Full opinion text
WEINSTEIN, Chief Judge. TABLE OF CONTENTS Preface and Summary ......................................................................................746 Introduction ____________________________________________________________________________________________________748 I. Procedural History .................................................................................750 A. Jurisdiction .....................................................................................754 B. Conflict of Laws............................................................................... 755 C. Class Action .......................................... 755 D. Status of Third Party Complaints .....................................................757 II. Fairness Hearings ..................................................................................758 A. Legal Requirements ............................................................. 758 B. Reaction of Class Members ..............................................................764 1. Hearings ............................................................................■_......764 a. Need for Medical Help for Veterans and Financial Help for Those Too 111 to Work ..................................................................765 b. Need for Medical and Financial Aid for Children Born with Birth Defects ...............................................................................765 c. Need for Information on Possible Genetic Damage to Veterans and Their Children ..............................................................766 d. Dissatisfaction with the Veterans Administration and the Treatment Received in its Hospitals .............................................766 e. Inadequacy of the Settlement Amount to Pay Adequate Damages 767 f. Failure of Chemical Companies to Admit Fault ..................... 768 g. Failure of Government to Admit Fault, Participate in Settlement and Accept its Responsibility for Caring for Veterans and their Children ............................................................ 768 h. Possibility of a Coverup of Information with Sealed Files and Return of Documents to Defendants ....................................769 i. Need for a Full Open Trial to Vindicate the Plaintiffs and Protect Their Rights to Individual Justice ........................................770 j. Inability to Decide Whether to Accept Settlement Without Knowing How it Would be Distributed and How Much would be Spent in Attorneys’ Fees ................................................................771 k. Inadequate Payment by Defendants Relative to Their Resources 771 l. Inadequate Time to File Claims ...........................................771 m. Need to Settle Now to Get on with Life ..............................771 n. Need for Further Research and Reassurances .......................772 2. Written Communications .............................................................773 III. Factual Problems with Claims ...............................................................775 A. Use of Agent Orange in Vietnam ....................................................775 B. Claimed Effects of Contact with Agent Orange in Vietnam ............... 777 1. General Considerations ..............................‘............................!___777 2. Plaintiffs’ Evidence of Causality .................................................782 C. Scientific Studies on Causality .........................................................787 D. Knowledge of Government and Defendants .......................................795 IV. Legal Problems with Claims ...................................................................799 A. Statutes of Limitations ............................................ 800 1. Introduction ...............................................................................800 2. Standard Multijurisdictional Approach ..........................................800 a. CPLR 202 ........................................................................... 800 b. Application of CPLR 202 to Agent Orange Litigation ............802 c. CPLR 214 ...........................................................................804 3. Single Time-bar Period Based Upon Federal or National Consensus Law ..........................................................................................804 a. Federal Substantive Law .....................................................804 b. National Consensus Law .................................................:____ 804 4. Single Time-bar Period for Class Actions ....................................805 a. General Theory ...................................................................805 b. Federal ...............................................................................806 c. New York .......................................................................... 808 5. Single Time-bar Period for American Veterans Based Upon Interpretation of New York Statute ......................................................... 810 a. Constitutionality ..................................................................811 b. Construing Provisions to Apply to Nonresidents ....................813 6. Wivesland Children ....................................................................815 7. Vietnam Veterans Living Abroad ................................................816 8. Conclusion on Statutes of Limitations .................................... 816 B. Failure to Determine Who Was Harmed and Who Caused Harm ............. 816 1. Facts ........................................................................................817 2. Law ..........................................................................................819 a. The Problem of the Indeterminate Defendant........................ 819 (1) Introduction .................................................................. 819 (2) Applicable Law ............................................................. 820 (a) Enterprise Liability .................................................820 (i) Legal Theory .............................................. 820 (ii) Application of Enterprise Liability Theory to this Case .......................... 821 (b) Alternative Liability and Its Variations .................... 822 (i) Legal Theory ...................................................822 (ii) Application of Alternative Liability to this Case . 826 (c) Defendants’ Individual Duty to Warn the Government of Dangers ............................-............................... 828 (i) Duty to Warn of Danger in Their Own Product 828 (ii) Duty to Warn of Dangers in Another’s Product 830 (d) Summary ............................................................... 833 b. The Problem of the Indeterminate Plaintiff........................... 833 (1) Scope of the Problem .................................................... 834 (2) Preponderance Rule ...................................................... 835 (a) Application of the Preponderance Rule to Mass Exposure Cases ............................................................. 836 (b) Inadequacy of Individualized Solutions ..................... 837 (3) Possible Solution in a Class Action ................................ 837 (a) Analogy and Precedent ........................................... 839 (i) Employment Discrimination Cases ..................... 839 (ii) Consumer Class Actions ................................... 840 (b) Practical Advantages of Class-wide Solution ............. 841 3. Conclusion as to Indeterminate Defendants and Plaintiffs ............ 842 C. Nature of Liability and Relations to Defense of Government Knowledge 843 1. Introduction ............................................................................... 843 2. Defense Production Act .................................................... 843 3. Law to be Applied to Government Contract Defense ___________________ 845 4. Modification of Government Contract Defense ............................. 847 D. Punitive Damages ........................................................................... 850 V. • Government Action To Protect Class .................................................... 851 A. Agent Orange Registry ................................................................... 852 B. Medical Care to Veterans Claiming Exposure to Agent Orange ......... 853 C. Aid to Spouses and Children of Veterans .........................................853 D. Exposure Data................................................................................. 854 E. Veterans’ Dioxin and Radiation Exposure Compensation Standards Act 854 VI. Conclusion Concerning Fairness of Settlement ......................................... 857 VII. Plan for Distribution of Fund ................................................................ 858 A. General Principles _________________J......................................................... 858 B. National Center for Vietnam Veterans Assistance .............................859 C. Veterans’ Benefits ....... 859 D. Genetic and Family Counseling ........................................................ 860 E. Children with Birth Defects ............................................................. 860 F. . Legislation .................................................r.................................... 861 G. Schedule ......................................................................................... 861 H. Attorneys’ Fees and Disbursements .................................................. 861 I. Cases Against the Government ........................................................861 VIÍI. Conclusion ................................................... 862 IX. Order ......................................................................1............................. 862 APPENDICES A. Settlement Agreement ............................................................................ 862 B. Order for Hearings on Fairness of Settlement plus Attachments.................... 866 C. Published Opinions in Agent Orange Litigation ........................................1176 D. Letter of Government Refusing to Participate in Negotiations .................. 879 E. Statutes of Limitations in the Relevant Jurisdictions ....................................879 F, Excerpts From “Protocol For Epidemiologic Studies of the Health of Vietnam Veterans” [Not printed] PREFACE AND SUMMARY In 1979 a class action was commenced charging the United States government and a major portion of the chemical industry with deaths and dreadful injuries to tens of thousands of Vietnam veterans who came in contact with herbicides used in the war in Southeast Asia. The suit also claimed that as a result of the veterans’ exposure, their children suffer severe birth defects. After five years of numerous motions and extensive discovery a tentative settlement was reached on the eve of trial. The sole question before this court is whether the case against the chemical companies should now be settled. Eleven days of nationwide hearings were conducted to give the class members themselves an opportunity to be heard on the merits of the settlement. After weighing the uncertainties and-legal obstacles that would accompany years of protracted litigation were the case to go to trial, the court has concluded that the settlement should be approved. This approval is subject to reconsideration after further hearings for the reasons indicated below. See the discussion under II, B, 1, j, Inability to Decide Whether to Accept Settlement Without Knowing How it Would be Distributed and' How Much Would be Spent in Attorneys’ Fees. The many legal issues are unique and the factual issues unresolved by the scientific communities addressing them. But it is neither fact nor law that makes this decision such a difficult one — rather, it is the deeply charged emotions that surround and engulf the litigation. In listening to hundreds of witnesses around the country and reading the poignant letters of many veterans, their wives and parents, a repeated refrain makes it clear that more than money is at stake. The veterans feel that out of love of country they went to its aid and fought bravely in a brutal war. In return, they believe, they were sprayed with chemicals that insidiously are destroying them. They were vilified by their countrymen on their return because the war became unpopular. Their perception is that they are denied proper treatment by the Veterans Administration to the point where many of them shun the VA’s medical and other facilities. Their families suffer as they waste away. And, perhaps even more important, they fear that they have been damaged genetically so that many choose to have no children or live in the despair of having sired children with birth defects who may spread this genetic damage to future generations. Vietnam veterans and their families desperately want this suit to demonstrate how they have been mistreated by the country they love. They want it to give them the respect they have earned. They want it to protect the public against future harm by the government and chemical companies. They want a jury “once-and-for-all” to demonstrate the connection between Agent Orange and the physical, mental and emotional problems from which many of them clearly do suffer. The court has been deeply moved by its contact with members of the plaintiffs’ class from all over the nation and abroad. Many do deserve better of their country. Had this court the power to rectify past wrongs — actual or perceived — it would do so. But no single litigation can lift all of plaintiffs’ burdens. The legislative and executive branches of government — state and federal — and the Veterans Administration, as well as our many private and quasi-public medical and social agencies, are far more capable than this court of shaping the larger remedies and' emotional compensation plaintiffs seek. Within the sharply limited judicial role we must ask whether the settlement of the litigation proposed by the parties’ representatives is acceptable. For the reasons indicated below we tentatively hold that it is. It gives the class more than it would likely achieve by attempting to litigate to the death. It provides funds to help at least some men, women and children whose hardships will be reduced in some small degree. It does represent a major step in the essential process of reconciliation among ourselves. This opinion first summarizes the terms of the settlement and outlines why the settlement as proposed appears reasonable for plaintiffs, defendants and the public. See Introduction, infra. It then sets forth the procedural history of the case, including a summary of opinions already issued by the court on the issues of subject matter jurisdiction, class certification, choice of law and government liability. See I, Procedural History, infra. The opinion then discusses the Fairness Hearings held by the court to solicit the views of class members on the settlement. In this section the court discusses the legal bases and requirements for class action settlement and the reactions of the class members to the settlement as expressed at the hearings and in other communications to the court. See II, Fairness Hearings, infra. Sections III and IV of the opinion discuss in detail the factual and legal obstacles that would be confronted by both plaintiffs and defendants if the case were to go to trial. Section III, Factual Problems with Claims, summarizes the evidence that the plaintiffs have adduced in support of their allegations. As the opinion indicates, at best the evidence is inconclusive. This is. due in part to the difficulty of proof in any mass toxic tort litigation and in part to the weakness in proof of causal relationship, at least as demonstrated in the epidemiological studies completed to date. Section III concludes with a description of the extensive knowledge the government had in the 1960s concerning the dangers of dioxin. The legal relevance of this knowledge is developed in section IV. Pursuant to the government contract defense, a defendant could avoid liability by showing sufficient government knowledge of the dangers of Agent Orange. The level of government knowledge was such that were the issue put to a jury, there is a substantial probability that defendants would prevail. Other legal problems posing major obstacles to plaintiffs’ recovery are also discussed in section IV, including Statute of Limitations and Failure to Determine Who Was Harmed and Who Caused Harm. Although a defensible argument can be made in favor of the application to the entire class of a single statute of limitations, it is at least questionable whether an appellate court would accept such a rationale. Thousands of plaintiffs could, therefore,. be barred from recovery, regardless of the merits of the case. The portions of section IV on Failure to Determine Who Was Harmed and Who Caused Harm deal with two interrelated problems. First, plaintiffs concede that because of the way the different defendants’ Agent Orange was mixed before spraying, they are unable to satisfy the traditional tort requirements that they prove not only that they were injured, but also that such injury was caused^, by an individual defendant. Second,^jt is likely that because of the epidemiological nature of much of the evidence, no individual plaintiff would be able to prove that his or her particular adverse health effects are due to Agent Orange exposure. It may be possible — through the use of the class action device — to overcome this obstacle, by making a single, class-wide determination of liability and by distributing the damages charged to all defendants as a group among all class members on a pro rata basis. At the present time, however, it is doubtful whether the legal system is ready to employ this device except, perhaps, as part of an overall settlement plan voluntarily entered into by the parties. | The discussion of why the settlement appears to be reasonable concludes with a description of the statutory obligations of the United States to protect and compensate the class. See section V, infra. Government action — present and potential — is relevant to the discussion since federal aid for the class bears directly on the overall adequacy of the settlement. It is important to emphasize — as the opinion does in the concluding section— that a tentative finding that the settlement is fair, reasonable and adequate, is but the first step in granting benefits to class members. Future actions include the awarding of attorneys’ fees, the resolution of plaintiffs’ and third party claims against the government and, most importantly, the preparation of a plan outlining how the settlement fund will be used to assist eligible class members. INTRODUCTION On May 7, 1984, the date on which jury selection was to begin, plaintiffs, on behalf of a class of Vietnam veterans and members of their families, agreed with defendants to settle their claims against the defendant chemical companies. See Appendix A, Settlement Agreement. Pursuant to the stipulation of settlement, defendants have agreed to pay to the class $180 million plus interest in a manner directed by the court. Interest began accruing from May 7, 1984, at the rate of some $60,000 per day. Defendants have not admitted any liability in connection with plaintiffs’ claims. Both sides have reserved whatever rights and claims they have against the United States and any person not a party to this class action. The mechanics of administering the settlement fund will be dealt with in a separate opinion to be issued after further hearings. Some preliminary and tentative conclusions on this subject are set forth in VII, A, Plan for Distribution of Fund, infra. The court held extensive hearings on the fairness of the settlement in New York, Chicago, Houston, Atlanta and San Francisco. See Appendix B, Order for Hearings on Fairness of Settlement and Attachments. It heard almost 500 witnesses and considered hundreds of written communications from veterans, members of their families, veterans’ organizations and others. It read a large part of the relevant literature, taking judicial notice of its substance. It had the benefit of listening to sound recordings of sessions held by New Jersey’s Commission on Agent Orange at various places in that state. It considered the extensive material in the court’s files and the many published opinions on the subject. See Appendix C, Published Opinions on “Agent Orange” Litigation. Finally, it studied the extensive briefs submitted by counsel and others. For the reasons indicated at greater length below, the settlement must be tentatively approved as reasonable under the law. There are many considerations that make this settlement desirable from the pjaintiffs’ viewpoint. First, the scientific data available to date make it highly unlikely that, except perhaps for those who have or have had chloracne, any plaintiff could legally prove any causal relationship between Agent Orange and any other injury, including birth defects. Second, the law that would need to be established is unique and would almost certainly result in repeated trials and appeals, with the likely ultimate result being no recovery by any plaintiff. Third, the suit was being financed by plaintiffs’ lawyers who had already expended millions of dollars in disbursements and time; a full trial, appeals and retrials would have lasted years and would have required the expenditure of many more millions of dollars with serious doubts about the plaintiffs’ attorneys’ ability to finance the litigation properly. Fourth, benefit to plaintiffs from an ultimate recovery, if any, would not be available for many years. And, fifth, a result adverse to the plaintiffs in the litigation might have an unfavorable impact on evaluation of the Agent Orange claims by Congress and the responsible executive departments which, in the final analysis, must take responsibility for the medical and other care of servicepersons and their families. From the defendants’ point of view the settlement is reasonable: First, defending the case would have cost more tens of millions of dollars in legal fees and expenses plus the time of employees and executives who could be doing more productive work. Second, though slight, there was a possibility of an ultimate finding of liability with claims totalling billions of dollars. Third, an ongoing emotional trial would have created adverse publicity (whether or not unfair), perhaps causing a spillover effect against defendants’ other products. Fourth, continued litigation and the possibility of an adverse result has a negative influence on the financial community, causing greater financing expenses as the companies become less attractive to investors. And, fifth, representatives of the defendants, like other Americans, have a sense of compassion and respect for veterans of the Vietnam War and their families who, because of circumstances entirely beyond their control, have been treated with less favor and respect than they should have been. This is a matter of concern to all citizens, including those responsible for defendants’ decisions. From the public’s point of view, settlement is desirable for three reasons. First, whether or not the defendants have formally admitted some responsibility for defects in their products and for possible injuries to some plaintiffs, the public can justifiably assume, for perhaps the first time, that there is some merit to the claims of those exposed to Agent Orange that they are suffering because of their war and postwar experiences. In any event, the publicity attendant on the settlement and the Fairness Hearings has alerted the nation to the needs of many Vietnam veterans and their families. Second, the bitterness of a long, hard-fought trial is avoided; plaintiffs and members of the public can devote their energies and talents to using the settlement fund to help the class while obtaining further aid from public and private sources. Finally, trial and appeals of this case would require an expenditure of hundreds of thousands of dollars of court funds and engage the time of judges and court personnel for thousands of hours that now can be spent in the administration of other aspects of the criminal and civil justice systems. This has been one of the most complex litigations ever brought. Some 600 separate cases have been sent to this district from all over the country with an estimated fifteen thousand named plaintiffs. Millions of pages” of documents and hundreds of depositions of witnesses have been collected. The docket sheet of this court has some 4000 separate entries respecting these related cases. Hundreds of motions have been heard and hundreds of oral directions given by the court, special masters and magistrate in the course of preparing the . case for trial. The court, magistrate and special masters have held meetings with counsel from all over the country on an almost daily basis. Hundreds of scientists, government personnel, private executives, lawyers and others have devoted a great deal of time to this litigation. It is unlikely .that further expenditure of time and money will be productive. It is time to bring this dispute^to a close. Since practically all the parties are before the court, a binding settlement ending the controversy as to veterans and their families is possible. There does remain the question of the government’s role. It contends that it expends some $70,000,000 a year to treat, those veterans who claim Agent Orange exposure, even though causality has not been shown. Nevertheless those testifying at the Fairness Hearings were almost unanimous in expressing dissatisfaction with the medical services supplied by the government to Vietnam veterans claiming Agent Orange related injuries. The government is also spending some $150,-000,000 on research to determine the effects of Agent Orange and of service in Vietnam. Moreover, legislation recently adopted by each house of Congress makes explicit the promise of further aid if a causal connection can be shown. It is, therefore, a matter of some regret to many veterans that the government decided not to participate in any settlement discussions. See Appendix D, Letter of Government, dated April 24, 1984, Refusing to Participate in Negotiations. As a result, further discovery, other pretrial preparations and possible trials and appeals continue to burden the parties and the courts, disturb veterans and their families and roil the conscience of the nation. I. PROCEDURAL HISTORY On February 19, 1979, plaintiffs filed a 162-page complaint in this district on behalf of named and unnamed Vietnam veterans and members of their families who claimed to have been injured as a result of the veterans’ exposure to various phenoxy herbicides, including Agent Orange. See Dowd v. Dow Chemical Company, 79 C 467. Plaintiffs alleged, among other things, that defendants negligently manufactured and sold to the government for use in Vietnam herbicides that contained 2, 3, 7, 8 tetrachlorodibenzo-p-dioxin (TCDD or dioxin), thought to be one of the most toxic substances known to man. See, e.g., R. Bovey & A. Young, The Science of 2,4,5-T and Associated Phenoxy Herbicides 134 (1980); United States v. Vertac Chemical Corp., 489 F.Supp. 870, 876 (E.D.Ark.1980); Citizens Against Toxic Sprays, Inc. v. Bergland, 428 F.Supp. 908, 914 (D.Or.1977). Plaintiffs also based their claims on theories of strict liability, breach of warranty, intentional tort and nuisance. According to plaintiffs, the veterans’ exposure to TCDD-contaminated herbicides in Vietnam resulted in injuries, such as chloracne, various systemic diseases including soft tissue sarcoma and porphyria cutanea tarda as well as miscarriages to veterans’ wives and birth defects in their children. The claims of both sides and the facts are set forth in further detail in the course of this opinion and other opinions by this court and the Court of Appeals referred to infra. Shortly after the first complaint was filed, eight similar cases were transferred to this district by the Judicial Panel on Multidistriet Litigation (MDL Panel) for consolidation of pretrial proceedings. Almost 600 cases originally filed in state and federal district courts throughout the country have been transferred for inclusion in this multidistrict litigation, MDL No. 381. Similar actions which have been filed by various civilian plaintiffs have also been transferred to this district by the MDL Panel. At present there are at least six actions involving claims by civilians. The civilian plaintiffs include: a proposed class of civilians allegedly exposed to phenoxy herbicides in Vietnam, Thornton v. Dow, C-81-005-JLQ (D.Wash.); a proposed class of thirty-five thousand civilian residents of the County of Kaui, State of Hawaii, who claim exposure to Agent Orange and other phenoxy herbicides during a testing program conducted in 1967, Fraticelli v. Dow, CV No. 82-0021 (D.Hawaii); civilian employees of defense contractors who were allegedly exposed to phenoxy herbicides in Vietnam in 1967, Kjome v. Dow, CV 83C-3876 (N.D.Ill.) and Vaughan v. Dow, CV No. 83-1440 (D.Ariz.); a medical doctor who served in Vietnam, in the employ of the State Department, Hogan v. Dow, CVR-81-410ECR (D.Nev.); and a civilian employee of a contractor exposed to Agent Orange in 1975, Lester v. Dow, CV No. H-80-587 (S.D.Tex.). These actions by civilians are not encompassed in the class and are, therefore, not covered by the settlement. A motion for change in venue in Fraticelli was denied by pretrial order number 37 on August 5, 1982; a motion for remand was denied by the MDL Panel on September 29, 1982 and a motion for remand in this court was denied on July 25, 1984. Discovery has not gone forward in these civilian cases although much of the information gathered in the instant case will be relevant to them. Cf. In re Cenco Inc. Securities Litigation, 434 F.Supp. 1237, 1239 (J.P.M.D.L.1977) (accommodation to special needs of particular cases in multidistrict litigation). At the Fairness Hearings a number of class members indicated that they were puzzled by the fact that they had retained counsel to handle their cases near where they lived in other parts of the country, yet the litigation was being conducted in New York. A brief description of the operation of the Judicial Panel on Multidistrict Litigation may be helpful at this point to explain why and how the cases were transferred to the Eastern District of New York. Since 1968, section 1407 of title 28 of the United States Code has provided a means for transferring related cases pending in different districts to a single district for pretrial proceedings. The savings in time and money when many cases are investigated and prepared together for disposition can be enormous. Pursuant to the statute, the MDL Panel may, after notice to the parties in all actions in which transfer is contemplated, transfer civil actions involving common questions of fact for the convenience of the parties and witnesses and to promote the just and efficient conduct of pretrial motions and discovery. 28 U.S.C. § 1407(a). The Panel may proceed under this section on its own initiative or on motion of any party seeking transfer. 28 U.S.C. § 1407(c). A subsequent action involving questions of fact in common with actions previously transferred under section 1407 is called a tag-along action and is conditionally transferred, with notice to parties, on the basis of the hearings regarding the previously transferred actions. See Rules 1 and 9 of the Rules of Procedure of the Judicial Panel on Multidistrict Litigation, 89 F.R.D. 273 (1981). Any party opposing transfer of a tag-along action must file a notice of opposition within 15 days and move to vacate the conditional transfer order to prevent transfer without a further hearing. Id; see, e.g., In re Penn Central Securities Litigation, 374 F.Supp. 1400 (J.P.M.D.L.1974). Section 1407 is designed to promote judicial economy and avoid conflict and duplication in discovery by consolidating related actions for pretrial purposes. 15 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3861 (1976). To effectuate these purposes, the transferee court has broad powers in matters relating to management of the multidistrict case before it. Weigel, The Judicial Panel on Multidistrict Litigation, Transferor Courts and Transferee Courts, 78 F.R.D. 575, 584 (1978). Once a case has been transferred by the Panel, the transferee court assumes complete jurisdiction for pretrial purposes. It has authority to decide all pretrial motions including dispositive motions such as those for summary judgment or approval of a settlement. Weigel, supra, 78 F.R.D. at 582. The transferee court is also authorized to handle matters relating to class action certification in order to prevent inconsistent rulings and to promote judicial efficiency. See In re Piper Aircraft Distribution System Antitrust Litigation, 405 F.Supp. 1402, 1403-04 (J.P.M.D.L.1975). Certain types of cases are especially suited to MDL treatment, among them, antitrust cases, see, e.g., In re Antibiotic Drugs, 320 F.Supp. 586 (J.P.M.D.L.1970) (transfer of 150 civil antitrust cases); mass tort actions such as aircraft disasters, see, e.g., In re Air Crash Disaster at Boston, Massachusetts on July 31, 1973, 399 F.Supp. 1106 (D.Mass.1975); and products liability cases such as “Agent Orange,” A.H. Robins Co., Inc., “Dalkon Shield” IUD Products Liability Litigation, 406 F.Supp. 540 (J.P.M.D.L.1975) (consolidation for pretrial proceedings of 54 actions involving claims for damages arising out of use of intrauterine contraceptive devices) and In re Celotex Corp. “Technifoam” Products Liability Litigation, 68 F.R.D. 502 (J.P.M.D.L.1975) (transfer of 10 actions in which plaintiffs claimed fire losses and structural damages as a result of defects in defendant’s insulation material). See also In re Aviation Products Liability Litigation, 347 F.Supp. 1401, 1403 (J.P.M.D.L.1972). Section 1407 provides that the Panel shall remand each case to the district from which it was transferred at or before conclusion of the pretrial proceedings unless it has already been terminated. 28 U.S.C. § 1407(a). Most actions are terminated in the transferee court, often by settlement or by transfer by the transferee court to itself for trial pursuant to section 1404(a) (convenience of parties and witnesses) or section 1406 (proper venue). Weigel, supra, 78 F.R.D. at 583. See, e.g., In re Antibiotic Actions, 333 F.Supp. 299 (S.D.N.Y.1971) (transfer of antitrust actions to home district of transferee judge for trial pursuant to section 1404(a)). Common to the actions either, started in this court or sent here by the MDL Panel are allegations that plaintiffs, principally American, Australian and New Zealand servicemen, were injured by exposure to Agent Orange or other phenoxy herbicides used as defoliants in Vietnam from 1961 to 1972. In 1980 a class was certified. The nature of a class action and some of its procedural implications are described in this court’s prior opinions. See In re “Agent Orange” Product Liability Litigation, 506 F.Supp. 762 (E.D.N.Y.1980), modified, 100 F.R.D. 718 (E.D.N.Y.1983), mandamus denied, 725 F.2d 858 (2d Cir.), cert. denied, — U.S. -, 104 S.Ct. 1417, 79 L.Ed.2d 743 (1984). Further reference to the effect of certifying a class action is made in the body of this opinion, particularly in connection with the discussion of statutes of limitations and indeterminate plaintiffs and deféndants, infra. Notice was given to the class. All members of the class were afforded the option of withdrawing from the class seeking compensatory damages; this option was not granted to the class seeking punitive damages. See 100 F.R.D. 718, 732 (E.D.N.Y.1983). In October 1983 the court, after conferring with the parties, ordered the trial to begin on May 7,1984. To assist the jury in focusing on the problems of causation the plaintiffs were directed to choose ten plaintiffs — veterans, wives and children — who had what they considered to be typical injuries, so that their claims would be litigated as characteristic of those of the class. The Honorable Shira A. Scheindlin, United States Magistrate, was directed to control the completion of- discovery on all issues and assist in preparation of a pretrial order. Special Master Sol Schreiber, Esq., who had been appointed in April 1982, had already supervised much of the discovery on the government contract defense. See 94 F.R.D. 173 (E.D.N.Y.1982). With the approval of the parties, in April 1984, Kenneth R. Feinberg, David I. Shapiro, and Leonard Garment, Esqs., all of Washington, D.C., were appointed as Special Masters to assist the parties in settling the case. Special Master Kenneth R. Feinberg had already commenced preliminary work on the issues with the knowledge of the parties that such work would be going forward. Plaintiffs’ claims against defendants Hooker, Ansul and Occidental were dismissed on the ground that those companies never designed, manufactured or marketed any phenoxy herbicides for use in Southeast Asia. 534 F.Supp. 1046, 1051-52 (E.D.N.Y.1982). For the same reason, defendant Uniroyal Merchandising Company’s motion for summary judgment was granted, 537 F.Supp. 977 (E.D.N.Y.1982), and defendants Syntex Corporation, Syntex Laboratories, Inc., Syntex Agribusiness, Inc., and Hoffman-Taff, Inc. (Delaware) and Northeast Industries were dismissed. See 544 F.Supp. 808, 809-10 (E.D.N.Y.1982) and 475 F.Supp. 928, 931 (E.D.N.Y.1979). The dismissal of these defendants as well as Hooker, Ansul and Occidental was conditioned upon each filing with the court a consent to renewal of the action against them by any present or future Agent Orange plaintiffs or class members in the event that the evidence showed that these companies did manufacture and sell Agent Orange to the government for use in Southeast Asia. These defendants also agreed not to raise any statute of limitations defense that included any time that passed between the date of commencement of the first of these actions and any renewal. The summary judgment motions of defendants Riverdale Chemical Company and Hoffman-Taff, Inc. (Missouri) were unopposed and, accordingly, granted. 565 F.Supp. 1263, 1272 (E.D.N.Y.1983). Summary judgment motions of defendant Hercules, Inc. and defendant Thompson Chemical Corporation were also granted based on plaintiffs’ failure to show that these defendants’ products contained dioxin. 565 F.Supp. at 1272-74. In November 1983, the court reconsidered this issue and denied the summary judgment motions of Hercules, Inc. and Thompson Chemical Corporation. Also denied were a number of jurisdictional motions by Thompson Chemical Corporation. Seven companies remain as defendants: Dow Chemical Company, Monsanto Company, Diamond Shamrock Chemicals Company, Hercules, Inc., Uniroyal, Inc., T.H. Agriculture & Nutrition Company and Thompson Chemical Corporation. Defendants have denied that the products they manufactured and sold to the government for use in Vietnam caused plaintiffs’ injuries. Defendants also contend that to the extent their products caused harm injuries occurred because of misuse by the government.. Moreover, their position has been that if any liability exists, the government, not the manufacturers, is responsible because it knew as much or more than the defendants about possible dangers and assumed responsibility for any ensuing damages. It appeared at one point that the government contract defense could be tried separately. See 506 F.Supp. 762, 796 (E.D.N.Y.1980). Later, after further discovery and briefing, it became apparent that a separate trial of the government contract defense was not desirable. 565 F.Supp. 1263, 1265, 1275 (E.D.N.Y.1983). Elsewhere in this opinion, modifying 534 F.Supp. 1046, 1054-58 (E.D.N.Y.1982), are set out the elements of proof which defendants would have had to meet on the government contract defense. See IV, Nature of Liability and Relation to Defense of Government Knowledge, infra. Defendants have served third-party complaints upon the United States, seeking indemnification or contribution for monies paid by defendants on plaintiffs’ claims. The government moved to dismiss on the grounds that the Feres-Stencel doctrine barred defendants’ actions. See Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152 (1950); Stencel Aero Engineering Corp. v. United States, 431 U.S. 666, 97 S.Ct. 2054, 52 L.Ed.2d 665, reh’g denied, 434 U.S. 882, 98 S.Ct. 250, 54 L.Ed.2d 168 (1977). The government’s motion was granted. 506 F.Supp. 762 (E.D.N. Y.1980). Upon reconsideration the government’s motion to dismiss defendants’ third-party complaints was granted only as to claims made by the veterans and the derivative claims of their family members. 580 F.Supp. 1242 (E.D.N.Y.1984). The government’s motion to dismiss was denied insofar as it related to the independent claims of the veterans' wives and children. Id. As indicated in the court’s 1980 and 1984 decisions on the issue, the law on the point is far from clear; this uncertainty enhances the desirability of the settlement. The third-party complaints against the government for the independent claims of veterans’ wives and children are still pending. They are not subject to the proposed settlement of plaintiffs’ claims against defendants. In effect, the manufacturers are saying that anything they pay to plaintiffs either by award or settlement is reimbursable by the government. Plaintiffs’ Eighth Amended Complaint, filed after the settlement was reached, for the first time seeks to obtain a remedy directly from the government on behalf of the class. A. Jurisdiction Plaintiffs originally brought this action pursuant to 28 U.S.C. § 1331, asserting that their claims arose under the statutes and common law of the United States. They argued that a private right of action could be implied from any of four statutes allegedly applicable to their claims: the Federal Insecticide, Fungicide & Rodenticide Act (FIFRA), 7 U.S.C. §§ 135-135K; the Federal Environmental Pesticide Control Act (FEPCA), 7 U.S.C. §§ 136-136y; the Toxic Substances Control Act (TOSCA), 15 U.S.C. § 2601, et seq. and the Consumer Product Safety Act (CPSA), 15 U.S.C. § 2051, et seq. Analyzing each of these statutes, the court rejected plaintiffs’ argument, finding that TOSCA and CPSA expressly exclude pesticides and that no private cause of action can be implied from FIFRA as amended by FEPCA. See 506 F.Supp. 737, 741-42 (E.D.N.Y.1979). Plaintiffs also contended that- federal question jurisdiction existed because defendants had violated the common law of the United States. This court sustained their contention. 506 F.Supp. 737, 749 (E.D.N.Y.1979). The Court of Appeals reversed over a strong dissent, concluding, for the purpose of denying federal question jurisdiction, that “there is [no] identifiable federal policy at stake in this litigation that warrants the creation of federal common law rules.” 635 F.2d 987, 993 (2d Cir.1980), cert. denied, 454 U.S. 1128, 102 S.Ct. 980, 71 L.Ed.2d 116 (1981). The Court of Appeals held that if the action was to continue in the federal courts, jurisdiction would have to be based on diversity of citizenship pursuant to 28 U.S.C. § 1332. Id. In a subsequent decision on appealability of the class certification order, the Court of Appeals pointed out that it had not decided whether the government contract defense was controlled by federal law. In re Diamond Shamrock Chemicals Co., 725 F.2d 858, 861 n. 2 (2d Cir.1984). This reservation has implications discussed below in connection with the substantive law applicable to the case and the general rule of conflicts as well as statutes of limitations. The majority decision by the Court of Appeals at 635 F.2d 987 injected great legal complexity and doubt into the litigation making further appeals after trial a near certainty and increasing the desirability of settlement. In their first amended complaint plaintiffs had asserted diversity of citizenship jurisdiction as well as federal question jurisdiction. The court struck the allegation of diversity because the first complaint failed to include the domiciles of plaintiffs and the corporate residences of the defendants. See 475 F.Supp. 928, 936 (E.D.N.Y.1979). Plaintiffs reasserted diversity as a jurisdictional basis when they filed their fourth amended complaint in 1983. Since the case was certified as a class action complete diversity was required only as between the named plaintiffs and the defendants. See Snyder v. Harris, 394 U.S. 332, 340, 89 S.Ct. 1053, 1059, 22 L.Ed.2d 319 (1969); Supreme Tribe of Ben-Hur v. Cauble, 255 U.S. 356, 41 S.Ct. 338, 65 L.Ed. 673 (1921). Plaintiffs also alleged that the amount in controversy with respect to each of the individual claims of the representative plaintiffs exceeded $10,000, thus satisfying the requirements of 28 U.S.C. § 1332. See Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973). Subsequent amended complaints designed to avoid various procedural difficulties were filed. The complaint now before the court is styled the Eighth Amended Complaint. B. Conflict of Laws Certification of a class in a diversity jurisdiction case such as this does not necessarily provide uniformity in substantive law because the substantive and conflict of laws rules of many states may apply. Accordingly, this court examined the choice of law rules of New York as well as the choice of law rules of the various states in which the transferor courts sit. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941); Van Dusen v. Barrack, 376 U.S. 612, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964). The difficulty in finding any one state’s law controlling was readily apparent. Any state’s contacts with this case are dwarfed by the national contacts. “[T]he United States Government (as distinct from any state of the United States) carried on [the Vietnam] war ... for national foreign policy and military purposes.” The exposure of veterans to Agent Orange manufactured by the defendants “was incident to carrying out those foreign and military policies. If the ... injury suffered by” the veterans “was caused by the negligence of the” defense contractors who manufactured Agent Orange “expressly for the United States and to its specifications, this is a matter of far greater concern to the United States than to any other State of the United States.” 580 F.Supp. 690, 712 (E.D.N.Y.1984) (quoting In re Air Crash Disaster Near Saigon, South Vietnam on April 4, 1974, 476 F.Supp. 521, 529 (D.D.C.1979)). The conflict of laws opinion analyzed the five most widely used choice of law methodologies and concluded' that under any approach utilized today the result, so far as could be predicted, would be the same. Given the strong state-federal interest in equal treatment of Vietnam veterans, the lack of a federal statute or of any uniform state statute on the issues, as well as the Second Circuit’s opinion denying that federal common law controls here of its own force, the states would look to federal or national consensus substantive law as the only workable approach to resolving the issues in this unusual case. The reasoning is developed at length in the opinion at 580 F.Supp. 690 (E.D.N.Y.1984). It is obvious that since no appellate court has passed on this theory, the probability of appeal and possible reversal or modification is substantial, making settlement more appropriate. C. Class Action In 1980, this court decided that the litigation would proceed as a class action pursuant to Rule 23(b)(3) of the Federal Rules of Civil Procedure. 506 F.Supp. 762, 787 (E.D.N.Y.1980). The basis for the decision was stated at length in the two opinions on the point, describing why a class action was the best vehicle to achieve a fair result. Id.) 100 F.R.D. 718 (E.D.N.Y.1983). As the court noted: A single class-wide determination on the issue of causation will focus the attention of Congress, the Executive branch and the Veterans Administration on their responsibility, if any, in this case. By contrast, possibly conflicting determinations made over many years by different juries make it less likely that appropriate authorities and the parties will arrive at a fair allocation of the financial burden, if any. 100 F.R.D. at 721. It was also pointed out that class certification would make settlement more likely. Id. at 723. In addition to its earlier conclusions, this court found that issues of general causation as well as certain defenses were common to the class, that such questions predominated over questions affecting individual members and that “given the enormous potential size of plaintiffs’ case and the judicial economies that would result from a class trial, a class was superior ‘for the fair and efficient adjudication of the controversy.’ ” 100 F.R.D. at 724. At the same time a separate class was certified on the issue of punitive damages under Rule 23(b)(1)(B), with no power to opt out. Questions as to the effect of certification under Rule 23(b)(1)(B) on plaintiffs’ rights to opt out under Rule 23(b)(3) were reserved. It was decided to permit plaintiffs to exercise their right to opt out pursuant to Rule 23(b)(3) but not to opt out pursuant to Rule 23(b)(1)(B). 100 F.R.D. at 728. The class is defined as “those persons who were in the United States, New Zealand or Australian Armed Forces at any time from 1961 to 1972 who were injured while in or near Vietnam by exposure to Agent Orange or other phenoxy herbicides, including those composed in whole or in part of 2, 4, 5-trichlorophenoxyacetic acid or containing some amount of 2,3,7, 8-tetra-chlorodibenzo-p-dioxin. The class also includes spouses, parents, and children of the veterans born before January 1, 1984 directly or derivatively injured as a result of the exposure.” 100 F.R.D. at 729. Although the class certification order was entered on January 16, 1984, notice to the class was not sent until March 9, 1984 because of a stay issued by the Court of Appeals pending decision on defendants’ petition for mandamus. The Second Circuit ultimately denied mandamus and vacated its stay. 725 F.2d 858 (2d Cir.1984). Pursuant to this court’s certification order personal notice was mailed to several hundred thousand persons. The largest group represented names on file at the Veterans Administration Agent Orange Registry which the Veterans Administration made available to plaintiffs’ counsel. A copy of the class order and notice was also sent to the governors of each of the states asking that the notice be referred to the proper state organization dealing with Vietnam veterans. Cooperation was excellent. Many states gave wide circulation to the notice and others provided a list of names and addresses so the notice could be mailed to those veterans by plaintiffs’ counsel. A court-approved announcement on nationwide television networks and on radio stations with a combined coverage of at least 50% of the listener audience in each of the top 100 radio markets was circulated. The text of that notice can be found in 100 F.R.D. at 734. The class notice was also published in three national general circulation newspapers and magazines and six veterans’ magazines. Notice was directed to be sent to the 10 largest circulation newspapers in Australia and the five largest circulation newspapers in New Zealand. The text of the newspaper and magazine notice can be found in 100 F.R.D. at 734-35. Informal notice through the news media was widespread. Finally, plaintiffs were authorized to arrange a toll-free “800” telephone number. Callers were to be told where to write to obtain more information concerning the litigation. The names and addresses of those calling were to be taken and those requesting a copy of the notice mailed to class members were to be sent one. A large number of people called the “800” number. Their names are in the files of the court. The notice to class members included a Request for Exclusion Form to be completed by anyone wishing to be excluded from the class. Exclusion forms were to be received by the Clerk of the Court on or before May 1, 1984. As of May 6, 1984, 2440 requests for exclusion had been received. This number should be compared to the 2,400,000 persons who, it is estimated, served in the American, Australian and New Zealand Vietnam forces. The number of persons from that group believed to have had some chance of exposure to Agent Orange has been variously estimated as between 600,000 and 2,400,000. As of the middle of July 1984 some 600 persons who had previously opted out asked to be reinstated as members of the class. More such communications are expected as a result of the public hearings even though they were to be filed by July 15. The court will consider such late applications to rejoin the class sympathetically. Following the settlement, but prior to the Fairness Hearings, counsel for a number of those who had not opted out moved to certify a subclass of those members of the class who object to terms of the settlement and to appoint counsel to represent the subclass. Cf. 534 F.Supp. 1046, 1052-53 (E.D.N.Y.1982). The court denied the motion orally on July 25,1984. Attorneys and objecting members of the class were free to write to the court and to appear at the Fairness Hearings to explain their views. See II, A, Fairness Hearings, Legal Requirements, infra. No purpose would have been served by appointing counsel for a subclass of disappointed claimants except to increase expenses to the class and delay proceedings. Cf. Parker v. Anderson, 667 F.2d 1204, 1208 (5th Cir.), cert. denied, 459 U.S. 828, 103 S.Ct. 63, 74 L.Ed.2d 65 (1982) (10 of 11 named plaintiffs who objected to settlement and insisted on satisfaction of their individual claims named as part of new subclass). D. Status of the Third-Party Complaints Defendants’ third-party action against the United States for indemnity and contribution on the independent claims of veterans’ wives and children is still pending. See 580 F.Supp. 1242 (E.D.N.Y.1984). The Court of Appeals denied the government’s petition for a writ of mandamus seeking review of this court’s February 1984 decision not to strike defendants’ third-party claims. 733 F.2d 10 (2d Cir.1984). Subsequently the government filed several motions with the Court of Appeals for rehearings, permission to proceed with an intermediate appeal and for a stay of the trial of the third-party claims which was then scheduled to begin on May 7, 1984. On May 4, 1984, the Court of Appeals stayed the trial of the third-party claims until May 8. On May 8 that court extended its stay. On May 23 the government moved in this court for a stay of all proceedings pending disposition of its appeal to the Court of Appeals. That motion was denied. On June 22 the Court of Appeals indefinitely stayed the trial of the third-party claims and this court then stayed further discovery pending a decision by the Court of Appeals on appealability. The appeal was dismissed for lack of jurisdiction in the Court of Appeals on September 21, 1984. See In re “Agent Orange” Product Liability Litigation, 745 F.2d 161 (2d Cir.1984). The defendants have conducted an enormous amount of discovery of the government in preparing the government contract defense. Since an early stay on discovery was lifted in 1980, 506 F.Supp. 762, 797 (E.D.N.Y.1980), the United States has attended these depositions and, in many cases, represented the deponents. See 99 F.R.D. 338 (E.D.N.Y.1983) (approving Special Master’s recommendation to permit government counsel appearing as counsel for former employees to review personal files of former employees for relevance as well as privilege claims). A principal focus of discovery was on an element of the government contract defense — the extent of the government’s knowledge of alleged hazards relating to the use of Agent Orange. More than 200 depositions were taken of former or current government employees, including military personnel, ranging from generals to privates. Rooms filled with military documents and other governmental records pertaining to the Vietnam War were made available for inspection by the parties, and hundreds of thousands of pages of government documents, many of which were formerly considered classified, were produced for the parties. Pursuant to pretrial discovery orders, and on consent of the government, all depositions of former or current government employees and the vast bulk of documents produced by the government are not subject to any protective order and are open to public scrutiny. Many other depositions were taken of selected plaintiffs and of scores of expert witnesses from each side. In addition, a large file of defendants’ records was amassed. Originally no separate trial of the third-party claims against the government was envisioned. These claims were to be heard by the same jury deciding the claims of plaintiffs against defendants. Since no jury is permitted in Federal Tort Claims Act cases against the government, the jury would be sitting in an advisory capacity to the judge. Any discovery which the government had not completed as of May 7, 1984 was to have been conducted during the trial of the main action pursuant to a schedule worked out by the Magistrate and the parties. After settlement of the controversy between plaintiffs and defendants, the parties were informed that trial of the defendants’ indemnification claims against the government would be scheduled for September 1984. At a pretrial conference on May 29, 1984, on the assumption that the Court of Appeals’ stay of trial would be lifted promptly, the Magistrate, at the court’s direction, set a new schedule for discovery in the third-party action. Since, however, the government’s appeal was not decided until September 21,1984 it was not possible to complete discovery or to try the third-party claims in September 1984 as scheduled. On May 4, 1984, defendant Diamond Shamrock moved in this court for reconsideration of so much of the February 16 decision as dismissed third-party claims against the government. Diamond Shamrock’s motion was premised upon claims arising under the Tucker Act for breach of contract. Oral argument on that motion was scheduled to be heard after the Court of Appeals decided the government’s appeal on third-party claims. There was substantial doubt about whether the Court of Appeals has jurisdiction to hear an appeal from a district court’s order denying dismissal of a complaint. See In re “Agent Orange”, 733 F.2d 10, 14 (2d Cir.1984). Accordingly, by letter dated May 24, 1984, the government inquired anew whether the district court would certify its ruling refusing to dismiss third-party claims against the government under 28 U.S.C. § 1292(b) to permit an immediate interlocutory appeal. The application was denied on May 25. The court pointed out that a prompt trial or other disposition was in the public interest and was consistent with efficient judicial management of these protracted proceedings. II. FAIRNESS HEARINGS A. Legal Requirements Rule 23(e) of The Federal Rules of Civil Procedure provides that a class action may not be settled without approval of the court and notice to members of the class. The procedure (1) assures that any person whose rights would be affected by settlement has the opportunity to support or oppose it, Pearson v. Ecological Science Corp., 522 F.2d 171, 176-77 (5th Cir.1975), cert. denied, 425 U.S. 912, 96 S.Ct. 1508, 47 L.Ed.2d 762 (1976); (2) prevents priva