Date: Wed, 12 Apr 2000 22:09:16 -0700

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Breast-Implant Suit Arguments Heard

.c The Associated Press

By JIM SUHR

DETROIT (AP) - A Dow Corning Corp. attorney asked a federal judge Wednesday to set aside a bankruptcy court's opinion the company says modifies and jeopardizes a $3.2 billion settlement over silicone breast implants.

George Tarpley asked U.S. District Judge Denise Page Hood to vacate federal Bankruptcy Judge Arthur Spector's December opinion that women opposed to the settlement may sue Dow Corning's parent companies.

Tarpley called Spector's opinion ``an error of law'' that, if allowed to stand, could cripple the settlement that took years to reach and has been approved by 94 percent of the 112,774 women who last year voted on it.

The companies and lawyers for women who voted in favor of the settlement say Spector's opinion changed the terms of the settlement he approved Nov. 30. That invalidated the deal, which was part of Dow Corning's $4.5 billion plan to emerge from Chapter 11 bankruptcy.

Tarpley told Hood that Dow Corning - a 50-50 joint venture between Dow Chemical Co. and Corning Inc. - was prepared to begin paying claimants, if Spector's opinion is reversed.

``It serves no purpose whatsoever to pay out $3 billion over a number of years only to have this litigation continue in other forms, as it did before bankruptcy,'' Tarpley said. ``We want to shut down litigation. If we're gonna pay money for it, we want it over with.''

Under the settlement, Dow Corning would pay out $3.2 billion to settle claims by more than 170,000 women blaming various health problems on silicone implants once made by the company.

But in his Dec. 21 opinion, Spector said women who voted against the settlement still could sue Dow Chemical and Corning if they chose. Spector said he lacked the power to release the parent companies from future liability, and the settlement wasn't designed to grant such a release anyway.

Dow Chemical spokesman John Musser has said that if Spector's opinion stands, ``then the plan won't be confirmed.''

The no-lawsuit release in the settlement had been fought by lawyers for a group of women from Nevada, where that state's Supreme Court has upheld damages against Dow Chemical over silicone implants, opening the door for similar lawsuits.

John White, one of the attorneys representing the 47 Nevada women, told Hood ``there's no reason, no bankruptcy purpose, for any injunction or stay against suing Dow Chemical over implants.''

Spector handles proceedings stemming from Dow Corning's bankruptcy filing, while Hood handles the case's appeals.

The hearing is to continue Thursday, with arguments scheduled over classifications and treatment of foreign claims, among other issues.

Attorneys expect Hood's ruling to take weeks. Any ruling unfavorable to parties in the case could be appealed to the 6th U.S. Circuit Court of Appeals in Cincinnati.