not by most of the workers — for many years. Beginning in the early part of this century, medical and scientific communities revealed growing persuasive evidence of the health hazards associated with asbestos.

Proof of asbestos risks initially emerged in scattered reports published between 1897 and 1918 in Europe, Canada, and the United States. These case studies discussed the danger of airborne asbestos fibers. Update, supra, at 7; Castleman, supra, at 2-6; Ozonoff, supra, at 155. The first detailed account in the modem era of a worker’s death from asbestosis was reported in England by Dr. A.H. Montague Murray, a pioneer in the use of x-rays for medical diagnosis, in 1906. See Castleman, supra, at 3-4; Update, supra, at 7. Prudential Life Insurance performed a study for the United States Bureau of Labor Statistics in 1918 entitled “Mortality from Respiratory Diseases in Dusty Trades (Inorganic Dusts).” This report revealed excess deaths from pulmonary tuberculosis in asbestos workers from twenty-five to forty-five years old. Dr. Hoffman who conducted the study concluded that the industry was a “considerable dust hazard” and noted “the practice of American and Canadian life insurance companies [to generally decline] asbestos workers ... on account of the assumed health injurious conditions of the industry.” Ozonoff, supra, at 157.

More extensive evidence began to accumulate in the 1920’s with reports of asbestosis in widely-circulated medical journals, including the British Medical Journal and the Journal of the American Medical Association (“JAMA”). Twelve separate British medical publications between 1928 and 1929 contained research on the hazardous effects of asbestos. Castleman at 6-9. A 1930 memorandum by the Market Analysis Section, Sales Promotion Department of the Johns-Manville Corporation entitled “Pulmonary Asbestosis” discussed several papers published in Great Britain between 1927 and 1929, including an analysis of a report by a British clinician, A.C. Haddow, in which he reported four fatal cases of asbestosis. This evidence of knowledge was eventually produced in discovery by Johns-Manville. Castleman, at 9, 510. Because a central controversy in asbestos cases concerns when manufacturers knew or should have known of the health hazards associated with exposure to asbestos dust, the existence of these medical reports significantly undermines contentions of lack of knowledge of Manville and the co-defendants.

Reports concerning the occupational risks of asbestos, including the incidence of *738 asbestosis and lung cancer among exposed workers, have been substantial in number and publicly available in medical, engineering, legal and general information publications since the early 1930s. See Sourcebook, supra, Chronological Bibliography at G1-G162. There is compelling evidence that asbestos manufacturers and distributors who were aware of the growing knowledge of the dangers of asbestos sought to conceal this information from workers and the general public.

The British Parliament commissioned an important study by Dr. E. Merewether, chief inspector of factories in England, in 1930 on the effects of exposure to asbestos dust which included recommendations for its control. The information in the report led to the introduction of safety measures and medical supervision for asbestos workers in England and to the extension of the Workmen’s Compensation Act to include asbestosis. Merewether's findings were published in the United States and received some mention in various journals including a 1930 issue of JAMA. Update, supra, at 7; Castleman, supra, 10-17.

In 1930 the first case of asbestosis in the United States was reported in Minnesota Medicine and noted in JAMA. Additional reports on asbestosis were published in the United States by K.M. Nynch and W.A. Smith, in JAMA, and W.B. Soper in 1930. Castleman, supra, at 16-22. As of 1930, the symptoms, pathology and disease progression of asbestosis were well understood. Fatalities from the disease had been reported, as well as the high incidence of asbestosis among workers in mines or manufacturing facilities producing asbestos-containing products.

At the same time Dr. Anthony J. Lanza, formerly of the United States Public Health Service, then with Metropolitan Life Insurance Company, began to study asbestos workers in the textile industry at the request of several prominent industry executives. Preliminary results of this study indicated that 43% of those who had worked in the industry for five years had X-ray signs of fibrosis; of those with five to ten years’ exposure, 50% showed fibrosis on X-rays; of those with ten to fifteen years’ exposure, 58%; and of those with over fifteen years, an incredible 87% had radiographic evidence of lung disease. Ozonoff, supra, at 167; Castleman, supra, at 22. The power wielded by the asbestos industry resulted in a four-year delay before the study was published in an allegedly altered form. Ozonoff, supra, at 170-72. Writing in 1931 the attorney for Johns-Manville explained the basis for the changes in the report:

[0]ne of our principal defenses in actions against the company on the common law theory of negligence has been that the scientific and medical knowledge have been insufficient until a very recent period to place upon the owners of plants or factories the burden or duty of taking special precautions against the possible onset of the disease in their employees.

Id. at 171.

Between 1931 and 1935 additional reports on asbestosis appeared in the medical literature of England, Germany and the United States. Castleman at 22-28. In 1932 an expert committee from the Children’s Bureau of the United States Department of Labor recommended the exclusion of minors from certain hazardous activities, including occupations involving exposure to asbestos dust. At a 1933 government hearing attended by many industry executives on asbestos production and use discussion touched upon the health hazards of airborne asbestos fibers. Castleman, supra, at 23. Even the allegedly heavily censored 1935 study conducted by the Metropolitan Life Insurance Company, which minimized or ignored significant data, recommended efforts at control of asbestos dust, regular medical examinations of employees and industry studies of known asbestosis cases. Castleman at 29-31.

By 1935 asbestosis was “widely recognized as a mortal threat affecting a large fraction of those who had regularly worked with the material.” Castleman at 32; see generally Selikoff and Lee, Asbestos and Disease 23 (1978). Even some of those who had worked for less than one year with asbestos manifested severe disease.

*739 It was known that the disease process would not become evident for the first few years of exposure_ Moreover, by the time the disease became evident, cessation of exposure would not halt the inexorable progress of the disease caused by the durable fibers already trapped in the lung tissues.

Id.

Additional studies concerning asbestosis continued to be published in the United States throughout the 1930’s and 1940’s. The United States Navy required airline respirators or dust respirators for asbestos jobs in 1943. U.S. Navy, “Minimum Requirements for Safety and Industrial Health in Contract Shipyards,” Section 11.1 (U.S. Gov’t Printing Office, 1943). These requirements were not enforced in naval shipyards and, in fact, there was official connivance at a coverup of the hazards of asbestos in the shipyards. Transcripts of Brooklyn Navy Yard trials, New York City Asbestos Litig., Civ. No. TS 90-9999 (E. & S.D.N.Y.1990-91) passim.

Medical evidence linking cancer with exposure to asbestos fibers developed more slowly. In 1935 a British pathologist, S. Gloyne, reported on the occurrence of lung cancer in association with asbestosis. Further evidence of a connection between cancer and asbestosis surfaced in reports in Great Britain, the United States, Norway, France and Germany during the late 1930’s. Update, supra, at 7-8; Castleman, supra, at 40-45, 55. In response to these reports the federal German government declared “asbestosis in combination with lung cancer” a compensable occupational disease in 1943. Castleman, supra, at 44 (citing Fourth Schedule of Extension of Compensation for Industrial Accidents and Diseases, Reichsgesetzblatt, Part 1, No. 14 (Jan. 29, 1943)). A report by Dr. Wilhelm C. Hueper in the same year suggested that lung cancer was an occupational disease of great significance to the asbestos industry in the United States and that “[ijndustry should make serious attempts to eliminate all potentially cancerigenic agents from further use by the development of suitable substitutes: Castleman, supra, at 45 (emphasis in original).

Correspondence in 1946 from the Sara-nac Laboratory to J.P. Woodard, a Johns-Manville executive, reveals that Woodard received a copy of Hueper’s 1943 article. Castleman, supra, at 43-45. Dr. E. Mer-ewether supplied additional evidence of an association between asbestosis and lung cancer in the 1947 and 1948 Annual Reports of the Chief Inspector of Factories in Great Britain. These reports noted that in 13% of known asbestosis fatalities, lung cancer was also present. Update, supra, at 8; Castleman, supra, at 57-58. At about the same time scattered reports of mesothelioma emerged in journals of industrial medicine and hygiene. Id. at 108. Important studies by Doll in 1955 and Seli-koff in 1964 supplied additional evidence of a causal connection between asbestosis and lung cancer, Update, supra, at 8, but the warnings to those who should have been alert had been sounded long before. Lilienfeld, The Silence: The Asbestos Industry and Early Occupational Cancer Research, 81 Am.J.Pub.Health 791 (1991) (“When these studies found that asbestos was a carcinogen, this information was suppressed. The ensuing cover-up, effected through industry associations and research compacts, resulted in thousands of deaths.”). As Castleman concluded,

[i]t remained for the epidemiologist not to document the cancer risk but quantify its extent in the asbestos industry, to identify the numerous types of cancer caused by asbestos, and further track the danger across property lines into the community (using rare mesothelioma as a marker).

Castleman, supra, at 108.

3. Current Asbestos Studies and Medical Knowledge

The capacity of asbestos fibers to cause serious injuries is no longer disputed. Injuries vary from fatal malignancies to mild scarring of the lung tissue. There are four disease processes associated with exposure to asbestos fibers: asbestosis, mesothelio-ma, cancers (including lung, gastrointestinal and others) and pleural plaques.

*740 Asbestosis refers to a pulmonary insufficiency caused by a destruction of air sacs in healthy lung tissue. See Selikoff, Churg & Hammond, Asbestos Exposure and Neoplasia, 188 J.A.M.A. 22, 25 (1964). This pulmonary disease caused by exposure to asbestos dust is progressive and incurable. Castleman, supra, at 302. The disease may dramatically reduce life expectancy and significantly impair lung capacity while the worker is alive. Some evidence suggests that persons with asbestosis may have an increased risk of contracting lung cancer and other malignancies. See Seli-koff, Lilis and Seidman, Predictive Significance of Parenchymal and/or Pleural Fibrosis for Subsequent Death of Asbestos-Associated Diseases (Division of Occupational and Environmental Health, Mount Sinai Medical Center Oct. 1990) (unpublished paper filed and docketed).

Malignant mesothelioma is an uncommon neoplasm arising in the mesothelial cells that make up the pleural, pericardial and peritoneal membranes enclosing the lungs, heart and abdomen respectively. Castleman, supra, at 98-99. The occupational association of asbestos as a cause of meso-thelioma is well-recognized. Special Project, An Analysis of the Legal, Social, and Political Issues Raised by Asbestos Litigation, 36 Vand.L.Rev. 573, 579 & n. 11 (1983). Between fifty and eighty percent of diagnosed cases of pleural and peritoneal mesothelioma have a history of asbestos exposure. Llewellyn, Current Approach to the Diagnosis and Treatment of Mesothelioma, 11 Int.Med. 50 (Dec. 1990). From the time of first contact with asbestos to the onset of disease may be more than forty years. Once manifested, the illness is usually fatal within two years. Id.

Brief but high-intensity and prolonged but low-level asbestos exposure seem equally related to the incidence of mesothe-lioma, but the risk is said by some to be much greater from the amphiboles (croci-dolite and amosite) with long and thin fibers than from the shorter, curly fibers of chrysotile. Id. Mesothelioma has been documented among individuals with only casual exposure to asbestos dust, such as family members who cleaned the clothes of workers or visited workers at their jobsite. Castleman, supra, at 98-103, 447-49, 457-60.

The incidence of mesothelioma is rising in the United States at a rate estimated by some at approximately thirteen percent per year, most likely as a result of the increased use of asbestos combined with the latency period and delayed recognition of the disease. Malignant mesothelioma causes more than 4,000 deaths annually in the United States. Llewellyn, Current Approach to the Diagnosis and Treatment of Mesothelioma, 11 Int.Med. 50 (Dec. 1990).

Among other cancers, pulmonary and bronchogenic malignancies are most commonly associated with asbestos exposure. According to Dr. Selikoff,

far more deaths from cancer of the lung and pleura occurred among the asbestos workers than would have occurred had their death rates from these diseases been the same as for all US white males.

Selikoff, Churg & Hammond, Asbestos Exposure and Neoplasia, 188 J.A.M.A. 22, 144 (1964). Combined exposure to asbestos and cigarette smoking results in significantly higher rates of cancer than occur when only one factor is present. Lerman, Selikoff, Lilis, Seidman, Gelb, Clinical Findings Among Asbestos Workers in the U.S.: Influence of Cigarette Smoking, 10 AM. J.Indus.Med. 449 (May 1986); Hammond, Selikoff & Seidman, “Asbestos Exposure, Cigarette Smoking and Death Rates,” Health Hazards of Asbestos Exposure, 330 Ann.N.Y.Acad.Sci. 473 (1979).

Dr. Selikoff and his colleagues believe that asbestos insulation workers suffer disproportionate death rates from stomach, rectum and colon cancer as well. Selikoff, Churg & Hammond, Asbestos Exposure and Neoplasia, 188 J.A.M.A. 22, 26 (1964). Some epidemiological studies have suggested excess risks of cancer of the kidney, larynx, pharynx and mouth among asbestos insulation workers. Selikoff & Seid-man, “Asbestos-Associated Deaths Among Insulation Workers” presented at conference “Third Wave of Asbestos Disease: *741 Exposure to Asbestos in Place. Public Health Control.” (New York, N.Y. June 1990); see Castleman, supra, at 99. Other experts dispute these findings.

Pleural plaques involve a thickening or calcification of the pleural tissue surrounding the lung. Some research has shown that limited radiographic changes often precede lung cancer, mesothelioma and severe asbestosis. See Selikoff, Lilis & Nicholson, “Asbestos Disease in United States Shipyards,” Health Hazards of Asbestos Exposure, 330 Ann.N.Y.Acad.Sci. 295, 304 (1979); Selikoff, Lilis & Seidman, Predictive Significance of Parenchymal and/or Pleural Fibrosis For Subsequent Death of Asbestos-Associated Diseases 9-12 (Oct. 1990) (unpublished paper filed and docketed) (study of asbestos insulation workers followed for twenty-seven years found those with parenchymal and pleural fibrosis suffered elevated risk of asbestos-associated cancers and deaths from asbestosis). Some experts question the relationship between pleural plaques and the development of lung cancer and asbestosis. See, e.g., Kiviluoto, Meurman & Hakama, “Pleural Plaques and Neoplasia in Finland,” in Health Hazards of Asbestos Exposure, 330 Ann.N.Y.Acad.Sci. 31 (1979).

Highly exposed occupational groups were the first to manifest an increased incidence of diseases later associated with asbestos exposure. Appearance of disease correlates with duration and intensity of exposure to asbestos fibers. The greater the exposure, the sooner the disease can be expected to appear; conversely, shorter or less intense exposure translates into a longer latency period. Occupational exposures that occurred in the 1940’s, 1950’s and 1960’s are generally considered excessive with a relatively short latency period of fifteen to thirty years. In contrast, those environmentally exposed and exposed through household contacts may only manifest injury forty or more years later. Age may also affect the latency period with younger exposed workers and family members experiencing longer latency periods. Seidman, Selikoff & Hammond, “Short-term Asbestos Work Exposure and Long-term Observation,” in Health Hazards of Asbestos Exposure, 330 Ann.N.Y.Acad.Sci. 61 (1979).

The form of asbestos known to pose a risk is “friable asbestos,” or asbestos which is capable of releasing fibers into the atmosphere which can be inhaled by humans. Cf . 40 C.F.R. § 61.141 (friable asbestos material defined as “any material that contains more than 1% asbestos by weight and that can be crumbled, pulverized, or reduced to powder, when dry, by hand pressure”). Asbestos fibers may become freed and airborne while being processed or used in manufacturing, construction or demolition. Anderson & Selikoff, “Asbestos-Associated Radiographic Changes Among Household Contacts of Amosite Asbestos Workers,” in Preger, Induced Disease: Drug, Irradiation, Occupation 254 (1979). Individuals working in less dusty areas report a lower incidence of parenchymal fibrosis (asbestosis) than those in more dusty areas of textile mills. Ozonoff, supra, at 188; see Selikoff, Lilis & Seidman, Predictive Significance, supra, at 9-12 (in later years with increased efforts to lower dust level, incidence of disease decreased). As of 1978, the Department of Health Education and Welfare estimated that eight to eleven million Americans workers had been exposed to asbestos since the beginning of World War II. Califano, Statement, Dep’t HEW (Washington, D.C. April 26, 1978). Asbestos-associated diseases are progressive. Cessation of exposure will not halt the deterioration in the individual’s lung condition. See Castleman, supra, at 32. While no cures are available for asbestos injuries, preliminary efforts indicate that some treatment may be possible. See Letter from Dr. Irving J. Selikoff (Mar. 18, 1991) (filed and docketed) (improved nutrition with supplementary diet improved respiratory muscle function and well-being in individuals with chronic obstructive pulmonary disease). Perhaps continued research efforts will produce advances in medical treatment for the hundreds of thousands of people who possibly have incurred asbestos-related injuries. Based on information presently available the courts must assume *742 that such advances will not appreciably reduce future claims.

Asbestos pollution was not expected to pose any significant health hazard to the general public. Yet, as early as 1960, mesothelioma was reported in nonoccupational asbestos-exposed individuals. Wagner, Sleggs & Marchand, Diffuse Pleural Mesothelioma and Asbestos Exposure in N.W. Cape Province, 17 Br.J.Ind.Med. 260-71 (1960). An additional nine cases of mesothelioma in family contacts of asbestos workers and eleven cases among individuals whose only identified exposure was living within one-half mile of an asbestos factory were reported in 1965. Newhouse & Thompson, Mesothelioma of the Pleura and Peritoneum Following Exposure of Asbestos in the London Area, 22 BritJ.In-dus.Med. 261 (1965). Similar reports appeared from nine different countries by the mid-1970’s. See Anderson, Lilis, Daum, Fischbein & Selikoff, Household-Contact Asbestos Neoplastic Risk, 271 Ann. N.Y.Acad.Sci. 311 (1976).

These reports led Doctor Selikoff and his colleagues at Mount Sinai Hospital to undertake a study to assess the risks of nonmalignant and malignant disease associated with household exposure to work-derived asbestos dust. Anderson, Lilis, Daum, Fischbein & Selikoff, Asbestosis Among Household Contacts of Asbestos Factory Workers, 330 Ann.N.Y.Acad.Sci. 387 (1979). The study has followed household members who resided with 1,664 asbestos workers at their time of employment in a factory which produced amosite asbestos products from 1941 to 1954. Id. While none of the household members had occupational exposure to asbestos, 35% had asbestos-related radiographic abnormalities and five members of the cohort had been diagnosed or died of mesothelioma as of 1979. Id. Second to occupational exposure, household contact is the most frequently identified source of asbestos exposure among reported mesothelioma cases. Anderson & Selikoff, “Asbestos-Associated Radiographic Changes Among Household Contacts of Amosite Asbestos Workers,” in Preger, Induced Disease: Drug, Irradiation, Occupation 254 (1979). Thus, the extent of injury among those casually exposed to asbestos is the subject of current study, but its dimensions remain unclear. This large group of insulators has now been followed by Doctor Selikoff and his associates for more than thirty-five years, providing some reliable guidance with respect to the incidence of asbestos-related injuries among those casually exposed. Initial analyses of the most recent data indicated increased rates of lung cancer, colon cancer and mesothelioma, but not significant nonmalignant abnormalities nor clinical disability. See Letter from Dr. Irving J. Selikoff (Feb. 7, 1991) (filed and docketed) (summarizing study conducted in September 1990 of family members of asbestos workers).

While Johns-Manville and other manufacturers ignored or attempted to conceal this information from the public, proper precautions and the development of alternative products were retarded. The consequence is that millions of people were unknowingly exposed to a dangerous substance. The health, economic and legal reverberations of exposure to asbestos will continue long into the future.

B. Johns-Manville Corporation

Johns-Manville was founded in 1858 by Henry Ward Johns who patented inventions for roofing and insulation products. According to most sources, from the 1920’s until the 1970’s Johns-Manville was both the largest manufacturer of asbestos-containing products and the largest supplier of asbestos in the United States. See Excerpt from 1970 Johns-Manville Corporation Form 10-K, attached to Affidavit of Anne E. Cohen at Exhibit C (Feb. 5, 1991) (“Cohen Aff.”); see generally Castleman, supra, at 510. The company boasted in an article in Asbestos Magazine in 1970, that “Johns-Manville participates in almost every facet of the Asbestos Industry and is the largest producer of asbestos-based products in the United States.” Asbestos Magazine at 14-15 (Sept. 1970) (Cohen Aff., Exhibit E). See also In re Johns-Manville Corp., 97 B.R. 174, 176 (Bankr.S.D.N.Y.1989) (“[Johns-Manville] was the *743 world’s largest processor, manufacturer and supplier of asbestos materials and products”).

This leading corporation manufactured a multitude of products that contained asbestos. During its heyday, Manville marketed more than 500 different lines of products manufactured at the company’s 33 plants and mines located throughout the United States and Canada. Asbestos Magazine at 50 (Aug. 1959) (Cohen Aff., Exhibit F). In its Product Handbook, Manville projected that its asbestos mill in Quebec, built in the mid-1950’s would have “full production capacity ... greater than one-third the free world’s supply of asbestos fibre,” and that the mine was “the largest mine in the world for the production of asbestos fibre.” Manville Product Handbook at 2, 3 (1955) (Cohen Aff., Exhibit H). Similarly, Man-ville proudly announced that it was a “leader in [the asbestos floor tile] industry since it was started on a wide commercial basis.” Asbestos Magazine at 18 (Nov. 1960) (Cohen Aff., Exhibit J).

Products of Johns-Manville saw widespread commercial, industrial and consumer use. In particular, its “85 percent magnesium” products were used extensively in shipyards in the years leading up to and during World War II. Johns-Manville was allegedly one of the few manufacturers that utilized crocidolite-type asbestos fibre in any significant quantity especially after 1945. See Affidavit of Robert D. Brown, 118 (Feb. 1, 1991); Affidavit of Bruce G. Tucker, ¶ 16 (Feb. 1, 1991). Significant medical data suggests, as already noted, that crocidolite fibers present greater dangers than other forms of asbestos, particularly in connection with the deadly asbestos-induced cancer, mesothelioma.

C. Proof of Industry Knowledge of Health Hazards

Through persistence, vigorous discovery and creative efforts, plaintiffs’ attorneys representing persons suffering from asbestos-related injuries gradually uncovered extensive evidence indicating that manufacturers, including Johns-Manville, knew that asbestos posed potentially life-threatening hazards and choose to keep that information from workers and others who might be exposed. P. Brodeur, Outrageous Misconduct: The Asbestos Industry on Trial 97-131 (1985).

As early as 1932 Johns-Manville, specifically Vandiver Brown and attorney J.C. Hobart, together with Raybestos-Manhat-tan, suggested to Dr. Anthony Lanza, Associate Director of Metropolitan Life Insurance Company (a provider of group insurance at various times to Manville and Raybestos), that Lanza publish his study on textile workers with material alterations that would minimize the disease process and its seriousness. Castleman, supra, at 139-142, 464-65. The study allegedly intentionally omitted mention of the potentially fatal consequences of asbestosis, a fact contested by Metropolitan Life. A sentence which stated “[hjowever, it is possible for uncomplicated asbestosis to result fatally” was allegedly deleted from the published report. Id. at 465.

The commonly referenced “Sumner Simpson papers” consist of correspondence to and from Sumner Simpson, a prominent officer of Raybestos-Manhattan from 1929 until his death in 1953. The first letter from A.F. Rossiter of Asbestos Magazine to Simpson dated September 25, 1935 refers to previous requests by Simpson to preclude publications in the magazine concerning the hazards posed by asbestos dust. In a second letter, dated October 1, 1935, Simpson told Vandiver Brown, Johns-Manville’s attorney, “the less said about asbestos, the better off we are.” The letter also mentioned English articles recommending asbestos dust control, noting that Asbestos has “been very decent about not reprinting the English articles.” In a third letter dated two days later, Brown replied: “I quite agree with you that our interests are best served by having asbestosis receive the minimum of publicity.” Castleman, supra, at 143-44. Brown suggested that if they decided not to object to the publication of such an article, it should use American instead of English data on the theory that the asbestos dust in North America was “considerably milder.” Id. at 142-43.

*744 In 1936 Johns-Manville, and others, appear to have actively censored the information disseminated by the Saranac Laboratories, and they continued to prevent the Saranac scientists from promptly disclosing adverse scientific data. In the 1930’s and 1940’s, Saranac Laboratories conducted studies on cancer and asbestosis funded by the asbestos industry for the Study of Tuberculosis. Again the corporations manufacturing and distributing asbestos exercised editorial control over the publication of these studies. Castleman, supra, at 46-54.

Litigation against Johns-Manville by eleven employees alleging health injuries caused by exposure to asbestos served to place the company on formal notice of the health risks for workers. According to the minutes of a Board of Directors meeting on April 24, 1933, the suits were settled by Johns-Manville on the explicit condition that the plaintiffs’ attorneys would not bring similar claims against the company in the future. P. Brodeur, Outrageous Misconduct: The Asbestos Industry on Trial 113-14 (1985).

Correspondence produced by Raybestos-Manhattan in discovery in a South Carolina case included letters concerning the nonpu-blication of articles in Asbestos magazine at the direction of industry executives, the alleged editing of the Metropolitan Life study by Lanza, and the sponsorship of the somewhat suppressed Saranac Labratory research. According to South Carolina Circuit Judge James Price:

The correspondence very arguably shows a pattern of denial and disease and attempts at suppression of information which is highly probative. [T]he correspondence reveals written evidence that Raybestos-Manhattan and Johns-Man-ville exercised an editorial prerogative over the publication of the first study of the asbestos industry which they sponsored in 1935.... [It] further reflects a conscious effort by the industry in the 1930s to downplay, or arguably suppress, the dissemination of information to employees and the public for the fear of promotion of lawsuits.

Castleman, supra, at 465 (quoting Amended Order, Barnett v. Owens-Corning Fiberglas Corp, et. al, (Ct. Common Pleas Aug. 23, 1978)).

Judge Robert Parker who has years of experience trying asbestos cases summarized the knowledge widely accepted in the scientific and medical community with respect to asbestos as follows:

1. There is no safe level of exposure.

2. There is a dose/response relationship that manifests itself in either the type disease that one may contract or the length of latency period between exposure and disease manifestation.

3. Asbestos is a competent producing cause of the diseases of mesothelioma, asbestosis, lung cancer, and pleural disease. Unanimity of opinion is not yet achieved regarding gastrointestinal tract cancers although the evidence has satisfied the Surgeon General.

4. Mesothelioma is an untreatable terminal cancer.

5. Asbestosis is a progressive untreatable disease of the lung.

Cimino v. Raymark Indus., 751 F.Supp. 649, 652 (E.D.Tex.1990).

A recently completed report issued by the Federal Judicial Conference Ad Hoc Committee on Asbestos Litigation condensed the history as follows:

It is a tale of danger known in the 1930s, exposure inflicted upon millions of Americans in the 1940s and 1950s, injuries that began to take their toll in the 1960s, and a flood of lawsuits beginning in the 1970s. On the basis of past and current filing data, and because of a latency period that may last as long as 40 years for some asbestos related diseases, a continuing stream of claims can be expected.

Report of the Judicial Conference Ad Hoc Committee on Asbestos Litigation 2 (Federal Judicial Center 1991) [hereinafter “Judicial Conference Asbestos Report”].

The chilling summary contained in David Ozonoff’s discussion of the failures to protect workers concludes:

It was not a lack of moral fibre on the part of scientists and engineers but a *745 lack of social controls that allowed private interests to meet their own needs at the expense of the health of workers, consumers, and the general public. The task before us is to fashion a set of social controls that is effective, equitable, and without the kind of unintended adverse consequences that often result when a complex system is changed. We can only hope that we are now evolving such a system and the progress will be speedy.

Ozonoff, supra, at 209-10. In lieu of such a system the injured were forced to turn to the tort system for private enforcement of rights. That they are doing so at a steadily increasing rate is shown by the following figures supplied by the Administrative Office of the United States Courts. The situation in state courts is many times as grave.

Asbestos Cases Filed, Terminated and Pending in United States District Courts

Pending on Filed Terminated June 30

1984 2,788 296 7,923

1985 4,239 968 11,194

1986 5,463 1,684 15,019

1987 7,776 3,369 19,467

1988 10,715 7,901 22,358

1989 8,230 5,603 25,378

1990 13,687 5,883 33,182

All data are for years ended June 30. See Judicial Admin. Office, Civil Cases (Asbestos Only) Commenced, Terminated and Pending During Twelve-Month Period Ending Dec. 31, 1990 Table C 1 (1991).

D. Litigation

Concomitant with the growing use of asbestos products, insulation workers formed a union in the United States and Canada. Initially chartered by the Knights of Labor in New York City in 1884, it was recognized by the American Federation of Labor in 1910 as the International Association of Heat and Frost Insulators and Asbestos Workers. Selikoff, Churg and Hammond, The Occurrence of Asbestosis Among Insulation Workers in the United States, 132 Ann.N.Y.Aca.Sci. 139-55 (1965). The presence of the Union greatly facilitated the transition from individual case studies reporting asbestos-related injuries to the extensive epidemiological data available today. See Selikoff, Third Wave, supra, at 4-6.

This union and others also provided access for workers suffering from asbestos-injuries to attorneys with special relationships to the unions who became familiar with the litigation. This phenomenon explains in part why asbestos litigation is concentrated in the offices of a relatively few attorneys who can earn enormous aggregate fees while cutting costs through economies of scale.

Typical of mass torts, during the early litigation stages plaintiffs had little success, but as they developed evidence, legal theories and expertise, there was a sudden explosion of asbestos litigation. See, e.g., McGovern, The Cycle of Mass Tort Litigation, Yale Law School Program in Civil Litigation, Working Paper No. 122 (1990); McGovern, Resolving Mature Mclss Tort Litigation, 69 Boston U.L.Rev. 659 (1989); T. Willging, Trends in Asbestos Litigation 8-13 (Federal Judicial Center 1987) [hereinafter Trends in Asbestos Litigation ]; Hensler, Felstiner, Selvin & Ebener, Asbestos in the Courts: The Challenge of Mass Toxic Torts (RAND, Inst, of Social Justice 1985) [hereinafter Asbestos in the Courts ].

The coincidence of prevalent use of asbestos, long latency period of illness and prior knowledge of asbestos hazards by industry executives fueled the litigation. *746 Angered by evidence that information had been suppressed, juries began to award punitive damages. The evidence reviewed above indicates that the issue of general causation is clear, but causation-in-fact, whether the individual’s exposure to a particular defendant’s product substantially contributed to the plaintiff’s injury, and the nature and extent of the injury, is subject to extensive dispute and in turn continues to encourage litigation.

Asbestos cases differ from typical personal injury cases in significant respects. The injuries caused by asbestos are medically complex. Asbestos in the Courts, supra, at 2; Trends in Asbestos Litigation, supra, at 11-12. The illnesses may be difficult to detect, diagnoses may be disputed among experts and the injuries may be associated with several causes. Asbestos in the Courts, supra, at 2. The injuries are serious, often progressive and life-threatening. The exposure which resulted in injury occurred many years earlier among circumstances which apply to a large group of plaintiffs. Id. A number of manufacturers produced the dangerous products. Evidence to demonstrate exposure to a given manufacturer’s product at a particular jobsite in the appropriate year may be difficult, or overshadowed by evidence of exposure to other products or smoking. Trends in Asbestos Litigation, supra, at 11. Despite these confounding factors, by 1985 one study concluded:

Asbestos cases, however complex they may have been at first, have become relatively routine product liability cases that involve a large number of parties. The major complications that remain relate to (1) disposition of claims against multiple defendants, who frequently have cross-claims against each other, and (2) disputes among defendants and their insurers about coverage.

Willging, Asbestos Case Management: Pretrial and Trial Procedures 5 (Federal Judicial Center 1985).

Traditional asbestos claims are primarily brought by workers whose occupations involved direct exposure to or handling of asbestos or asbestos-containing products. A second large category of injured persons consists of those who worked alongside such workers and consequently inhaled asbestos fibers. They include insulation workers, shipyard workers, oil refinery workers and chemical refinery workers. So-called nontraditional claims are brought by persons who are exposed to asbestos already in place such as construction workers, tire workers, merchant seamen, and sheet metal workers. More recently, the incidence of injuries in persons environmentally exposed or household members of workers raises the specter of yet another wave of asbestos litigation.

Escalating jury awards generated incentive for both plaintiffs and attorneys to turn to the tort system for redress and began to create such an extensive docket in some jurisdictions that resolution appeared forever in abeyance. The most current figures estimate that roughly 100,000 asbestos cases are currently pending on federal and state dockets nationwide. Order to Show Cause, Judicial Panel on Multidistrict Litigation, No. 875 (1991). A recent Report issued by the Judicial Conference included the prediction that

the final toll of asbestos related injuries is unknown. Predictions have been made of 200,000 asbestos disease deaths before the year 2000 and as many as 265,000 by the year 2015.

Judicial Conference Asbestos Report, supra, at 2. Many of these projections require further analysis. See Appendix B attached.

As a practical matter, for plaintiffs to obtain relief they need a trial date. This in turns presents problems. As one commentator noted,

the roughly contemporaneous filing of large numbers of asbestos disease cases in selected jurisdictions throughout the United States has created excessive demands for the most scarce resource in the litigation system — judicial trial time.

McGovern, Resolving Mature Mass Tort Litigation, 69 B.U.L.Rev. 659, 663 (1989). In part as a result of the known backlog of cases, only a trial date will generate sufficient incentive to compel the parties to *747 settle or result in a trial verdict that terminates the case. While the disposition of asbestos cases is admittedly calendar-driven, fewer than one percent of all asbestos tort cases are ultimately prosecuted to judgment. See Tr. 1/2/91 at 77-78.

The sustained success of plaintiffs in establishing liability for serious and deadly injuries has helped usher in a new stage of asbestos litigation in which the burden of jury awards threatens the viability of many former manufacturers and producers of asbestos products. McGovern, supra, 69 B.U.L.Rev. at 665; Judicial Conference Asbestos Report, supra, at 13-14; Appendices A, C, attached. At present some dozen former manufacturers of asbestos products have filed for bankruptcy; numerous smaller distributors who have been targeted in the wake of absent manufacturers and have also become insolvent. See Judicial Conference Asbestos Report, supra, at 14 & n. 33 (listing eleven of twenty-five major manufacturers in bankruptcy; H.K. Porter filed after completion of the Report); see, e.g., In re Pacor Inc. and Pacor Material Supply Co., Case Nos. 86-03251, 86-03252 (Bankr.E.D.Pa. Dec.1989) (former distributor of asbestos-containing products).

Defendants who have not yet been driven into bankruptcy have developed a defensive posture as a means of survival. See Cimino v. Raymark Indus., 751 P.Supp. 649, 651-52 (E.D.Tex.1990). As Judge Parker explained:

[Defendants] assert a right to individual trials in each case and assert the right to repeatedly contest in each case every contestable issue involving the same products, the same warnings, and the same conduct.

Id. This approach has slowed dispositions, contributing to the clogging of federal and state courts with tens of thousands of complaints.

Not all defendants have successfully adopted this posture of delay. Some defendants have been involved in this mature mass tort litigation for years, have little or no insurance left and continue to barely survive. Some defendants have participated in cooperative efforts among companies and insurers as members of the Wellington group (after Dean Wellington of Yale Law School). The Wellington facility succeeded in fostering a considerable degree of cooperation among defendants that at least reduced litigation transaction costs for its participants. After its dissolution due to conflicting interests among members, a score of smaller defendants formed the Center for Claims Resolution. This group continues to promote the interest of its individual members and to settle the vast majority of claims it faces at reduced transactional costs.

A newer generation of peripheral defendants are becoming ensnarled in the litigation as plaintiffs and defendants. In particular, Owens Corning Fiberglas seeks to spread the burden of asbestos litigation as extensively as possible through third-party actions. This effort and that of plaintiffs seek to uncover new sources of compensation for the hundreds of thousands of present and anticipated plaintiffs. The extent of liability, possible defenses and value of the claims against these new defendants is unknown at this point. For example, in the consolidated cases predicated on exposure to asbestos while engaged in the construction, operation or maintenance of electric generating stations in New York (the “powerhouse cases”), over 200 third-party defendants, many of whom have never previously been involved in asbestos litigation, have been brought into the action by Owens Corning Fiberglass. The third party defendants include Consolidated Edison, Long Island Lighting Company, General Electric, Westinghouse, Bechtel, General Motors and others of the Fortune 500 groups as well as many relatively small companies. Trial of the first fifty of nearly 800 consolidated powerhouse cases from the Eastern and Southern districts of New York began before Judge Charles P. Sifton in the Eastern District of New York at the beginning of April 1991. The new defendants are strenuously resisting being drawn into the asbestos vortex. Settlement of the cases in this group is being attempted by Kenneth E. Feinberg, Esq. as Special Master; he was instrumental in set *748 tling much of the Brooklyn Navy Yard docket of the state and federal cases.

Plaintiffs’ attorneys have also differed in their approach to handling asbestos cases. They too are seeking to expand the number of those with assets available to pay for asbestos injuries. Some plaintiffs’ attorneys have chosen to file only their more serious cases in numbers that can be processed by existing judicial methods. See McGovern, ADR Approaches to Mass Torts (April 19, 1991) (unpublished paper) (filed and docketed). Others have filed all of their cases without regard to the extent of injury. In conjunction with unions they have arranged through the use of medical trailers and the like to have x-rays taken of thousands of workers without manifestations of disease and then filed complaints for those that had any hint of pleural plaque. Some attorneys will settle their stock of cases for relatively small amounts, making up for fee shortfalls by the large number of cases, while others tend to fight on a case-by-case basis for maximum recovery.

The natural concentration of cases in jurisdictions encompassing areas that witnessed heavy exposure to asbestos products, such as the shipyards, oil fields and tire factories has yielded an uneven distribution of cases. See Judicial Admin, office, Civil Cases (Asbestos Only) Commenced, Terminated and Pending During Twelve Month Period Ending Dec. 31, 1990, Table C 1 (1991). Thus, the prospect for trial varies considerably from jurisdiction to jurisdiction leaving the plaintiffs’ bar with significantly greater leverage in some areas than others.

The courts have adopted diverse postures as well. Some courts have aggressively addressed problems raised by asbestos litigation using a variety of aggregative techniques. See Mullenix, Beyond Consolidation: Postaggregative Procedures in Asbestos Mass Tort Litigations, 32 William & Mary L.Rev. 475 (1991). For example, many districts have instituted innovative judicial management procedures that have streamlined the discovery and trial phases of litigation considerably. Judicial Conference Asbestos Report, supra, at 15-16. Some courts have established alternative dispute resolution facilities connected to the court. Id. at 24-25. For trial, certain jurisdictions have consolidated as many as sixty-five individual cases for a unified trial of all issues. See, e.g., New York City Asbestos Litig., Civ. No. TS 90-9999 (S. & E.D.N.Y.1990) (Brooklyn Navy Yard cases); In re Powerhouse Cases, Civ. No. PH 90-8888 (S. & E.D.N.Y.1991) (consolidation of some 800 powerhouse cases; fifty on trial using reverse bifurcation to try damages before liability); see also Hendrix v. Raybestos-Manhattan, Inc., 776 F.2d 1492 (11th Cir.1985). A single trial on limited issues of some 9,000 cases is scheduled in state court in Maryland.

New York Supreme Court Justice Helen E. Freedman has been instrumental in encouraging and facilitating unique cooperation among the state and federal courts handling asbestos cases in New York State. Her experience and extensive knowledge of state substantive law has been invaluable to the federal courts. Through her contacts with members of other state judicial systems, the courts have gained a better understanding of how the Manville situation affected state and federal asbestos proceedings throughout the country.

Other courts have utilized class actions in an effort to avoid endless repetition of testimony, documents, experts and argument. See, e.g., Jenkins v. Raymark Indus., 782 F.2d 468 (5th Cir.1986); Cimino v. Raymark Indus., 751 F.Supp. 649 (E.D.Tex.1990).

Another strategy employed in an effort to reduce the burden of asbestos cases is to create an inactive docket of cases with plaintiffs who have few if any objective symptoms. Judicial Conference Asbestos Report, supra, at 25-26. Placement of a claim on such a registry acts to toll the statute of limitations holding in abeyance unimpaired plaintiffs whose claims may return to the active docket following the onset of disability. Id. See, e.g., Order To Establish Registry for Certain Asbestos Matters, In re Asbestos Cases, (Cook County Circuit Court May 26, 1991) (Trafelet, *749 J.); Order to Establish Asbestos Deferred Registry, In re Asbestos II, No. 86-1739 (N.D.Ill. May 10, 1991).

A number of courts have employed special masters to gather data and encourage settlement. Federal courts in Texas, Ohio, New York and Massachusetts have used this technique as have state courts in Maryland. Some judges have taken an active role in encouraging settlements, while others have not.

Other courts, perhaps feeling a greater burden and urgency from overwhelming criminal and civil dockets have not instituted procedures specifically designed to cope with the asbestos litigation crisis. Cf Judicial Admin. Center, supra, (Table indicating numbers of asbestos cases filed, terminated and pending for each district). In such districts the dockets continue to grow with almost no dispositions.

Plaintiffs have extensively exercised their power to choose forums. They have generally chosen to move cases to the high verdict districts where the calendars move. Where the tempo or verdicts vary between state and federal courts, the attorneys file where a faster disposition seems likely. In many instances, they file their cases in both courts to increase their options and leverage on defendants.

At this stage of the litigation cycle, most workers exposed to asbestos recover substantial sums through settlement or jury awards. Nonetheless, the disparities are enormous. In New York City, for example, three large trials of similar plaintiffs and defendants were consolidated. One trial of twenty plaintiffs in the Southern District of New York resulted in twenty defense verdicts. In re Joint Eastern & Southern Dists. Asbestos Litig., 762 F.Supp. 519 (E. & S.D.N.Y.1991) (Patterson, J.). A second of thirty-five plaintiffs in Supreme Court, New York County resulted in a verdict of 65 million dollars plus punitive damages. In re New York City Asbestos Litig., NYAL 4000 (N.Y.Sup.Ct. 1990) (Freedman, J.) A third of sixty-four plaintiffs in the Eastern District of New York resulted in thirteen defense verdicts and fifty-one plaintiffs’ verdicts for a total of 35 million dollars with no punitive damages. In re Joint Eastern & Southern Dists. Asbestos Litig., BNY 90-9999 (E. & S.D.N.Y.1990) (Weinstein, J.). Trials are much like a lottery with substantially higher verdicts in New York City, East Texas and parts of California than other parts of the country.

Settlements are, of course, much more consistent, representing an averaging out of the expectations of all counsel. The ratio of trials to settlement also varies from district to district depending on local substantive law, practice and tradition and the happenstance of counsels’ needs and judges' expectations. There are variations by industry as well: tire workers (where exposure is light), on the one hand, and navy shipyard workers or insulators (where exposure is heavy), on the other, have cases which vary widely in the mix of cancer, asbestosis and pleural plaques disease and in which causation is viewed with skepticism or is clear. Much will depend on pressures by the judges to settle, local calendar congestion and the like. In short, while the present phase of the litigation favors plaintiffs, there are enormous variations across the country and even within the same geographic areas or industries.

Some research has attempted to estimate the elements of the cost of asbestos litigation. While difficult to gauge with precision, a 1984 Rand study revealed that for every dollar paid to compensate a plaintiff, $2.59 was spent on litigation and transaction costs. Kakalik, Ebener, Felstiner, Haggstrom, Shanley, Variation in Asbestos Litigation Compensation and Expenses 91 (Rand Inst.Civ.Justice 1984) (plaintiffs receive roughly 39 cents for every dollar spent). Based on information now available, including overheads, insurance costs and expenditures for courts, the percentage available to plaintiffs is probably closer to 30 cents for every dollar expended. See also Appendix C, attached.

At the time it filed for bankruptcy, the relatively-modest sized Eagle-Picher Industries reported that it hád devoted $119.7 million to litigation and settlements associated with asbestos claims in 1989, amount *750 ing to an astonishing 2.3 million dollars each week. Judicial Conference Asbestos Report, supra, at 13. This was an almost insolvent company heading for bankruptcy that had little remaining insurance coverage.

The extent of litigation costs for companies still defending asbestos claims with the benefit of insurance coverage exceeds the Eagle-Picher figure. The Manville Trust, designed to fairly and expeditiously compensate personal injury claimants was spending approximately one million dollars a week on outside counsel litigation defense costs alone in 1990 in addition to its own staff counsel and overhead costs at a time when it had almost no unrestricted cash. See H.Ex. 4, 6. As the Judicial Conference Asbestos Report, concluded, “[t]he transaction costs associated with asbestos litigation are an unconscionable burden on the victims of asbestos disease.” Judicial Conference Asbestos Report, supra, at 13.

A fundamental debate remains about the suitability of the tort system for handling the tens of thousands of asbestos cases that remain on state and federal court dockets. The initial social benefits of tort litigation were impressive. It provided a forum for exposing the greed and indifference of industry and government to the health of American workers. It furnished a means of compensating those injured and deterring future wrongful conduct by creating ample incentives for manufacturers to pay close attention to the potentially harmful side effects of their products. But to continue to process claims in the same fashion as the initial cases were handled despite the extensive body of experience and epidemiological data now accumulated appears intolerable as a matter of national policy. See Part IX, infra. When actual recovery represents some one-third of the expense of litigation, systemic inefficiencies seem to outweigh benefits derived from traditional one-on-one adjudication. As one Rand study concluded:

The picture is not a pretty one. Decisions concerning thousands of deaths, millions of injuries, and billions of dollars are entangled in a litigation system whose strengths have increasingly been overshadowed by its weaknesses.

Asbestos in the Courts, supra, at iii (Forward).

The large number of asbestos lawsuits pending throughout the country threatens to overwhelm the courts and deprive all litigants, in asbestos suits as well as other civil cases, of meaningful resolution of their claims. Judicial Conference Asbestos Report, supra, at 7 (tide of asbestos litigation “continues to rise unabated and has not begun to crest”). Several commentators have recounted the inefficiencies and inequities of case-by-case adjudication in the context of mass tort disasters. See, e.g., American Law Institute, Enterprise Responsibility for Personal Injuries: Reporters’ Study (April 15, 1991); American Bar Association, Revised Final Report and Recommendations of the Commission on Mass Torts (Nov. 1989); Rosenberg, Class Actions for Mass Torts: Doing Individual Justice by Collective Means, 62 Ind.L.J. 561 (1987); Trends in Asbestos Litigation (Federal Judicial Center 1987); Rubin, Mass Torts and Litigation Disasters, 20 Ga.L.Rev. 429 (1986); Note; Class Certification in Mass Accident Cases Under Rule 23(b)(1), 96 Harv.L.Rev. 1143 (1983); Comment, Federal Mass Tort Class Actions: A Step Toward Equity and Efficiency, 47 Alb.L.Rev. 1180 (1983).

The heyday of individual adjudication of asbestos mass tort lawsuits has long passed. See Judicial Conference Asbestos Report, supra, at 7 (“one point on which plaintiffs’ counsel, defense counsel and the judiciary can agree is that the present way in which we have attempted to resolve asbestos cases has failed”). The reasons are obvious: the complexity of asbestos cases makes them expensive to litigate; costs are exacerbated when each individual has to prove his or her claim de novo; high transaction costs reduce the recovery available to successful plaintiffs; and the sheer number of asbestos cases pending nationwide threatens to deny justice and compensation to many deserving claimants if each claim is handled individually. The backlog is eroding a fundamental aspiration of our judi *751 cial system — to provide equality of treatment for similarly situated persons. Cf. Asbestos in the Courts, supra, at 12 (recent wave of asbestos litigation marked by high concentration of claims, dominance of characteristics of individual asbestos cases, behavior of parties, lawyers and the attributes of judges “created a situation in which dispositions are slow, costs are high, and outcomes are variable”).

Overhanging this massive failure of the present system is the reality that there is not enough money available from traditional defendants to pay for current and future claims. Even the most conservative estimates of future claims, if realistically estimated on the books of many present defendants, would lead to a declaration of insolvency — as in the case of some dozen manufacturers already in bankruptcy. Compare Appendix A, attached with Appendix C, attached; see Part VII.D.4.a, infra and passim.

The courts have reached a crossroad in their efforts to resolve the multitude of social and legal issues that asbestos litigation has engendered. See discussion of larger context of asbestos litigation at Part IX.A, infra. Either the law will adapt to changed circumstances and new pressures or large numbers of persons will be deprived of a practical means by which to redress their injuries. The situation is urgent for many aging victims and widows who have endured years of suffering without relief. This Settlement must be viewed in this larger historical context.

E. Bankruptcy of Johns-Manville

Manville had been a highly successful producer of asbestos and asbestos products, but by 1982 it was experiencing severe financial stress resulting from the massive number of tort claims filed by persons who had contracted various diseases resulting from exposure to Manville asbestos.

In August of 1982, Johns-Manville Corporation and affiliated entities filed for reorganization under Chapter 11 of the United States Bankruptcy Code. A realistic fear of burgeoning asbestos-related tort claims for compensatory and punitive damages motivated the filing.

Manville already faced a substantial number of asbestos disease claims, including more than 17,000 pending tort suits. By 1982 more than 3,570 claims had either been settled or been tried to verdict at an average disposition cost of $20,000. Man-ville then estimated another 35,000 claims and projected its total asbestos liability at more than one billion dollars. The corporation sought bankruptcy protection to devise a means to cope with its exploding asbestos liability.

Despite this massive contingent liability, the Chapter 11 filing by Manville, a company with assets valued at $2.25 billion and a net worth of $830 million, shocked both the business world and those involved in asbestos litigation. It inspired extensive academic and other commentary. See, e.g., L. Kallen, Megabankruptcies of the 1980’s and 1990’s chs. 9-11 (1991); P. Brodeur, Outrageous Misconduct: The Asbestos Industry on Trial, 286 (1985) (committee of asbestos-related litigants filed motion to dismiss petition as effort to use bankruptcy law to impair “the constitutionally protected rights of present and future victims of asbestos-related diseases and their survivors ... to obtain full compensation for personal injuries and wrongful death”); see also id. at 283, 320; Olick, Chapter 11 — A Dubious Solution to Massive Toxic Tort Liability, 18 Forum 361 (1983); Harris, Asbestos Chapter 11 “Solution” to the Tort Litigation System in Recent Developments in Tort Law Reform, 39 Bus. 209 (Johnson ed. Nov. 1983). During the six years of bankruptcy, no asbestos-related claims were paid.

After four years of difficult and intense negotiations among representatives of present claimants, future claimants, code-fendants, Manville, equity security holders and other interested parties, Manville proposed its Second Amended and Restated Plan of Reorganization (the “Plan”) in August of 1986. It was formally approved and after appeals the Trust became operative on November 28, 1988. As indicated below, serious underestimates of future *752 claims and their value sowed the seeds of failure. The assumption was that there would be a full payment of all creditors, including asbestos claimants. Plaintiffs’ attorneys insisted on a scheme that allowed their earliest clients to be paid in full and permitted the attorneys to collect large fees without reduction for cost savings created by mass settlements. But for what will probably be hundreds of thousands of unpaid asbestos health claimants little was left. When they came, the cupboard was bare.

F. Second Amended and Restated Plan of Reorganization

The Plan provided for the creation of the Trust which was designed to satisfy fully Manville’s asbestos-related liability. See In re Johns-Manville Corp., 68 B.R. 618, 635 (Bankr.S.D.N.Y.1986), aff'd, 78 B.R. 407 (S.D.N.Y.1987), aff'd sub nom. Kane v. Johns-Manville Corp., 843 F.2d 636 (2d Cir.1988). Specifically, the Trust was formed to assume Manville’s liabilities resulting from pending and potential claims, defined as Class 4 Claims, including (1) individuals exposed to asbestos who have manifested asbestos-related diseases or conditions, (2) individuals exposed to asbestos who have not yet manifested asbestos-related diseases or conditions, and (3) third-party asbestos-related health claims against Manville for indemnification or contribution. Plan and Related Documents, § 2.4 at C-24. The Trust was expected to satisfy those claims with assets to be committed to the Trust immediately and over time by Manville and its insurers. It is of some significance in the current class action that all the parties agreed that claimants and codefendants were to be placed in the same class of creditors.

Upon consummation of the Plan on November 28, 1988 (the date the Trust Agreement was executed), the Trust became the exclusive entity from which to seek compensation for existing and future asbestos health claims caused by exposure to Johns-Manville products. An injunction insulated the Manville Corporation from any asbestos-related litigation.

As stated in the Plan, Manville established the Trust to implement the following purposes:

(i) to use the assets in the Trust Estate to deliver fair, adequate and equitable compensation to bona fide Beneficiaries, whether presently known or unknown, without overpaying or underpaying any claims and with settlement to be preferred over arbitration, arbitration to be preferred over resort to the tort system, and fair and efficient resolution of claims to be preferred over all else;

(ii) to enhance and preserve the Trust Estate;

(iii) otherwise to carry out the provisions of this Agreement, the Supplemental Agreement, the [Property Damage] Supplemental Agreement and any other agreements into which the Trustees have entered or will enter in connection with the Plan.

Trust Agreement, § 2.02, at C-80.

Under the provisions of the Plan, the Manville Corporation would fund the Trust up to agreed upon payments for at least thirty years. Pursuant to the Plan, the Trust would receive three types of assets in order to satisfy anticipated asbestos claims. See Trust Agreement, Schedule I at C-90.

First, the Trust was to receive insurance proceeds, cash and accounts receivable with a total value of $869 million (mostly from insurance). Second, two bonds with an aggregate face value of $1.8 billion and a $50 million installment note were executed by Manville in favor of the Trust, payable in installments commencing August 1991 and extending through November 2014. Third, the Trust was given up to 80 percent of the stock in the reorganized Manville Corporation — 24 million shares of common stock (representing fifty percent of Manville common stock outstanding at the time) plus preferred stock convertible under certain circumstances to an additional 72 million common shares (constituting an additional thirty percent interest). The stock was hedged with restrictions that would prevent the Trust from interfering with management’s control for some years. *753 Beyond these assets, beginning in 1992 the reorganized Manville Corporation was to make payments to the Trust of up to twenty percent of its annual profits.

The Plan thus anticipated an extended life for the Trust and closely linked its financing to the health of the reorganized company. The ultimate transfer of a controlling share of Manville stock was designed to give the Trust a long-term interest in the company’s operations:

[T]he Trust, as fiduciary for asbestos health victims will be the single largest stockholder in the reorganized debtor. The effect of this Plan will be to give the “tort victims” the beneficial interest in the ongoing operating corporate entity.

In re Johns-Manville Corp., 68 B.R. 618, 621 (Bankr.S.D.N.Y.1986), aff'd, 78 B.R. 407 (S.D.N.Y.1987), aff'd sub nom. Kane v. Johns-Manville Corp., 843 F.2d 636 (2d Cir.1988). The bonds were also structured to provide the Trust with funds for a twenty-four year period.

Similarly, the profit-sharing provision sought to ensure a long-term source of income for the Trust. As the Bankruptcy Court recognized,

the Trust is guaranteed an “evergreen” source of funding by virtue of its 20% call on profits of the operating corporation. This funding of the Trust will continue until the last asbestos victim is found and paid.

In re Johns-Manville Corp., 68 B.R. at 621-22.

The Plan provided that “[e]ach holder of an Allowed Class 4 Claim shall be paid the full amount of such Allowed Claim in accordance with the terms and provisions of the Claims Resolution Facility and Article IV of the Trust Agreement.” Plan and Related Documents § 3.4, at C-25. In this context, “Allowed” claims means those timely filed with the Claims Resolution Facility and “liquidated and fixed as to amount in accordance with the terms of the Trust Agreement.”

Article X of the Plan expressly retained jurisdiction in the court “to enforce and administer the provisions of the Plan and, to the extent expressly provided therein, the Exhibits thereto and the Annexes to the Exhibits,” “to modify any provision of the Plan to the full extent permitted by the Code” and “to enter such orders as may be necessary or appropriate in aid of confirmation and to facilitate implementation of the Plan.” Plan and Related Documents § 10.1, at C-36, C-37. This Bankruptcy Court endorsed the efficacy and propriety of the provision retaining jurisdiction. See In re Johns-Manville Corp., 97 B.R. 174, 181 (Bankr.S.D.N.Y.1989) (“The success of these reorganizations will be measured by the ability of the Trust to compensate the future asbestos-health claimants.”).

To carry out the Plan post-confirmation, the Trust administers the Claims Resolution Facility (“CRF”) described in the Claims Resolution Procedures, Annex B to the Trust Agreement. The stated purpose of the Claims Resolution Procedures embodies the priorities and principles guiding operation of the Trust as envisioned at its creation:

to provide a simple, economical procedure for obtaining and encouraging the prompt, efficient and equitable resolution of asbestos-related bodily injury claims which are based upon a physician’s diagnosis of any and all asbestos-related diseases and conditions while preserving the rights of the parties [sic] access to the tort system, including the right to jury trial in a forum selected by a claimant pursuant to the applicable federal or state laws of the jurisdiction selected, with the only condition precedent to the exercise of the right to trial by jury being the procedures specified in Section II.B.

Trust Agreement Annex B, § 1.A.1 at C-99.

Among other items, the CRF required claims to be processed in the order in which they are originally filed whether in a court or with the CRF whichever is earlier, known as the first-in, first-out (“FIFO”) system. Trust Agreement Annex B, § I.A.2 at C-99. The procedures permit certain exceptions to the FIFO system. First, claimants who have previously settled with all other codefendants may pro *754 cess their claims with the Trust out of the main FIFO queue. Id. Second, to a limited extent the Trust was permitted to negotiate and implement group settlements so long as it would not “in any substantial way” prejudice the FIFO processing. Id. Third, extreme hardship claimants could receive a priority in both the processing and payment of their claims. Trust Agreement Annex B, § 11.B.7 at C-101.

For claimants who failed to liquidate claims with the Trust through its procedures, mediation or arbitration and instead pursued a tort action, the claimant had the right to assert against the Trust all claims available under applicable state law for compensatory but not punitive damages. The CRF specifies that claims liquidated by settlement or arbitration must be paid shortly after liquidation. Id. §§ II.B.9, III. D.6, III.E.5 at C-101-104. No similar urgency is expressed for payment of claims that have been liquidated through trial. This provision did not, however, in practice represent a significant disincentive to trial.

On December 22, 1986 the Bankruptcy Court entered its order confirming the Plan. Following nearly two years of appeals, the confirmation order became final on October 28, 1988. The Plan was executed and delivered on November 28, 1988.

Upon starting operations it was known to the Trust and others that the Plan was grossly inadequate. Within a year-and-a-half of start-up, the Trust was without liquid assets. Internal memoranda and meetings of the Trust’s personnel with selected plaintiffs’ counsel made it clear that the shortfall was recognized almost at once. Nevertheless, settlements and payments went on with no allowance made for the looming crisis.

G. Problems with the Trust

Pursuant to orders of the Bankruptcy Court the Trust was established on an interim basis prior to consummation. An initial staff was hired in January 1987. By May 1988, the Trust began settling but not paying pre-petition claims.

1. Inaccurate Estimates of Claims and Values

At the time of the Trust’s creation, the architects of the Plan expressed the view that the assigned assets and financial resources of the Trust would be sufficient to pay all asbestos health claims as they were liquidated. Relying on its experience to date, counsel to Manville stated at the time of confirmation:

[w]e cannot demonstrate with mathematical certitude that the trust is funded adequately, but with reasonable estimates and by the substantial amounts that the company has committed to pay into the trust, we believe that there is a reasonable probability that the company will be able to meet all of its commitments under the plan and that there will be adequate funding to pay every asbestos claimant.

Confirmation Hearing Tr. at 274.

A critical ingredient in the ability of the Trust to fulfill its obligations was the value of the Trust’s common stock at the time of its sale. The Disclosure Statement calculated that value at “various price earnings multiples of between 6 to 12 times the respective year’s projected consolidated net earnings available for common stock, subject to a minimum value of 60% of net book value.” Id. Moreover, Manville explicitly stated:

For the assumed total of 83,000 claims, the estimated amount of Manville Common Stock to be sold by the Trust ranges between approximately 28% and 45% of the total common equity of Manville, depending on the selling price per share ... Under certain assumptions of the 100,000 claims case, the Trust would be required to sell most, if not all of the 80% Manville common equity available in its portfolio in order to pay claims, a large number of which are anticipated to be settled in the early years after consummation.

Id.

During the pendency of the bankruptcy proceeding more than 50,000 additional asbestos health claims were asserted. This compelled Manville to revise upward its total claims projections. Contrary to its *755 early estimation of an ultimate total of 35,000 claims, the rate of filing did not plateau and decrease, but in fact continued to rise. As a result, by the time of the Plan’s confirmation, Manville’s new projection anticipated that it would face between 83,000 and 100,000 claims. In view of the extent of claims, the Debtors’ Disclosure Statement specifically recognized that sufficient funds might not be available to the Trust to pay all asbestos health claims as they were liquidated:

Although Manville believes that the funding of the Trust will over time be adequate for the payment of 100,000 claims valued at $25,000 per claim in 1986 with per-claim cost increasing by four percent per year thereafter, depending on the timing of the receipt and liquidation of claims, the Trust is likely to experience periods when the payment of claims will be dependent upon the timing of receipt of payments from Manville.

Disclosure Statement IXC(c)(iii) at C — 377; see also id. Intro D(l) at C-325. Similarly, the Court of Appeals for the Second Circuit, while upholding the bankruptcy court’s confirmation of the Plan, conceded that the Trust might not be able to satisfy all claims against it. Kane v. Johns-Manville Corp., 843 F.2d 636, 644-45 (2d Cir.1988).

Drawing on its prepetition experience, Manville in the Disclosure Statement estimated that on average resolving pending and future claims against the Trust would cost $25,000 per claim in 1986, with the per-claim cost increasing four percent annually thereafter. See Disclosure Statement 61 IXC(c)(ii) at C-377.

The Plan thus relied upon assumptions that the number of claims would not exceed 100,000 and that the timing of claims would roughly coincide with the timing of payments from the Corporation to the Trust. Based on available data, the Bankruptcy Court found that the Plan satisfied the criteria set forth in § 1129(a) and that it was “not likely to be followed by the liquidation, or the need for further financial reorganization, of the debtor or any successor to the debtor under the plan.” In re Johns-Manville Corp., 68 B.R. 618, 635 (“The evidence submitted by [Manville] ... provides a reasonable estimation, based upon known present claimants and reasonable extrapolations from past experience and epidemiological data, of the number and amount of asbestos-related claims that the AH Trust will be required to satisfy.”), aff'd, 78 B.R. 407 (S.D.N.Y.1987), aff'd sub nom. Kane v. Johns-Manville Corp., 843 F.2d 636 (2d Cir.1988).

Circumstances quickly outstripped projections concerning the number of claims, the rate at which they were filed and their average value. The confluence of these factors meant that the Trust began incurring liabilities in excess of, and at a far greater rate than, the cash flow to the Trust. Moreover, rather than containing disincentives for trial, in fact the practical effect of certain provisions of the Plan was to encourage costly and wasteful litigation. First, plaintiffs could accelerate the processing of their claim if they obtained a trial date. The Trust would negotiate and settle cases set for trial in an effort to lessen trial exposure and litigation defense costs. Yet this avenue provided a vehicle for late-filing claimants to move ahead of the FIFO queue. Second, the provision permitting codefendants to implead the Trust in any ongoing litigation increased exponentially the number of cases simultaneously docketed for trial. In one fell swoop, the Trust was brought into tens of thousands of cases. This necessitated retaining local counsel in nearly every state, participating in pretrial discovery and preparing tens of thousands of cases for trial rather than merely evaluating them for settlement. Under the weight of constantly increasing claims, the Trust expanded its reliance on expensive outside counsel.

To the extent that cases were settled through the Claims Resolution Facility, plaintiffs’ attorneys exercised considerable and effective influence over the Trust’s settlement and payout practice. The Trust began settling pre-petition claims in groups organized by plaintiffs’ counsel. Spreadsheets were developed to summarize basic information concerning certain selected law firms’ pre-petition claims relying on infor *756 mation from plaintiffs' counsel, Manville, the Resource Planning Corporation (a fact gathering and data analysis company employed by the Trust at great expense), and information obtained during the claims review process. After spreadsheets were completed, an analysis of the data was undertaken to determine disease mix, total prior settlements or judgments from code-fendants and a possible range of Manville’s market share based on the occupations of the claimants. Affidavit of Gregory Smith, Western Region Claims Manager of the Trust, II5A-5C (Oct. 10, 1990) (Cohen Aff., Exhibit M). While millions of dollars was spent for an outside information processing firm to gather and enter data in computers as claims came in, adjusters at the Trust often settled large groups of cases using hand-written file summaries.

Settlement discussions with plaintiffs’ counsel varied widely. According to Trust memoranda, group settlements were common and could involve hundreds of claims with an aggregate settlement value ranging in the millions of dollars. Not infrequently these claims were settled relying on varying levels of information supplied by plaintiffs’ counsel subject to a random audit after settlement. For example, on June 21 and 22, 1988, Trust personnel met with counsel from one plaintiff firm to discuss settlement of 880 cases. After setting aside certain extraordinary cases the parties proceeded to discuss and settle 835 cases in the course of an afternoon:

After lunch, discussion continued concerning the 45 special claims. The [representative of the Trust] stated that the plaintiff counsel had [already] received, [from codefendants] on the 835 claims, a total average per claim of $64,414.23. [He] explained that his calculations ... concluded] the accurate amount [was] $53,785,879.

... [He] offered $20,916,731 for 835 cases to their demand of $70,331,000. [Counsel representing plaintiff-beneficiaries] responded that if one were to take the previous paid amounts and look at them at 40% market share versus 35%, the total would then be approximately $54,000,000. [He] further noted that the Trust offer should at least be $36,000,-000. [The Trust representative] replied that the actual JM market share is un-known_ [The Plaintiffs’ representative] requested that the Trust pay the firm based on joint and several liability. [The Trust representative] commented that the Trust can not afford to compensate on the things that “could have been.” Negotiations on both sides continued and [The Trust representative] gave a counter-offer of $25 million. Plaintiff counsel asked for a few minutes to confer.

Plaintiff counsel responded with a demand of $32,965,538 which was to reflect 38% of the market share liability. [The Trust counsel] said that it would be easy to split the difference, but they wanted to dwell on the concept and not on numbers. [The Trust] gave a counter offer of $28,861,627. [Plaintiffs’ counsel insisted that the firm wanted more than 35% market share. [The Trust] offered $31,500,000 ... Plaintiff counsel accepted the offer and settlement of 835 claims was concluded at $31,500,000 (36.9%).

Trust Memorandum (June 27, 1988) (Cohen Aff., Exh. N). The firm involved settled with the Trust for over $50 million. No limit on fees based on the economies of scale was negotiated to reduce the Trust’s payment. The share paid by the Trust was arguably greater than present litigation indicates it should have been. Special Master Marvin E. Frankel, appointed to determine whether the Trust constituted a limited fund, see Part II.J, infra, in the course of his hearings turned his attention to the “perplexing subject” of possible gross overpayment of claims by the Trust. Special Master’s Report, In re Joint Eastern & Southern Dists. Asbestos Litig. (Johns-Manville), 120 B.R. 648, 661-68 (E. & S.D.N.Y.1990) [hereinafter “Special Master’s Report”].

Preliminary discussion between Trust personnel and another prominent plaintiffs’ firm centered on fixing the appropriate average value for a group of 326 cases and Manville’s share of responsibility. The Memorandum recording the discussion is *757 illustrative of some of the inherent problems in the Trust’s settlement process:

[Plaintiffs’ counsel] went on to relate how he and members of his firm had pulled files at random and done a blind evaluation, assigning a total value to each case and then subtracting out what funds had already been received. [He] maintained that the remaining J-M share worked out to be 30%.

[The Trust representative] responded with his “Trust Speech” stressing the Trust’s fiduciary responsibility to future claimants as well as its obligation to maintain the viability of the Trust while providing fair and just compensation.

[Plaintiffs’ counsel] argued that his cases involved such high value jurisdictions as Texas and Florida and that he was interested in compensating these people fairly and not "gouging the Trust” as evidenced in his assessment of the 13 unsettled cases. [The Trust] reminded him of the 17,200 expected pre-petition cases to be followed by an estimated 150,000 claims over the life of the Trust ...

[The Plaintiffs’ counsel] declared that Texas was a good state for getting trials easily and that he was surprised to learn that the average case value was only $130,000 compared to the $150,000 average he had assumed. [The Trust] reminded him that those settlements were docket-driven and then asked him if he had a figure in mind.

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[The Trust representative] disputed the [percentage calculated by Plaintiffs’ attorney] by explaining that considering the cases in bulk masked mitigating factors that individual case evaluations would reveal. Urging [Plaintiffs’ attorney] to back away from the courthouse steps logic, [The Trust representative] contended the amount of money already paid on these claims by the [Claims Resolution] Facility was inflated.

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[The Trust representative] maintained that the Trust could not remain in business if it paid an average of $47,500 a case.

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[The plaintiff’s representative] reiterated his position by stating the Trust was capable of paying his demand on the basis that 25% of the average case award of $85-90,000 was $30,000. $30,000 per 17,200 cases would total $516,000,000, a figure he insisted was below the budget the plaintiff’s [sic] committee had determined for the first year....

Trust Memorandum (June 2, 1988) (Cohen Aff., Exh. Q). This firm settled claims with the Trust for some $30 million. One plaintiffs’ firm settled claims with the Trust for over $110 million using similar mass negotiation methods. See Appendix D.

Trust personnel made little effective effort to apportion available cash among total anticipated assets or to maintain the $25,000 average claim payment level relied upon in devising the Plan. Rather, the Trust was manipulated into paying high tort prices for claims theoretically settled through an alternative dispute resolution process.

When negotiations were successful, a confirmation letter was sent to the attorney indicating that the settlement was contingent upon the receipt of acceptable Proof of Claim forms for all claimants, upon the completion of an audit of all claims paid in excess of $50,000, upon the completion of an audit of a random sampling of 10-20% of the entire settlement group, upon proof that the claims were in fact pre-petition and upon Trust approval of the law firm’s allocation among the claimants. Similar but apparently not identical procedures were used in the Western and Eastern Regions in settling pre-petition claims on behalf of the Trust. G. Smith Aff., supra, at 115H.

By March 81, 1989, the Trust had received 60,000 claims and had liquidated and paid in full the majority of its pre-petition claims. The average settlement value of the 15,000 pending claims from before the bankruptcy was $39,000. Payment of pre-petition claims ultimately totalled approxi *758 mately $625 million of the Trust’s initial available cash of about $837 million. Huge start-up and continuing Trust administrative costs were also paid from this cash on hand. Many of the pre-petition claimants had received roughly full compensation for their injuries from the codefendants during the bankruptcy. Tr. 1/23/91 at 51 (plaintiffs “have gotten full value for cases since 1982” in settlements with and judgments against codefendants). Nevertheless, their attorneys were able to obtain large additional amounts from the Trust consuming almost all of its liquid resources.

During the second year of the Trust’s administration the number of claims filed with the Trust nearly doubled; by March 31, 1990 the Trust had received 143,000 claims. Thus, within its first two years of operation the Trust faced almost 50% more claims than the highest projection made at the time of confirmation for the total number of claims to be filed during the entire life of the Trust. By February 5, 1991 the number of claims received by the Trust had soared to over 170,000 and claims continue to flood in. Memorandum of Law of Man-ville Personal Injury Settlement Trust In Support of Motion to Approve Class Action Settlement, Findley v. Blinken, Civ. No. 90-3973 at 10-11 (S. & E.D.N.Y.1991).

Beyond the number of claims asserted for asbestos-related injuries, the average liquidated value of each claim amounted to $42,128. Id. This represented nearly a 40% increase over the original projection of $25,000 per claim.

In December of 1989, in an attempt to assist the Trust with its manifest cash shortage, the Manville Corporation prepaid the $50 million Trust Note originally due in equal installments in 1990 and 1991. The payment included $50,000,000 in principal and $8,117,715 in accrued interest.

2. Massive Impleading of Trust Leading to High Transaction Costs, Expensive Settlements and Litigation Costs

The drafters of the Plan clearly anticipated that the vast majority of claimants would settle their claims with the Trust without resort to the tort system, even though the Plan preserved the right to a trial by jury. See Disclosure Statement VC 2 at C-360-361. Yet no credible disincentives to use of the tort system were built into the system. In fact, by March 1990 thousands of claims were pending against the Trust in state and federal courts across the country. A major precipitating cause of this condition was the right of codefend-' ants to implead the Trust into ongoing litigation 240 days after consummation of the Plan. See Trust Agreement Annex F, § IV.B, at C-139. Thus, as of July 28, 1989, the Trust could be made a party in any pending asbestos personal injury case that it had not already settled. Codefend-ants were anxious to push as much of the cost of asbestos claims — typically filed against many defendants — off on the Trust. Since they had been blocked from this route of sharing costs while the Man-ville stay was in effect between bankruptcy in 1982 and operation of the Trust in 1988, they were not inclined to show consideration for the Trust once it became vulnerable to suits.

Moreover, claimants could jump the FIFO line by commencing actions. Judgments would be enforceable and early large settlements could be obtained, often with the aid of judges understandably anxious to clear their calendars; one such settlement in one federal district court was for $140 million. See Cimino v. Raymark Indus., 751 F.Supp. 649 (E.D.Tex.1990).

As noted, representatives of the Trust made clear to select plaintiff’s counsel almost as soon as the Trust began operations that the Trust’s assets were insufficient. As a result, there was an urgency by plaintiffs to assemble huge numbers of claims quickly and push them to early settlement or judgment before the money ran out. The hundreds of millions of dollars in fees received by plaintiffs’ attorneys made assembling large stables of claimants hugely profitable. The result was a frenzied offense by plaintiffs’ bar to dispose of claims by the hundreds and thousands at a time and collect fees before the Trust went broke.

*759 To avoid the expense of litigation and the risk of a high trial judgment, the Trust sought to settle cases pending on trial dockets. Settlements obtained on the steps of the courthouse invariably cost more than those negotiated without the looming fear of an unpredictable jury verdict. With the constant pressure of massive numbers of cases scheduled for trial, the Trust all but abandoned its efforts to settle cases through the Claims Resolution Procedures. Tr. 1/2/91 at 100-04.

One of the most unacceptable consequences of the Trust’s presence in the tort system was the staggering cost of litigation defense. In 1990, the Trust spent roughly $50 million on outside counsel fees. These fees continued to mount despite the Trust’s own internal costs of some $25,000,-000 a year for its settlement operations. With a rental of a million a year for quarters in Washington, an expensive insurance policy of dubious utility to protect its trustees despite a $30,000,000 protective fund from the Trust’s assets, over a hundred employees negotiating settlements and support for outside counsel services in all parts of the country, the Trust quickly spent its assets, present and prospective. Without the intervention of the courts, despite valiant efforts of a dedicated staff, it seemed unable to protect the remaining corpus for the benefit of the hundreds of thousands of present and future unpaid claimants.

As early as January 1989, the Trust publicly warned numerous plaintiffs’ counsel that cash shortages might necessitate substantial delay between the time of claim liquidation and payment. See H.Ex. 16 at tab 13 (1/3/91). The Trust was aware, as already pointed out, of this certain denouement even before it began first payments. And it seems clear that the leading members of the plaintiffs’ bar operated on the assumption that they had to obtain as much cash as possible quickly because there would be only enough for a small number of their present clients and for their fees and probably none for future claimants. The Trust reiterated these concerns to plaintiffs’ counsel in May and June of 1989. See id. at tabs 15, 16; Tr. 1/3/91 at 344. By August 3, 1989 when Trust officials met with Select Counsel for the Beneficiaries to discuss financial alternatives, including formulating a new payment plan, the Trust was predicting waiting periods of up to twenty-five years between claim filing and complete payment. See H.Ex. 16 at tab 20; Tr. 1/3/91 at 306.

The Trust realized that the only hope to survive its cash shortage and at least postpone disaster was to defer payment of liquidated claims in order to draw from the long-term funding generated by profits and bond payments from Manville and the sale of Manville common stock. See Tr. 1/3/91 at 314. The payment scheme presented in December 1989 anticipated liquidating all claims filed in 1982 and paying a fixed percentage ninety days after the close of the year of settlement with the balance due in five years without interest. Thereafter, the Trust planned to settle one-half of the 1983 claims in 1991 and the other half in 1992; to settle one-third of the 1984 claims in 1993, and continue at much the same pace. In each case the Trust planned to make partial payments as described above. See Tr. 1/2/91 at 101.

If the Trust could defer payment, then it could settle far more cases, control the timing of the sale of its Manville shares and retain Manville’s bonds and the right to the profit-sharing payments for their full long-term payout values. See Tr. 1/3/91 at 289; H.Ex. 16 at tab 23. These principles formed the basis of the payment plan announced on April 6, 1990. See Tr. 1/3/91 at 314; discussion of New Plan infra.

3. Operational Problems

The fiduciary responsibility to compensate those injured by exposure to asbestos dust yet to pay only bona fide claims without overcompensating or undercompensat-ing claimants alone creates a formidable challenge. Efficiencies of scale through fixed payment schedules and reduced transactional costs had been blocked by plaintiffs’ counsel who insisted on the FIFO system based on an individual-by-individual tort compensation plan as embodied in the bankruptcy Plan. See Peter *760 son, Giving Away Money, 54 Law & Con-tem.Probs. 1201, 1207-08 (Winter 1991).

The Plan’s success depended on the Trust settling 98% to 99% of the claims at fair, but relatively low values. With little cash, the Trust suddenly found itself scheduled for trial in thousands of cases without the money to enter effectively into settlement negotiations with the promise of prompt payment. The “seeming paradox” of simultaneously owing a fiduciary duty to beneficiaries and vigorously defending the Trust in litigation against plaintiff-beneficiaries or in faithfully preserving adequate assets to provide fair and equitable treatment to all claimants known and unknown appeared to present irreconcilable conflicts. Special Master’s Report, 120 B.R. 648, 665 (E. & S.D.N.Y.1990).

Even with litigation costs devouring much of the Trust’s limited resources, most of the cases addressed by the staff of the Trust or scheduled for trial ultimately settled. Since consummation of the Plan, the Trust has resolved over 27,000 asbestos health claims, including more than 10,000 cases on active trial dockets. According to the General Counsel of the Trust, only 164 of the total number of claims resolved were the subject of trial verdicts; the remaining claimants all settled with the Trust. Affidavit of David T. Austern, 1111 (Jan. 2, 1991).

The transaction costs that resulted from the Trust’s presence in the tort system clearly exacerbated the situation. Plaintiffs who otherwise accepted the premise that the best method for resolving cases was through consensual agreements were no longer willing to liquidate and release the Trust from responsibility without any firm indication of when claimants would receive payment. The benefits of increased efficiency and reduced litigation and transaction expenses that typically attend even hybrid administrative claims facilities were not being achieved. Cf McGovern, Resolving Mature Mass Tort Litigation, 69 B.U.L.Rev. 659, 694-5 (1989) (routine processing of cases in hybrid litigation-administrative format easily reduces transaction costs).

Some effort was made to devise alternatives to the calendar-driven tort system. The Trust informed the Select Counsel for the Beneficiaries, the three attorneys elected by the Asbestos Litigation Group comprising attorneys who specialize in the representation of asbestos victims, that the Trust’s financial condition threatened its ability to pay claims fully as they were liquidated according to the specified terms of the Plan. The Trust and Manville met with Select Counsel for the Beneficiaries in 1989 and 1990 in an effort to find ways to eliminate or minimize the Trust’s soaring transaction costs. Tr. 1/2/91 at 19. No consensus on how to address the Trust’s fiscal problems emerged from these discussions. The select counsel, being themselves key players with large stocks of cases, continued to look after their own claimants. They can hardly be accused of using insider information since the Trust’s situation was well known — except possibly to the claimants.

By January 1, 1990 the Trust had increased its efforts to safeguard what cash it possessed. At that time, the Trust issued a statement that indicated that all 1982-84 claims would be paid in full over the course of five years. While aware of the tensions and inadequacies from the outset, the Trust continued to guide its efforts to resolve the Trust’s formidable and unanticipated difficulties by adherence to select provisions of the Plan.

4. Trust Payment Plan Promulgated on April 6, 1990

On April 6, 1990 in the face of dire cash shortages extending beyond the immediate future, the Trust announced a revised payment plan for settling the nearly 130,000 claims pending against it as of March 31, 1990. Under the new plan, all claims (with the exception of those denominated as Hardship, Exigent Health or “Manville Only” claims) would receive 40% of the agreed upon settlement or judgment amount within 90 days of the end of the year in which the claim would be eligible for payment in the Trust’s “FIFO queue.” The remaining 60% of the amount due *761 would be paid five years after the initial payment. It has already been pointed out that the Plan’s Claims Resolutions Procedures permit the Trust to negotiate with claimants out of FIFO order if the claimant has settled with all other defendants.

With the proposed new payment plan (“New Plan”) the Trust established its contemplated payment schedule for all claims filed as of March 31, 1990. According to the schedule, claimants who filed in 1982 would receive 40% of their payment at the end of the first quarter of 1991, and would receive the remaining 60% in 1996. Claimants who filed in 1990 were scheduled to receive their first 40% in 2015 with the remainder due in 2020. Persons who filed claims that were placed in the FIFO queue in 1988 could expect 40% between 2004 and 2007; the remainder would be paid between 2009 and 2012. Those in the FIFO year 1989 would receive their first payment between 2007 and 2015; the remaining 60% to be paid between 2012 and 2020.

The New Plan applied to both settlements and judgments. In contrast with earlier practice, the Trust intended not to pay out of FIFO order trial docketed cases that either were prosecuted to judgment or were settled by all co-defendants. This proposed change in Trust practice was designed to deal with the pressure by attorneys to get cases on trial dockets and expedite trial schedules in order to obtain immediately enforceable judgments. The result was to put greater docket pressure on the courts for accelerated trial dates in many parts of the country. Codefendants became concerned because the increased rates of judgments and court pressured settlements accelerated their own cash outflow problems, driving more and more of them toward bankruptcy as their insurance coverage was exhausted. And, of course, ever more efficient disposition by the courts resulted in no diminution of pending cases, since the asbestos bonanza led to an increased search for more clients through unions and independent solicitation and increased filings.

Hardship Claims under the New Plan were defined as claims in which the Trust in its discretion has determined that there is a causal connection between the claimant’s financial condition and an asbestos-related disease and that the claimant needs financial assistance on an immediate basis. They would receive full or partial payment with a portion deferred depending on the financial circumstances of the claimant.

Exigent Health claimants, defined by the New Plan as claimants with clear and convincing evidence that they suffer from asbestos-related injuries where a physician has submitted a declaration or affidavit attesting that there is substantial medical doubt that the claimant will survive beyond six months, would be paid 40% within twenty business days of the Trust receiving a release. The balance would be paid in accordance with the preexisting Guidelines for Exigent Health Program. It provided that to the extent possible the balance due would be paid during the year that the claim was settled. If that was not possible the claims would be paid on a pro rata basis according to the relative size of each deferred payment amount.

In addition, the Trust would endeavor to settle twenty percent of so-called Manville Only claims, those in which the Trust in its discretion determines that Manville is the only party that could be named as a defendant (including claims by workers in Man-ville plants and those in which exposure was predominantly to Manville asbestos containing products). Those claimants could not expect to recover from codefend-ants — as most claimants can. They would receive 40% of the liquidated value of their claim within ninety days of the end of the year in which the Trust receives a release with the balance to be paid within five years.

The Trust began negotiating under the New Plan’s terms immediately. Tr. 1/3/91 at 314. In view of the uncertainties concerning the financial condition of the Trust even over the course of the immediate future, the terms described above provided additional disincentive for plaintiffs to settle with the Trust on such precarious terms with payment extending well into the twenty-first century. Tr. 1/2/91 at 17-18.

*762 Since plaintiffs’ counsel and some courts took the position that a judgment was enforceable by its terms in full at once, the New Plan’s deferral provisions further accelerated the rush to the courthouse and judgments. Liens and seizure of the Trust’s assets by those holding judgments were threatened. Codefendants’ attempts to slow the process proved less and less effective.

The sociology of the courts, long urged and habituated to dispose promptly of pending cases, increased disposition rates. Moreover, the courts themselves had developed efficient methods of discovery, docket control, multiple trials, use of special masters and the like that provided great potential for compounding the crisis. In this Alice in Wonderland world, they were running faster and faster yet moving backward, while codefendants were being carried along, toward bankruptcy. As a result of escalating litigation and court pressures, the Trust’s rapidly dwindling assets were increasingly consumed by transaction costs.

H. Stay of Payments; Stay of Litigation; Orders and Opinions of the Courts

The deteriorating situation came to the attention of the district courts sitting in the Eastern and Southern Districts of New York in the Spring of 1990 when a number of its judges discovered the plight of the parties as they began to speed dispositions of asbestos cases under the direction of Judge Charles P. Sifton of the Eastern District of New York acting for the Eastern and Southern Districts. He had undertaken to control discovery and calendars for asbestos cases on behalf of both districts.

Pursuant to the Bankruptcy Code, any referral of a bankruptcy case or proceeding may be withdrawn in whole or in part by the district court. See 28 U.S.C. § 157(d); Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1982). On July 20, 1990 the undersigned district court judge was granted supervisory responsibility over the Plan, (consolidated cases) 82 B 11656(BRL) through 82 B 11676(BRL). See July 20, 1990 Designation Order of James L. Oakes, Chief Judge, Second Circuit; July 20, 1990 Assignment Order by Charles L. Brieant, Chief Judge, United States District Court, Southern District of New York. In effect, a section 157(d) partial removal occurred by that date permitting the district court to protect the Trust against destruction and the Plan against frustration. The need for these steps had been revealed earlier in the Brooklyn Navy Yard cases then being prepared for settlement and trial by the district judge granted supervisory responsibility over the Plan.

In May 1990, through proceedings in the consolidated Brooklyn Navy Yard cases, the New York State Supreme Court and federal district courts for the Eastern and Southern districts sitting jointly requested that the Trust furnish information on the assets it began with, its current assets, its projected liabilities and its operations. The courts were prompted by the Trust’s apparent inability to enter into meaningful settlement negotiations with the plaintiffs in the Navy Yard cases. The Trust’s response indicated that it had insufficient cash to meet its obligations over the next twelve months. Thus, a mere one year and nine months after it became operational, the Trust was effectively out of funds. Based on the report from the Trust, the district courts for the Eastern and Southern districts entered a temporary stay of payments and a stay on the enforceability of judgments and settlements against the Trust pending revision of the Trust’s operations. Memorandum and Order, In re Joint Eastern and Southern Dists. Asbestos Ditig., NYAL/BNY Index No. 4000 (E. & S.D.N.Y. July 9, 1990) (available on WESTLAW as 1990 WL 115761).

Leon Silverman of Fried, Frank, Harris, Shriver & Jacobson, Special Advisor to the Bankruptcy Court during the Manville Chapter 11 proceedings and a respected national leader of the litigating bar was appointed by the Bankruptcy Judge. He was assisted by his able partner Matthew Gluck. Mark Peterson, a consultant of the *763 RAND Corporation and an expert analyst in mass torts and alternative dispute resolution matters, was appointed as advisor by the district courts. Id.

The Trust, with the assistance of Mr. Silverman, Mr. Peterson,. Select Counsel for the Beneficiaries and other interested parties, was directed to consider (1) developing new eligibility criteria and a restructuring of the payment schedule and (2) refinancing of the Trust so that it would have sufficient funds now and in the future to meet its obligations and make reasonably timely payments. Id.

I. Rule 706 Expert to Project Future Claims

It was apparent that more reliable information was required on the nature and extent of future claims so that any revisions and payment plans could be more realistic. The district court appointed Professor Margaret A. Berger, a noted evidence scholar and consultant to the Carnegie Commission Project on Science, Technology and Government, pursuant to Rule 706 of the Federal Rules of Evidence to consider the creation of a panel of experts which would evaluate and predict the volume and type of future claimants. Order, Findley v. Blinken, 122 B.R. 6 (E. & S.D.N.Y.1990). She was specifically charged with reporting to the courts “upon the feasibility of providing accurate estimates of future claims upon the Trust,” and “empowered to aid the court in selecting an appropriate panel of knowledgeable and neutral experts pursuant to Rule 706 of the Federal Rules of Evidence.” Id.

An evaluation of the probable success of the proposed Settlement hinges on its projections about the incidence of future diseases and deaths due to asbestos exposure and about the volume and nature of claims that will be asserted against the Trust in the future. The courts sought expert assistance to explore the feasibility of developing a statistical model that would ensure more reliable projections. A panel of experts in the fields of epidemiology, medicine, statistics and actuarial sciences might supply more reliable and accurate predictions upon which to calculate equitable distribution of Trust assets.

The district courts’ authority to appoint a neutral expert is well established although not extensively utilized in practice. See McCormick on Evidence § 17 at 42-45 (E.Cleary 3d ed. 1984) (common law power to call experts dates back at least to fourteenth century). In the context of a complex reorganization plagued by a history of inaccurate estimates of future claimants and conflicting epidemiologic projections, the assistance of an independent expert may offer the courts an impartial reservoir of data from which to gauge the fairness of the settlement. See Students of California School for the Blind v. Honig, 736 F.2d 538, 548-49 (9th Cir.1984), vacated as moot, 471 U.S. 148, 105 S.Ct. 1820, 85 L.Ed.2d 114 (1985) (after much conflicting expert testimony, well within court’s discretion to appoint neutral expert).

In the hearings before Special Master Marvin E. Frankel, the Trust projected 47,-000 future claimants. A number of plaintiffs’ counsel considered this a gross underestimate. Codefendants viewed the Trust’s estimate of its future liability as exaggerated, criticizing the model it used to project future claims. At the fairness hearings several individual claimants and representatives of white lung associations indicated their belief that the ultimate number would greatly exceed the Trust’s estimate of 47,-000.

The projections in Mark Peterson’s estimates contained in Appendices A and C, attached, range up to a total of 366,000 present and future claims. See Part VII. D.4.a, infra. An examination by the court of the early 1980 studies referred to in Professor Margaret A. Berger’s report, Appendix B, attached, suggests that a wide range of estimates rather than a single estimate is all that can be expected. Nevertheless, a disinterested attempt by neutrals to obtain a spread of estimates would provide more assurance of the future than has been available.

Commentators familiar with mass tort litigation and claims resolution facilities have emphasized the efficiency that *764 attends effective and comprehensive data collection. See, e.g., McGovern, Resolving Mature Mass Tort Litigation, 69 B.U.L.Rev. 659, 692-93 (1989) (“A facility can then gauge the adequacy of available funds, evaluate effective settlement strategies, and be more confident in devising case resolution processes.”). In this proceeding, the courts must consider divergent and contingent interests of those who may seek compensation from the Trust estimated to range in the hundreds of thousands. This fundamental concern warrants independent expert review of opinions upon which the success of the Settlement rests.

As Dean Berger testified at the Fairness Hearing on January 22, 1991, projecting the number of future claimants with any degree of confidence is a difficult, complex task because of numerous unknowns that surround the incidence of disease and the incidence of claims. Tr. 1/22/91 at 3-16. Her initial report to the court concluded that such projections are feasible. It then considered the desirability of having court-appointed experts undertake the task of making projections and concluded that such a project directed by court-appointed experts is in the best interests of the Trust, of present and future claimants and of the courts. Finally, it proposed a work schedule consisting of several stages, and recommended that the first stage be implemented immediately. See Appendix B, attached.

The history of the Johns-Manville bankruptcy demonstrates the need for projections made by persons who are not associated with the litigants. An independent study is not susceptible to attack on the basis of bias, a charge leveled against some of the projections previously made. Evidence obtained almost immediately following confirmation of the Plan that the estimates for future claimants made on behalf of the Johns-Manville Corporation were much too low have fueled these charges of bias. The Johns-Manville litigation also demonstrates that not all projections undertaken by parties see the light of day at the time when they would be most useful. A study made at the direction of the courts will become part of the public record. Its assumptions and conclusions will be publicly aired and subject to peer review by the scientific community. The consequence of asbestos use is an issue about which the public and our policy-makers need to be informed; the Trust is a quasi-public entity-

At first both the courts and Dean Berger thought that the principal expert and advisory panel should be appointed at the same time. Accordingly, Dean Berger spent considerable time searching for well-respected, neutrally-perceived experts in the following fields: epidemiology, biostatistics, environmental medicine, pulmonary medicine and economics. Suggestions were also made that a pathologist and an expert on fibers might be useful. While she has identified candidates for the panel in many of these fields, she soon realized that selecting an epidemiologist who was truly knowledgeable about asbestos but who would not be perceived as plaintiff or defendant oriented was a task that would take some time. There was considerable opposition expressed by the plaintiffs’ bar and reluctance to cooperate with any Rule 706 panel.

Dean Berger was directed by the district court to proceed promptly without deferring work on the projections until the panel was in place. The district courts approved all of Dean Berger’s recommendations after conferring with interested parties and holding a public hearing on her report. The orders approving the necessary Rule 706 appointments were signed by the district court. See Fed.R.Evid. 706; see also Fed.R.Evid. 101, 1101(a).

J. Appointment of Hon. Marvin E. Frankel; Limited Fund Hearings

On September 18, 1990, the Trust moved for a determination that its assets constituted a limited fund within the meaning of Rule 23(b)(1)(B) of the Federal Rules of Civil Procedure. Shortly thereafter, the district court appointed the Honorable Marvin E. Frankel to hold hearings and report on the following questions and any related issues:

(1) Whether the financial assets of the Trust are so limited that there exists *765 substantial risk that payment for the present and prospective asbestos-related personal injury and wrongful death claims brought against the Trust will be placed in jeopardy.

(2) Whether “there is a substantial probability — that is less than a preponderance but more than a mere possibility — that if damages are awarded, the claims of earlier litigants would exhaust” the defendant’s available and projected assets, including any pertinent insurance proceeds. In re “Agent Orange” Prod. Liab. Litig., 100 P.R.D. 718, 726 (E.D.N.Y.1983), mandamus denied sub nom. In re Diamond Shamrock Chemical Co., 125 F.2d 858 (2d Cir.), cert. denied, 465 U.S. 1067, 104 S.Ct. 1417, 79 L.Ed.2d 743 (1984).

Memorandum and Order, In re Joint Eastern and Southern Dists. Asbestos Litig. (Johns-Manville), NYAL 4000 (E. & S.D.N.Y. Sept. 18, 1990).

The Trust provided notice, including a copy of the pleadings and order of the court, to all individuals and institutions whose names appeared on their exhaustive mailing lists. This included 1,452 notices sent to attorneys who represent asbestos health claimants who have filed proof of claim forms with the Trust, 1,746 notices addressed to claimants who have filed proof of claims forms with the Trust on behalf of themselves or as personal representatives but without an attorney, and 635 notices addressed to individuals and institutions who appear on the service lists used during the Manville Bankruptcy.

All who expressed an interest in participating in the limited fund hearings before the Special Master were afforded an opportunity to be heard. Representatives for both plaintiffs and codefendants appeared and participated in Special Master Frankel’s hearings. All document and discovery requests were accommodated by agreement of counsel and a substantial volume of documents were freely produced by the Trust. Special Master’s Report, 120 B.R. 648, 662 (E. & S.D.N.Y.1990). In addition to preliminary informal meetings with counsel, the Special Master held four days of hearings.

Acting with great skill and dispatch, the Special Master furnished a Report indicating that no meaningful disagreement existed on the referred questions. All parties conceded that they should be answered in the affirmative. Special Master’s Report, 120 B.R. at 661. The parties did differ in their valuation of the Trust’s assets, the valuation of the assets it will liquidate in the future and the extent of its present and future liabilities. Id.

Notwithstanding these variations, the Special Master made the following findings and conclusions based upon “evidence that is clear and convincing to the point of being undisputed and beyond dispute in all essential respects”:

1. Without pretending to certainties beyond what the nature of facts allows, it is reasonable to say, and it is found, that the Trust’s assets have a value in the range of $2.1 to $2.7 billion.

2. On a similar basis, the Trust’s liabilities for asbestos claims already pending and unliquidated, together with an estimated 47,000 further claims to be received in the future, come to a total of $6.5 billion. In addition, the Trust owes $448.5 million for claims that have been liquidated by settlement or judgments.

3. If it could fulfill its obligations in the interests of the claimant beneficiaries, the Trust would pay promptly the $448.5 million owed for liquidated claims. The Trust lacks the cash, however, to pay more than an inconsequential portion of this amount.

4. However insolvency is defined, the Trust is deeply insolvent.

5. The Trust’s assets and expectations of future receipts are and will be so limited that there is a substantial risk that payments for present and prospective asbestos-related claims for personal injury and wrongful death will be in jeopardy.

6. There is a substantial probability that the award of damages to earlier litigants will exhaust the Trust’s available and projected assets. *766 Special Master’s Report, 120 B.R. at 667-68.

The report made it clear that revisions were necessary. All interested parties gave their attention to the form the changes should take.

K. Negotiations

By all standards, the negotiations that led to the Settlement were arduous and extensive. They occurred over several months. Plaintiffs’ counsel met at national assemblages and conducted almost continuous face-to-face and telephone conferences. To facilitate the process, the court-appointed advisors participated in almost all discussions.

One of the realities of the structure of the Plan is that the ability of the Trust to pay victims over time hinges on the fiscal success of the reorganized Manville Corporation. To the extent that tort claimants seek to strip Manville of cash or assets now, they would reduce the Corporation’s ability to compete and prosper in the future. This in turn diminishes the monies that would be available for compensation of asbestos victims whose claims are pending but not yet liquidated and for those who have not yet filed claims primarily because their injuries are latent. In particular, any refinancing which has the effect of reducing the value of Manville stock in the future would redound to the detriment of claimants at the time they monetize their controlling share of Manville stock, their single most valuable asset. Furthermore, any settlement that reduced the productivity of Manville would decrease the profits, a percentage of which the Trust is due to begin receiving in 1992.

In response to the district courts’ July 9, 1990 order, the Select Counsel for the Beneficiaries, a three lawyer liaison group created under the terms of the Plan, see Plan, Ex. A at C-57, convened a large meeting of members of the asbestos plaintiffs' bar in Dallas on August 13, 1990. Tr. 1/2/91 at 21. The Select Counsel for the Beneficiaries are elected by the Board of Directors of the Asbestos Litigation Group, a voluntary association of plaintiffs' attorneys who specialize in the representation of persons suffering from asbestos-related injuries. The Select Counsel serve as representatives of the larger group of plaintiffs’ counsel. Notice of the meeting was sent to all plaintiffs’ attorneys as well as to pro se claimants throughout the country.

More than seventy attorneys attended the meeting and participated in the debate about how to respond to the Trust’s fiscal crisis. Tr. 1/2/91 at 21. The group ultimately elected a seven person committee to negotiate with the Trust and report back on its progress. The committee consisted of Peter G. Angelos, Frederick M. Baron, Thomas W. Henderson, Ronald L. Motley, Christopher M. Placitella, Robert B. Stein-berg and Harry F. Wartnick, each of whom represents large numbers of clients with differing mixes of asbestos diseases, differing geographical bases and differing histories in asbestos litigation.

Its members sought information through meetings with Drs. Selikoff and Nicholson of Mt. Sinai Hospital, with investment bankers, with Mr. Silverman, with Mr. Peterson and with others familiar with the situation. Tr. 1/2/91 at 22-23. The group first addressed the question whether in fact the Trust’s assets presently and over time constituted a limited fund within the meaning of Rule 23(b)(1)(B).

The committee met with members of the plaintiffs’ bar in New Orleans on September 13, 1990. The committee took the opportunity to outline priorities it felt ought to be embodied in any revisions of the Trust’s operations. These included eliminating the Trust’s huge transaction costs that attend its presence in the tort system; reducing plaintiffs’ legal costs; treating all beneficiaries equally, yet paying those suffering with more serious illnesses on an accelerated basis so that they might receive compensation during their lifetime; segregating adequate funds so that future claimants would also receive compensation from the Trust; and removing the Trust from the tort system in a manner that preserved the litigation postures of the beneficiaries. The constituency endorsed the basic principles presented and authorized the commit *767 tee to devise a concrete scheme for review, Tr. 1/2/91 at 24.

Simultaneously with these meetings, Mr. Silverman was conducting negotiations between the Trust and Manville to explore mechanisms by which to infuse desperately needed cash into the Trust in the short term. Id. These discussions led to a new financing arrangement between the Trust and Manville. On September 7, 1990 the Trust and the Manville Corporation announced an agreement in principle to provide additional funding from the Manville Corporation to the Trust up to a maximum of $520 million over the next seven years, contingent on the Trust revising its payment procedures.

During this time period Mr. Peterson was in contact with representatives of co-defendant beneficiaries and communicated their views regarding settlement discussions to the negotiating committee. Tr. 1/2/91 at 187-88. Similarly, Mr. Silverman and Mr. Austern received a written submission from the codefendants outlining their position on a restructuring. Tr. 1/28/91 at 32.

The plaintiff negotiating committee again reported on the progress of negotiations to its constituency on October 29, 1990. The committee reported that the evidence presented in the limited fund hearings before Special Master Frankel demonstrated beyond cavil that there was a limited fund. An intense debate ensued concerning several of the cornerstone provisions of the proposal. Great effort was expended to respond as much as possible to articulated concerns. Although there was no unanimous position, a consensus emerged from the meeting. Tr. 1/2/91 at 25. A mandate to approach the Trust once again culminated in an agreement. Tr. 1/2/91 at 25-26.

This intense responsible effort by a diverse national plaintiffs’ bar represented a commendable and almost unique effort on behalf of hundreds of thousands of prospective and present claimants. The strengthened institutional structures may well be useful in devising more global solutions to the asbestos problems presented by the codefendants.

L. Stipulation of Settlement; Financing Agreement Between Manville and the Trust

Plaintiffs filed a class action complaint on November 19, 1990 against the trustees of the Trust in their capacity as such seeking a revision of the obligations and payment procedures of the Trust to promote the equitable compensation of all Trust beneficiaries. The complaint seeks to enjoin any action inconsistent with the requested relief.

On the same day, representative counsel submitted the proposed Settlement in the form of a Stipulation of Settlement and attachments as follows: Exhibit A entitled “Trust Distribution Process”, Exhibit B entitled “Master Agreement dated as of November 15,1990 between Manville Corporation and Manville Personal Injury Settlement Trust” and Exhibit C, a proposed Order and Final Judgment. Copies of the Stipulation of Settlement, the Trust Distribution Process and certain Memoranda and Orders of the courts appear in In re Joint Eastern and Southern Dists. Asbestos Litig. (Johns-Manville), 120 B.R. 648 (E. & S.D.N.Y.1990). This court document was printed in a booklet and widely distributed to anyone interested during the fairness hearings described below. The salient features of the Settlement are described in the next section.

1. Stipulation of Settlement

The Stipulation provides for discontinuance of the class action with prejudice upon court approval pursuant to Rule 23(e) of the Settlement and entry of final judgment. The Stipulation recites that

WHEREAS, unless the Trust is restructured, it is likely that

(i) its assets will be dissipated at substantially less than their fair value;

(ii) enormous sums of money will be spent on defense costs which could and should otherwise be allocated to the payment of Beneficiaries;

*768 (iii) certain Beneficiaries will receive a disproportionately large payment on their claims in comparison to other Beneficiaries while some Beneficiaries will receive far less than is equitable or nothing at all....

Stipulation of Settlement, In re Joint Eastern & Southern Dists. Asbestos Litig. (Johns-Manville), 120 B.R. 648, 668 (E. & S.D.N.Y.1990) [hereinafter “Stipulation”]. In order to maximize the value of the assets of the Trust it is necessary, the Stipulation conceded, that the Manville Corporation function and prosper as a going business without the present uncertainty engendered by fiscal difficulties of the Trust.

The Stipulation is binding on each member of the class defined as follows:

The Class consists of all Beneficiaries of the Trust, including, but not limited to, all persons who presently have or may in the future have (a) any unliquidated claim for death or personal injury arising from exposure to asbestos and arising or allegedly arising, directly or indirectly from acts or omissions of the Manville Corporation or any of its predecessors, subsidiaries or affiliates; (b) any warranty, guarantee, indemnification or contribution claims against the Trust arising directly or indirectly from exposure to asbestos by any member of the Class; and (c) settlements or judgments arising from any of the foregoing claims previously asserted against the Trust.

Stipulation, ¶ 2, 120 B.R. at 669. The Stipulation is expressly conditioned upon court approval of the class action and the Settlement upon terms satisfactory to the class representatives and the Trustees, and upon court authorization for the execution, delivery and performance by the Trustees and Trust of the terms of the Settlement. Stipulation, 116-7, 120 B.R. at 669. The Stipulation is also predicated upon a reaffirmation of the injunction barring asbestos-related suits against Manville.

The Stipulation releases the Trustees, officers, employees and agents of the Trust from liability to any beneficiary as a result of any action or inaction of the Trust if the decision or judgment was based on a good faith belief that it was authorized by the terms of the Stipulation. Stipulation, 115, 120 B.R. at 669.

Holders of claims which as of November 19,1990 were the subject of a final order or judgment or a valid and binding contract (unless the claimant elects to receive payment in accordance with the Trust Distribution Process) will be paid according to their terms except that any amounts immediately due and owing as of the date of a final judgment in the class action shall be paid within ten days of the payment of the first dividend without interest. Stipulation, 119, 120 B.R. at 669. In effect, prior judgments and settlements will be paid according to their terms following final approval of the Settlement and exhaustion of appeals. Any judgments and settlements dated after November 19, 1990 will be treated as Level One or Level Two claims with no priority in payment to any post-November 19, 1990 judgment. This provision and other safeguards in the Settlement provide what should be effective safeguards against litigating Manville claims in the courts. In effect, Manville claims are removed from the court system, both federal and state.

2. Distribution Process

The rights and duties of class members and the rights and duties of Trustees with respect to beneficiaries are governed by the Trust Distribution Process. Stipulation, If 8, 120 B.R. at 669. Class members will receive payments from the Trust only in compliance with the terms of the Trust Distribution Process. Id. The ultimate objective is to pay each claimant, present and future, an equal percentage of their claim’s value over time.

All available funds of the Trust will be distributed annually as the Trust settles with claimants, unless some funds must be set aside for future claimants. In years in which the Trust monetizes its assets, a portion of the proceeds will be set aside for future claimants. Trust Distribution Process, §§ E & L, In re Joint Eastern and Southern Dists. Asbestos Litig. (Johns-Manville), 120 B.R. 648, 674 (E. & S.D.N.Y.1990) [hereinafter “Trust Distribu *769 tion Process”]. The allocation of funds between two accounts, one utilized to make payments to current claimants and one held for the benefit of future claimants, will ensure some protection for those who will suffer from asbestos injuries in the future. At the same time the Distribution Process has left open the possibility that additional information may warrant changes in its allocations and payment procedures. Trust Distribution Process, § L, 120 B.R. at 679.

Priority in terms of scheduling the timing of payment will be given to those most seriously injured. Cancer victims, wrongful death cases and those with serious asbestosis, categorized as Level One claimants, will begin receiving payments in the first two years of the plan. Those with less serious injuries, Level Two claimants, will receive funds that are available starting in the third year of the plan. Once claimants receive forty-five percent of the value of their claim, they will stop receiving payments from the Trust until all other claimants have similarly received forty-five percent of the total value of their claims. Thereafter, as funds allow, payments will be made on a pro rata basis to all claimants until they have been paid the full liquidated value of their claim. Contribution and indemnification claims will be categorized according to the injury suffered by the underlying tort claimant.

The Distribution Process provides guidelines for settlements of each category of asbestos illness with both midpoints and maximum values. Trust Distribution Process, §§ B & D, 120 B.R. at 672-73; Trust Distribution Process, Attachment A, 120 B.R. at 680 (initial projected maximum and average midpoint payment amounts by disease). Except in extraordinary cases, the liquidated value of a claim will not exceed the maximum set for the disease category. Claims will be evaluated in light of the following criteria: the individual’s age, the jurisdictional history, Manville’s relevant market share, whether the individual was living or dead when the claim was filed, disability, dependency, special damages and pain and suffering. Trust Distribution Process, § B, 120 B.R. at 672.

The Trust will analyze and attempt to liquidate two-thirds of the Level One malignancy claims currently pending prior to thirty days before payment of the first dividend, roughly two years after the distribution process begins operating. Id. at § F. Level One claims filed after the initial two years will be processed by the Trust and if liquidated will receive a payment from the Trust within two years of their filing date. Such claims filed after the first two years will receive an equal portion of the liquidated value of their claim as if they had entered the pool during the first year. Trust Distribution Process, § F(a), 120 B.R. at 675. The procedures that govern the valuation of a claim are improved to simplify and accelerate the settlement of claims and reduce litigation expenses. See, e.g., Trust Distribution Process, § D, 120 B.R. at 673.

Notwithstanding any other provision, the Trust may continue to liquidate and pay Level One extreme hardship and exigent health claims to the extent that Trust funds permit. Beginning with the third payment cycle, the Trust must liquidate and pay Level Two extreme hardship claims as well. Trust Distribution Process, § A, 120 B.R. at 670. These exceptional payments must be kept to an absolute minimum to prevent a drain on already severely depleted Trust funds. An end-run around the Settlement limitations by substantial numbers of claimants must not be permitted by the Trust.

The Trust may choose to offer Level Two claimants an option to receive faster, limited payments not to exceed $2,000 to avoid waiting until his or her claim is liquidated. Such deferral payments will be funded with savings in litigation expenses, but are limited to a total of $75 million during the first four years. In addition, a Level Two claimant who has received payment from the Trust may reassert a further claim if he or she develops a Level One illness. This option also applies to Level One claimants who settle on the basis of serious asbestosis and subsequently contract asbestos-related cancer.

*770 In most instances, beneficiaries may not sue the Trust in the tort system. Instead they must follow the procedures set forth in the Distribution Process. Where a beneficiary disagrees with the value that the Trust assigns to a claim, he or she may seek binding or non-binding arbitration with the Trust.

There are substantial disincentives to suits. If non-binding arbitration fails to resolve the dispute, the beneficiary then retains the right to seek a jury trial as to damages. Trust Distribution Process, § D, 120 B.R. at 673-74. The Trust will not contest its liability. The Process establishes maximum values for each asbestos-related disease. Any verdict that a plaintiff receives in excess of that maximum will be paid from a separate Trust account, Pool B, that will be funded only after all other Trust beneficiaries have been paid in full. Trust Distribution Process, § E, 120 B.R. at 674.

To conserve assets and avoid wasteful transaction costs, all pending tort suits against the Trust will be dismissed without prejudice and all beneficiaries will be enjoined from litigating against the Trust except as provided in the Distribution Process. The injunction extends to the prosecution of a claim against the Trust aimed at establishing the Trust’s status as a joint tortfeasor, its relative share of fault or its liability for contribution or indemnification. Where a defendant has paid a judgment for which it claims the Trust has responsibility in whole or in part, that defendant may file and liquidate the claim as if it were the injured claimant. If the Trust has already liquidated that person’s claim, a defendant who is subject to a judgment is entitled to a credit against the judgment in the amount that the plaintiff has received from the Trust, and then may succeed to any remaining entitlement of the plaintiff from the Trust. Trust Distribution Process, § H, 120 B.R. at 676-77.

Attorneys’ fees payable in connection with claims liquidated and paid pursuant to the Settlement will be the lower of the fee provided in a contract between claimant and counsel or twenty-five percent where calculated as a percentage of recovery. Such legal fees will be paid over time as clients receive payments from the Trust.

Plaintiffs’ attorneys must play an active role in the distribution process by electing whether to file the proof of claim as a Level One or Level Two claim and by supplying certain medical and other information before the claim will be processed. Trust Distribution Process A, § B, 120 B.R. at 672. This requirement of counsel responsibility is designed to reduce the administrative burdens of the Trust. It is also expected that attorneys will keep their individual clients fully informed, providing the usual services of lawyers representing individual clients on a one-to-one basis.

The courts expect the Trust to insist that counsel promptly supply all necessary information. In the past the Trust has apparently accepted incomplete data, increasing the costs of its own internal administration.

3. Master Agreement Between Trust and Manville

In order to effectuate the provisions of the Stipulation, the Trust and Manville entered into the Master Agreement, annexed as Exhibit B to the Settlement. This agreement seeks to make cash available in the near future so that the Trust can enter into meaningful settlement negotiations with claimants suffering from debilitating and often fatal asbestos-related illnesses. Pursuant to the Distribution Process, Level One claims should begin to be liquidated immediately upon approval of the Settlement.

According to the terms of the Master Agreement, Manville will pay special dividends resulting in an additional $100 million in cash available to the Trust in each of the first two years that the restructuring takes place. During the third and fourth years, Manville will pay special dividends that will supply an additional $40 million each year. In the fourth through seventh years the Corporation will pay special dividends up to a total of $300 million based on Manville’s performance, $240 million of which constitute the Trust’s share. All but *771 the first dividend payments are subject to financing.

In addition, the Trust will exchange its current $1.8 billion bonds for a new bond with identical payment obligations. The new bond may be exchanged for marketable debentures of equal value, but with more standard payment terms that will permit the Trust to sell them. Manville’s obligation to make annual bond payments begin in 1991.

The refinancing of the Trust leaves in place the monies the Trust was due to receive from the Corporation under the terms of the Plan of Reorganization including the right to twenty percent of Man-ville’s annual net profits beginning in 1992 and continuing as long as necessary. The additional financing is contingent on the restructuring of the distribution of Trust assets in conformity with the Trust Distribution Process.

M. Appointment of Representative of Future Claimants; Appointment of Laurence Gold

1. Factual Setting Necessitating Appointment

The long latency period for disease resulting from exposure to asbestos, which can take twenty to forty years after the victim’s exposure to manifest itself, necessitated the appointment of a legal representative for those who will contract asbestos-related injuries and consequently seek compensation from the Trust in the future (“future claimants”). The number of future claimants is impossible to predict with certainty. Special Master Frankel adopted the Trust’s best current estimate that it will receive roughly 47,000 additional claims. Special Master’s Report, 120 B.R. 648, 667 (E. & S.D.N.Y.1990). This projection seems very low based upon past claims, current filings, known exposures to asbestos and latency periods. See H.Ex. # 106 (Memorandum from Mark Peterson to Les Fagen dated Dec. 11, 1990); Appendices A & B, attached. It is significant that even the highest estimates made in the early and mid-1980’s in the course of the bankruptcy were lower than claims actually filed to date. See Estimates on file with Margaret A. Berger.

As of November 30, 1990 approximately 130,000 asbestos health victims and code-fendants had unresolved claims pending with the Trust, consisting of roughly 128,-500 claims filed by about 1,300 attorneys and over 1,500 claims filed pro se by claimants or their personal representatives. As of April 1, 1991 there are approximately 136,000 pending unsettled claims and this number continues to increase. An additional 11,300 claims were settled but unpaid as of that date. More than 15,500 claimants have executed and delivered releases in favor of the Trust and have been paid in full. The total filed claims to April 1, 1991 are approximately 163,000.

Based on current flows of cases and projections, an estimate of more than double the number of claims received to date, approximately 170,000 future claims, is the courts’ present best upper level working estimate. It must be emphasized that this number provides a working hypothesis made in the absence of objective reliable data supplied to date by the parties. This number of future claims would leave a total of somewhat under 320,000 claims to be paid as of April 1,1990. (136,000 unsettled claims plus 11,300 unpaid but settled claims plus 170,000 future claims = 317,-300 unpaid claims, past and future). See Appendix A, attached. More precise ranges of estimates may be possible utilizing pending work under the direction of Dean Berger. See Appendix B, attached. Based on current estimates, their knowledge of present settlement practices and considerations of fairness, the courts have recommended present best estimate allowances for the Trust’s share of future payments under the Settlement. See Part VII. D.4.a, infra; Part II!, supra; Part III! & J, supra.

The class action attempts to restructure the financing and payment procedures of the Trust in a manner that will ensure that the Trust’s assets are distributed equitably to all beneficiaries over time. The Settlement, if approved, binds all present and future beneficiaries to its proposed distri *772 bution and financing procedures and enjoins any action inconsistent with its provisions. The importance of developing adequate safeguards to protect the interests of future beneficiaries in accomplishing this ambitious goal cannot be overestimated.

Although the provisions of the Settlement affect the interests of present and future beneficiaries, each plaintiff is a present claimant. A central issue in the reformulation of the Trust’s procedures is how to allocate the Trust’s limited assets between present and future claimants. As to that basic question, the interests of present and future claimants are in conflict. Hence no present claimant can serve as an adequate representative of future claimants. The Trust owes a fiduciary duty to all beneficiaries; it cannot appropriately further the interests of some at the expense of others.

2. Legal Basis of Appointment

The Supreme Court recently stated that in general unless “a person, although not a party, has his interests adequately represented by someone with the same interests who is a party,” the nonparty cannot be bound by the judgment. Martin v. Wilks, 490 U.S. 755, 109 S.Ct. 2180, 2184 & n. 2, 104 L.Ed.2d 835 (1989). Thus the class’ attempt to bind future beneficiaries and accomplish a final conclusive judgment would be significantly hampered by the absence of counsel representing the interests of future claimants.

Ample precedent exists in bankruptcy law, trust law and other analytically similar contexts to appoint a representative for future claimants. The inherent equitable powers of the courts pursuant to Section 105(a) of the Bankruptcy Code and the All Writs Act, 28 U.S.C. § 1651, exercised in furtherance of the courts’ jurisdiction over this proceeding and the assets of the Trust authorize the appointment of a legal representative for parties with a substantial stake in the litigation.

When faced with a modification of a trust, courts have appointed legal representatives for unborn or unascertained trust beneficiaries. . In Hatch v. Riggs Nat’l Bank, 361 F.2d 559, 565-66 (D.C.Cir.1966), the court explained,

[t]he use of guardians ad litem to represent interests of unborn and/or otherwise unascertainable beneficiaries of the trust seems to us wholly appropriate. Though the persons whose interests the guardian ad litem represents would be unascertainable as individuals, they are identifiable as a class and their interest, as such, recognizable.

Id. at 566, on remand, 284 F.Supp. 396, 399 (D.D.C.1968) (“[N]ot only does [the court] have the authority to appoint a guardian ad litem without statutory authority but the majority of jurisdictions and commentators agree and approve of such action.”).

This equitable power has been invoked by other courts in class actions where members of the plaintiff class were unknown, unborn or incompetent. See, e.g., Meyer v. Citizens & S. Nat’l Bank, 677 F.Supp. 1196, 1200 (M.D.Ga.1988) (appointing guardian ad litem prior to approving settlement of class action brought by trust beneficiaries against trustee); see generally III A. Scott & W. Fletcher, The Law of Trusts § 214 at 319 (4th ed. 1988) (“The interests of beneficiaries who are under a disability or unborn or unascertained may be protected by the appointment by the court of a guardian ad litem.”); Begleiter, The Guardian Ad Litem in Estate Proceedings, 20 Willamette L.Rev. 643, 647-55 (1984) (discussion of power of courts to appoint); Note, Trusts: Modifications of Irrevocable Trusts Through Appointment of a Guardian For Unborn Heirs — Repu diation of Worthier Title Doctrine, 66 Co-lum.L.Rev. 1552 (1966).

New York has codified an express provision governing trust proceedings that mandates such appointments. “[I]f it appears that there is no person in being or ascertained, having the same interest” as persons not in being or unascertained, “the court shall appoint a guardian ad litem to represent or protect the person who eventually may become entitled to the interest.” N.Y.Surr.CtProc. Act § 315(2)(a)(iii) (Supp. *773 1990). While the courts are not bound by this arguably state procedural rule under the holding of Erie R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), it reflects a strong policy that should be respected as a matter of comity in adjudicating the right of beneficiaries of a New York trust.

The Federal Rules of Civil Procedure have no comparable provision except in instances of infants or incompetents. See Fed.R.Civ.P. 17(c). Rule 17(c), however, indicates a recognition of the value of independent representation on behalf of persons not in a position to protect their own interests. See 6A C. Wright, A. Miller & M. Kane, Federal Practice and Procedure § 1570, at 504 (2d ed. 1990) (“The district court’s power to appoint a guardian ad litem under Rule 17(c) has been broadly interpreted and has not been limited by a narrow construction of the ‘infant’ or ‘incompetent.’ ”).

In several bankruptcy proceedings involving former manufacturers or producers of asbestos products subject to tort claims, courts have appointed independent legal representatives to advocate on behalf of those who in the future will manifest asbestos-related illnesses. The Johns-Man-ville case persuasively demonstrated both the importance of a separate legal representative and carefully traced the ample precedent that supports such an appointment. See In re Johns-Manville Corp., 36 B.R. 743, 749-59 (Bankr.S.D.N.Y.1984), aff'd, 52 B.R. 940 (S.D.N.Y.1985). The Second Circuit explicitly affirmed the bankruptcy court’s appointment of a representative of future claimants. Kane v. Johns-Manville Corp., 843 F.2d 636, 644 (2d Cir. 1988). The Third Circuit subsequently reversed the decision of a bankruptcy court refusing to appoint such a representative in the case of a debtor who formerly produced asbestos products. In re Amatex Corp., 755 F.2d 1034, 1043 (3d Cir.1985) (“because of the adverse interests of other parties, it would appear that future claimants require their own representative”); see also In re UNR Indus., Inc., 46 B.R. 671 (Bankr. N.D.Ill.1985) (finding future claimants “parties in interest” entitled to participate and have separate representation).

In view of the indisputable findings of the Special Master that without some fundamental change in the Trust’s operations the payment of present claims will jeopardize payment to future claimants, the courts concluded that future claimants were entitled to a legal representative to independently and impartially evaluate and pursue their interests in this litigation. Consistent with this finding, the courts appointed Leslie Gordon Fagen of Paul, Weiss, Rifkind, Wharton & Garrison as Legal Representative of Future Claimants on November 23, 1990 to review and report on the fairness of the proposed Settlement of the class action. Order, Findley v. Blinken, Civ. No. 90-3973 (E. & S.D.N.Y. Nov. 23, 1990). The question of whether representation should be continued after court approval of the Settlement is discussed at part III.H, infra.

3. Amicus Curiae Appointment

In addition, the district court appointed Laurence Gold, General Counsel of the American Federation of Labor and Congress of Industrial Organizations, as ami-cus curiae to assist in evaluating the fairness of the Settlement. Order, In re Eastern and Southern Dists. Asbestos Litig. (Johns-Manville), NYAL 4000 (E. & S.D.N.Y. Nov. 20,1990). Assistance of this prominent labor representative was sought because “[i]t would be useful to have the plan independently reviewed by an individual who understands the plight of the American worker with respect to the problems associated with asbestos and asbestos litigation.” Id. The ultimate goal of the courts is to ensure that the plan treats workers and their families equitably. “It is highly desirable that labor have direct input into the process.” Id.

N. Courts’ Orders of November 23; Notice of Hearings

On November 23, 1990, the courts heard argument in response to orders to show cause on the following issues: why a class should not be certified pursuant to Rule 23; *774 why representative counsel should not be appointed on behalf of future claimants; why all proceedings and litigation against the Trust should not be enjoined; why the proposed form of notice informing interested persons of the hearings on the fairness of the proposed settlement and propriety of class certification should not be sent; why all payments from the Trust should not be enjoined during the pendency of the class action proceedings; and any other matter any interested person sought to bring to the courts’ attention. Notice of the hearing on the orders to show cause was served by overnight mail upon counsel for plaintiffs, counsel for individual Trust beneficiaries known to the Trust, codefendants known to the Trust and the Property Damage Trust. The Trust served notice upon Trust beneficiaries who are not represented by counsel by first class mail.

After hearing from all who wished to be heard, the courts entered several orders. They conditionally certified the class as defined in the complaint. In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 681 (E. & S.D.N.Y.1990) (Order Conditionally Certifying Class and Appointing Representative Counsel and Others). The courts appointed the named plaintiffs to serve as class representatives and five prominent members of the plaintiffs’ bar selected by the plaintiffs’ bar, Frederick M. Baron, Ronald L. Motley, Christopher M. Placitella, Robert B. Stein-berg and Harry F. Wartnick, to act as representative counsel on behalf of the class. Id. At the request of counsel for the codefendants, separate representation selected by counsel for codefendants, Roger E. Podesta, John D. Aldoch and Andrew T. Berry, was approved to speak for the codefendant beneficiaries of the Trust. In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 691 (E. & S.D.N.Y.1990) (Order Appointing Defendants’ Representatives).

Simultaneously the courts enjoined all litigation against the Trust in aid of their jurisdiction over the class action and to halt the dissipation of assets and resources of the Trust during the pendency of the action and consideration of the proposed restructuring. In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 688 (E. & S.D.N.Y.1990) (Order Staying Proceedings). At that time defense litigation costs for outside counsel alone were consuming roughly one million dollars per week from the Trust’s severely limited funds. Id. The courts granted certain exemptions from the stay of all proceedings. In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 689 (E. & S.D.N.Y.1990) (Order Making Exceptions to Stay of Proceedings). The courts also restrained the execution or enforcement of judgments or settlements against the Trust or its assets except in instances of Exigent Health Claims or Hardship Claims. In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 687 (E. & S.D.N.Y.1990) (Order Staying Payments).

Also approved was a form of notice that indicated the nature of the class proceedings, the basic elements of the proposed Settlement and the time and place of public hearings at which time the courts would consider whether the class should be unconditionally certified, whether named plaintiffs should serve as class representatives, class counsel should serve as representative counsel, and the Settlement approved as fair, reasonable and adequate in accordance with Rule 23(e). In re Joint Eastern & Southern Dists. Asbestos bitig. (Johns-Manville), 120 B.R. 648, 683 (E. & S.D.N.Y.1990) (Order Setting Hearings And Approving Form of Notice).

A copy of each of the courts’ orders described in the preceding two paragraphs were served by overnight mail to each known claimant’s counsel and codefendant counsel and to approximately 1,500 pro se claimants. All federal and state courts in which the Trust was a party in litigation also were served by hand, fax or overnight mail copies of the Order Staying Proceedings and sent copies of the remaining orders by first class mail. Judges who participate in state or federal asbestos coordinating committees were served with copies of the documents. Codefendant counsel, *775 parties to the Brooklyn Navy Yard litigation, those on Manville’s service list from its bankruptcy proceeding, the Property Damage Trust, court-appointed counsel and experts and the Manville Corporation were also served by overnight mail. In sum, all persons known to have a potential interest in the class action were served with the relevant papers.

Notice was published in the following periodicals on November 30, 1990:

The New York Law Journal

The New York Times

The Washington Post

The Times-Picayune

San Francisco Chronicle

The Dallas Morning News

The Atlanta Journal and the Atlanta Constitution

USA Today

Chicago Tribune

Los Angeles Times

The Baltimore Sun

In addition, between December 29, 1990 and continuing through January 9, 1991 abbreviated copies of the Notice were published in periodicals in those cities in which the fairness hearings in the class action were to take place.

0. Fairness Hearings

Hearings were scheduled for January 2 & 3, 1991 in the Eastern District of New York; January 4, 1991 in Washington, D.C.; January 9, 1991 in the Eastern District of Louisiana; and January 11, 1991 in the Northern District of California. Additional hearings were held at the request of objectors to the Settlement who needed more time to develop their alternative proposal and present expert and other testimony in its support on January 22nd in the Southern District of New York and January 23rd in the Eastern District of New York. Subsequently a schedule of briefs and extensive oral argument was provided. An additional hearing on Dean Berger’s proposed studies and Mark Peterson's projections of future payments and codefend-ants shares as well as on related matters was held on April 18, 1991 in the Eastern District of New York.

A magistrate judge was appointed to assist the parties in obtaining discovery. During the fairness hearings the courts directed the parties to exchange further documents and compile relevant information. Requests for information or discovery were granted. See In re General Motors Corp. Engine Interchange Litig., 594 F.2d 1106 (7th Cir.), cert. denied, 444 U.S. 870, 100 S.Ct. 146, 62 L.Ed.2d 95 (1979) (abuse of discretion to deny plaintiff objectors discovery requests to show that negotiations were irregular and settlement prejudiced interests of class members).

It is within a court’s discretion to control discovery and the presentation of evidence in determining whether the settlement is fair. Mars Steel Corp. v. Continental Illinois Bank & Trust Co., 834 F.2d 677 (7th Cir.1987); Glicken v. Bradford, 35 F.R.D. 144, 148 (S.D.N.Y.1964). In view of the comprehensive record developed by the proponents and opponents of the Settlement at the fairness and limited fund hearings as supplemented by affidavits, no additional materials was required to assist the courts. See H. Newberg, Newberg on Class Actions § 11.56, at 477 (2d ed. 1985). In any event, Objectors were given the opportunity to fully develop and present expert testimony and evidence in support of an alternative settlement. See Tr. 1/22/91; Tr. 1/23/91.

At each hearing, any interested persons were afforded an opportunity to address the courts on any subject relevant to the proceedings. Attorneys were permitted to introduce evidence and cross-examine witnesses called by other parties. Written submissions were accepted until February 12, 1991. On the following day, the courts heard oral argument from any counsel who indicated a desire to be heard on the legal issues raised by the proceedings.

The record thus developed is extensive. In the course of eight days of hearings, thirty-seven witnesses and attorneys addressed the courts, eighty-seven exhibits and detailed reports of Dean Berger and Mark Peterson were introduced and some 1,200 pages of transcript were recorded. *776 In addition, the courts had before them the extensive record created before Special Master Frankel.

P. Order and Partial Judgment

At the conclusion of oral argument on February 13, 1991, the courts entered an order and partial judgment that certified a non-opt-out class pursuant to Rule 23(b)(1)(B) consisting of all beneficiaries each of whom has or will have a claim either for death or personal injury caused by exposure to asbestos, or a claim for warranty, guarantee, indemnification or contribution arising from an obligation of the Trust for the payment of a death or personal injury claim. Pending entry of final judgment and completion of appeals the Trust was enjoined from making any payments on asbestos claims with the exception of Exigent Health Claims and Hardship Claims and from settling or proceeding with litigation in asbestos cases except appeals.

III. POSITIONS OF THE PARTIES ON THE FAIRNESS OF THE SETTLEMENT

The Settlement appears, under the circumstances, to be the most efficacious one that might be devised. The courts would have preferred more protection for future claimants. Present claimants are fully protected by their counsel. Essentially the Settlement depends upon the trustees to protect future claimants by being conservative about making future assets available for known as opposed to unknown claimants. The Settlement drafters’ expectation that tensions between trustees and attorneys for plaintiffs will suffice to protect future claimants must be viewed with some skepticism in view of the past inability of the trustees to adequately serve that role.

Transactional costs are still far too large with a case-by-case individual settlement tort-driven process instead of an administrative-insurance scheme that would arrange for scheduled payments by disease with limited variations. Such an administrative system could save hundreds of millions of dollars for claimants in projected costs, in Trust expenses and in fees to plaintiffs’ attorneys. It is the system reportedly to be used in administering the UNR Industries bankruptcy asbestos trust, a trust which was modeled upon the Man-ville Trust concept.

There is also unfairness in paying in full settlements and judgments of some $450 million achieved before the Settlement date. Many of them were obtained in a rush by plaintiffs’ attorneys when it was already clear that the roof was about to collapse on the Trust. Allowing such windfalls to a relatively small group and to attorneys who have received or will receive hundreds of millions of dollars in fees as a result of bulk settlements and payments already made is also disturbing. See Appendix D and D-l, attached. Many of these attorneys had to know that these recoveries would result in detriment to their other clients and to future claimants.

Despite these and other reservations discussed below, the courts recognize that they are reviewing the fairness and viability of a Settlement, not devising the best available system for compensation. Inhibited by past decisions in the litigation, the Trust’s history and the courts’ limited powers, we turn to the positions of the parties.

A. Majority Claimants

Having worked diligently and responsibly to refinance the Trust and restructure its payment procedures, the majority claimants through the appointed representative plaintiffs and their counsel staunchly support the Settlement. They readily admit it is not the only possible solution to the Trust’s problems, but assert that it is a sensible and workable compromise. They maintain that it was the product of difficult negotiations and represents a fair, adequate and reasonable settlement of the class members’ claims. The attorneys have met their professional responsibilities to devise a viable and fair solution to a complex and vexing problem.

The majority claimants contend that the Settlement accomplishes the most significant progress that can be made in the circumstances of the Trust’s limited funds. *777 First, the Settlement has the effect of removing the Trust from the tort system, eliminating the dissipation of Trust assets on transaction costs while leaving tort litigants in much the same posture inter se as they were before the class action.

One of the primary objectives of the Settlement is to attempt to assure that over time each claimant, present and future, will receive an equal percentage of the liquidated value of his or her claim. To accomplish this result, the Distribution Process provides that claimants will receive an annual pro rata share of their claims liquidated according to the Settlement process with somewhat uniform payment guidelines.

The Trust is effectively removed from the tort system saving hundreds of millions of dollars in future transaction costs which will then be available to injured claimants. The Trust is no longer obligated to follow the FIFO processing and payment system nor to pay claimants 100% of the liquidated value of their claim upon settlement or judgment. Instead, the Distribution Process requires the Trust to allocate and reserve funds to meet its future obligations to claimants.

Plaintiffs’ attorneys have agreed to limit their fees to a maximum of 25% of the amounts received by their client payable in installments as payments are made by the Trust. This will save several hundreds of millions of dollars, leaving higher net awards to the claimants.

Majority claimants assert that these provisions in conjunction with the flexibility of the Process will ensure that the ultimate goal of equitable compensation to all claimants over time can be achieved. With the benefit of additional cash during the early years, the Trust will promptly pay some of the most seriously injured claimants who otherwise would have received little if any compensation from the Trust while they were alive.

B. Minority Claimants

1. Henderson & Goldberg

The firm of Henderson & Goldberg is one of a small group of plaintiffs’ counsel with extensive national experience in representing persons suffering from asbestos-related injuries. Thomas W. Henderson played a significant role in unearthing incriminating evidence that Johns-Manville, among other asbestos manufacturers and producers, was aware of and choose to suppress and conceal from its employees and others the dangers caused by exposure to asbestos fibers. See P. Brodeur, Outrageous Misconduct, supra, 97-106 (1985).

As a member of the Select Counsel for the Beneficiaries during the period when the Settlement was negotiated, Mr. Henderson not only knew of the need to refinance and restructure the Trust’s distribution system, but actively participated in formulating some of its critical components. He concedes that the Trust is on the brink of bankruptcy, but differs about how the troubles that plague the Trust should be handled. In fact, Mr. Henderson supports certain aspects of the new Trust Distribution Process and incorporates by reference those provisions into his own proposal.

Notwithstanding the portions he seeks to maintain, Mr. Henderson makes a number of procedural and substantive objections to the class certification and Settlement. His firm developed an alternative scheme that in his view cures the infirmities of the Settlement. He summarizes his procedural objections as follows:

—Orders to restructure the Trust were entered in a procedural vacuum out of context of a concrete dispute.

—Limited fund hearings were held before filing of a class action complaint.

—Orders were entered on November 23, 1990 without obtaining personal jurisdiction over the parties sought to be bound or otherwise protecting absent class members’ rights to due process.

—The class was conditionally certified without providing class members notice, opportunity to be heard, opportunity to opt out and adequate representation.

—The class was conditionally certified despite the district court’s lack of subject *778 matter jurisdiction over claims of class members.

—The class was conditionally certified despite absence of commonality, typicality and adequate representation.

—The class was conditionally certified and proceedings against the Trust were stayed in violation of the Anti-Injunction Act.

—Hearings were held on class certification issues without adequate notice, opportunity to be heard, opportunity to opt out and adequate representation.

—Notice of the hearings was misleading.

—The class counsel with inherent conflicts of interest were appointed.

—The confirmed and substantially consummated Plan of Reorganization was modified without disclosure to and voting by classes of creditors.

—Parties are attempting to amend a trust without obtaining written consent of all beneficiaries.

Brief of Objecting Asbestos Disease Claimants (Henderson & Goldberg) at 2-3.

On a substantive level, Mr. Henderson contests the fairness of the Plan primarily because it gives those beneficiaries suffering from more serious illnesses a temporal preference in the payment of their claims over those claimants with less debilitating injuries, allegedly in violation of the Bankruptcy Code and applicable law governing trusts in New York. He contends that there is a strong possibility that Level One claimants will receive a higher percentage of the total value of their claims than Level Two claimants. In addition, he argues that the courts prejudged the fairness of the Settlement by suggesting that more seriously disabled claimants be paid first; that the Settlement alters vested rights; and that it modifies the Plan but fails to comply with the requirements of the Bankruptcy Code providing for good faith, same treatment for class members, absence of discrimination, fair and equal treatment among class members, voting by claimants and feasibility. Finally, Henderson & Goldberg assert that the financing agreement between the Trust and Manville will diminish the value of the Trust’s assets in Manville as a consequence of the heavy debt Manville must assume to pay its promised dividends in the next several years. The law firm prefers to postpone payment to all claimants for a period of approximately five years at which time all the assets of the Trust can be liquidated and distributed.

Henderson & Goldberg have proposed an alternative plan on behalf of a minority of the plaintiffs. The proposal responds to certain of the substantive provisions they argue render the Settlement untenable and contrary to applicable law. The minority proposal would delay payments much longer than the majority’s Settlement. In the interim, the minority proposal provides for the payment of a substantial group of “hardship cases.” All other claimants would then be paid simultaneously, eliminating the two levels of the majority’s plan.

2. Peter G. Angelos

Peter Angelos represents many thousands of unpaid claimants. See Appendix Dl, attached. He supports the minority proposal preferred by Henderson & Goldberg. He appeared at the fairness hearings and objected to the class certification and Settlement on the grounds that the courts lack subject matter jurisdiction. He argues that the courts cannot exercise jurisdiction except pursuant to section 1127(b) of Title 11 of the United States Code because the compromise modifies a confirmed and consummated reorganization plan. He contends that the district court lacks diversity jurisdiction because many absent members of the class will settle their claims with the Trust for substantially less than the jurisdictional minimum of $50,000.

On a substantive level, Peter Angelos raises many of the same objections pressed by Henderson & Goldberg. In particular, he contends that the proposed Settlement does not comply with bankruptcy law in that it fails to treat all class members equitably. By prioritizing payments to Level One claimants there is created, he suggests, a disparity in percentage of recovery taking into account both the time *779 value of money and the greater risk of nonpayment or lesser percentage of payment to Level Two claimants.

Peter Angelos challenges the fairness of the provision for the payment of preexisting settlements between the Trust and claimants, amounting to approximately $450 million, that were settled but unpaid at the time the class action was filed. See Appendix D, attached. This full payment amounts to a windfall, he argues, for one group of claimants who won the race to settlement or judgment. A large portion of the money, $200 million, covers two mass court action settlements, the Cimino litigation in East Texas and the Norfolk litigation in Virginia. According to Mr. Angelos there is no principled basis upon which to distinguish this group of claimants from those subject to the terms of the class action Settlement. Regardless of the severity of their injuries, those parties will receive full compensation from the Trust for the value of their claims.

Mr. Angelos also suggests that the Settlement should not be approved because adequate inquiry has not been made into the cause of the Trust’s insolvency. In particular, he alleges that the officers and directors of the Trust violated their fiduciary duties in the evaluation and payment of claims. Specifically, he claims that the Trust liquidated claims without complete information. He relies for this contention on the testimony of Mark Lederer, Chief Financial Officer of the Trust. Tr. 1/3/91 at 318-22. As a result, Mr. Angelos suggests that claims against the Trustee’s insurance policies, with a face value of $100 million, might be appropriate.

While differing somewhat on detail, during the course of the fairness hearings Peter Angelos appears finally to have embraced the modified plan proposed by Henderson & Goldberg. He has simultaneously sought dismissal of the class action, rejection of the Settlement, and appointment of a receiver to examine all past and future functions of the Trust and to investigate funds due the Trust from third parties.

C. Mississippi Claimants

This group consists of the féw lawyers for claimants who have cases pending in Jackson County, Mississippi. The majority of the Mississippi claimants were exposed to asbestos while working at Ingalls Shipyard in Pascagoula, Mississippi from the 1940s through roughly 1976. Some of the cases have been pending since 1978. In 1988, all asbestos cases that had been removed to the district court were remanded back to the state court creating a total of over 6,000 pending cases. A consolidated trial of approximately 75 cases was scheduled to begin in April 1990. Four days before it was scheduled to begin, the trial was stayed by the Mississippi Supreme Court pending resolution of an interlocutory appeal to determine when the Mississippi statute of limitations should begin to run in latent injury cases. On December 12, 1990, the Mississippi Supreme Court held that Mississippi law embraced a “discovery” rule, and lifted its stay. Shortly thereafter, Circuit Judge Darwin M. Maples issued an order consolidating all pending cases for a trial similar to that conducted by Judge Parker and upheld by the Fifth Circuit in Jenkins v. Raymark Indus., 782 F.2d 468 (5th Cir.1986).

These claimants primarily object to the stay of state court proceedings issued on November 23, 1990. They claim that the stay violates principles of federalism and comity and the Anti-Injunction Act, 28 U.S.C. § 2383. In addition they assert that the court lacks personal jurisdiction over absent state court plaintiffs. The Mississippi claimants also contend that the Settlement modifies the confirmed Plan of Reorganization without meeting the requirements of 11 U.S.C. § 1127(b). They challenge the courts’ jurisdiction to adjudicate the class action and in particular to enforce a nationwide mandatory class action.

D. Steven Kazan for Asbestos Victims of America

Speaking on behalf of Asbestos Victims of America, Mr. Kazan took an opposite position to that of Henderson and Angelos when he expressed the view that those *780 described as Level One claimants deserve to be compensated first and fully before any other asbestos victim receives any compensation from the Trust. Tr. 1/11/91 at 161-62. In addition the Asbestos Victims of America favor paying so-called Exigent Health Claimants in full within twenty to thirty days from the date of a negotiated settlement.

Mr. Kazan suggests that each plaintiffs counsel submit a survey of its cases in order to ascertain the extent of existing Level One claimants. After the Level One claimants receive full compensation, Asbestos Victims of America would recommend that the Trust compensate impaired asbestosis and impaired pleural claimants who are elderly and not likely to be around long enough to develop a Level One degree of illness. Mr. Kazan asserted that no unimpaired pleural claimants should receive money from the Trust until all impaired victims are paid in full. Tr. 1/11/91 at 164. According to his testimony, the organization he represents conducted an informal survey of its members including persons with all levels of disease, impairment, potential future claimants and those without impairment. It found that even those without impairment favored not seeking compensation from the Trust at this time in favor of those who are disabled, dying and dead. They would rather wait and liquidate their claim against the Trust if and when they became impaired. Hopefully, their deferral of any right to present compensation would help ensure that funds would be available in the future as needed. Tr. 1/11/91 at 165. This victim organization does not view such a scheme as discriminating between different classes of victims, but rather as a means of treating all persons exposed to asbestos equally. To the extent that it makes distinctions based on diseases, it submits that this does not constitute discrimination in the sense prohibited by the bankruptcy code.

Mr. Kazan also urged that the Trust adopt a statute of limitations that would not require presentation of a claim unless there is impairment of the ability to perform one’s usual occupation. For people who retire before becoming impaired, in effect no statute of limitations would apply or bar a claim if he or she later suffers impairment. This model, based on the system apparently adopted in California, would deter the filing of claims of those without a right to compensation under his proposal.

E. Organizations Representing Asbestos Victims

The National Asbestos Victims Legal Action Organizing Committee, an umbrella organization, comprises roughly five asbestos victim groups including White Lung Associations from various states with a total membership of approximately thirteen thousand workers and several trade unions. The trade unions claim membership of approximately twenty thousand persons.

During the course of the fairness hearings, nearly a dozen present claimants or potential future claimants testified. In addition the courts received approximately twenty form letters from members of various White Lung Associations. Throughout the proceedings exposed individuals expressed views with respect to the reasons why the Trust ran out of money so quickly, the stay on sometimes long-awaited payments, the stay on litigation against the Trust, the class action and provisions of the Settlement. These letters emphasize the unfairness to those suffering from asbestos illness of bearing the brunt of the insolvency of the Trust. They implored the courts to “[m]ake the industries responsible for the destruction of the peoples’ healths and lives with the products they produce.”

Roughly a dozen individual members of National Asbestos Victims Legal Action Organizing Committee sent copies of a form letter which stated “we strongly encourage you to set up a mechanism by which asbestos victims can be fully apprised of the ramifications of the proposed plan and vote agreement or disagreement with it.” Despite extensive notice through individual mailings to claimants, their representatives or their attorneys, publication of notice, and notice through the various trade publications and through White Lung *781 Associations and other asbestos victims’ organizations, few claimants appeared during the course of the Fairness Hearings. Myles O’Malley, a leader in this organization, stated that his organization sent individual notice to four thousand asbestos victims informing them of the hearings and their right to appear and be heard. Tr. 1/9/91 at 85. In all, about thirty members came to the initial New York hearing, ten people to Washington, D.C., and five to New Orleans, Louisiana.

Mr. O’Malley in testimony and written submissions expressed his belief that many more than the 47,000 future victims will surface seeking compensation from the Trust. In particular, he points to the recent increase in claims by family members of workers who developed asbestos-related injuries from their contact with the worker. Another group ignored or underestimated according to Mr. O’Malley consists of those who currently have pleural disease or asbestosis and who may have a substantially increased risk of contracting asbestos-related cancers. Additionally, those who participate in asbestos abatement programs also face risk of injuries resulting from exposure during removal, although significantly greater precautions have supposedly attended abatements than were utilized prior to the 1970’s in production and installation.

In terms of concrete alternative proposals, the National Asbestos Victims Legal Action Organizing Committee favored reopening the Manville bankruptcy, voiding the settlement between Manville and its insurers, and if necessary liquidating the corporation in order to meet its obligation to pay claimants. The letter submitted by several members of the organization requests that the court

appoint special counsel to examine the feasibility of maximizing the Manville Trust’s assets by re-opening the original bankruptcy reorganization plan. The information, provided by Manville Corporation, upon which that plan was based, especially the settlement between Man-ville Corporation and its Insurers, was misleading and self-serving.

F. Parties Who Continue to Support FIFO Represented by Hal C. Pitkow and Others

A number of claimants beneficiaries represented by Hal C. Pitkow object to the Settlement because it modifies the principles of the reorganization Plan which they contend formed the basis for the claimants’ votes for its adoption. They object to a restructuring of the payment procedures to protect future beneficiaries, who were represented by counsel during the reorganization, to the detriment of present beneficiaries. They argue that the Plan was confirmed and approved on appeal with their interests in mind. Other plaintiffs’ counsel have asserted the same position.

The claimants allege that the fiscal crisis facing the Trust results from its payment of excessive settlements, primarily pre-petition cases, without proper and complete evaluation; from its group settlements which ignored adherence to the FIFO order in violation of the Plan and from the practice of certain courts in consolidating hundreds and in some instances thousands of cases for trial with the result that the Trust was pressured to settle such cases without appropriate and full evaluation.

Pre-petition claimants represented by Hal C. Pitkow seek equal treatment to that of other pre-petition claimants. They claim that they will not receive the equal treatment mandated by the bankruptcy code under the proposed Settlement. These pre-petition claimants have settled with other codefendants and released all claims against them having excluded the portion of their injury that they attributed to Man-ville. Under the Settlement they will only receive a portion of the value of their claims against Manville; the remaining portion will be uncompensated. Similarly, post-petition claimants have also settled and released codefendants with a similar understanding that they would be able to obtain the full value of their claim from the Trust. Claimants represented by Mr. Pit-kow therefore object to the Settlement because it will deny full compensation for injuries.

*782 G. Laurence Gold

Laurence Gold, General Counsel of AFL-CIO, speaking on behalf of organized labor, offered the judgment that the Settlement is in general fair and deserves court approval. Three factors in particular informed Mr. Gold’s opinion. First, the additional funding available through the Settlement appeared to be reasonable, recognizing the ongoing needs of the Corporation and the interests of current employees of the Man-ville as well as those of claimants suffering from asbestos-related injuries. Second, as a result of years of hard work and successful litigation, it is possible to place proper values on asbestos cases as determined by the tort system. Third, in view of the funding available to the Trust and the extent and value of the claims against it, there is little doubt that the Trust cannot afford to pay 100 cents on the dollar. Even more significantly, the Trust cannot afford to continue to participate in litigation which constitutes the most expensive method by which to value claims and pay compensation.

With respect to the Settlement, Mr. Gold praised its system of providing compensation over time with provisions for modifying and adjusting payments to take account of claims experience and income flow. The history of the Trust under the reorganization Plan demonstrates the paramount importance of flexibility. Proper concern for the uncertainties that attend the future will hopefully ensure fair treatment of claimants over time. These components were critical to Mr. Gold’s overall support of the Settlement. In addition, the limited fund warrants more substantial payments to those who are most sick, preserving the claims of Level Two claimants to conserve cash.

Mr. Gold raised two special concerns with respect to the Settlement. One involved persons who had predominantly been exposed to only Manville asbestos products, such as Manville employees. Such individuals only have the Trust to look to for compensation. Nothing in the Settlement give them priority in recognition of that fact. For example, he suggested treating such persons as having Level One claims to accelerate their payment. According to the Trust, roughly 4500 of 157,000 pending claims would fall into the Manville Only category. Approximately 1500 of these 4500 claims have been settled.

Second, the role of the Special Advisor to the Trust appeared too limited especially after the experience of the Trust thus far. He recommended elevating the status of the Special Advisor to that of the Select Counsel for the Beneficiaries. Without that protection, in his view some provision should be permitted for outside input from either the representative for the future claimants or someone else responsible for overseeing and sharing administrative authority under the Settlement.

He also pointed out that the transaction costs associated with administering the Trust appeared to be in excess of what is appropriate under the circumstances. For what should essentially be a compensation program, this percentage could be and should be reduced, possibly eliminating the extensive involvement of plaintiffs’ counsel. Moreover, Mr. Gold noted that the system retains a great deal of sensitivity and discretion in payment levels, increasing the value of having claimant representation and unnecessarily hindering simpler administration and processing of claims.

Mr. Gold also offered comments with respect to how this Settlement fits within the larger areas of concern to organized labor in the context of the asbestos problem. In his view those injured would be better served by a single comprehensive fund which covered the major defendants and the federal government which bears some responsibility for the injuries that occurred as a result of its procurement needs.

Finally, Mr. Gold expressed some concern about the lack of investment in monitoring, prevention and education. In particular, substantial progress in informing workers of the consequences of smoking might improve their quality of life and minimize the severity of their latent disease. Despite the above suggestions, Mr. Gold concluded that the Settlement is the prod *783 uct of fair negotiations and represents a qualitative improvement over the present situation.

H. Leslie Gordon Fagen, Legal Representative of Future Claimants

After careful consideration and active participation in the fairness hearings, the Legal Representative for Future Claimants has urged the courts to approve the Settlement. Cognizant of the uncertainties that attend all predictions of the number of future claimants the Trust will face, the Legal Representative did not demand a guarantee of equal payment of all future claimants. Instead he found that the Settlement represents an effective attempt to accommodate the rights of future claimants to equal pro rata treatment in view of the limited resources of the Trust.

He noted that the current distribution procedures of the Trust require complete payment of settlements and judgments as they are liquidated on a first in, first out basis leaving little hope that the Trust would have resources with which to compensate future claimants fairly, if at all. Against the present backdrop, the Settlement offers future claimants significantly greater protection. In particular, the Settlement would remove the Trust from the tort system thus eliminating the inherent inequity to future claimants in the existing race to the courthouse to secure recoveries from diminishing Trust assets. Simultaneously, the Trust would save the multimillion dollar annual costs of litigation that it can ill afford to pay.

The Settlement would permit the Trust to liquidate claims, but only to pay a pro rata portion of the value of the claim each year up to a maximum of forty-five percent of the total funds in order to safeguard enough assets to pay future claimants on an equitable pro rata basis. Finally, the Trust would be required to evaluate statistical, epidemiological and medical data to develop over time a clearer understanding of the nature and extent of future claimants. The availability of this data will compel the Trust to plan ahead to a much greater extent than previously.

The Legal Representative for Future Claimants concluded, "these provisions alone represent an enormous advance for the interests of future claimants under the current circumstances and justify our support for the Settlement.” Memorandum of Legal Representative of Future Claimants at 2-3. Mr. Fagen found that Henderson & Goldberg’s alternative proposal, while not before the courts for consideration as a settlement within the meaning of Rule 23(e), in fact did not afford adequate protection of the interests of future claimants.

Mr. Fagen objected that the 25% fee allowance to plaintiffs’ counsel was too high in view of the limited work they had to do under the Settlement, the efficiencies of scale they could expect and the substantial fees they will receive even if the maximum fee was reduced far below the 25%.

Mr. Fagen found no reason to continue his appointment beyond approval of the Settlement since future claimants could expect adequate protection from the trustees and Select Counsel for the Beneficiaries, whom Mr. Fagen understood to have a fiduciary duty to all beneficiaries. In addition to the cost savings that would result to the trust from the termination of his appointment, his firm substantially reduced its usual fees as part of a pro bono contribution to the Settlement.

This position that future claimants required no special representative following approval of the Settlement was modified by Mr. Fagen’s letter of April 26,1991. In the interim he had received a letter dated March 1,1991 from Elihu Inselbuch writing as counsel to the Selected Counsel for the Beneficiaries. In it Mr. Inselbuch stated, “we disagree with the suggestion that the Selected Counsel for the Beneficiaries act as fiduciaries for future claimants ...” It was his position that, in instances where the interests of present and future beneficiaries conflict, they had an obligation only to “all present beneficiaries.”

Mr. Fagen then stated, “I now believe that the Trust’s February 5, 1991 proposal for the appointment of a Permanent Legal Representative of Future Claimants should be adopted.” Letter of April 26, at 2. The *784 letter outlined the following role for the Legal Representative:

I propose that the Court, using its inherent powers over the Trust, appoint a Permanent Legal Representative with the following rights and powers:

1. To receive notice regarding:

(a) any determination as to proposed major Trust asset sales and the timing or amount of proposed allocations between present and future claimants upon the sale of major Trust assets under the terms of the Settlement, and

(b) any material proposed changes in the administration of the Settlement such as the setting or resetting of a percentage cap on claims payments.

2. To obtain full disclosure regarding the matters described in 111 above including reasonable access to all Trust personnel, to experts retained by the Trust or appointed by the Court pursuant to Rule 706, and to all relevant documentary information.

3. To receive any periodic or other reports produced by or for the Trust, the Special Advisor, the [Select Counsel for the Beneficiaries], or experts appointed by the Court pursuant to Rule 706.

4. To observe any dispute resolution procedure which may be held pursuant to Section J of the Distribution Plan of the Settlement.

5. To have standing to invoke the Court’s continuing equitable jurisdiction over the administration of the Trust and to bring legitimate grievances to the attention of the Court.

Id. at 6-7 (footnote omitted). This position is consistent with that of Mr. Gold, Part III.G, supra, and of the Trust.

Authority for the continuing appointment was found by Mr. Fagen to rest on general equitable powers over a trust’s assets. See, e.g., Surrogate Court Practice Act §§ 315(2)(a)(iii), 403 (power to appoint guardian); Guaranty Trust Co. v. York, 326 U.S. 99, 106, 65 S.Ct. 1464, 1469, 89 L.Ed. 2079 (1945) (“a federal court may afford an equitable remedy for a substantive right recognized by a State even though a state court cannot give it”); Perfect Fit Indus. v. Acme Quilting Co., 646 F.2d 800, 806 (2d Cir.1981), cert denied, 459 U.S. 832, 103 S.Ct. 73, 74 L.Ed.2d 71 (1982).

He pointed out that nearly fifty years ago the Supreme Court, referring to “the requirements of equity practice with a background of several hundred years of history,” said:

The essence of equity jurisdiction has been the power of the Chancellor to do equity and to mould each decree to the necessities of the particular case. Flexibility rather than rigidity has distinguished it. The qualities of mercy and practicality have made equity the instrument for nice adjustment and reconciliation between the public interest and private needs as well as between competing private claims.

Hecht Co. v. Bowles, 321 U.S. 321, 329, 64 S.Ct. 587, 592, 88 L.Ed. 754 (1944).

By letter dated May 7, 1991, Elihu Insel-buch, on behalf of plaintiffs’ counsel, objected to appointment of any representative for future claimants. He declared that it would be contrary to the terms of the Settlement.

The courts are persuaded by Mr. Fagen’s arguments and proposal. Their powers to appoint a representative of future claimants lie outside those embodied in the Settlement. A court of equity has power and responsibility to ensure that trust funds are available for those they are designed to benefit, but who are as yet unknown. Mr. Fagen is appointed as Representative of Future Claimants with the authority recommended by him. The courts retain power to replace him or terminate his appointment.

I. Codefendants

The codefendants have unanimously opposed the Settlement as fundamentally unfair. They object to both the process by which the Settlement was negotiated and the substantive provisions of the agreement. They estimate that the effect of the Settlement will be to shift hundreds of *785 millions of dollars of asbestos liabilities that would otherwise have been borne by Manville to the codefendants and rid them of protections recently enacted by many states that limit such shifting of joint liabilities.

The codefendants contend that the class should not have been certified because the requirements of Rule 23(a)(3) and (a)(4) are not met. All named plaintiffs in the class action are plaintiff-beneficiaries rather than codefendant-beneficiaries. Similarly, class counsel who filed the complaint and negotiated the Settlement exclusively represented the interests of personal injury plaintiffs to the detriment of the codefend-ants. Therefore, codefendants assert, such counsel cannot adequately represent the interests of the entire class including the codefendants. Instead, codefendants argue that in view of their historic, bitter and protracted conflicts with the plaintiff beneficiaries the class must be divided into subclasses. Simply stated, the divergence of interests reduces to the fact that the plaintiffs seek to maximize the compensation they can obtain from the Trust while preserving their rights to recovery in the tort system against the codefendants. In contrast, the codefendants seek the maximum set off or credit for payments that the Trust makes to plaintiffs and to retain the benefits of tort reforms that modify joint and several liability in many states.

Codefendants contend that the conflict of interests between the two groups of beneficiaries clearly manifests itself in the unfairness of the terms of the Settlement. Section H precludes the introduction of any Manville-related evidence in any proceedings between beneficiaries. According to the codefendants, this undermines their ability to demonstrate that it was Man-ville’s products that caused a plaintiffs injuries, or at least that Manville bears a much greater responsibility for the injuries than the defendants who might be present at trial. In addition, without the presence of Manville on verdict forms, codefendants allegedly lose the ability to benefit from independent state law rights that modify joint and several liability and thereby limit a defendant’s responsibility to that portion of the harm a jury finds it substantially caused. The consequence of these provisions for the codefendants is supposedly to shift to them the entire burden of the difference between the perceived full value of plaintiffs’ claims against Manville and any lesser amounts actually paid by the Trust. Many of the rights the codefendants contend are sacrificed by the Settlement arise independently under state law, such as the right to introduce evidence relevant to proximate causation in litigation in which neither the Trust nor Manville is a party. Such tort cases involve the competing interests of plaintiffs and codefendants.

Finally, codefendants argue that the Settlement eliminates rights that they bargained for in the bankruptcy proceeding without any benefit in exchange. They claim that the Settlement constitutes a material modification of the Plan because it eliminates their right to implead the Trust in pending asbestos litigation. Thus, the Settlement violates Section 1127(b) which prohibits material modifications of the rights of a party under a confirmed Plan after it has been “substantially consummated.” See 11 U.S.C. §§ 1127(b), 1101(2).

The codefendants argue that their principal objections may be corrected without interfering with the accelerated funding available through the Master Agreement between Manville and the Trust and without interfering with the establishment of the new claims resolution procedures contemplated by the Settlement. They propose deleting the provision that prohibits the introduction of evidence concerning Manville and permitting the codefendants to continue to implead the Trust but treating the Trust as a settling party to prevent the unnecessary expenditure of limited Trust funds. The Trust would therefore not have to appear. In states that have modified joint and several liability, the co-defendants will then be able to present evidence and argument with respect to fault and apportionment unhindered by the absence of the Trust from the litigation.

J. Distributors

Distributor-codefendants, who never produced asbestos but merely sold asbestos- *786 containing products manufactured by Man-ville and other manufacturers, join the co-defendants’ objections outlined above. They do not, however, uniformly accept the proposed solution endorsed by the code-fendants who were themselves producers of asbestos products. Distributors at least in some states have claims for indemnity rather than contribution from the Trust and are only secondarily liable if the party primarily liable cannot be sued. In addition, certain distributors of Manville products have negotiated agreements with the Trust that they seek to protect and enforce.

1. Pacor

The Pacor Settlement Trust, created by a chapter 11 reorganization plan, objects to the proposed Settlement if it modifies the Stipulation of Settlement between the Pa-cor and the Manville Trusts approved by the bankruptcy courts presiding over the Pacor and Manville reorganizations. Pursuant to the Pacor plan, all asbestos health claims against Pacor, a former distributor of Manville asbestos-containing products, are channelled to the Pacor Trust. The debtor in turn assigned to the Pacor Trust its interest in the Stipulation which provides for a pass-through to the Manville Trust of claims against Pacor arising from the distribution of Manville products and the assumption by the Manville Trust of liability for certain claims against Pacor unrelated to Manville products. These claims are treated as though the claimants filed proof of claim forms directly with the Manville Trust. Pacor/Manville Stipulation § 2(b)(i).

If the Trust accepts liability for pass-through claims, when the Trust processes, defends and resolves the claim in accordance with its claims resolution procedures, it then obtains releases for Pacor, the Pa-cor Trust and the Manville Trust. Pa-cor/Manville Stipulation § 2(b)(iii), (iv). If the Manville Trust rejects the claim, it returns it to the Pacor Trust for processing, defense and resolution subject to Pacor’s right to seek contribution or indemnification and have that issue submitted to binding arbitration. Pacor/Manville Stipulation § 2(b)(vi)(a). The Pacor plan was confirmed on November 30, 1989. In re Pacor, Inc. and Pacor Material Supply Co., Nos. 86-03251 and 86-03252 (Bankr. E.D.Pa.1989). If the proposed Settlement does not alter the rights of the Pacor Trust, it has no objection to the class action and its compromise.

If the Settlement alters rights emanating from their Pacor/Manville Stipulation, the Pacor Trust contends that principles of res judicata, collateral estoppel and comity preclude its modification. In addition, it argues that the Settlement then would constitute a modification of Pacor’s substantially consummated plan of reorganization and trigger creditors rights under Sections 1127(b) and 1101(2) of the Bankruptcy Code.

Pacor joins the objections asserted by the codefendants, but not their proposed solutions which in fact the Pacor Trust asserts further prejudices its rights. The nominal joinder of Manville as a party in tort litigation and introduction of evidence to prove Manville’s tortious conduct would serve to increase the share of liability attributable to distributors in states with derivative liability. In effect, judgments would be entered against Pacor as the distributor in Manville’s stead, leaving the Pacor Trust with the additional burden of defending Manville to minimize the allocable share which the plaintiff can collect from the distributor. This contrasts sharply with the primary benefit derived from the Pa-cor/Manville Stipulation, the elimination of its obligation to process and defend claims.

Beyond increasing the burdens imposed on distributors, the codefendants’ suggested modification of the Settlement, Pacor argues, eliminates its indemnification rights. Instead, indemnification and contribution rights would be determined in the underlying action and the defendant would pay only its proportionate share of the judgment. The personal injury claimant could then proceed against the Pacor Trust to recover an amount commensurate with the percentage of fault allocated to Man-ville. Lack of a simultaneous judgment against Manville prejudices a distributor *787 who pays that share but loses the right to proceed against the Trust.

Finally, the Pacor Trust seeks to opt out of the class action if the Settlement is approved. Pursuant to Rule 23(c)(1) it claims the court has the power to alter or amend its certification order if and when it becomes apparent that diverse interests cannot be represented by the defined class. Cf. Rios v. Marshall, 100 F.R.D. 395, 408 n. 14 (S.D.N.Y.1983); Brady v. LAC, Inc., 72 F.R.D. 22, 29 (S.D.N.Y.1976). It argues that the courts should exercise their discretionary power to permit the Pacor Trust’s exclusion from the class. See County of Suffolk v. Long Island Lighting Co., 710 F.Supp. 1407, 1420-21 (E.D.N.Y.1989), aff'd, 907 F.2d 1295 (2d Cir.1990).

2. MacArthur

MacArthur Company, Western MacArthur Company and Milwaukee Insulation (“MacArthur”) similarly object to the proposed Settlement. MacArthur is a longtime distributor of Manville products. Following the bankruptcy filing of Manville and its protection from litigation pursuant to the automatic stay provisions under chapter 11 § 362(a), MacArthur was transformed from a minor peripheral party in the asbestos litigation to a primary target potentially liable for Manville’s share of responsibility in Manville’s absence. See, e.g., Kaminski v. Western MacArthur Co., 175 Cal.App.3d 445, 220 Cal.Rptr. 895 (1985) (distributor of Manville’s defective products jointly and severally liable for all harm caused by such products). MacArthur’s protection against jeopardy was to obtain indemnity from Manville as the responsible manufacturer. Kaminski, 175 Cal.App.3d at 457, 220 Cal.Rptr. at 901.

MacArthur argues that its circumstances are unique and require separate consideration. It claims that Manville’s insurance policies were subject to “vendor endorsements” which allegedly provided direct insurance coverage to vendors and distributors of Manville products as “additional insureds.” MacArthur vigorously objected to the settlement reached between Manville and its insurers without success. See MacArthur Co. v. Johns-Manville Corp., 837 F.2d 89, 94 (2d Cir.), cert. denied, 488 U.S. 868, 109 S.Ct. 176, 102 L.Ed.2d 145 (1988).

After months of difficult negotiations, MacArthur and Manville negotiated a settlement approved by other parties in the bankruptcy in August 1989. In compromise of its twenty-six million dollar indemnity claim, MacArthur received a lump sum of eight million dollars. The settlement also contained specific mechanisms by which MacArthur can assert indemnity and contribution claims against the Trust. In essence, MacArthur may submit codefend-ant proofs of claim if the underlying asbestos health claim is liquidated by settlement or judgment. If MacArthur and the Trust do not settle the claim within 180 days, MacArthur has the right to bring an action for contribution or indemnification in any court of competent jurisdiction. The claims can be processed according to the codefend-ants’ procedures notwithstanding their contingency and the fact that MacArthur did not make a Contribution Claim Election. If a plaintiff could have utilized priority processing under the Claims Resolution Procedures but did not do so, MacArthur could immediately commence a third-party action. MacArthur/Trust Stipulation M10-13.

As with the Pacor Trust, MacArthur presumably would withdraw its opposition if in fact the Settlement left in place the agreement it negotiated with the Trust. If that settlement is affected by the current proceedings, it objects to any abrogation of rights it secured through a court-approved agreement. MacArthur interprets the Settlement as radically impairing its rights under the codefendant procedures which they claim virtually eliminates its right to indemnity for derivative distributor liability. Relying on accepted principles of contract law and res judicata, MacArthur claims that no circumstances warrant either rescinding the agreement with the Trust or setting it aside. MacArthur also maintains that the Trust’s posture, if in fact it intends to ignore its agreement with MacArthur, serves to aggravate the low confidence level of Manville’s present and future business partners which it has sought to bolster.

*788 In sum, MacArthur seeks to prevent plaintiffs from recovering against the Trust and then suing it as a distributor for the same harm caused by the same products. If plaintiffs were required to release their claims against MacArthur for any and all derivative liability attributable to the distribution of Manville’s asbestos-containing products, and MacArthur preserved its ability to obtain indemnification and contribution from the Trust, it would endorse the Settlement.

3. E.J. Bartells (joined by Allied Signal; Ford Motor Company; General Motors Company; Phelps Dodge Corporation and Thorpe Insulation Company).

Bartells, a Washington-state corporation, is a distributor of insulation and refractory products in a number of states including Washington and Oregon. For approximately 50 years, Bartells distributed insulation and refractory products manufactured by Johns-Manville, its affiliates and successors including some of its asbestos-containing products, as well as products of other manufacturers some of which also contained asbestos.

Bartells seeks exception from the Settlement on the ground that it abrogates the company’s rights under California law to (1) obtain comparative or equitable indemnity against the Trust in cases in which Bartells has been sued solely or in part because of its alleged activities as a distributor of Manville’s asbestos-containing products, and (2) obtain an apportionment of damages against the Trust based on the respective liability of the parties. Cf. Safeway Stores v. Nest-Kart, 21 Cal.3d 322, 579 P.2d 441, 146 Cal.Rptr. 550 (1978); American Motorcycle Ass’n v. Superior Court, 20 Cal.3d 578, 578 P.2d 899, 146 Cal.Rptr. 182 (1978). Under the principle of comparative indemnity, ordinarily a manufacturer is primarily liable and obliged to totally or partially indemnify a distributor or retailer where the liability is derivative or vicarious rather than based on an independent duty to the plaintiff. See Angelus Assocs. Corp. v. Neonex Leisure Prods., 167 Cal.App.3d 532, 213 Cal.Rptr. 403 (1985).

Bartells, as a distributor of many companies’ insulation products, has contribution rather than indemnification claims against the Trust as well as other manufacturers. Not all of its liability can be shifted to the Trust. In states where the distributor’s liability is secondary, the absence of the Trust from the litigation will serve to shift a substantial burden toward those companies otherwise not directly liable. Section H leaves ambiguous whether a distributor would be entitled to assert a set-off for amounts received or to be received by a plaintiff as a result of his or her claim against the Trust.

It also objects to the absence of procedural guidelines for the processing of indemnification and contribution claims. Whereas plaintiffs are instructed to present evidence of asbestos-related injury resulting from exposure to Manville products that would sustain a cause of action at common law, codefendants should not be hostage to the plaintiffs’ presentation of adequate medical proof or be forced to substantiate plaintiffs’ claims. In addition, Bartells objects to a requirement that it must have a judgment against it prior to asserting a claim against the Trust.

These parties claim that the proposed Settlement violates the fifth, tenth and fourteenth amendments to the Constitution as well as the Anti-Injunction Act, 28 U.S.C. § 2283. They allege that they were not permitted to participate in the negotiations between plaintiffs attorneys and the Trust that resulted in the Settlement which substantially impairs legal rights and financial interests of their clients. They assert that their clients contribution and indemnification rights were traded off for higher payments to plaintiffs and their attorneys. They argue that the effort to clear the asbestos dockets constitutes a taking of property without due process of law in violation of the fifth and fourteenth amendments.

Because their clients allegedly had no notice of these proceedings, they claim that the Settlement violates their clients’ due *789 process and equal protection rights. They claim that the Settlement cannot make evi-dentiary determinations barring the introduction of Manville-related evidence in trials yet to occur in various state and federal courts throughout the country. These companies contend that this provision violates the tenth amendment. The summary allegations made have not been substantiated with legal authority.

Thorpe Insulation Company, another Manville distributor further claims that preservation of the debtor’s distributors in business should be as much an object of the Settlement agreement as preservation of Manville. Without companies to sell and install Manville products, they argue, Man-ville will not earn the funds necessary to remain in business and support the Trust. In addition, under California law Thorpe’s liability as a distributor is said to be derivative and coextensive with that of Manville. Plaintiffs need not show negligence on the part of the distributor to support liability. Thorpe therefore requests that the release of liability against Manville incorporate a release of those whose liability is solely derivative of Manville’s. It also seeks a provision enjoining litigation against Man-ville’s distributors, a provision which prevents a claimant who settles with the Trust from pursuing a claim against a distributor and that any judgment against a distributor presently obtained by a Trust beneficiary automatically be credited with any amount ultimately received from the Trust.

4. General Refractory Company

General Refractory Company also has contribution and indemnification claims against the Trust. This company joins the objections made by the codefendants, particularly to the adoption of a national rule limiting the set off or reduction in liability to the amount that the Trust agrees to pay a plaintiff-beneficiary. Many of the cases against this company are pending in Maryland and Pennsylvania, states in which non-settling defendants allegedly are entitled to pro rata reductions on account of a settlement. See Md.Code Art. 50 § 20; 42 Pa. Cons.Stat.Ann. §§ 8326, 8327. In order to obtain this reduction in liability, there must be proof that the settling defendant is a joint tortfeasor. This evidence they claim is barred by Section H of the Settlement.

K. Shipowners

Various shipowners submitted objections to the class action certification and proposed Settlement. They claim that notice and the opportunity for objection to the Settlement were inadequate even though they participated in the public fairness hearings and submitted written memoran-da expressing their position. They contend that the provisions of the Settlement deprive shipowners of rights previously conferred in the Plan and under existing applicable law in violation of due process.

The shipowners are domestic shipping companies that have been sued by plaintiffs including longshoremen and seamen-employees for injuries allegedly caused by exposure to asbestos-containing products. The defective products were manufactured by Johns-Manville and other companies and installed or carried on board these shipowners’ vessels. Plaintiffs base liability upon the contention that the vessels were in an unseaworthy condition as a result of the presence of asbestos-containing products on board. Under well-established principles of maritime law, the shipowners may seek indemnification from Manville or the other manufacturers. See Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 76 S.Ct. 232, 100 L.Ed. 133 (1956) (shipowner may recover for stevedoring contractor’s breach of implied warranty of workmanlike performance); Cooper Stevedoring Co. v. Fritz Kopke, Inc., 417 U.S. 106, 94 S.Ct. 2174, 40 L.Ed.2d 694 (1974) (right to seek contribution); Nye v. A/S D/S Svendborg, 501 F.2d 376 (2d Cir.1974), cert. denied, 420 U.S. 964, 95 S.Ct. 1356, 43 L.Ed.2d 442 (1975) (right to seek implied indemnity). Shipowners also claim the right to recover from the manufacturer for settlements they enter into with plaintiffs if reasonable and the cost of expenses associated with the satisfaction of plaintiffs’ claims.

*790 One court recently held,

a Shipowner’s duty to maintain its vessel in a seaworthy condition is non-delegable and may be breached regardless of the Shipowner’s own fault [and] where the condition of unseaworthiness has been caused by a third party it is that [third] party who should be made to bear the ultimate responsibility for any damage or injury caused by the vessel’s unseaworthiness.

Vaughn v. Marine Transp. Lines, Inc., 723 F.Supp. 1126 (D.Md.1989). This standard requires the shipowner to demonstrate that the ultimate responsibility lies with Manville. To establish such a claim, shipowners claim that they must introduce evidence barred by their interpretation of section H of the Settlement. Thus, the Settlement imposes on shipowners the burden of litigating the underlying claims, fully satisfying liabilities ultimately attributable to the Trust and effectively re-litigating the claim against the Trust.

The shipowners also object to the reduced value they will receive on their indemnification claims. While a court or jury establishes the value of the plaintiff's claim, when the shipowner turns to the Trust to satisfy its indemnity obligation, the value of the claim is, under the Settlement, re-liquidated and depreciated in accordance with the Distribution Process. Absent the new Plan it is claimed that the Trust would pay the liability in full once responsibility was established.

L. The Trust

The Trust favors the mandatory class action and Settlement. While its view of the past may differ from that of the plaintiffs and codefendants, the Trust cannot ignore the financial plight it faces. It believes that the Settlement has several distinct and significant advantages over both the present Claims Resolution Procedures and the Henderson & Goldberg alternative proposal.

The Trust outlines the reasons for its support as follows: First, the Settlement provides a more fair and equitable distribution of the Trust’s limited funds to presently known claimants while still recognizing the special needs of a small number of extraordinarily situated claimants through exceptions for hardship and exigent health cases. Second, the Distribution Process creates a mechanism by which the Trust will set aside funds to protect the interests of future claimants to whom the Trust has a responsibility but little means to treat equitably under the Plan. Third, it permits the Trust in consultation with the Special Advisor to the Trust and with the concurrence of Select Counsel for the Beneficiaries to control the timing and manner of disposition of its assets and thereby maximize their value for the benefit of all claimants. Fourth, the Settlement provides flexibility to alter any aspect of the process to achieve the agreed-upon purpose of the Settlement, in particular the distribution pattern between present and future claimants. Given the uncertainties regarding the assets and liabilities of the Trust and the practical problems of implementing the Settlement this aspect is particularly important. Finally, the Master Agreement between the Trust and Manville will furnish severely needed cash to enable swifter compensation of those beneficiaries with the most serious injuries.

The Trust opposes the Minority Claimants’ proposal because it prohibits any distributions to Trust beneficiaries for a period up to six years with the exception of limited payments to hardship claimants. The Trust considers this delay particularly unfair in light of the substantial number of years many claimants have already waited to receive payments both as a consequence of the bankruptcy and of the Trust’s inadequate cash flow. The Settlement pays the neediest claimants at least some money relatively quickly, a result the Trust believes is critical.

Moreover, the Minority Proposal appears to reject the Master Agreement between Manville and the Trust. Among other obligations, this agreement provides for more than $500 million which the company would not otherwise be obligated to pay pursuant to the existing Plan. In view of the assurances of both Manville’s and the Trust’s investment bankers that Manville should be *791 able to perform its responsibilities under the Master Agreement without suffering undue harm to its business and overall financial condition, Tr. 1/23/91 at 255-56, 260-61; there seems to be no basis, the Trust argues, upon which to reject these substantial and valuable payments.

The Trust has had the benefit of outstanding representation by its General Counsel, David T. Austera. His excellent services have greatly assisted the parties and the courts throughout this complex litigation.

M. Manville Corporation

The Manville Corporation favors the proposed Settlement in all respects. It has agreed to provide additional funding pursuant to the terms of the Master Agreement to help the Trust enhance its present and future ability to compensate asbestos health victims. The Corporation’s experts have indicated that they believe the new payment obligations can be met and will not unduly hamper Manville’s business prospects in the future. In exchange for the new funding, Manville seeks an order reaffirming the injunction instituted as part of the bankruptcy reorganization. The Corporation wants additional protection against any attempt to sue it rather than the Trust now or in the future.

N. Cimino Plaintiffs

The Cimino plaintiffs consist of 2298 plaintiffs who participated in the class action proceeding before Judge Robert M. Parker and hold a final judgment obtained by consent against the Trust. Cf. Cimino v. Raymark Indus., 751 F.Supp. 649 (E.D.Tex.1990). The underlying agreement between the Trust and the Cimino plaintiffs provides that the Trust is to pay $140,-564,000 to the Cimino clients and their attorneys over a six year period beginning in 1991.

Counsel for the Cimino plaintiffs object to any construction of Paragraph 9 of the Stipulation of Settlement that alters in any manner the terms of payment on their judgment. Paragraph 9 states that the Trust will pay Liquidated Claims, defined as final judgments and valid and binding agreements entered prior to November 19, 1990 in accordance with the terms of those judgments or agreements. These claimants contend that unless they elect to follow the procedures of the Distribution Process, the provisions of their agreement govern the obligations of the Trust with respect to their claims. They strenuously object to an interpretation of Paragraph 9 which infers that only the first payment, which will be “immediately due and owing” as of the date of a Final Order, must be paid according to its terms, and the remaining payments can be made under the Trust Distribution Process. While some claimants may have signed releases which state that payments are subject to the availability of funding, the Cimino judgment contains no such exception. They assert that their right to enforce their judgment according to its terms is not and cannot be altered by the Settlement.

O.Claimants from Massachusetts Represented by Edward Dangel

Edward Dangel in testimony during the Fairness Hearings objected to the portion of the Settlement that considers “jurisdictional history” in the valuation of claims. Tr. 1/4/91 at 101. He argued that in the context of a national class action that seeks to pay victims based on the asbestos disease they have contracted, the history of jury awards is not relevant. To permit the Trust to liquidate claims at different prices based on this factor would only create regional friction and increase the administrative difficulties for the Trust. Moreover, Mr. Dangel argues that in a national class action, national values and averages should prevail over the uncertainties and vagaries of the tort system. In particular,- consideration of this factor undermines efforts to establish a rational and uniform process for all claims against the Trust and carries an air of unfairness into a compensation-type scheme. Mr. Dangel also recommended that the courts retain jurisdiction during the early years under the Settlement to ensure that the parties have an accessible *792 avenue for redress if that appears necessary.

Mr. David L. Meade of West Virginia, who represents over a thousand claimants seeking compensation from the Trust, submitted a letter echoing Mr. Dangel’s objection to inclusion of traditional jurisdictional value as relevant in liquidating claims. He explained his position as follows: “[I]f certain attorneys are permitted to say that their mesothelioma death case is worth ten (10) times more than a mesothelioma case in another state, that will permit that attorney to deprive nine (9) other individuals who have claims with the fund from being paid.” He further cautioned:

We have already seen the results of the greed of a few attorneys in plundering the fund and leaving little money for remaining beneficiaries. Simply because my clients live in the State of West Virginia, which is a poor state and in which the juries are not out of control and know the value of money, should not lessen the value of their claim with the Trust.

Letter from David L. Meade (dated Oct. 31, 1990) (filed and docketed).

P. Selected Claimants Represented by James Gavin

James Gavin objects to the Settlement on behalf of claimants he represents because it allegedly impermissibly modifies the Plan and claims resolution procedures adopted in the reorganization proceeding. First, he argues that pre-petition claimants who have not yet settled with the Trust suffer disproportionately and unfairly from a reordering of claims that abandons the Plan’s obligation to follow the FIFO queue. While the majority of pre-petition cases have settled and been paid in full, those that are still pending do not receive temporal priority under the Settlement and will be paid over several years rather than receiving full payment within twenty business days as required under the Plan. Second, Mr. Gavin contends that the Settlement, which sets forth average values for asbestos-related injuries, violates the provision of the original claims procedures which directed the Trust to set values based upon the individual factors of the particular claimant. Lastly, he objects to certification of a class pursuant to Rule 23(b)(1)(B) consisting of individuals suffering from different injuries as a consequence of particular work and exposure histories, as inconsistent with the requirements of Rule 23.

IV. JURISDICTION

A. Subject Matter Jurisdiction

As a threshold matter, the courts must determine whether they have subject matter jurisdiction to resolve the present controversy. The complaint alleges two bases of jurisdiction, diversity of citizenship, 28 U.S.C. § 1332 (1988 & Supp. II 1990), and bankruptcy jurisdiction, 28 U.S.C. § 1334 (1988).

Undoubtedly the jurisdiction of federal courts to resolve mega-mass tort litigations would be clarified and the ability to rationally deal with procedural and substantive issues improved were Congress to address the problems directly. See, e.g., Mullenix, Complex Litigation Reform and Article III Jurisdiction, 59 Ford.L.Rev. 169 (1990); cf. Multiparty, Multiforum Jurisdiction Act of 1990, H.R. 3406, 101st Cong., 2d Sess., 136 Cong. Rec. H3116-19 (daily ed. June 5, 1990) (proposing grant of district court original jurisdiction in wrongful death or personal injury cases involving harm to at least twenty-five persons in which residence of defendant and place of injury differ, two defendants live in different states or significant events occurred in more than one state) (initial draft). In the absence of such legislation, traditional jurisdictional bases must be revisited. As indicated below, there is ample basis for exercising jurisdiction in this case.

1. Diversity Jurisdiction

In the class action context, to satisfy the prerequisites of diversity each named class representative must reside in a different state from each defendant. See Snyder v. Harris, 394 U.S. 332, 340, 89 S.Ct. 1053, 1059, 22 L.Ed.2d 319 (1969) (“if one member of a class is of diverse citizen *793 ship from the class’ opponent, and no non-diverse members are named parties, the suit may be brought in federal court even though all other members of the class are citizens of the same State as the defendant”); Supreme Tribe of Ben-Hur v. Cauble, 255 U.S. 356, 41 S.Ct. 338, 65 L.Ed. 673 (1921); see also 3B J. Moore & J. Kennedy, Moore’s Federal Practice ¶ 23.-95, at 23-546 (2d ed. 1987); 13B C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3606, at 424 (2d ed. 1986) (“the courts look only to the citizenship of the representative parties in a class action”). Most courts have accepted the principle that for federal class action purposes complete diversity between each member of the plaintiff class and each defendant is not required. In re School Asbestos Litig., 921 F.2d 1310, 1317 (3d Cir.1990), cert. denied, — U.S. -, 111 S.Ct. 1623, 113 L.Ed.2d 720 (1991); In re Agent Orange Prod. Liab. Litig., 818 F.2d 145, 162 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988). In reviewing a jurisdictional challenge on the basis of lack of complete diversity in a class action the Second Circuit stated:

It is hornbook law, based on 66 years of Supreme Court precedent, that complete diversity is required only between the named plaintiffs and the named defendants in a federal class action.

Agent Orange, 818 F.2d at 162.

In ascertaining the residency of a trust, the court will look to the state citizenship of the trustees and deem the trust to reside in each state where its trustees reside. Navarro Savings Ass’n v. Lee, 446 U.S. 458, 464, 100 S.Ct. 1779, 1783-84, 64 L.Ed.2d 425 (1980). According to the complaint, each of the trustees reside in a different state from each of the class representatives, hence this component of diversity jurisdiction is met. Cf. Freeport-McMoRan, Inc. v. K N Energy, Inc., — U.S. -, 111 S.Ct. 858, 112 L.Ed.2d 951 (1991) (per curiam) (diversity jurisdiction, once established, is not defeated by the addition of a nondiverse party to the action).

Federal diversity jurisdiction also requires that “the matter in controversy” exceed “the sum or value of $50,000, exclusive of interest and costs ...” 28 U.S.C. § 1332 (1988 & Supp. II 1990); cf. Judicial Improvements and Access to Justice Act, Pub.L. No. 100-702, 102 Stat. 4642 (1988) (partly codified as amended at 28 U.S.C. § 1332) (increasing amount in controversy requirement from $10,000 to $50,000). For a class action to proceed, each member of the class must meet the jurisdictional minimum; the claims of the individual members cannot be aggregated to satisfy the requisite amount in controversy. See Zahn v. International Paper Co., 414 U.S. 291, 301, 94 S.Ct. 505, 512, 38 L.Ed.2d 511 (1973); In re Agent Orange Prod. Liab. Litig., 818 F.2d 145, 163 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988).

In determining if all class members satisfy the amount in controversy,

the sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal.

St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938) (footnotes omitted). The court need not dismiss an entire class action for lack of subject matter jurisdiction of certain individual class members. In re School Asbestos Litig., 921 F.2d 1310, 1315 (3d Cir.1990), cert. denied, — U.S. -, 111 S.Ct. 1623, 113 L.Ed.2d 720 (1991). Rather the court would be required only to dismiss those members who appeared “to a legal certainty” to have claims for less than jurisdictional amount. Id.

The injuries suffered by persons exposed to asbestos are serious and substantial. According to the complaint, each personal injury claimant seeks compensatory damages well in excess of $50,000. While any plaintiff is free to settle a claim for less than the amount sought in the complaint, the amount that controls for jurisdictional purposes is what the claimant in good faith pleads. See In re Agent Orange Prod. Liab. Litig., 818 F.2d 145, 163 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988) (court *794 has no affirmative obligation to question amount pled by plaintiffs absent some reason to make further inquiry).

The district court charged with the instant case tried to conclusion scores of plaintiffs’ claims and has also assisted in many hundreds of settlements of asbestos cases. In addition, we have studied settlements and judgments in other courts, many of which are published, and have had available appropriate records of the Trust including settlements of tens of thousands of claimants. The courts take judicial notice of the fact that the value of every claim in the complaint can in good faith be said to exceed $50,000 for the purposes of pleading.

The courts cannot find, to a legal certainty, that any of the claims of the class members are worth less than the statutory minimum. See In re A.H. Robins Co., 880 F.2d 709, 723 (4th Cir.), cert. denied, — U.S. -, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989); Payton v. Abbott Labs, 83 F.R.D. 382, 395 (D.Mass.1979) (unliquidated claims subject to jury evaluation cannot be found, to a legal certainty, to be less than jurisdictional amount), vacated on other grounds, 100 F.R.D. 336 (D.Mass.1983). Plaintiffs satisfy the prerequisites of diversity jurisdiction pursuant to 28 U.S.C. § 1332.

2. Bankruptcy Jurisdiction; Jurisdiction Retained Under Plan

A post-confirmation bankruptcy court retains jurisdiction over matters concerning the implementation or execution of a confirmed plan. 11 U.S.C. § 1142 (1988); see Goodman v. Phillip R. Curtis Enterprises, Inc., 809 F.2d 228, 232 (4th Cir.1987) (court retains authority to implement confirmed plan); In re Pittsburgh Terminal Coal Corp., 183 F.2d 520, 522 (3d Cir.), cert. denied, 340 U.S. 904, 71 S.Ct. 280, 95 L.Ed. 654 (1950) (court retains power to protect its decree and prevent interference with execution of plan). See also In re Johns-Manville Corp., 97 B.R. 174, 180 (Bankr.S.D.N.Y.1989) (jurisdiction of bankruptcy court “continues post-confirmation as to fundamental questions of interpretation and administration of a plan”). Section 1142 invokes the district court’s bankruptcy jurisdiction under the Federal Rules of Civil Procedure. See 28 U.S.C. § 1334 (1988); see also 28 U.S.C. § 157(d) (1988) (withdrawal of reference of case to bankruptcy court).

In this case the Plan itself in Article X explicitly reserves the courts’ jurisdiction. See Plan § 10.1 at C-36, C-37; In re Johns-Manville Corp., 97 B.R. at 180. Several of the stated purposes appropriate for the invocation of jurisdiction pursuant to Article X apply to this equitable action, most significantly ensuring the feasibility and survival of the Plan itself. See, e.g., Plan § 10.1.L at C-37 (“To enter such orders as may be necessary or appropriate in aid of confirmation and to facilitate implementation of the Plan.”); Plan § 10.1.K, at C-37 (“To enforce all orders, judgments, injunctions and rulings entered in connection with the Cases”).

In contrast with other judicial proceedings which end with the entry of a final judgment, a bankruptcy case does not clearly end at the point a plan of reorganization is confirmed. As the court in In re A.J. Mackay, 50 B.R. 756 (D.Utah 1985) stated:

A bankruptcy proceeding where a chapter 11 reorganization plan is confirmed differs markedly from a typical civil case in federal district court. Once a judgment is rendered in a typical case, the case is over. The court rendering the judgment generally has jurisdiction over only a few ancillary administrative matters. ... In a bankruptcy case, however, the confirming of a plan of reorganization is in some ways only the beginning of a case. The bankruptcy court generally retains broad jurisdiction over a case even after a plan has been confirmed.

Id. at 759. Cf. United States v. Novak, 86 B.R. 625, 629 (D.S.D.1988) (“Congress has long recognized that the process of reorganization is involved and complex_”).

Pursuant to section 1142, the courts have the authority to direct the debt- or and others to perform acts necessary for execution of a plan. 11 U.S.C. § 1142 *795 (1988); see generally Lander & Warfield, A Review and Analysis of Selected Post-Confirmation Activities in Chapter 11 Reorganizations, 62 Am.Bankr.L.J. 205-08 (1988). The court in In re Terracor, 86 B.R. 671 (D.Utah 1988), found that Section 1142 expresses a “clear intent ... to assure that the terms of the confirmed Chapter 11 plan are carried out until the plan is completed and a final decree is entered closing the case.” Id. at 676.

The courts have already stated with respect to their role in the Trust’s reorganization proceedings that they retained jurisdiction to oversee the reorganization process even after the Plan was confirmed. See In re Joint Eastern and Southern Dists. Asbestos Litig. (Johns-Manville), 120 B.R. 648, 657 (E. & S.D.N.Y.1990). The Second Circuit has rejected the “contention that adoption of the reorganization plan ousted the court of jurisdiction_” In re Dilbert’s Quality Supermarkets, Inc., 368 F.2d 922, 924 (2d Cir.1966); cf. United States v. Energy Resources Co., — U.S. -, 110 S.Ct. 2139, 2141-43, 109 L.Ed.2d 580 (1990) (section 105 permitted court to order IRS to apply post-confirmation payments in manner that ensured success of reorganization plan).

The Fourth Circuit Court of Appeals in affirming the Daikon Shield reorganization plan explicitly approved the district court’s retention of continuing jurisdiction over the personal injury trust fund created to process claims of parties injured by debtor’s products as long as the actions taken by the court did not interfere with the power and duties of the Trustees and were necessary to ensure that the plan was feasible. In re A.H. Robins Co., 880 F.2d 769, 776-77 (4th Cir.1989). The Fourth Circuit stated:

Matters relating to the control and supervision of trusts are within the equity jurisdiction of the court, and the power of the court of equity is usually invoked to require a trustee to perform a duty under a Trust.

Id. at 776 (interpreting Virginia law [New York law is not to contrary]).

Even without a specific provision in a plan reserving jurisdiction, the bankruptcy court continues to have the power post-confirmation to resolve fundamental questions of interpretation and effectuation of a plan. In re Johns-Manville Corp., 97 B.R. 174, 180 (Bankr. S.D.N.Y.1989). The need to settle disputes concerning the administration of the reorganization necessitates maintaining jurisdiction. See In re A.J. MacKay Co., 50 B.R. 756, 759 (D.Utah 1985). See generally In re A.H. Robins, 88 B.R. 742, 752 (E.D.Va.1988) (“Sections 105, 1129(a)(4) and 1142 of the Bankruptcy Code and Sections 157 and 1334 of Title 28 of the United States Code as well as principles of equity empower and require the Court to maintain a continuing supervision in the manner aforesaid.”), aff'd, 880 F.2d 694 (4th Cir.), cert. denied, — U.S. -, 110 S.Ct. 376, 107 L.Ed.2d 362 (1989).

The courts rely upon bankruptcy jurisdiction in addition to jurisdiction over the proceeding pursuant to authority to resolve diversity cases.

B. Personal and In Rem Jurisdiction

1. In Personam Jurisdiction

The court must also have personal jurisdiction over the parties to the litigation. To compel the defendant to appear and defend in a particular forum, it must be “reasonable and just, according to our traditional conception of fair play and substantial justice.” See International Shoe Co. v. Washington, 326 U.S. 310, 319-20, 66 S.Ct. 154, 159-60, 90 L.Ed. 95 (1945); see World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-94, 100 S.Ct. 559, 564-66, 62 L.Ed.2d 490 (1980) (due process does not permit state to bind person with whom state has no contacts, ties, or relations); Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977) (applying “fair play and substantial justice” standard to in rem actions).

There can be little dispute that the defendant has substantially more than the necessary minimum contacts with the forum to satisfy due process. The Trust was created pursuant to a Chapter 11 reorgani *796 zation Plan filed in New York. See In re Johns-Manville, 68 B.R. 618, 621-22 (Bankr.S.D.N.Y.1986) (order approving reorganization and simultaneous creation of Trust to pay personal injury claimants), aff'd, 78 B.R. 407 (S.D.N.Y.1987), aff'd sub nom. Kane v. Johns-Manville Corp., 843 F.2d 636 (2d Cir.1988). Furthermore, a provision of the final reorganization Plan explicitly provided for the continuing jurisdiction of the bankruptcy court, and by extension the district court, for overseeing effectuation of the Plan. See Plan, § 10.1 at C-36.

A slightly more difficult question involves the court’s jurisdiction over nonresident class members who may have little or no connection with this forum. Since New York had no prelitigation contact with many of the plaintiff class members or their claims against the Trust, the issue turns on whether each member of the class must satisfy the “minimum contacts” standard typically applied to out-of-state defendants in individual suits. E.g., International Shoe Co. v. Washington, 326 U.S. 310, 319-20, 66 S.Ct. 154, 159-60, 90 L.Ed. 95 (1945); World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-92, 100 S.Ct. 559, 564-65, 62 L.Ed.2d 490 (1980).

The extent of due process protection afforded out-of-state defendants stems in part from the hardship imposed by being haled into an inconvenient forum to defend or suffer the consequences of a default judgment. Woodson, 444 U.S. at 291-92, 100 S.Ct. at 564-65. While an adverse determination will have res judicata effect on an absent plaintiff's cause of action, “[t]he burdens placed by a State upon an absent class-action plaintiff are not of the same order or magnitude as those it places upon an absent defendant.” Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 808, 105 S.Ct. 2965, 2972, 86 L.Ed.2d 628 (1985). Out-of-state defendants must hire counsel, travel — perhaps on many occasions — to the forum state, participate in discovery and court proceedings, and comply with whatr ever judgment the court may impose, including one for money damages. By contrast, the plaintiff class member enjoys the benefits of representative litigation.

A proceeding may only go forward as a class action after a court has determined that the named plaintiffs and absent plaintiffs share common claims, that the representatives will adequately protect the interests of absent class members, and that absent members have received notice of the pendency of the action and been afforded an opportunity to be heard. Fed. R.Civ.Pro. 23; see discussion of requirements of Rule 23 infra. Moreover, the court has continuing responsibilities to absent class members including review of any settlement or dismissal of class claims. Fed.R.Civ.P. 23(e). Absent plaintiffs may hire counsel, intervene, and participate in the proceedings, or they may rely upon the court-approved representatives to protect their interests. See Larionoff v. United States, 533 F.2d 1167, 1186 n. 44 (D.C.Cir.1976) (“in suits under subdivisions (b)(1) or (b)(2), once the court determines that the members are adequately represented as required by Rule 23(a)(4), it is reasonably certain that the named representatives will protect the absent members and give them the functional equivalent of a day in court”), aff'd, 431 U.S. 864, 97 S.Ct. 2150, 53 L.Ed.2d 48 (1977). In fact, absent plaintiffs are not affirmatively required to act in any way in order to protect their rights and will not have to pay money damages if an adverse judgment is entered against the class. Shutts, 472 U.S. at 810, 105 S.Ct. at 2973-74.

In Shutts, the Supreme Court addressed the question whether a Kansas state court had the power to bind absent plaintiff class members in an opt-out class action, implicitly holding that the court had jurisdiction over those absent parties. The Court concluded

a forum State may exercise jurisdiction over the claim of an absent class-action plaintiff, even though that plaintiff may not possess the minimum contacts with the forum which would support personal jurisdiction over a defendant. If the forum state wishes to bind an absent plaintiff concerning a claim for money dam *797 ages or similar relief at law, it must provide minimal procedural due process protection.

Shutts, 472 U.S. at 811-12, 105 S.Ct. at 2974 (footnotes omitted); see also Robertson v. National Basketball Ass’n, 556 F.2d 682, 685 (2d Cir.1977) (“While the due process clause imposes definite limitations on Rule 23, those limitations concern adequacy of representation, notice, and opportunity to participate and be heard_").

There is no reason to demand greater due process protection for out-of-state plaintiffs in a federal non-opt-out class than that afforded in state common question class actions. As a practical matter, to restrict the court’s power to bind absent class members would effectively eviscerate Rule 23(b)(1)(B) class actions. 1 H. New-berg, Newberg on Class Actions § 1.15, at 12 (Supp.1990) (“it is probable that individual procedural due process rights involving minimum contacts with the forum will not be imposed on these more cohesive [23(b)(1) and (2) ] class actions, when they were not required in more discretionary common question [23(b)(3)] class actions”).

Without adjudicating the rights of all claimants to a limited fund, the court cannot ensure that the interests of parties to the litigation are not impaired or exterminated. For the hundreds of thousands of injured victims who risk losing the opportunity to recover as a result of the backlog of asbestos cases and the ongoing race to the courthouse to obtain a portion of the coveted limited funds from the remaining solvent manufacturers and distributors of asbestos-containing products, due process mandates a unified disposition that includes all claimants. See Miller & Crump, Jurisdiction and Choice of Law in Multistate Class Actions After Phillips Petroleum Co. v. Shutts, 96 Yale L.J. 1, 52 (1986). The courts may properly exercise personal jurisdiction over absent plaintiffs in this class action.

What is true generally of limited fund class actions is a fortiori true in the present case. Under the Court’s analysis in Shutts, the filing of a proof of claim seeking compensation from the Trust can be construed as implied consent to the court’s jurisdiction. If the mere failure to fill out and return an “opt out” card constitutes implied consent, see Shutts 472 U.S. at 812-14, 105 S.Ct. at 2974-76, then the more active decision to file a claim with a Trust created in New York, with its funds in New York and governed by New York law similarly implies consent. Without the filing of a proof of claim form, there can be no recovery from the Trust. This was decided when the Court of Appeals approved the Plan incorporating that requirement. See Kane v. Johns-Manville Corp., 843 F.2d 636, 650 (2d Cir.1988) (affirming confirmation of Plan).

In addition, four other factors relevant to exercise of jurisdiction under the Court’s standard of fair play and substantial justice favor a finding that the courts have personal jurisdiction over absent class members. See Worldwide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 564, 62 L.Ed.2d 490 (1980); see also Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477, 105 S.Ct. 2174, 2184, 85 L.Ed.2d 528 (1985) (these factors “sometimes serve to establish the reasonableness of jurisdiction upon a lesser showing of minimum contacts than would otherwise be required”); Asahi Metal Indus. Co. v. Superior Court of California, 480 U.S. 102, 113, 107 S.Ct. 1026, 1033, 94 L.Ed.2d 92 (1987) (listing factors). They include:

1) The forum state’s interest in adjudicating the dispute. In the instant case this factor is significant because the Trust’s funds are administered under New York trust law pursuant to a Plan approved by a bankruptcy court in New York. The continued viability of the New York Trust and hence reorganization itself is at stake in this class action proceeding.

2) The plaintiffs’ interest in obtaining convenient and effective relief is a major factor. In the case at bar limited funds mean that tens of thousands of claimants require a class action to protect the corpus of the Trust.

3) The national judicial system’s interest — including that of both state and feder *798 al courts—in obtaining the most efficient resolution of controversies is important. Here only a settlement by class action can efficiently dispose of related disputes arising in every state in the country in a manner that is equitable for all Trust beneficiaries. Moreover, the original exposures to asbestos resulted from a national technology, manufacture of asbestos products in many states and use of the product in every state in combination with equipment and products probably manufactured in every state. Asbestos related disputes involve the viability of national codefendant corporations doing business in every state with hundreds of thousands of workers. If ever there was a dispute implicating national issues and interstate commerce it is this one.

4) The shared interest of the several states in furthering fundamental social policies is significant. Each state has a similar interest in ensuring that injured persons are compensated effectively. Some differences among the states exist as to such aspects of compensation as rights to punitive damages, limits on liability and the like. But no punitive damages are permitted against the Trust under the .Plan and in no case will damages exceed those permitted in any state because there are such limited assets. The special problem of co-defendants is discussed below.

The ultimate result of a jurisdictional inquiry must be reconcilable with these four factors. 4 C. Wright & A. Miller, Federal Practice and Procedure § 1073, at 452 (2d ed. 1987); see also Johnson Creative Arts, Inc. v. Wool Masters, Inc., 743 F.2d 947, 951 (1st Cir.1984) (part of fairness inquiry is whether state has legitimate interest in bringing in out-of-state defendant). Protection of New York claimants as well as claimants from all other state jurisdictions and survival of the Plan itself requires that the rights of all claimants be adjudicated in this Rule 23(b)(1)(B) class action.

2. In Rem and Quasi in Rem Jurisdiction

While the vast majority of federal cases are actions in personam, there is no constitutional or statutory limitation on the power of a federal court to entertain actions in rem or, under certain circumstances, actions quasi in rem. See 14 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3631, at 3 (2d ed. 1985).

Jurisdiction predicated on the presence of property or assets within the court’s geographical domain has a long history. See Pennoyer v. Neff, 95 U.S. 714, 24 L.Ed. 565 (1878). In rem and quasi in rem jurisdiction arising from a court’s territorial power over the property is typically invoked when persons with claims to the property are nonresidents and securing personal jurisdiction is difficult or impossible. 4 C. Wright & A. Miller, Federal Practice and Procedure § 1070, at 417 (2d ed. 1987).

In Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977), the Supreme Court held that securing personal jurisdiction over a nonresident defendant through the seizure of property located within the state but unrelated to the action violated due process. Id. at 207, 97 S.Ct. at 2581. The plaintiff had seized defendant’s shares in a Delaware corporation to obtain jurisdiction to resolve a dispute unrelated to any acts within the state. Id. Without additional contacts, the Court found that jurisdiction offended traditional notions of fair play and substantial justice. Id. Thus, for quasi in rem actions, due process requires the court to look beyond the mere physical existence of the property within the forum. See Estate of Portnoy v. Cessna Aircraft Co., 603 F.Supp. 285 (S.D.Miss.1985).

Essentially the same principles of minimum contacts that govern personal jurisdiction are relevant in determining the propriety of asserting quasi in rem jurisdiction. Shaffer v. Heitner, 433 U.S. 186, 207, 97 S.Ct. 2569, 2581, 53 L.Ed.2d 683 (1977). The location of the property remains a significant factor, however, as it “may bear on the existence of jurisdiction by providing contacts among the forum State, the defendant, and the litigation.” Id.

*799 The Shaffer decision has inspired considerable commentary on its applications and limitations in various factual settings. See generally Silberman, Shaffer v. Heitner: The End of an Era, 53 N.Y.U.L.Rev. 33 (1978); Kalo, Jurisdiction as an Evolutionary Process: The Development of Quasi in Rem and In Personam Principles, 1978 Duke L.J. 1147; Farrell, Forward: Symposium on Shaffer v. Heitner, 45 Brooklyn L.Rev. 493 (1979) (describing articles in symposium). Much debate still surrounds the use of quasi in rem jurisdiction, clouded in part by varying definitions of two jurisdictional concepts. Technically, in rem jurisdiction relates to the determination of title to, or the status of, property located within the court’s territorial limits. 4 C. Wright & A. Miller, Federal Practice and Procedure § 1070, at 422 (2d ed. 1987). A court’s authority stems directly from adjudicating the ownership or other rights with respect to the property and the judgment is effective against all persons with an interest in the property. See, e.g., 28 U.S.C. § 1655 (1988) (granting federal court jurisdiction to hear cases involving title, liens, claims or encumbrances as to real or personal property).

Typically, a quasi in rem action does not directly relate to the property, although the property often represents the asset that will be used to satisfy a subsequent judgment if the plaintiff prevails. 4 C. Wright & A. Miller, Federal Practice and Procedure § 1070, at 422 (2d ed. 1987). Most courts and commentators support continued reliance on in rem and quasi in rem jurisdictional bases in instances where the property is the subject matter of the litigation or at least a significant ingredient in it, but seriously question its use in absence of minimum contacts. See Cargill, Inc. v. Sabine Trading & Skipping Co., 756 F.2d 224, 227-28 & n. 2 (2d Cir.1985); Spungin v. Chinetti Int’l Motors, 515 F.Supp. 31 (E.D.N.Y.1981); Drexel Burnham Lambert Inc. v. D’Angelo, 453 F.Supp. 1294, 1296-97 (S.D.N.Y.1978); see generally Silberman, Shaffer v. Heitner: The End of an Era, 53 N.Y.U.L.Rev. 33 (1978).

One distinction between in rem and quasi in rem jurisdiction relates to the preclusive effect of a judgment in the action. The question whether a court exercising quasi in rem jurisdiction can bind the parties on matters unrelated to the property is open. According to the Second Restatement of Judgments, a judgment rendered in a quasi in rem action “is conclusive between the parties, in accordance with the rules of issue preclusion, as to any issues actually litigated by them and determined in the action.” Restatement (Second) of Judgments § 32(3) (1982).

The courts have an adequate basis to exercise both in rem and quasi in rem jurisdiction in this class action proceeding. The assets of the Trust constitute the res and are located within the territorial limits of the courts. The subject matter of the action relates directly to the res and in fact affects the financing and distribution of funds from the res. Each absent class member has some contact with the jurisdiction since each seeks to recover monies from the res and hence expects to benefit from this forum’s laws protecting the Trust’s assets. Absent class members, in contrast with out-of-state defendants, have other due process protections safeguarding their interests in the litigation that permit a lower quantum of contacts with the forum to satisfy due process. See Part IV.B.l, supra.

Additional connection between the res, the forum and absent class members stems from the fact that the Trust was created pursuant to a bankruptcy proceeding in this jurisdiction. New York law governs disputes that arise concerning the Trust, supplying a further nexus with this jurisdiction and in fact rendering it the most convenient, efficient and logical location for the class action. See 4 C. Wright & A. Miller, Federal Practice and Procedure, § 1070, at 441 (2d ed. 1987). This forum also has an interest in protecting the value and marketability of property within its borders; these interests are served by providing a peaceful procedure for the resolution of disputes concerning the Trust’s property. See Shaffer v. Heitner, 433 U.S. 186, 208 n. 30, 97 S.Ct. 2569, 2582 n. 30, 53 L.Ed.2d 683 (1977).

*800 Mr. Henderson argues that in rem jurisdiction is not available “because a court’s in rem or interpleader jurisdiction extends only to the property or funds deposited in the court,” relying upon State Farm Fire & Cas. Co. v. Taskire, 386 U.S. 523, 87 S.Ct. 1199, 18 L.Ed.2d 270 (1967). While this requirement applies to statutory interpleader actions, it does not govern all in rem proceedings. See Note, The Requirement of Seizure in the Exercise of Quasi in Rem Jurisdiction: Pennoyer v. Neff Rexamined, 63 Harv.L.Rev. 657 (1950). For example, an action concerning the foreclosure of a mortgage on property within the jurisdiction invokes a traditional use of in rem power to bring in all parties who may have an interest in the property before the court without prior proceedings to take possession of the property.

In this instance, the courts have constructive possession of the Trust and the presence of its assets suffices to warrant the exercise of jurisdiction. See Farmers’ Loan & Trust Co. v. Lake Street Elevated R. Co., 177 U.S. 51, 61-62, 20 S.Ct. 564, 568, 44 L.Ed. 667 (1900) (constructive possession adequate); Palmer v. of Texas, 212 U.S. 118, 129, 29 S.Ct. 230, 233-34, 53 L.Ed. 435 (1909) (same). Courts have held that enjoining the transfer of the res eliminates the need for actual possession and amounts to seizure of the property. In Pennington v. Fourth Nat’l Bank, 243 U.S. 269, 272, 37 S.Ct. 282, 283, 61 L.Ed. 713 (1917), the Supreme Court stated:

The objection that this proceeding was void, because there was no seizure of the res at the commencement of the suit, is also unfounded. The injunction which issued against the bank was as effective a seizure as the customary garnishment or taking on trustee process.

Id.

Unlike the more typical circumstances where plaintiffs fear that the property will be disposed of prior to judgment and render any subsequent judgment unenforceable, the facts of this case do not raise such concerns. Thus, actual judicial possession of the corpus of the Trust is unnecessary for the purpose of jurisdiction. The injunction precluding any payments from the Trust amounted to constructive possession by the courts of the res and will sustain the courts’ exercise of in rem jurisdiction.

C. Notice

A final jurisdictional element required to maintain this class action is affording persons who may be bound by any judgment or settlement adequate notice. Such notice must comport with due process as well as Rule 23.

In Hansberry v. Lee, 311 U.S. 32, 61 S.Ct. 115, 85 L.Ed. 22 (1940), the Supreme Court set out the fundamental tenets of notice that will satisfy due process in class actions. Hansberry predicated binding of passive class members to a judgment rendered on proof that such members were “in fact, adequately represented by parties who are present_” Id. at 43, 61 S.Ct. at 118. While Rule 23(a)(4) similarly requires that representative parties “fairly and adequately protect the interest of the class,” due process may implicate a particularly stringent scrutiny of adequate representation in mandatory class actions.

The extent of notice required for binding adjudications is “notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314, 70 S.Ct. 652, 657, 94 L.Ed. 865 (1950). This pragmatic approach to notice recognizes that while “[pjersonal service of written notice is always adequate,” publication notice is also constitutionally adequate where it is not reasonably possible or practicable to give more adequate warning. Id. at 313, 317, 70 S.Ct. at 657, 658. This is particularly true in actions where some of the class members are unknown. Id. The Supreme Court recognized that there is also a strong public interest in settling disputes, thus a “construction of the Due Process Clause which would place impossible or impractical obstacles in the way could not be justified.” Id. at 313-14, 70 S.Ct. at 657.

*801 Timely notice necessarily means that class members learn of the proceedings when meaningful participation is still available to them. See id. at 314, 70 S.Ct. at 657 (“This right to be heard has little reality or worth unless one is informed that the matter is pending and can choose for himself whether to appear or default, acquiesce or contest.”). Moreover, the content of the notice must clearly describe the nature of the proceeding; how it will affect any rights the recipients of the notice may have; and when, where, and how such persons may express their objections. One circuit court has held that absent class members who would be bound by a judgment in a Rule 23(b)(1)(B) class action must have an opportunity to participate in pre-certification hearings to challenge the propriety of certification and contest the adequacy of the representation in order to satisfy the dictates of due process. See In Re Temple, 851 F.2d 1269, 1272 (11th Cir.1988).

The interplay of due process and the federal rules notice requirements varies depending on the nature of the class action. Rule 23(c)(2) specifies mandatory individual notice to class members of an action brought pursuant to Rule 23(b)(3), see Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177, 94 S.Ct 2140, 2152, 40 L.Ed.2d 732 (1974), but articulates no precise form of notice for 23(b)(1) actions. Notice provided in 23(b)(1) class actions is governed by the more flexible provision of Rule 23(d)(2) which leaves greater discretion with the district judge, subject only to constitutional due process limitations expressed in Hans-berry and Mullane.

Because of the mandatory nature of a 23(b)(1)(B) class action, pre-certification notice to all potential class members must be designed to inform absent members of the action to the extent reasonably possible consistent not only with Hansberry and Mullane, but with the more rigorous criteria outlined in Eisen. Applying these standards to the notice afforded in the instant class action, both with respect to the limited fund hearings and the fairness hearings, the notice satisfied the dictates of Rule 23 and due process.

The form of the notice given here was essentially that approved by the Court of Appeals in In re Agent Orange Prod. Liab. Litig., 818 F.2d 145 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988); see County of Suffolk v. Long Island Lighting Co., 907 F.2d 1295 (2d Cir.1990) (similar form of notice approved). Notice in the instant case was much more effective than it was in Agent Orange because every pro se claimant received notice and each other claimant was represented by counsel who obtained actual notice. In addition, the various White Lung Associations received notice and informed their thousands of members of the hearings. The unions also had notice through their counsel and Mr. Gold. The most widely circulated periodicals that follow and report on asbestos litigation developments publicized the Settlement and hearings as well. So, too, did the public press.

Individual notice to all claimants, representatives of injured persons, and attorneys who have filed proof of claim forms with the Trust are likely to have reached almost all of those persons directly interested in the class action. Notice to those who participated in the Manville bankruptcy proceedings will further inform those who previously indicated an interest in proceedings relating to Manville. Moreover, communication through such associations as the AFL-CIO, local unions, asbestos publications and asbestos victims organizations will serve to advise some workers who may have been exposed but who have not yet manifested an asbestos-related illness that they have an interest in these proceedings and an opportunity to participate.

The courts find that the notice given was adequate to apprise potential class members, including out-of-state claimants and possible future claimants, to the extent reasonably possible, of the pendency of the action. They were afforded an opportunity to present their objections at the pre-certifi-cation hearings. See In re Temple, 851 *802 F.2d 1269, 1272 (11th Cir.1988). Presence of counsel for future claimants also helped ensure that their rights would be adequately protected.

V. CLASS ACTIONS

Recognizing the tremendous burden imposed by repetitive asbestos litigation, class proponents believe that resolution of that aspect of the national asbestos tragedy impinging on the Trust is appropriate for class action disposition. A class action fosters judicial economy and efficiency by adjudicating in a unified proceeding, to the extent possible, issues that affect many similarly situated persons. See Califano v. Yamasaki, 442 U.S. 682, 700-01, 99 S.Ct. 2545, 2557-58, 61 L.Ed.2d 176 (1979). Courts have emphasized the flexibility of the class action as a tool for meeting substantive and procedural barriers to a just decision. See Curley, Karanftlian & Roberts v. Brignoli, Curley & Roberts Associates, 915 F.2d 81, 87 (2d Cir.1990), cert. denied, — U.S. -, 111 S.Ct. 1430, 113 L.Ed.2d 484 (1991).

Traditionally courts of equity have considered the surrounding factual circumstances and balanced affected interests in devising equitable remedies. In the asbestos mass tort context these include: (1) fairly and expeditiously compensating numerous injured persons, (2) deterring wrongful conduct, while, where possible, preventing over-deterrence that will shut down industry or remove needed products from the market, (3) keeping the courts from becoming paralyzed by tens or even hundreds of thousands of repetitive personal injury cases, and (4) reducing transaction costs so that those injured can obtain the most compensation possible with the least damage to industry and its current workers.

Class treatment presents a superior mechanism for fairly resolving similar issues and claims without repetitious and wasteful litigation. Cf. General Tel. Co. v. Falcon, 457 U.S. 147, 155, 102 S.Ct. 2364, 2369, 72 L.Ed.2d 740 (1982) (“the class action device saves the resources of both the courts and the parties by permitting an issue potentially affecting every [class member] to be litigated in an economical fashion”). This is especially true when class certification is contemplated in the context of a proposed Settlement and distribution plan for class-wide relief. Adjudication on a classwide basis enables the court to reduce transaction costs, particularly attorneys’ fees, thereby maximizing available resources to compensate injured claimants. Where liability is determined on a class-wide basis, or resolved according to the terms of a settlement, scarce financial and judicial resources are conserved. In addition, for some claimants class settlement will accelerate the receipt of compensation for injuries they suffered years ago, enhancing the monetary value of the settlement.

Much of the objection to class treatment of personal injuries cases rests on the loss of individual control of the litigation. This concern is exaggerated in the context of the asbestos personal injury litigation against the Trust. There is no substantial loss of individuals’ rights to control the claim and obtain a day in court. In practice, since dockets are inundated with asbestos litigation, most claimants cannot expect a court trial during their lifetime. The goal of individual tort compensation has been obscured by excessive delay and litigation. Individual litigants in these cases have been hostage to mass settlement techniques necessarily devised by their attorneys with the encouragement of the courts and defendants. There is in fact little or no individual client consultation and no judicial oversight of a hidden process of wheeling and dealing to maximize overall recovery and fees for hundreds and thousands of massed cases. Moreover, the value of a day in court is largely illusory unless the claimant wins the race to the courthouse door before funds constantly depleted by transaction costs run out.

The traditional role of equity is that of “adjusting legal rules that do not work well, providing a moral force, and shaping new substantive law.” Subrin, David Dudley Field and the Field Code: A Historical Analysis of an Earlier Pro *803 cedural Vision, 6 L. & Hist.Rev. 311, 345 (1988). It is this principle of fashioning remedies where none exist at law that underlies Rule 23 and justifies its application to this complex of asbestos cases. Rule 23 is a child of equity.

A. Class Action and Mass Torts; Aggregation Problems

Litigation arising from large-scale disasters is an inevitable consequence of the mass character of contemporary society and the complexity of ever-advancing technology. The national implications of mass distribution and use of products which subsequently cause serious and fatal illnesses have presented the courts with circumstances that necessitated a reassessment of traditional approaches to tort litigation. Common law models of litigation that envision one plaintiff sparring with one defendant were not designed to and cannot cope with harm experienced by huge numbers of geographically dispersed people. No mass tort epitomizes this phenomenon more dramatically than asbestos.

Historically, the class action has served as a procedural device to enable courts of equity to render comprehensive decrees in litigation involving numerous individuals. C. Bacon and F. Morse, The Reasonableness of the Law: The Adaptability of Legal Sanctions to the Needs of Society 187, 204-05 (1924). Several practical needs spurred the development of representative litigation including to protect defendants from inconsistent obligations, to protect the interests of parties not before the court, to provide a convenient and economical means for disposing of similar lawsuits and to spread the costs among numerous litigants with similar claims. See United States Parole Comm’n v. Geraghty, 445 U.S. 388, 402-03, 100 S.Ct. 1202, 1211-12, 63 L.Ed.2d 479 (1980). Although the class action in its present form is a relatively modern development, representative lawsuits date back to medieval England. Group litigation in the medieval period existed in a different social and political context, but certain common threads emerge from a brief look backward that continue to guide modern courts in their search to effectuate their equitable responsibilities.

In medieval England, life was characterized by social relations defined according to group status, arising from membership in organizations such as villages, guilds, parishes and manors. A person’s status as a group member gave rise to known duties and obligations common to all group members. These responsibilities were enforced on a collective basis by law and religious authorities. Chosen representatives spoke for the particular groups in administrative matters and in manorial, royal, and ecclesiastical courts when litigation became necessary to settle disputes. Representative litigation was an inevitable and natural outcome of the collective social and political organization of medieval society. See generally S. Yeazell, From Medieval Group Litigation to the Modem Class Action 38-99 (1987); Yeazell, Group Litigation and the Social Context: Toward a History of the Class Action, 77 Colum.L.Rev. 866, 866-96 (1977).

Between 1400 and 1700, the modern European state emerged, along with significant social, economic and legal changes. Most important to the evolution of group litigation was the development of the legally-sanctioned corporate form, such as the chartered borough and the quasi-corporate status of the parish. Incorporation and substantive charter rights became the basis for a group’s right to approach the royal court; lack of corporate status made it difficult for a court of law to recognize a suit brought by an unincorporated association. S. Yeazell, From Medieval Group Litigation to the Modem Class Action, supra, at 100-31.

Though manor and parish group litigation theoretically continued into the eighteenth century, by the latter part of the seventeenth century these suits were heard exclusively in the equity Courts of Chancery. Id. at 125, 155. To avoid multiple proceedings and to render a complete decree, the Chancery courts imposed a compulsory joinder rule. Realizing the administrative problems inherent in bringing all interested parties before the court, Chan- *804 eery developed the Bill of Peace, a class or representative action by which one person could sue on behalf of others similarly situated. A subsequent decree would be binding on the entire class. See 1 J. Pomeroy, Equity Jurisprudence, §§ 252, 253 (1918); Chafee, Bills of Peace with Multiple Parties, 45 Harv.L.Rev. 1297 (1932); see also 1 H. Newberg, Newberg on Class Actions, §§ 1.10, 3.03 (2d ed. 1985). Thus, equity courts retained the capability of adjudicating and concluding litigation affecting numerous persons.

With the transformation of feudal society, village-based group litigation ended around the start of the eighteenth century. At that time, new, more loosely-bound groups emerged with shared interests. The equity courts responded with greater flexibility than the common law courts did to the needs of these new associations of capital and labor. Joint stock companies and “friendly societies” (voluntary trade affiliations that insured their members against illness and death) whose constituents were associated not through social bonds, but by membership for limited purposes, required a new rationale for aggregation of parties and issues in the courts. The justification for group litigation became one of representation, based on actual consent of the members or on an identity of interests among the members. Eventually, legislation recognizing these associations as legal entities entitled to sue and subject to suit was passed and group litigation via equity fell into disuse in England. S. Yeazell, From Medieval Group Litigation to the Modem Class Action 160-96 (1987).

As in England, the class action in the United States evolved from the court’s equitable jurisdiction over bills of peace and in response to the equitable rule of compulsory joinder. Trial courts relied on their equitable powers to avoid multiple suits where numerous individuals sued a defendant for a single legal grievance. J. Story, Equity Pleadings § 97 (3d Ed.1944); Note, Action Under the Codes Against Representative Defendants, 36 Harv.L.Rev. 89 (1922). In 1842, the Supreme Court promulgated Equity Rule 48. This rule officially recognized representative suits where the parties were too numerous to be conveniently brought before the court, but refused to bind absent parties to any resulting judgments. The Supreme Court described the class action in a court of equity as a device of convenience, which could “prevent a failure of justice ... [and insure] that the interest of all will be properly protected and maintained.” Smith v. Swormstedt, 57 U.S. (16 How.) 288, 302-03, 14 L.Ed. 942 (1854).

In 1912, Rule 48 of the Federal Equity Rules was rewritten as Rule 38. The new rule allowed representative suits where the parties were too numerous for joinder. In contrast with the prior rule, absent parties could be bound by subsequent judgments pursuant to this provision. One of the best examples of a limited fund case from this time period is Hartford Life Ins. Co. v. Ibs, 237 U.S. 662, 35 S.Ct. 692, 59 L.Ed. 1165 (1915). The case involved an insurer’s contingency fund created through contributions from policyholders. The Supreme Court found that the policy was properly treated as a unit and that the adjudication of rights to it had to be determined in a single suit in which all policyholders were joined. The Court explained that

[t]he Fund was single.... It would have been destructive of [policyholders’] mutual rights ... to use the Mortuary Fund in one way ... in one State and to use it another way ... in a different State.

Id. at 670-71, 35 S.Ct. at 695. See also Sovereign Camp of the Woodmen of the World v. Bolin, 305 U.S. 66, 78-79, 59 S.Ct. 35, 39-40, 83 L.Ed. 45 (1938) (group challenge to reorganization of fraternal benefit association necessitated compulsory join-der).

After 1938, with the theoretical merger of law and equity in the Federal Rules of Civil Procedure, class actions became increasingly common. They retained their roots in equity with consequent flexibility to meet new needs. The former Rule 23 divided class actions into three categories: (1) spurious, (2) true, and (3) hybrid actions. The antecedents of the current limited fund-type proceeding are found in the hy *805 brid class action in which the class claimed a “right in a common fund or in common property.” Pennsylvania Co. for Ins. on Lives and Granting Annuities v. Deckert, 123 F.2d 979, 983 (3d Cir.1941); 2 Barron & Holzoff, Federal Practice and Procedure § 562.2, at 272 (1961); see Van Gemert v. Boeing Co., 259 F.Supp. 125, 129 (S.D.N.Y.1966). In 1966, Rule 23 was amended and augmented to its present form, providing greater reach to grow and change in response to changing social and legal needs.

Concerns about equity, fairness and judicial efficiency clearly implicate the use of the class action in the mass tort situation. Yet, since the 1966 revision of Rule 23, some courts have been reluctant to certify such class actions. Many district courts that have certified mass tort classes encountered resistance and obstacles from the courts of appeals. Much of this caution stems from comments of the Advisory Committee:

A “mass accident” resulting in injuries to numerous persons is ordinarily not appropriate for a class action because of the likelihood that significant questions, not only of damages but liability, would be present, affecting the individuals in different ways. In these circumstances an action conducted nominally as a class action would degenerate in practice into multiple lawsuits separately tried.

Fed.R.Civ.P. 23 advisory committee notes 39 F.R.D. 69, 103 (1966).

These comments of the Advisory Committee reflect the traditional wisdom that the nature of a personal injury suit with its concomitant private implications militated against the desirability of class treatment in mass tort cases. See, e.g., Hobbs v. Northeast Airlines Inc., 50 F.R.D. 76, 78 (E.D.Pa.1970); Causey v. Pan American World Airways, 66 F.R.D. 392 (E.D.Va. 1975); see also Yandle v. PPG Indus., 65 F.R.D. 566 (E.D.Tex.1974) (noting “general feeling that when personal injuries are involved each person should have the right to prosecute his own claim and be represented by the lawyer of his choice”). The comments also generated concern in some courts that class treatment of mass accidents encouraged unethical solicitation. See, e.g., Hobbs, 50 F.R.D. at 78 (“use of the class action device in personal injury litigation seems to contain at least the suggestion of improper claim solicitation”); Hernandez v. Motor Vessel Skyward, 61 F.R.D. 558, 559 (S.D.Fla.1973) (“aware of potential for abuse that exists whenever a class action arises”), aff'd mem., 507 F.2d 1278 (5th Cir.1975). Finally, the complexity and choice of law problems that arise in multistate class actions deterred some courts from employing the device in mass tort cases. See, e.g., Causey, 66 F.R.D. at 398 (only two putative class members had sufficient contacts with forum state); cf. Bentkowski v. Marfuerza Compania Maritima, SA, 70 F.R.D. 401, 405 (E.D.Pa. 1976) (distinguished food poisoning case from airplane crash disaster case).

Despite these difficulties, the years immediately following passage of amended Rule 23 witnessed some successful efforts to obtain the benefits of class actions in mass disasters. Early certifications under 23(b)(1) demonstrated the possible efficiency, speed and broad relief that can be afforded through class treatment. See American Trading and Prod. Corp. v. Fischbach & Moore, Inc., 47 F.R.D. 155, 148 (N.D.Ill.1969) (1200 tort claims for fire at McCormick Place convention center); Hernandez, 61 F.R.D. at 560-62 (655 personal injury claims of passengers due to contaminated water on board ship); Hall v. Union Oil Co., No. 69-889-ALS (C.D.Cal. 1969) (3000 victims of Santa Barbara, California oil spill); Cobum v. 4-R Corp., 77 F.R.D. 43, 46 (E.D.Ky.1977) (164 deaths or injuries resulting from fire in nightclub); Bentkowski, 70 F.R.D. at 405 (food poisoning of 200 passengers); Ouellette v. Int’l Paper, 86 F.R.D. 476 (D.Vt.1980) (400 pollution victims),. aff'd, 776 F.2d 55 (2d Cir.1985), aff 'd in part, rev’d in part, 479 U.S. 481, 107 S.Ct. 805, 93 L.Ed.2d 883 (1987). See also Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 563 (2d Cir.1968) (Rule 23 should be given “liberal rather than a restrictive interpretation”), vacated on other grounds, 417 U.S. 156, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974).

*806 In certifying a class action under Rule 23(b)(1)(A), (B) and (b)(2) in a case arising out of a plane crash, one court, subsequently reversed on appeal, stated unequivocally

that, notwithstanding ... the notes of the advisory committee ... the plain language of P.R.Civ.P. 23 was devised for just such a situation as this. If that rule was not intended to cover Tort actions or death actions in crash cases, or any kind of a mass Tort, it would have been simple enough to say so in the text of the rule. But the rule is very broad in its language so as to permit the courts to eliminate repetitive and burdensome litigation.

In re Gabel, 350 F.Supp. 624, 627 (C.D.Cal. 1972), vacated sub nom. McDonnell Douglas Corp. v. United States Dist. Court, 523 F.2d 1083 (9th Cir.1975), cert. denied, 425 U.S. 911, 96 S.Ct. 1506, 47 L.Ed.2d 761 (1976).

There is some doubt about the intended scope of the Advisory committee comment. It specifically addressed common question Rule 23(b)(3) class actions. Moreover, the secondary source relied upon was obviously out-of-date and myopic. See Notes of 1966 revisors to Subdivision (b)(3) referring to 9 Buffalo L.Rev. at 469. The (b)(3) provision offers litigants the option of pursuing their claims in a unified proceeding merely because their claims share legal and factual allegations. See Fed.R.Civ.P. 23(b)(3). To satisfy 23(b)(3), the movant must not only demonstrate that the common questions predominate, but also that the class device will provide a superior method for fair and efficient adjudication of the controversy. See Kaplan, Continuing Work of the Civil Committee: 1966 Amendments of the Federal Rules of Civil Procedure (I), 81 Harv.L.Rev. 356, 389-90 (1967). Considerations pertinent to the latter finding include the class members’ interest in individual control over the litigation, the extent and nature of litigation already commenced, the desirability of concentrating litigation in a particular forum, and the difficulties to be encountered in managing the class action. Id.; see Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 567 (2d Cir.1968), vacated on other grounds, 417 U.S. 156, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974).

These factors are enumerated in an effort to ascertain the ultimate benefit of proceeding as a class in common question actions. Similar considerations do not govern certification of a class action pursuant to Rule 23(b)(1)(B). When the proceeding is predicated upon the existence of a limited finite fund, individual litigants face potential prejudice to their rights and ability to recover if the claims proceed separately. See generally 7B C. Wright, A. Miller & M. Kane, Federal Practice and Procedure § 1783 (2d ed. 1986); Miller and Crump, Jurisdiction and Choice of Law in Multi-state Class Actions After Phillips Petroleum Co. v. Shutts, 96 Yale L.J. 1, 44 n. 307 (1986). As a result there is greater coherence and nexus among claimants in (b)(1) class actions. This distinction has led commentators to suggest that the Advisory Committee Notes recommending against class treatment for mass disasters might not apply with equal force to such cases. Id.; see also 3B J. Moore, Federal Practice § 23.45[2], at 23-324, 23-325 (2d ed. 1980) (certification appropriate, despite notes of Advisory Committee, if claimants brought together “more by mutual interest in the settlement of common questions than it is divided by the individual members’ interest in matters peculiar to them”). Certification is appropriate if class members are “seeking to remedy a common legal grievance.” Id. at 23-332.

Although the comments suggest that a mass accident is ordinarily inappropriate for a class action, courts heeding this advice have failed to distinguish between mass accidents and mass product liability torts. See Williams, Mass Tort Class Actions: Going, Going, Gone?, 98 F.R.D. 323, 324 n. 1 (1983). Use of the phrase “mass accident” indicates that in evaluating the propriety of class actions, the Advisory Committee focused on events such as airplane crashes. Though tragic, such one-time occurrences generally affect a finite number of people. In contrast, product liability and mass toxic torts typically involve injuries to significantly greater *807 numbers of people — sometimes numbering in the hundreds of thousands. See In re A.H. Robins Co., 880 F.2d 709, 725 (4th Cir.) (product defects generate more cases than single-incident accidents), cert. denied, — U.S. -, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989). Rather than causing injury as a result of a single event, mass torts often inflict harm over a period of time through multiple events experienced by geographically dispersed persons.

The specialized bar has enabled the mass accident cases, such as airplane crashes, to be handled on a de facto consolidated basis with the aid of the Multidistrict Panel at relatively low transaction costs. See J. Ka-kalick & E. King, Costs and Compensation Paid in Aviation Accident Litigation (Inst.Civ.Justice, Rand Corp.1988) (of total expenditures per death case, plaintiffs took home 71% in net compensation and 29% went toward transaction costs). Ensuing litigation, while burdensome, does not threaten to bankrupt the judicial system in the same fashion as megamass toxic tort and product liability disasters. See id. In noting the general inapplicability of class actions, the Advisory Committee could not have anticipated the mass tort litigation that has proliferated in recent years. See Mullenix, Class Resolution of the Mass Tort Case: A Proposed Federal Procedure Act, 64 Tex.L.Rev. 1039, 1062-63 (1986).

Despite the potentially narrow implications of the Advisory Committee’s Note, some courts have applied it broadly and reflexively refusing to certify a class in any mass tort litigation. See, e.g., In re Federal Skywalk Cases, 680 F.2d 1175, 1189 (8th Cir.), cert. denied, 459 U.S. 988, 103 S.Ct. 342, 74 L.Ed.2d 383 (1982); In re Northern Dist. of California Daikon Shield IUD Prods. Liab. Litig., 693 F.2d 847, 852-53 (9th Cir.1982), cert. denied, 459 U.S. 1171, 103 S.Ct. 817, 74 L.Ed.2d 1015 (1983); Mertens v. Abbott Laboratories, 99 F.R.D. 38, 41-42 (D.N.H.1983); In re Three Mile Island Litig., 87 F.R.D. 433, 442 (M.D.Pa.1980); Vincent v. Hughes Air West, 557 F.2d 759, 767 (9th Cir.1977); Yandle v. PPG Indus., 65 F.R.D. 566, 570 (E.D.Tex.1974); Boring v. Medusa Portland Cement Co., 63 F.R.D. 78, 83-84 (M.D.Pa.1974).

While the initial trend appeared to preclude the use of class actions in mass torts, the overwhelming burden of these cases in the twenty years since the Advisory Notes were published has revived efforts to utilize the device to fashion equitable and efficient remedies. As one class action authority explained:

Historically, classes in the mass tort field have largely been denied, based on assumptions made in early decisions which were never adequately challenged. Mass torts in modern-day jurisprudence are taking a fresh look at the value of Rule 23 class actions. The economies of time, effort, and expense of the class device cut across categorical tort lines and ought not to be obscured by the narrow application of circumstances or by undue emphasis on traditional interests in one-to-one litigation.

3 H. Newberg, Newberg on Class Actions § 17.06, at 373 (2d ed. 1985). See also Manual for Complex Litigation, Second § 33.24 (1985). Professor Wright forcefully explained the need to reevaluate the emphasis on traditional values preserved by individual adjudication:

I was an ex officio member of the Advisory Committee on Civil Rules when Rule 23 was amended, which came out with an Advisory Committee Note saying that mass torts are inappropriate for class certification. I thought then that was true. I am profoundly convinced now that is untrue. Unless we can use the class action and devices built on the class action, our judicial system is simply not going to be able to cope with the challenge of the mass repetitive wrong that we see in this case and so many others that have been mentioned this morning and afternoon.

Prof. C. Wright, In re: School Asbestos Litig., Master File 83-0268, Class Action Argument, Tr. 106 (E.D.Pa. July 30, 1984).

Many leading commentators have agreed that the purpose underlying Rule 23 can be achieved in mass torts situations. According to Professor Moore’s treatise:

*808 Mass accidents appear peculiarly appropriate for class treatment. Indeed, the question of liability to all those injured in a plane or train crash is more likely to be uniform than that of liability for manipulation of the price of securities; with the introduction of such large scale public transportation facilities as the ‘jumbo jets,’ the ability to determine liability for an accident in one proceeding will be even more desirable.

3B J. Moore, Moore’s Federal Practice 1123.45, at 23-353 to 23-354 n. 40 (2d ed. 1982). See also 7B C. Wright, A. Miller & M. Kane, Federal Practice & Procedure § 1783, at 71-76 (2d ed. 1986) (argument for class action treatment particularly strong in cases arising out of mass disasters such as airplane crashes where there is little chance of individual defenses). But see Trangsrud, Joinder Alternatives in Mass Tort Litigation, 70 Corn.L.Rev. 779 (1985) (opposing use of class actions for mass torts).

Courts have recently been more receptive to the use of class action in mass tort litigation. See, e.g., In re A.H. Robins Co., 880 F.2d 709, 740-49 (4th Cir.), cert. denied, — U.S. -, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989); In re School Asbestos Litig., 789 F.2d 996, 1009 (3d Cir.) (“the trend has been for courts to be more receptive to use of the class action in mass tort litigation”), cert. denied, 479 U.S. 852, 107 S.Ct. 182, 93 L.Ed.2d 117 (1986); Jenkins v. Raymark Indus., 782 F.2d 468, 473 (5th Cir.1986); In re Agent Orange Prod. Liab. Litig., 818 F.2d 145, 149 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988). In Jenkins, the Fifth Circuit succinctly explained

Judge Parker’s [class action] plan is clearly superior to the alternative of repeating, hundreds of times over, the litigation of state of the art issues with ... days of the same witnesses, exhibits and issues from trial to trial.

Jenkins, 782 F.2d at 473. With respect to the Advisory Committee Note, the Third Circuit declared:

Although the statement continues to be repeated in case law ... there is growing acceptance of the notion that some mass accident situations may be good candidates for class action treatment.

In re School Asbestos Litig., 789 F.2d 996, 1008 (3d Cir.), cert. denied, 479 U.S. 852, 107 S.Ct. 182, 93 L.Ed.2d 117 (1986). In one recent case, Sterling v. Velsicol Chem. Corp., 855 F.2d 1188 (6th Cir.1988), the court approved certification of a class action against a chemical manufacturer for personal injuries and property damage to residents who lived near the corporation’s chemical waste burial site. While each plaintiff suffered different damages, the evidence to establish causation, level and duration of contamination, liability and types of injuries were common to the class, warranting certification. Id. at 1197. In A.H. Robins, the Fourth Circuit, after an extensive discussion tracing the evolution in judicial and academic perception of the wisdom of certifying classes in mass tort cases concluded that a single integrated legal proceeding was necessary for efficient disposition. In re A.H. Robins Co., 880 F.2d 709, 740 (4th Cir.), cert. denied, — U.S. -, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989).

The voluminous literature which the subject has inspired reflects the urgency in developing a more satisfactory and expeditious means for resolving mass tort claims. See, e.g., Nielson, Was the 1966 Advisory Committee Right?: Suggested Revisions of Rule 23 to Allow More Frequent Use of Class Actions in Mass Tort Litigation, 25 HarvJ.Legis. 461 (1988); Rosenberg, Class Actions for Mass Torts: Doing Individual Justice by Collective Means, 62 Ind.L.J. 561 (1987); Wright & Colussi, The Successful Use of the Class Action Device in the Management of the Skywalk Tort Litigation, 52 U.M.K.C.L.Rev. 141 (1984); Williams, Mass Tort Class Actions: Going, Going, Gone?, 98 F.R.D. 323 (1983); 7B C. Wright & A. Miller, Federal Practice and Procedure § 1783 (2d ed. 1986); Note, Class Certification in Mass Accident Cases Under Rule 23(b)(1), 96 Harv.L.Rev. 114 (1983). Some of the unassailable findings illuminated in these writings bear repetition here.

*809 Professor Arthur Miller teaches us:

It is important in understanding the class action debate to realize that the “big case” phenomenon transcends the class action. The “big case” is an inevitable by-product of the mass character of contemporary American society and the complexity of today’s substantive regulations. It is a problem that would confront us whether or not rule 23 existed. Indeed, it is becoming increasingly obvious that the notion of civil litigation as merely bilateral private dispute resolution is outmoded. Since our conception of the roles of judges and advocates is based on this traditional view, the ferocious attack on the class action may reflect anxiety over the growing challenge to the model’s immutability.

Miller, Of Frankenstein Monsters and Shining Knights: Myth, Reality, and the “Class Action Problem”, 92 Harv.L.Rev. 664, 668 (1977). Mr. Newberg has explained the evolution in thinking as follows:

Two benchmarks herald the arrival of mass tort class actions. First, the emerging judicial acceptance of class suits involving mass torts is undoubtedly the result of cumulative effects of mass production, with its attendant imperfections, in the context of a growing population and a court system with finite growth dimensions. The other arises from a single event — the Johns-Manville bankruptcy proceedings....

Many courts are now abandoning their historic reluctance to certify mass tort class actions in light of what is often an overwhelming need to create an orderly, efficient means for adjudicating hundreds or thousands of related claims.

Newberg, “Mass Tort Class Actions,” Trial 53 (Feb.1986).

Due to the procedural complexities of class actions, they are processed in a highly varied and individualistic fashion. “Every rule 23 decision, therefore, must be viewed through the prism of its particular facts, some of which may not even appear in the court’s opinion.” Miller, Of Frankenstein Monsters and Shining Knights, 92 Harv. L.Rev. 664, 668, 677 (1977). The American Law Institute Complex Litigation Project prepared a paper on class actions for discussion which stated:

Despite Rule 23’s ambitious goals, multiparty, multiforum cases often are not certified for class treatment because its requirements have been read quite restrictively by some federal courts. Large scale tort actions involving personal injuries rarely are certified. In the past, this may be due primarily to the federal courts’ reliance on the statement in the 1966 Advisory Committee Note.... Although this reasoning may be criticized as shortsighted, it nonetheless has been influential. In addition, concern about how to handle individual issues and large numbers of claimants have served to restrict class certification in nationwide products liability cases, as well as in consumer, securities, and antitrust actions. Recent years, however, have seen some weakening in the resistance to the certification of mass tort class actions ... Nonetheless, the full procedural advantages of class actions have not been realized_ Several commentators have decried the courts’ narrow approach to the Rule, arguing it should be interpreted more broadly to achieve unitary adjudication.

American Law Institute, Complex Litigation Project Tent. Draft No. 1, at 36-37 (1989).

Many equitable goals are served by class treatment of mass tort claims. First, separate litigation of numerous similar claims entails enormous transaction costs. Joint litigation eliminates duplicative effort on behalf of plaintiffs, conserves scarce judicial resources and minimizes the difficulty of defending in several forums simultaneously. For example, discovery is broader for plaintiffs in class suits, but if the procedures are coordinated defendants will only have to respond to one cumulative production request. See Manual for Complex Litigation, Second § 1.94 (1985). In turn, unified discovery can lead to more efficient and economical pretrial proceedings. See 3 H. Newberg, Newberg on Class Actions § 17.03, at 367 (2d ed. 1985). The reduction in costs almost certainly will *810 lead to a higher percentage of net compensation for the injured plaintiffs.

Second, distribution of the total recovery among those injured will be more equitable if accomplished as a class action. Individual adjudication encourages the race to sue so prevalent in asbestos litigation. This produces inconsistencies among similarly situated claimants both in amount of compensation received based on disease suffered and in timing of recovery. The unprincipled and inequitable allocation of punitive damages, in some instances at the expense of other deserving claimants receiving compensatory damages, also warrants class treatment in some situations.

Third, class treatment helps to equalize the bargaining power of plaintiffs and defendants. This in turn may enhance possibilities for settlement of the case, accomplishing an expeditious and just result with great savings. See In re A.H. Robins Co., 880 F.2d 709, 738-40 (4th Cir.), cert. denied, — U.S. -, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989) (“ ‘proper’ in determining certification to consider whether such certification will foster settlement of the case with advantage to the parties and with great savings in judicial time and services”). Some courts have approved classes explicitly for the purposes of pursuing possible settlement. See Weinberger v. Kendrick, 698 F.2d 61, 72-73 (2d Cir.1982). Judge Friendly explained:

The hallmark of Rule 23 is the flexibility it affords to the courts to utilize the class device in a particular case to best serve the ends of justice for the affected parties and to promote judicial efficiencies. Temporary settlement classes have proved quite useful in resolving major class action disputes. While their use may still be controversial, most Courts have recognized their utility and have authorized the parties to seek to compromise their differences, including class action issues through this means.

Id. This court has emphasized that it

“may not ignore the real world of dispute resolution_ [A] classwide finding of causation may serve to resolve the claims of individual members ... by enhancing the possibility of settlement among the parties.... ”

In re Agent Orange Prod. Liab. Litig., 100 F.R.D. 718, 723 (E.D.N.Y.1983), aff'd, 818 F.2d 145, 166-67 (2d Cir.1987), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988). The Third Circuit similarly declared:

[M]ost mass tort cases settle, and the preliminary maneuvering in litigation today are designed as much, if not more, for settlement purposes than for trial. Settlements of class actions often result in savings for all concerned.

In re School Asbestos Litig., 789 F.2d 996, 1009 (3d Cir.), cert. denied, 479 U.S. 852, 107 S.Ct. 182, 93 L.Ed.2d 117 (1986). See also In re First Commodity Corp., 119 F.R.D. 301, 306-08 (D.Mass.1987); In re Mid-Atlantic Toyota Antitrust Litig., 564 F.Supp. 1379, 1388-90 (D.Md.1983). But see In re Bendectin Prods. Liab. Litig., 749 F.2d 300, 305 (6th Cir.1984).

After the Eighth Circuit vacated a mandatory certification in the Skywalk litigation, two voluntary class actions were certified and settled in the federal and state courts. See In re Federal Skywalk Cases, 680 F.2d 1175 (8th Cir.), cert. denied, 459 U.S. 988, 103 S.Ct. 342, 74 L.Ed.2d 383 (1982). As a persuasive article explained,

certification and settlement of those two voluntary class actions performed the same management function and permitted the claims of all litigants to be resolved in the same equitable and efficient manner that would have resulted if the mandatory class action had not been vacated.

Wright & Colussi, The Successful Use of the Class Action Device in the Management of the Skywalk Mass Tort Litigation, 52 U.M.K.C.L.Rev. 141, 141-43 (1984).

Fourth, class treatment enables the court to exercise greater control over the transaction costs associated with massive complex tort litigation, particularly attorneys’ fees. In the absence of a class action— where appointed representative counsel is paid a reasonable hourly rate out of the total recovery or settlement fund — attorneys who represent multiple victims in a *811 mass disaster charge multiple contingencies without regard to the amount of time spent on each case. See In re Federal Skywalk Cases, 98 F.R.D. 462, 463 (W.D.Mo.1983) (“attorneys who represent some victims [not part of class action] are receiving multiple contingency fees, the sum of which greatly exceeds any reasonably justifiable fee for the amount of time actually spent earning the fee”). In contrast, a district court through a one-time award for all work performed on behalf of the entire class preserves assets for compensation. Id.; see also Jenkins v. Raymark Indus., 782 F.2d 468, 473 (5th Cir.1986) (attorneys fees for all parties greatly reduced by class treatment both by elimination of trial time and control of fees collected from all members of plaintiffs class by judge). For example, in Jenkins, Judge Parker limited plaintiffs’ class counsel to a twenty percent contingency fee which, while substantial in amount, represented a tremendous savings from the traditional fee collected in asbestos cases. See id. at 473. Attorneys’ fees and other litigation expenses devour approximately two-thirds of the total expenditures in asbestos cases. See D. Hensler, W. Felstiner, M. Selvin & P. Ebener, Asbestos in the Courts: The Challenge of Mass Toxic Torts (Inst.Civ.Justice, Rand Corp.1985). The experience of the courts is that, when direct and indirect transactional costs are taken into account, these costs amount to some 70% of money available for compensation.

Fifth, class treatment better serves tort goals of uniformity and deterrence. As one commentator noted:

Two goals of tort law should be predictability and uniformity.... But if various factfinders reach inconsistent conclusions about the same set of facts, the defendant (and others in similar circumstances) is left without any guidance concerning the legality of its conduct, which may serve important legitimate aims— But defendants and plaintiffs alike have interests in consistent liability determinations, interests that can and should be addressed.

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