It’s logical that companies trying to settle a large number of mesothelioma claims are going to argue for the least possible payout.
But our Boston mesothelioma lawyers know that such offers fall far short when you calculate the sheer number of people sickened and the devastating impact that this lung disease has on those affected.
In a federal bankruptcy court in Pittsburgh, a judge is sifting through a weeks’ worth of testimony – 17 hours from each side – to close the gap in the disparity of how much both sides think proven and legitimate victims should get now and in the future.
It’s called an estimation hearing, and it stems from a Chapter 11 bankruptcy petition filed three years ago by three companies that specialized in making an asbestos-containing joint compound for at-home projects and renovations. In all, the companies were facing down some 15,000 claims of liability from people who said they suffered illness after using these products. Nearly 3,000 of those claims were from people who had developed mesothelioma. Others developed chronic lung ailments, such as asbestosis.
Filing for bankruptcy allows these companies to insulate themselves from a barrage of lawsuits. But they don’t get to simply walk away. They have to establish what is known as a 524(g) trust fund, from which future claims meeting certain criteria can be filed and paid.
The American Bar Association reports that in 2011, there were 56 asbestos trusts paying out hundreds of millions of dollars in claims annually, with the number of claims and the amount of reward steadily increasing each year. It’s estimated that the total assets of these trusts is right now somewhere in the neighborhood of $35 to $60 billion – and growing.
A recent study by the A.M. Best ratings firm calculated that the entire industry could be expected to shell out approximately $85 billion in asbestos cases when all is said and done.
At issue here is that the defendants claim they’ve essentially already had to pay more than is reasonable. Nearly 15 years ago, when a flood of mesothelioma claims began to be filed, many companies chose to file bankruptcy and create trusts. These companies did not.
As a result, in certain districts that employ methods of liability known as joint and several, the businesses that had not filed bankruptcy but were sued alongside those that had were stuck paying the whole amount of damages in civil cases they had lost. In other words, they had paid for the liability of other companies, as well as their own.
So now, they are attempting to argue that they shouldn’t have to set aside as much as other firms have in the past.
Additionally, they are trying to argue that the type of asbestos they used, called Chrysotile asbestos, isn’t as deadly as other forms (despite ample evidence to the contrary). Another aspect of their argument is that the number of pending claims when compared to their market share doesn’t add up. In other words, they say it’s improbable that so many people got so sick using their product just a few times.
This last argument is sometimes known as the “safe exposure” theory, which purports that the level of your sickness is relative to how much asbestos you came in contact with. However, as the federal Occupational Health and Safety Administration has repeatedly pointed out, there is no safe level of exposure when it comes to asbestos.
If you or a loved one is diagnosed with mesothelioma in New England, call for a free and confidential appointment at 1-888-367-2900.
Asbestos bankruptcy estimation hearing gets under way in western Pa., Jan. 7, 2013, By Jon Campisi, Legal Newsline Legal Journal
Asbestos bankruptcy estimation hearing highlights major disparities, Jan. 9, 2013, By Jon Campisi, Legal Newsline Legal Journal
More Blog Entries:
Insurers Expected to Shell Out $85B in Asbestos Claims – $11B More Than Anticipated, Jan. 6, 2013, Boston Personal Injury Lawyer Blog