Appendix — Richard v. Hoechst Celanese Chemical Group, Inc.

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APPENDIX A — FINAL JUDGMENT OF THE

CHANCERY COURT FOR OBION COUNTY,

TENNESSEE AT UNION CITY, TENNESSEE

DATED AND FILED NOVEMBER 17, 1995

IN THE CHANCERY COURT FOR OBION COUNTY,

TENNESSEE AT UNION CITY, TENNESSEE

Civil Action No. 18,844

CLASS ACTION

TINA COX, CHARLES HOMER CLOAR, MARY H.

CLOAR, MELODY ALFORD, COUNTRY VILLAGE

MOBILE HOME PARK, and PHYLLIS BIRMINGHAM,

individually and on behalf of all other individuals and entities

similarly situated,

Plaintiffs,

¥.

SHELL OIL COMPANY, d/b/a SHELL CHEMICAL

COMPANY, and HOECHST CELANESE CORPORATION,

Defendants.

FINAL JUDGMENT

This matter is before the Court on motion by the parties

for final approval of their proposed settlement as set forth in

the Settlement Agreement filed July 31, 1995, as amended

by an Amendment dated October 6, 1995, a Second

Amendment dated October 24, 1995, and a Third Amendment

2a

Appendix A

dated November 9, 1995 (the “Agreement”). Also before the

Court is the Application of Class Counsel for Award of

Attorneys’ Fees and Expenses, and Awards to the

Representative Plaintiffs (the “Application”).

A hearing on the motion and Application was held on

November 8 and 9, 1995, pursuant to the Court’s Order of

July 31, 1995, granting preliminary approval of the settlement

and the August 7, 1995, order conforming the class definition,

under procedures set forth in the August 24, 1995, Order

Approving Forms of Notice, Scheduling Fairness Hearing

and Setting Opt-out and Objection Dates.

This Final Judgment is entered pursuant to a Final Order

Approving the Class Action Settlement, Attorneys’ Fees and

Expenses, and Awards to Representative Plaintiffs (the “Final

Order”) which is entered together herewith. The Court has

determined that the Class Action Settlement, as encompassed

within the Agreement, should be approved as fair, adequate,

and reasonable to the Settleinent Class under Rule 23.05

of the Tennessee Rules of Civil Procedure, and that the

Application should be granted.

The Court has further determined that there is no just

reason for delay in the entry of final judgment in accordance

with the Final Order pursuant to Rule 54.02 of the Tennessee

Rules of Civil Procedure.

Accordingly, it is ORDERED that judgment is hereby

entered in accordance with the Final Order.

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Appendix A

It is further ORDERED that the Settlement Class is

defined as follows:

All persons and entities that (1) own real property

or structures in the United States in which there

was installed between January 1, 1978 and July

31, 1995, polybutylene plumbing with acetal

insert or metal insert fittings or a polybutylene

yard service line; (2) own or previously owned

such real property or structures and have already

incurred any cost or expense, by reason of leakage

from, or from failure, repair, or removal of, all or

any portion of such polybutylene plumbing or yard

service line which was installed between January

1, 1978 and July 31, 1995; or (3) will own such

real property or structures during the term of

entitlement to relief under the Settlement

Agreement.

The definition of the Settlement Class excludes:

(1) All persons who, in accordance with the terms

of the Settlement Agreement, execute a timely

request for exclusion from the Settlement Class;

(2) the Defendants; the Released Manufacturers;

the parent and any subsidiary, affiliate and

controlled entity of any of them; and the officers

and directors of each of them; and (3) all parties

to Geno Cioe, et al. v. Shell Oil Company, et al.,

Case No. 662214, and Robert L. Williams, et al.

v. Shell Oil Company, et al., Case No. 658403,

and related combined actions (Case Nos. 640245,

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Appendix A

654709, 656787, 661372, 665521 and 665527) in

the Superior Court of the State of California in

and for the County of San Diego, and all members

of the certified classes in those lawsuits.

It is further ORDERED that the Court directs that the

settlement be consummated in accordance with the terms and

conditions of the Agreement.

It is further ORDERED that the Amended Complaint

and all claims and causes of action asserted therein are

dismissed with prejudice with costs to be paid from the

settlement fund in accordance with the terms of the

Settlement Agreement.

It is further ORDERED that, in the event that the

settlement does not become final (as more fully defined in

the Agreement) in accordance with the terms of the

Agreement, then this Final Judgment and the Final Order

shall be rendered null and void and be vacated, and the

Agreement shall be rendered null and void in accordance

with the provisions thereof.

It is further ORDERED that, without affecting the

finality of the Final Order and this Final Judgment, the Court

shall retain continuing jurisdiction over this action and the

settling Parties (as more fully defined in the Agreement),

including all members of the Settlement Class; the

administration and enforcement of the settlement; and

the benefits to the Settlement Class, including for such

purposes as supervising the implementation, enforcement,

construction, and interpretation of the Settlement Agreement.

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Appendix A

It is further ORDERED that, subject and pursuant to

the terms and conditions of the Agreement, Plaintiffs and all

members of the Settlement Class are barred and permanently

enjoined from prosecuting (in any forum) against Shell Oil

Company and/or Hoechst Celanese Corporation any and all

claims, demands, causes of action of every kind and nature,

obligations, damages, losses, and costs, whether known or

unknown, actual or potential, suspected or unsuspected,

contingent or fixed, either arising out of or relating to any of

the facts, transactions, actions, or conduct alleged in this

action, or that were or could have been asserted or sought in

the action, other than any past, present, or future claim for

bodily injury (including wrongful death) and associated

emotional distress and mental anguish.

It is further ORDERED that, in accordance with the

above-described Application and the Funding Agreement

referred to in the Agreement, the defendants shall pay

Plaintiffs’ Class Counsel, as attorneys’ fees and expenses,

the sum of $45 million, plus interest at the rate applicable to

federal court judgments entered on July 31, 1995, for the

period from July 31, 1995, until the earlier of July 31, 1996,

_ or when paid.

It is further ORDERED that, in accordance with Section

25.1 of the Agreement and with the Funding Agreement

referred to in the Agreement, the defendants shall pay the

sum of $3,000.00 to each single Representative Plaintiff or

Representative Plaintiff married couple.

It is further ORDERED, pursuant to Rule 54.02 of the

Tennessee Rules of Civil Procedure, that the Court hereby

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Appendix A

DIRECTS the entry of this judgment as a final judgment

based upon the Court’s finding that there is no just reason

for delay, notwithstanding the Court’s retention of jurisdiction

to oversee implementation and enforcement of the Agreement

as set forth above, and the Court’s continuing jurisdiction to

provide for supplemental notice (and related proceedings)

to potential members of the Settlement Class as to whom the

Court previously received requests for exclusion from the

Settlement Class.

Dated at Union City, Tennessee, this 17 day of November,

1995.

s/ W. Michael Maloan

W. MICHAEL MALOAN, CHANCELLOR

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APPENDIX B — FINAL ORDER APPROVING THE

CLASS ACTION SETTLEMENT, ATTORNEYS’

FEES AND EXPENSES, AND AWARDS TO

REPRESENTATIVE PLAINTIFFS OF THE

CHANCERY COURT FOR OBION COUNTY,

TENNESSEE, UNION CITY, TENNESSEE

FILED NOVEMBER 17, 1995

IN THE CHANCERY COURT FOR

OBION COUNTY, TENNESSEE

AT UNION CITY, TENNESSEE

Civil Action No. 18,844

CLASS ACTION

OBION COUNTY

Paula Rice

Clerk and Master

D.C. & M.

TINA COX, CHARLES HOMER CLOAR, MARY H.

CLOAR, MELODY ALFORD, COUNTRY VILLAGE

MOBILE HOME PARK, and PHYLLIS BIRMINGHAM,

individually and on behalf of all other individuals and entities

similarly situated,

Plaintiffs,

V.

SHELL OIL COMPANY, d/b/a SHELL CHEMICAL

COMPANY, and HOECHST CELANESE CORPORATION,

Defendants.

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Appendix B

FINAL ORDER APPROVING THE CLASS ACTION

SETTLEMENT, ATTORNEYS’ FEES AND EXPENSES,

AND AWARDS TO REPRESENTATIVE PLAINTIFFS

This matter is before the Court on motion by the parties'

for fina’ approval of their proposed settlement (the

“Settlement”) as set forth in the Settlement Agreement

filed July 31, 1995, as amended by-an Amendment dated

October 6, 1995, a Second Amendment dated October 24,

1995, and a Third Amendment dated November 9, 1995

(the “Agreement’’). Also before the Court is the Application

of Class Counsel for Award of Attorneys’ Fees and Expenses,

and Awards to the Representative Plaintiffs (the

‘“Application”). A duly noticed hearing on the motion

and Application was held on November 8 and 9, 1995,

(the “Fairness Hearing”) pursuant to the Court’s Order of

July 31, 1995, granting preliminary approval of the

Settlement and the August 7, 1995, order conforming the

class definition (collectively the “Preliminary Approval

Order’), under procedures set forth in the August 24, 1995,

Order Approving Forms of Notice, Scheduling Fairness

Hearing and Setting Opt-out and Objection Dates.

Notice of the Fairness Hearing was given to potential

class members nationwide in accordance with the Preliminary

Approval Order and the Court approved notice prograin.

Voluminous pleadings and briefs were submitted by the

settling parties in support of the Settlement and in response

1. The parties are the named individual and representative Cox

plaintiffs, on behalf of the certified Settlement Class, and defendants

Shell Oil Company d/b/a Shell Chemical Company and Hoechst

CelaneseCorporation.

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Appendix B

to all objections and motions filed regarding the Settlement,

including the various objections and related papers filed by

objector Tony Martin, et al., and affiliated objectors through

their attorneys (the “Martin Objectors”). The parties,

numerous interested members of the Settlement Class, and

others appeared at the Fairness Hearing, either individually

or by their respective attorneys. The Court heard and

considered evidence in support of the proposed Settlement.

This evidence included live testimony, affidavits,

documentary and video presentations, as wel! as oral

representations by various attorneys. The attorneys for the

parties and others were heard. An opportunity to be heard

was given to all other persons requesting to be heard in

accordance with the Preliminary Approval Order. This

included a significant number of members of the Settlement

Class who, in some instances, had traveled great distances

from other states to appear and participate in the Fairness

Hearing, who were invited to and did make statements and

ask questions regarding the terms of the Settlement and the

relief it provides.

As more fully set forth below, the Court has determined

that the notice given to members of the Settlement Class

certified in the Preliminary Approval Order fully and

accurately informed the Settlement Class members of all

material elements of the proposed Settlement; was the best

notice practicable under the circumstances; was valid, due,

and sufficient notice to all Settlement Class members; and

complied fully with Rule 23 of the Tennessee Rules of Civil

Procedure, the United States Constitution, and any other

applicable law. .

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Appendix B

OPINION

The Court has greatly benefited from the fine briefs and

oral arguments of the attorneys in this case, all of whom are

worthy adversaries, and appreciates the manner in which they

have conducted themselves in this most difficult, complex,

and hotly contested litigation. Great credit must be given to

Judge Richard Silver of Monterey County, California for his

initiative to coordinate a settlement conference with the Cox

and Spencer parties. The revised Cox Settlement is due, in

no small part, to his efforts. The Court also commends Judge

Hardaway of Greene County, Alabama, for his willingness

to join in this unprecedented effort by three state courts to

coordinate and settle competing national class actions. As to

the settling parties, the plaintiffs, the plaintiff class, Shell

Oil Co., and Hoechst Celanese Corp., the Court acknowledges

that if it were not for your recognition of this opportunity to

reach a global settlement of these issues, all of these efforts

would have been in vain. You have put aside your armor and

your hardened positions from years of battle and have finally

made peace.

Compromises are favored in the law. Neither this Court,

nor any court, has the resources to fully litigate all issues,

nor is it always fair to the parties to do so. The time, cost,

and lack of finality of protracted litigation require certain

matters to be settled. The polybutylene plumbing litigation’s

time has come. Closure is not only appropriate, but timely.

2. Spencer, et al v. Shell Oil, et al, Case No. CV 94-074, Circuit

Court of Greene County Alabama, Honorable Eddie Hardaway, Jr.,

presiding.

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Appendix B

The parties to this and to the many other individual and group

cases that have comprised the polybutylene plumbing

litigation have fought long and hard with varying degrees of

“success and defeat; however, the affected party, the consumer,

has seen very little benefit from these efforts. The Cox

settlement agreement is a compromise. In every compromise,

each side must abandon or set aside its ideal position and

reach an agreement that is fair and reasonable to all concerned

under the circumstances, and not insist on terms only

beneficial to one party. The Cox settlement is not perfect. |

would have preferred that the Agreement include no leak

requirements and a larger claims “window” for class

members. The Court has some concern the $75 million cap

on past damages may not adequately pay all past damages in

full; however, these concerns must be weighed in light of

the numerous unique advantages to the consumer that the

Cox settlement does provide.

The Court finds the Settlement is fair, adequate and

reasonavle.The $950 million dollars is a minimum

contribution of the defendants to those who are aft. ted by

polybutylene plumbing. When the Court initially gave

preliminary approval to the proposed Settlement, this factor

was the leading factor in granting that approval. As counsel

for the parties have confirmed at various times in open court

as the hearings have progressed in this matter, the initial

funding commitment (now increased to $950 million) may

ultimately be more if funds are expended and provided by

the defendants and if other responsible parties contribute to

the fund in the future. Due to the uncertainty of the size of

the class and how many claims will ultimately be filed, this

Court would not have approved a “limited fund” which

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Appendix B

provided less than full relief while demanding full release.

If the worst case does present itself, that is, if the class is 2s

large as six million people, all claims are presented, and the

fund is totally expended; the only prejudice to the consumer

will be the delay caused by the filing of claims and payment

of funds. The Agreement tolls statutes of limitations for class

members. The Agreement provides that any consumers not

fully reimbursed or compensated under the terms of the-

Agreement would be able to pursue all legal and equitable

claims and remedies (including punitive damages)

individually and as a class.

The Court finds the notice program is excellent.

As specified in the findings below, the evidence supports

the conclusion that the notice program is one of the most

comprehensive class notice campaigns ever undertaken. The

Court is satisfied that all reasonable efforts have been made

to reach affected consumers.

The Court must also consider the complexity, the

expense, and the likely duration of these proceedings if

settlement were not reached and approved. The Court must

weigh the benefits of settlement against the likely outcome

of litigation. As the Court has already stated, much has been

spent and much has been done over the past years in group

and individual polybutylene pipe litigation across the country,

but not much has been accomplished for the benefit of the

consumer. The claims in Cox and Spencer each have their

own legal problems, which, if fully litigated, would delay

the ultimate resolution of these cases for many years to come.

If litigated, complex legal issues would be presented, such

as statutes of limitations and repose, choice of appropriate

l3a

Appendix B

state laws, liability, and measure of damages. All of these

issues, if litigated and appealed, could clog the courts across

the country for years to come. There is a question as to

whether some state courts would give full faith and credit to

another state court’s determination of these issues.

It is an important aspect of the Setilement that the

plaintiffs’ attorney’s fees and costs are paid b / the defendants

in addition to the settlement fund, and are not deducted from

the settlement fund. In the absence of a comprehensive Class

Settlement now, as presented here in Cox, after the resolution

of the contentious issues described above, any ultimate

recovery available for consumers would be reduced by

attorney’s fees. These normally range from a third to forty

percent. None of this delay, risk, mounting transaction costs

and reduction of recovery by individual fees would be in the

long-term interest of the consumer. In Cox, the attorney’s

fees requested are much less: approximately five percent of

the settlement fund; moreover, unlike a typical contingent

fee, they are not paid from the fund. The request for fees in

the case is approved. The Court finds that they are reasonable

under the circumstances, and the Court is pleased to approve

them.

The Court is pleased with the reaction of the class

members to the proposed Settlement. The Court is greatly

comforted by the small number of individual opt-outs, the

removal of objections by Spencer class counsel and by Tony

Martin, who is represented by the Fleming group, and the

Support expressed by the consumers who testified at the

Fairness Hearing. The Court finds that the Consumer

Plumbing Recovery Center (“CPRC”) claims facility

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Appendix B

procedures which have been outlined to the Court and which

are provided for in the Agreement, appear to constitute a

simple, consumer-friendly and efficient method of adjusting

the claims in this case.

The discussions and negotiations that ultimately lead to

the settlement presented for Court approval were, from all

reports and from the Court’s own observation, intensive,

exhaustive, and often heated. The Court finds the Agreement

is the result of good faith, arms-length, and non-collusive

' negotiations. The Agreement is fair, adequate, and reasonable

under the circumstances, and it is approved.

ADDITIONAL FINDINGS AND CONCLUSIONS

The entire matter of the proposed Settlement and the

Application having been fully heard and duly considered by

the Court, the Court further FINDS and CONCLUDES, in

addition to the findings and conclusions in the foregoing

Opinion, as follows:

1. The polybutylene plumbing litigation has been

pending, in various forms and in various courts around the

country, for more than a decade. It has included individual

cases, cases with large numbers of individual plaintiffs, and

putative nationwide or statewide class actions brought in

federal court and in many state courts.

2. The first nationwide polybutylene plumbing class

action was filed in September 1993 by lawyers who are now

members of the team of Cox Class Counsel. The action,

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Appendix B

Robert Beeman, et al. v. Shell Oil Company, et al.,

No. 93-047363, was filed in a state district court in Harris

County, Texas.

3. Over the course of many months of intensive

negotiations, involving a neutral mediator at many critical

junctures, a tentative settlement of the Beeman case was

achieved in October 1994. In February 1995, however, the

Texas state court denied preliminary approval of that

settlement without comment.

4. After the Court in this case certified the nationwide

class on June 13, 1995, Cox Class Counsel joined with the

plaintiffs’ attorneys in the Beeman action to prosecute this

case for the benefit of mobile and site-built homes with

polybutylene plumbing across the country.

5. Collectively, this combined team of Class Counsel

included highly qualified and well-regarded lawyers with

extensive Class action and complex litigation experience, as

well as lawyers with vast experience in polybutylene

plumbing litigation.

6. Class Counsel then were able to negotiate a settlement

generally patterned after that originally arrived in Beeman,

although the minimum funding commitment was $100

million greater, other features were added, and only two of

the three Beeman defendants, Shell and Celanese, were

involved.

7. Because of the pendency of a nationwide class action

in Greene County, Alabama, and of other polybutylene actions

l6a

Appendix B

around the country, with many brought as class actions,

including an uncertified case for a putative statewide mobile

homeowner class in the Superior Court of Monterey County,

California,’ Judge Hardaway and this Court agreed that Judge

Silver in Monterey would further the cause of final resolution

of polybutylene plumbing litigation if he was appointed to

serve as a settlement judge for all three courts.

8. Judge Silver issued an October 12, 1995 Order Setting

Settlement Conference with the endorsement of this Court

and Judge Hardaway, to convene the coordinated settlement

process. Other state courts with proposed class actions were

asked, by the parties and/or by Judge Silver, to dismiss or

stay their proceedings in deference to the coordinated

settlement effort in order to give it an opportunity to succeed,

undistracted by collateral litigation.

9. Accordingly, from October 23, 1995, through

November 7, 1995, the day before the Fairness Hearing in

this Cuurt, intensive and continuous global settlement

negotiations were conducted among Cox Class Counsel, the

Spencer counsel, and defendants’ counsel and representatives

through the mediation and supervision of Judge Silver.

10. As a result of these concentrated efforts, a

comprehensive settlement was reached, resulting in

significant enhancements to the Settlement as it was

originally presented to the Court and preliminarily approved

on July 31, 1995.

3. Meers, etal vs. Shell Oil, et al, Case No. M 30590, Superior

Court of the State of California, County of Monterey, Honorable

Richard M. Silver, presiding.

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Appendix B

11. The resulting Settlement, documented and as

presented for final approval at the Fairness Hearing, provides

consumers with a recovery program consisting of

reimbursement of otherwise unreimbursed expenses for

repairs to and replacement of leaking polybutylene plumbing

systems and property damage caused by such leaks, as well

as an extensive program for replacement of such leaking

plumbing systems.

12. Some of the features of this Settlement are these:

a. Free replacement of polybutylene plumbing

systems installed since January 1, 1978, if two or more

qualifying leaks occurred before August 21, 1995, or if only

one such leak occurs either in the two years following that

date or during a period (of from 10 to 16 years, depending

on the type of structure) following installation of the system;

b. Reimbursement of the unreimbursed expenses of

plumbing repairs, replacements, and property damage from

January 1, 1978, to August 21, 1995, up to $75 million will

be distributed, pro rata if necessary, for these expenses; and

property damage after August 21, 1995, at 100 cents on the

dollar;

c. An unlimited funding potential, with the

defendants committed to to initially provide up to $950

million for the relief; if additional funds are required, the

defendants will either provide them, or litigation will be

resumed with all applicable statutes of limitations and repose

tolled in the interim;

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Appendix B

d. Provision for additional relief to eligible members

of the Settlement Class who experience special needs in

connection with qualifying leaks;

e. A comprehensive notice program, including

notice every three years through the life of the program, which

ends in 2009; and

f. The payment of class counsel’s attorneys’ fees and

expenses in addition to the $950 million reserved for relief

for the Settlement Class.

13. The Court is not aware of any other class action

settlement with successive notices as provided in the Cox

Settlement.

14. In reaching this Settlement, the defendants have

foregone very significant defenses and issues which could

have precluded or limited liability as to some or many class

members’ claims. These include the statutes of limitations

and repose, selection of the appropriate states’ laws applicable

to various issues, the “economic loss” limitation on

recoveries of the type sought here, the lack of privity between

the members of the Settlement Class and the defendants, the

fact that many of the members of the Settlement Class

purchased their structures “as is,” and, of course, the risk

that plaintiffs would not be successful in proving their

allegations. In agreeing to this Settlement, the defendants

have displayed commendable corporate responsibility,

responsiveness, and good will toward consumers.

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Appendix B

15. The Court appointed Rust Consulting, Inc. and

Kinsella Communications Ltd. as class notice providers in

this case. Richard Redfern, president of Rust Consulting, and

Katherine Kinsella, president of the communications firm

bearing her name, testified at the Fairness Hearing. The Court

also considered Ms. Kinsella’s affidavit and the affidavit of

Jeffrey Dahl, Executive Vice President of Rust Consulting,

in connection with their activities as notice providers.

16. Cox Class Counsel and the notice providers worked

with Todd B. Hilsee, an experienced class action notice

consultant, to design a class notice program of unprecedented

reach, scope, and effectiveness. Mr. Hilsee was accepted by

the Court as a qualified class notice expert at an earlier

hearing to approve the commencement of the notice program.

He testified at the Fairness Hearing, and his affidavit was

also considered by the Court, as to the operation and outcome

of this program.

17. The above-mentioned individuals provided

documents, information, and affidavits at the outset of the

notice period that assisted the parties in designing, and the

court preliminarily approving for implementation, a

singularly comprehensive and creative notice program.

18. Beginning in August, 1995, and extending into

October, 1995, an extensive notice effort was undertaken in

this case to implement the Court approved notice program

specified in the Preliminary Approval Order.

19. Since not all Settlement Class members were known

or readily identifiable, the notice program implemented in

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Appendix B

this case combined multimedia publication (newspapers,

magazines, radio and television), individual mailed notice,

ongoing press and media outreach, and a toll-free telephone

information service. The purpose of the program was to make

potential Settlement Class members aware of the Action and

the Settlement, and to encourage them to identify themselves

to the notice providers, so they could receive further written

notices and information, and be placed on the notice

providers’ Settlement Class member database.

20. Commencing on or before August 21, 1995, which

is the Initial Notice Date as specified in the Agreement, more

than 5.6 million copies of the Court approved Notice of Class

Action and Proposed Settlement were mailed, by first class

mail or overnight service, to Settlement Class members in

accordance with the Preliminary Approval Order.

21. During September, 1995, the Court approved

summary notice was published in Parade Magazine, USA

Weekend, People Magazine, and TV Guide in accordance with

the Preliminary Approval Order. The combined circulation

of these consumer publications and national magazines is

over 73 million. During August and September, 1995, Court

approved notice arneared twice in Friday editions of USA

Today, with combined circulation of over 4.7 million.

22. Also duiing September, 1995, the Court approved

summary notice appeared in 201 daily and weekly

newspapers in 13 targeted states (Alabama, Arizona,

California, Colorado, Florida, Georgia, Louisiana, Maryland,

Nevada, North Carolina, South Carolina, Texas, and Virginia)

and the District of Columbia. The combined circulation of

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Appendix B

these newspapers exceeds 23.6 million. In addition, the notice

appeared in Spanish in 38 Hispanic newspapers, with a

combined circulation over 3 million, in 29 media markets

during September, 1995. Moreover, the notice appeared in

247 daily, weekly, bimonthly, and monthly African-American

newspapers with a combined circulation of nearly 6 million.

23. Notices were also published in t’te October, 1995,

editions of various trade publications, comprising a total

circulation of 244,000.

24. A 30-second spot television notice was produced and

appeared 213 times from August 21, 1995, through

September 3, 1995, on national and cable television,

including on such networks as ABC, NBC, CBS, TNN, CNN,

and TNT. During the same period, a 30-second Spanish

language television notice appeared 18 times on the Univision

Network, a popular Spanish language network.

25. Apress release, a media advisory, a public service

announcement, a video news release, a radio news release,

and a press kit were all prepared and disseminated as part of

the notice program in this case. The press release went to

2,000 newspapers, wire services, magazines, and broadcast

points across the United States through PR Newswire.

The press release and media advisory were also disseminated

to 469 media outlets, specifically targeting consumer

reporters and media in the top 250 media markets and 84

local daily newspapers in the 13 targeted states and the

District of Columbia. 142 outlets, with a combined

circulation of more than 14.5 million, have confirmed using

the press materials to publish articles. It is estimated that the

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Appendix B

public service announcement was broadcast by radio stations

yielding nearly 2.9 million gross impressions; an additional

5.5 million impressions are estimated from the broadcast of

the radio news release. The video news release was used by

at least 21 outlets with combined viewership of more than

1.7 million. Finally, a two-column article was provided to

10,000 daily and weekly newspapers.

26. Court approved notice forms were disseminated

through various online computer services, including

CompuServe, Prodigy, and America Online, and with Legal

Link on the Internet.

27. The various forms of published notice provided

recipients with a toll free “800” teiephone number to which

potential Settlement Class members could call to obtain

further information and to request the full notice packet to

be mailed to them. The telephone message was updated as

the notice program progressed, and commonly raised

questions were answered by live operators, in English or

Spanish as required by the caller. The parties prepared and

updated scripts and information by which the operators were

able to provide the general information commonly requested

by callers.

28. The toll-free telephone facility established for notice

purposes in this case received more than one million

telephone calls in response to the published notice program.

29. Over 195,000 requests for a claim form have been

received by the notice providers.

23a

- Appendix B

30. Mr. Hilsee demonstrated, by affidavit and in live

testimony at the Fairness Hearing, a number of significant

facts regarding the reach and effectiveness of the notice.

The national] media campaign reached an extraordinarily high

percentage of United States adults aged 35 years and over:

approximately 114 million individuals, or 92.11 % of this

population. Each of these adults was exposed to the national

media notice an average of 4.01 times. The national media

campaign also reached approximately 151 million persons

in the United States aged 25 years and over, representing

90.88 % of this population. Each of the individuals in this

larger, secondary target group was reached an average of 3.76

times by the national media notice, a frequency that also

exceed the primary target reach in other class actions. These

ure higher reach and frequency statistics than have been found

adeauate bycourts in other class actions. These data do not

include the reach of the notice campaign through means other

than the national paid notice campaign, such as the television

and print notices targeted to Hispanic and African-American

media, the local newspaper notices, the non-paid media and

direct mail notices to millions of Settlement Class members.

31. Mutifaceted notice programs like that implemented

in this case have been approved by other courts and utilized

successfully for similar purposes in large consumer or product

class actionssuch as this one, where most class members are

not individually identified at the outset. See, e.g., In re

Domestic Air Transportation Antitrust Litigation, 141 F.R.D.

534 (E.D. Pa. 1992); 148 F.R.D. 297 (E.D. Pa. 1992);

In re Silicene Gel Breast Implant Products Liability

Litigation, MDL 926 (N.D. Ala. 1994); Roberts v. Bausch & .

Lomb, Inc., }4-C-1144-W (N.D. Ala. 1995).

24a

Appendix B

32. As other courts have done with respect to the less

comprehensive notice programs they approved, this Court

finds that the notice program described above, as designed

and implemen’ 2d, met and exceeded the requirements of the

United States Supreme Court, Tennessee’s Rule 23, due

process and the Constitution, as construed in Phillips

Petroleum Co. v. Shutts, 472 U.S. 797 (1985) and its progeny.

33. Thus, the best notice practicable under the

circumstances has been provided to members of the

Settlement Class. That notice accurately and adequately

advised them of th!s action; the proposed Settlement and its

terms, features, and benefits; their rights and options; and

the applicable procedures and deadlines for exercising them.

34. A full opportunity has been provided to the members

of the Settlement Class to participate in the Fairness Hearing,

both orally and by way of written submission to the Court.

35. The Court previously found the requirements of

Rule 23 of the Tennessee Rules of Civil Procedure were met

and certified a nationwide class for litigation and

trial purposes in the Order of National Class Certification.

While such certification was and is contested by the.

defendants, they have agreed to class certification for

settlement purposes, to promote a comprehensive, classwide

resolution of polybutylene pipe litigation.

36. The numerosity, typicality, commonality, and

adequacy requiremenits of Rule 23.01 of the Tennessee Rules

of Civil Procedure are satisfied as to the Settlement Class in

connection with the Settlement in this case.

25a

- Appendix B

37. In accordance with Rule 23.02(3), common issues

of fact and law predominate and make certification of the

Settlement Class for settlement purposes efficient and

appropriate. The members of the Settlement Class have been

afforded the right and opportunity to exclude themselves from

the Settlement Class.

38. The settlement encompassed within the Agreement

is in all respects fair, reasonable, and adequate and in the

best interests of the Settlement Class.

39. The Court-approved notice program provided clear

and simple procedures and instructions for the submission

of objections by or on behalf of Settlement Class members.

For example, paragraph 10 of the Court-approved Notice of

Class Action and Proposed Settlement required objections

to be submitted, in writing, postmarked not later than October

20, 1995, and further stated, “if you do not comply with the

procedure and the deadline stated herein, you may not be

entitled to be heard at the Fairness Hearing or to otherwise

contest the approval of the Settlement, or to appeal from any

orders or judgments of the Court entered thereon.”

All objections, however styled, that failed to comply with

the procedures and deadlines set forth in the notice program,

are hereby found to be procedura!ly deficient and are

disqualified in accordance with the foregoing statement.

40. The Court has also reviewed the Principles of

Agreement dated November 7, 1995, executed by the parties,

including the terms applicable to U.S. Brass Corp., Eljer

Manufacturing, Inc., and Eljer Industries, Inc. The terms of

the Principles of Agreement appear to be reasonable and in

26a

Appendix B

accordance with the efforts being made to seek a global

resolution of all litigation pertaining to the issues among the

parties. The prior Cox settlement was unclear as to

the effect of funds received from U.S. Brass Corp.,

Eljer Manufacturing, Inc., and Eljer Industries, Inc.

The revised settlement makes clear that amounts received

from U.S. Brass and/or Eljers will add to the minimum fund

of $950 million. If that settlement is perfected and approved

by the United States Bankruptcy Court, the minimum fund

would substantially increase.

41. In independently determining to approve the

Settlement and the Application, the Court has considered the

substance of all objections to the Settlement, whether timely,

qualified or not, including those by the Martin Objectors and

others that have since been withdrawn or stricken.

42. Certain objectors have asserted that the proposed

Settlement must be reduced by a proposed settlement of

claims against du Pont in the Spencer case pending in the

Circuit Court of Greene County, Alabama, which the

objectors characterized as a $120 million settlement.

43. The proposed du Pont settlement has not been

approved by the Spencer court, and this Court may not

speculate whether it will be approved by the Spencer court.

44. The proposed du Pont settlement in Spencer purports

to entitle a claimant to a rebate of 8% of monies the claimant

pays for replumbing his or her structure.

- 27a

Appendix B

45. The Settlement before this Court, in the minimum

amount of $950 million, provides for the assignment of

Settlement Class members’ claims against du Pont and others

to defendants Shell and Celanese.

46. Objectors are incorrect in asserting that the “credit”

arising from the assignment reduces the Defendants’

contribution to the Settlement. The original Cox settlement

was $850 million to be paid by the Defendants. The revised

Cox settlement requires the Defendants to pay a minimum

of $950 million to consumers with assignment of rights,

against du Pont, regardless of whether du Pont ultimately

participates in the settlement. The revised Cox settlement

substantially increases benefits to consumers.

47. Contrary to objectors’ assertions, all interest earned

on funds held by the CPRC will be for the benefit of the

Settlement Class and will not be credited against the

Defendants’ obligations under the Agreement.

48. Because of the structure of the Settlement, the

Defendants’ obligation to fund the CPRC on an ongoing,

as-needed basis, and the Defendants’ obligation to pay

reimbursement for Past Expenses in a reasonable time after

the close of the one year claim filing period on August 21,

1996, and any related opt out period that may be necessary

under § 4.5.1 of the Agreement, there is no significant ability

by the Defendants to delay payments due under the

Settlement.

49. Objectors are incorrect in asserting that, even before

the Defendants’ initial funding commitment was increased

28a

Appendix B

from $850 million to $950 million, the “net funding by

Shell and Celanese under . . . the agreement [was) only $547

million.”

50. The notice provided to the Settlement Class was

neither misleading nor defective.

51. The defendants are each responsible for one-half of

the settlement obligations as specified in the Settlement

Agreement unless and util the respective liabilities are

established by arbitration under the Funding Agreement.

52. The Cox Class Counsel have undertaken a

reasonable risk that each of the defendant companies will be

solvent and capable of fulfilling its obligations under this

agreement.

53. Had the plaintiffs settled at separate times with Shell

and Celanese, it is highly unlikely that there would ever have

been joint and several liability between them.

54. The Settlement is more favorable to the Settlement

Class than litigation if it is assunied that one of the defendants

will, some years from now, become unable to pay all claims,

since the class will receive payment under the Settlement

promptly, thereby reducing the number of claimants who

would be subjected to proving claims in a bankruptcy.

55. The Agreement provides broad ranging powers for

the enforcement of a defaulting defendant’s obligations,

including the full panoply of equitable powers this Court

possesses.

29a

Appendix B |

56. The Agreement expressly provides that the default

of one defendant does ot exonerate the other defendant of

its obligations under the Agreement.

57. Past expenses will be compensated after expiration

of one year from August 21, 1995, the Initial Notice Date

under the Agreement.

58. Claimants will not, contrary to an objection, be

required to wait 14 years to receive their entitled

reimbursements or distributions under the Agreement.

59. The so-called exclusion of a “hot water heater

leak” —a leak occurring within six feet of piping measured

from the take-off at the unit’s hot water heater-does not apply

to any claim for reimbursement of repair costs and property

damage. Thus, the only exclusion is for eligibility for a

replumb, and even there, the exclusion applies only if

(1) it is the first leak in the unit and (2) it can be repaired

without cutting into the unit’s walls, ceilings, or floors.

60. Therefore, a replumb will be provided under the

Agreement even if the hot water heater leak is the first leak,

if to repair the leak would require cutting into the walls,

ceilings, or floors of the unit. Similarly, there will be a

replumb if the hot water heater leak is the second leak in the

system.

61. The claimant has the right to select the contractor

to do the replumbing and property damage repair work.

30a

Appendix B

62. Nothing in the Agreement abrogates the warranty

of work done by the contractors and suppliers of pipe and

other components in the replumb.

63. The Agreement permits special relief involving

unusual hardship, so long as the CPRC Ombudsman

and President concur that such relief should be provided.

This provision allows the CPRC to provide relief from a

breach of warranty arising out of replumbing work, where

the warrantor fails to provide or cannot provide corrective

relief. CPRC § VI, E.

64. There is no factual basis for the asserted objection

that there is any conflict of interest with respect to the Cox

Class Counsel.

65. The Cox Class Counsel maintained the highest

standards of professionalism and advocacy in protecting and

promoting the interests of the Class throughout the

prosecution and settlement of this case.

66. There is no factual basis for the asserted objection

that settlements in individual cases are improperly disparate

from the Cox Settlement.

67. There is no need to provide additional notice to the

entire Settlement Class by reason of the revised terms of the

Settlement since the Court approved the notices disseminated

to the Settlement Class. All changes have been to improve

the Settlement over that described in the notices, and none

of the changes has an adverse impact on any Class member.

3la

Appendix B

68. As class action jurisprudence has accumulated,

various federal and state courts, in Tennessee and elsewhere,

have articulated criteria and factors that courts may consider

in evaluating proposed settlements for final approval.

See, e.g., Third Nat'l Bank v. Scribner, 212 Tenn. 400, 410,

370 S. W.2d 482 (1963); Clark Equip. Co. v. International

Union, Allied Indus. Workers, 803 F.2d 878, 880 (6th Cir.

1986), cert. denied sub nom. Jones v. Clark Equip. Co., 480

U.S. 934 (1987); Williams v. Vukovich, 720 F.2d 909, 922

(6th Cir. 1983); Bailey v. Great Lakes Canning, Inc., 908

F.2d 38, 42 (6th Cir. 1990); In re Warner Communications

Sec. Litig., 618 F. Supp. 735 (S.D.N.Y. 1985) aff'd, 798 F.2d

35 (2d Cir. 1986); Girsh v. Jepson, 521 F.2d 153, 157 (3d

Cir. 1975). This Court has been guided, generally, by the

procedures and criteria recommended in the Manual for

Complex Litigation, 3d ed. (Federal Judicial Center 1995),

§§ 30.4, et seq., since the federal and Tennessee class action

provisions and criteria are consistent.

69. Factors that may be considered in assessing the

fairness, adequacy, and reasonableness of the proposed

settlement include: the plaintiffs’ likelihood of ultimate

success on the merits balanced against the amount and form

of relief offered in the settlement; the stage of the proceedings

at which the settlement is reached; the extent of cumulative

discovery or investigation; the nature of the settlement

negotiations; the costs, risks, and delays of establishing

liability and damages; the views of experienced counsel; the

reaction of the class members themselves; the comparison

of the settlement’s benefits with other settlements or with

the alternative of continuing litigation; and whether approval

of the settlement is in the class members’ and the public

32a

Appendix B

interest. As the above opinion and findings demonstrate,

consideration of these and other recognized factors, such as

the participation and recommendations of an experienced and

able settlement judge and the testing of the settlement’s merits

in the clash of adversary proceedings, demonstrate the

Settlement’s entitlement to approval.

70. Expert opinions have been submitted in support of

the proposed Settlement. (See Opinion of Professor David

Rosenberg, Affidavit of Professor Paul H. Rubin). In

approving the Settlement, the Court has considered these

opinions.

71. The Court will retain jurisdiction and address a

supplemental notice program, on a joint motion of the settling

parties, to advise all members of the Settlement Class on

whose behalf a purported or actual request for exclusion was

received of the enhanced Settlement, providing those

individuals with a new opportunity to request exclusion from

the Settlement Class in light of the enhanced Settlement.

72. There is no just reason for delay in the entry of a

final judgment and decree by reason of such supplemental

notice and related proceedings or of the retention by the Court

of continuing jurisdiction to oversee the implementation and

enforcement of the Agreement and Settlement.

73. The Application is fair and should be granted.

Based upon the foregoing, it is hereby ORDERED,

ADJUDGED, and DECREED:

33a

Appendix B

1. The Court has jurisdiction over all claims asserted in

the Action on behalf of all Settlement Class members and

over all parties to the Action, including all members of the

Settlement Class.

2. The Settlement Class is defined as follows:

All persons and entities that (1) own real property

or structures in the United States in which there

was installed between January 1, 1978 and July

31, 1995, polybutylene plumbing with acetal

insert or metal insert fittings or a polybutylene

yard service line; (2) own or previously owned

such real property or structures and have already

incurred any cost or expense, by reason of leakage

from, or from failure, repair, or removal of,

all or any portion of such polybutylene plumbing

or yard service line which was installed between

January 1, 1978 and July 31, 1995; or (3) will

own such real property or structures during the

term of entitlement to relief under the Settlement

Agreement.

The definition of the Settlement Class excludes:

(1) All persons who, in accordance with the terms

of the Settlement Agreement, execute a timely

request for exclusion from the Settlement Class;

(2) the Defendants; the Released Manufacturers;

the parent and any subsidiary, affiliate and

controlled entity of any of them; and the officers

and directors of each of them; and (3) all parties

a eee

34a

Appendix B

to Geno Cioe, et al. v. Shell Oil Company, et al.,

Case No. 662214, and Robert L. Williams, et all.

v. Shell Oil Company, et al., Case No. 658403,

and related combined actions (Case Nos. 640245,

654709, 656787, 661372, 665521 and 665527) in

the Superior Court of the State of California in

and for the County of San Diego, and all members

of the certified classes in those lawsuits.

3. All members of the Settlement Class who have not

timely elected to be excluded from the Settiement Class are

members thereof and are bound by this Order and the Final

Judgment being entered herewith.

4. Pursuant to Rule 23.01, Rule 23.02, and Rule 23.03

of the Tennessee Rules of Civil Procedure, the Court confirms

the certification of the Settlement Class provided in the

Preliminary Approval Order and maintains such certification

for purposes of final approval of the settlement.

5. The Class Representatives and Plaintiffs’ Class

Counsel designated in paragraph 8 of the Court-approved

Notice of Class Action and Proposed Settlement to represent

the Settlement Class are hereby confirmed.

6. The Agreement and the Funding Agreement entered

into by the Defendants pursuant to the Agreement are hereby

made part of the record in this case and as such shall have

the full force and effect of an order of the Court.

7. Pursuant to Rule 23.05 of the Tennessee Rules of Civil

Procedure, the Court hereby grants final approval of the

35a

Appendix B

Agreement and the Settlement set forth in the Agreement

and finds that it is fair, adequate, and reasonable to the

members of the Settlement Class.

8. The objections that were filed, whether timely or not,

have been considered and are all overruled.

9. Accordingly, the Court directs that the Settlement be

consummated in accordance with the terms and conditions

of the Agreement.

10. Plaintiffs and a!l members of the Settlement Class

are barred and permanently enjoined from prosecuting

(in any forum) against Shell Oil Company and/or Hoechst

Celanese Corporation any and all claims, demands, causes

of action of every kind and nature, obligations, damages,

losses, and costs, whether known or unknown, actual or

potential, suspected or unsuspected, contingent or fixed,

either arising out of or relating to any of the facts,

transactions, actions, or conduct alleged in this action, or

that were or could have been asserted or sought in the action,

other than say past, present, or future claim for bodily injury

(including wrongful death) and associated emotional distress

and mental anguish.

11. The Complaint as amended, and all claims and

causes of action asserted therein are dismissed with prejudice

and costs, as provided in the Agreement, to be paid from the

settlement fund.

12. The Application is hereby granted. In accordance

with the Funding Agreement referred to in the Agreement,

36a

Appendix B

the defendants shall pay Plaintiffs’ Class Counsel, as

attorneys’ fees and expenses, the sum of $45 million plus

interest at the rate applicable to federal court judgments

entered on July 31, 1995, for the period from July 31, 1995,

until the earlier of July 31, 1996, or when paid. In addition,

in accordance with Section 25.1 of the Agreement and with

the Funding Agreement referred to in the Agreement, the

defendants shall pay the sum of $3,000.00 to each single

Representative Plaintiff or Representative Plaintiff married

couple.

13. In the event that the Settlement does not become

Final (as more fully defined in the Agreement) in accordance

with the terms of the Agreement, then this Order and the

Final Judgment and Decree being entered herewith shall be

rendered null and void and be vacated and the Agreement

shall be rendered null and void in accordance with the

provisions thereof.

14. Without affecting the finality of this Order or of the

Final Judgment being entered herewith, the Court shall retain

continuing jurisdiction over the Action and the settling Parties

(as more fully defined in the Agreement), including all

members of the Settlement Class; the administration and

enforcement of the Settlement; and the benefits to the

Settlement Class, including for such purposes as supervising

the implementation, enforcement, construction, and

interpretation of the Agreement.

15. Any die ies or controversies arising with respect

to the interpretation, enforcement, or implementation of the

Agreement shall be presented by motion to the Court.

37a

Appendix B

16. Pursuant to Rule 54.02 of the Tennessee Rules of

Civil Procedure, the Court hereby directs the entry of this

judgment based upon the Court’s finding that there is no just

reason for delay notwithstanding the Court’s retention of

jurisdiction to oversee implementation and enforcement of

the Agreement and its continuing jurisdiction to provide for

supplemental notice (and related proceedings) to potential

members of the Settlement Class as to whom the Court

previously received requests for exclusion from the

Settlement Class.

s/ W. Michael Maloan

CHANCELLOR

ENTERED: November 17, 1995