When Boston asbestos lawsuits first began to stack up back in the 1970s, it wasn’t long before defendants, victims and judges concluded that valid personal injury claims were going to outpace the amount of money available to adequately compensate those who had been wronged.
It was for this reason that many asbestos defendants started to file for bankruptcy protection – but they weren’t able to get off the hook entirely. Approximately 100 companies have filed for bankruptcy reorganization actions that allowed the firms to set aside money for current and future asbestos injury claims while continuing to operate. Some companies no longer operate, but still have trustees managing these asbestos bankruptcy trusts as claimants continue to emerge decades after exposure.
In these cases, the court decides how much money the firm must set aside (based on projections of current and future liability). It’s often an involved process. But once it’s approved, filing a claim with a mesothelioma bankruptcy trust is a fairly streamlined process. An experienced attorney can help you appropriately file the claim.
Recently, another defendant in a series of asbestos tort actions filed for Chapter 11 bankruptcy protection. New Jersey-based aluminum company Consolidated Aluminum Corp. stopped operating back in 1994, but it remained open to manage ongoing litigation against it. In December, it filed for bankruptcy.
Court records in the case indicate there company has about 200 creditors – one of whom it owes $72 million – but it only has somewhere between $500,000 and $1 million in assets.
The company, which used to do business as Conalco, has been named numerous times as a defendant in asbestos lawsuits.
In one of those cases, Patterson v. Consolidated Aluminum Corp., a woman and her husband filed a suit against the company after the woman was diagnosed with malignant mesothelioma. The lawsuit contended the woman was exposed to the material for years while washing her father and grandfather’s work clothing. The clothing was covered in asbestos dust that flaked from products produced by the aluminium company.
Another case involves an Ohio man who worked for the aluminum firm from 1958 to 1979 and has since been diagnosed with lung cancer.
This and all such similar actions have been removed to bankruptcy court for resolution.
Once a firm like Consolidated Aluminum files for bankruptcy, no other lawsuits can be filed against it at that point. Any future liability claims against the firm have to be handled through the trust.
In many cases, compensation through an asbestos trust is typically less than what a plaintiff would receive had they been able to pursue a lawsuit. However, it’s a better option than receiving nothing after a company folds.
Asbestos trusts are managed not by the company, but rather by trustees. These are the individuals responsible for receiving, evaluating and paying out claims. Trustees also ensure the payments are issued at at a rate that is going to ensure there are enough funds left for future claims.
Since the first bankruptcy trusts were established, these entities have processed some 3.3 million claims, dolling out roughly $17.5 billion. It’s expected that the number of bankruptcy trusts will continue to increase as the number of asbestos injury claims continue to rise.
If you have questions about filing an asbestos bankruptcy trust claim in Boston, contact our experienced legal team.
If you or a loved one is diagnosed with mesothelioma in Boston, call for a free and confidential appointment at 1-888-367-2900.
Asbestos defendant declares bankruptcy, Jan. 1, 2014, By John O’Brien, The West Virginia Record
More Blog Entries:
Low Levels of Asbestos Exposure Can Cause Mesothelioma, Jan. 2, 2014, Boston Mesothelioma Attorney Blog