Asbestos Bankruptcy Trusts
Generally asbestos bankruptcy trusts are established by companies that have filed for bankruptcy. Trusts are then able to pay personal injury claims of those who were exposed to asbestos. In the mid-1970s, at least 56 asbestos bankruptcy trusts were set up.
Armstrong World Industries Asbestos Trust
It was established in 1860 in Pittsburgh, PA, Armstrong World Industries is the world’s largest wine cork manufacturer. It has over three thousand employees and 26 manufacturing plants across the globe.
The company employed asbestos in a range of products like insulation, tiles as well as vinyl flooring and tiles in its beginning years. The result was that employees were exposed to the material, which can lead to serious health problems such as mesothelioma and lung cancer and asbestosis.
The asbestos-containing products manufactured by Armstrong were extensively used in residential, commercial, and military construction industries. Due to the exposure to asbestos, thousands of Armstrong workers suffered from asbestos-related diseases.
While asbestos is a naturally occurring mineral, it is not safe to be consumed by humans. It is also known as a fireproofing material. Companies have created trusts to compensate victims due to the dangers of asbestos.
As a result of the bankruptcy of Armstrong World Industries, a trust was set up to compensate those who have been affected by the company’s products. The trust was able to pay out more than 200,000 claims in the first two years. The total compensation totaled more than $2 billion.
The trust is owned by Armor TPG Holdings, a private equity firm. The company held more than 25 percent of the fund as of the beginning of 2013.
According to the Asbestos Victims Compensation Trust the company was responsible for more than $1 billion in personal injuries claims. The trust has more than $2 billion in reserves to pay claims.
Celotex Asbestos Trust
In the early to mid 1980s, Celotex Corporation, a manufacturer and distributor of building materials, had to contend with an avalanche of lawsuits claiming asbestos-related property damage. These claims, along with others, demanded billions in damages.
In 1990, Celotex filed for bankruptcy protection. To process asbestos-related claims, the Asbestos Settlement Trust was created in the reorganization plan of Celotex. The Trust filed a claim at the United States District Court for Middle District of Florida. The Trust was represented by attorneys from Saiber L.L.C.
In the course of the investigation the trust sought coverage under two extra comprehensive general liability insurance policies. One policy provided five million dollars of coverage while the other provided 6.6 million. The trust also asked for coverage from Jim Walter Corporation. It did not discover any evidence that showed the trust was required by law to give notice to excess insurances.
The Celotex asbestos attorney in allouez Trust filed proofs of bodily injury claims on December 31 in 2004. The trust also made a motion to overturn the special master’s ruling.
Celotex had less that $7 million of primary coverage when it filed, but was of the opinion that future asbestos litigation would affect its coverage. In reality, the company anticipated the need for asbestos lawyer in Barling a number of layers of extra insurance coverage. However, the bankruptcy court found no evidence to establish that Celotex provided adequate notice to its excess insurance carriers.
The Celotex Asbestos Settlement Trust is an extremely complex process. It is responsible for settling claims against Philip Carey (formerly Canadian Mine) and providing treatment for asbestos-related diseases.
The process can be difficult to understand. Fortunately, the trust has an easy to use claims management tool and an interactive web site. There is also a page on the website that addresses the issues with claims.
Christy Refractories Asbestos Trust
Christy Refractories originally had an insurance pool of $45 million. However, in the first quarter of 2010 the company filed for bankruptcy. The filing was made to settle asbestos lawsuits. In the meantime, Christy Refractories’ insurance carriers have been settling asbestos Lawyer in barling-related claims at roughly $1 million per month.
Over 20 billion dollars paid out from asbestos trust funds since the end of the 1980s. These funds can cover the cost of therapy as well as lost income. The funds that are included in these are the Western MacArthur Trust, the M.H. Detrick Asbestos Trust, the Thorpe Insulation Settlement Trust, and the M.H. Porter Asbestos Trust.
The Thorpe Company’s products comprised insulation and refractory materials which included asbestos. The company filed for Chapter 11 bankruptcy in 2002 However, it reemerged in 2006. It has dealt with more than 4,500 claims.
The Western MacArthur Trust has paid out over $1.1 billion in claims. The Synkoloid Company, Abex Corporation, and Pneumo Corporation all used asbestos in their products. The United States Gypsum Company used asbestos in its products.
The Utex Industries, Inc. Successor Trust has paid more than 22,000 asbestos claims. It provided sealing products to the oil extraction industry.
The Prudential Lines Trust faced hundreds of lawsuits in mass tort actions and a 20 year limit on the amount of money that could be disbursed.
The Western MacArthur Asbestos Settlement Trust has paid out over $500 million in claims. It also manages Yarway claims.
The Thorpe Insulation Settlement Trust includes the Pacific Insulation Company as well as the Thorpe Insulation Company.
Federal Mogul’s Asbestos PI Trust
Federal Mogul’s Asbestos Personal Injury Trust was first filed in 2007. It is a trust that assists victims of asbestos exposure. The Federal Mogul Asbestos PI Trust is a trust in bankruptcy that provides financial compensation for ailments caused by asbestos exposure.
The initial assets of $400 million were used to establish the trust in Pennsylvania. It made payments to claimants in the millions following its establishment.
The trust is located in Southfield, MI. It is made up of three separate coffers. Each is devoted to the administration of claims against entities who produce asbestos products for Federal-Mogul.
The main goal of the trust is to pay financial compensation for asbestos-related diseases among approximately 2,000 occupations that employ asbestos. The trust has already paid more than $1 billion in claims.
The US Bankruptcy Court estimated the net value of asbestos liabilities to be approximately $9 billion. It was also decided that creditors should maximize the value of their assets.
In 2007 the Asbestos PI Trust (PI Trust) was established. Elihu Inselbuch was a partner at the firm Caplin & Drysdale and served as the Trust attorney.
To handle claims, the trust has established Trust Distribution Procedures (or TDPs). These TDPs are designed to treat all claimants equally. They are based upon previous values for nearly identical claims in the US tort system.
Reorganization helps asbestos companies protect themselves from mesothelioma lawsuits
Many asbestos lawsuits are settling every year, due in part to bankruptcy courts. Large corporations are using new methods to gain access to the legal system. One such strategy is restructuring. This permits the company to continue to operate and offer relief to those who have not paid their creditors. It could also be possible to shield the business from lawsuits by individual creditors.
For example, a trust fund may be set up for asbestos victims as part of a restructuring. These funds can be used to pay out in cash, in gifts, or the combination of both. The reorganization mentioned above is an initial funding proposal that is followed by a reorganization program approved by the court. A trustee is appointed after the reorganization has been approved. This could be an individual or a bank, or an outside party. Generally, the most effective reorganization will provide for all participants.
Apart from announcing a new strategy for bankruptcy courts, the restructuring reveals some powerful legal tools. It’s not surprising that many companies have filed for chapter 11 bankruptcy protection. Certain asbestos-related companies were forced to declare bankruptcy under chapter 7 to ensure their safety. Georgia-Pacific LLC, for example had filed chapter 7 bankruptcy in 2009. The reason is straightforward. To guard itself against a rash of mesothelioma claims, Georgia-Pacific filed for a restructuring and combined all of its assets into one. To get a handle on its financial problems, it has been selling off its most important assets.
Presently, there is an act in Congress known as the “Furthering Asbestos Claim Transparency Act” (FACT) which will change the way fairhope asbestos lawsuit trusts function. The legislation will make it more difficult to claim fraudulent claims against asbestos law firm chatham trusts and will allow defendants unlimited access to information during litigation.
The FACT Act requires that asbestos trusts publish a list listing claimants in a public docket of court. It also requires them to publish the names as well as exposure histories and compensation amounts paid to the claimants. These reports, which are publically available, could prevent fraud from happening.
The FACT Act would also require trusts to share other information, such as payment details even if they were part of confidential settlements. The Environmental Working Group’s report on FACT Act found that 19 House Judiciary Committee members voted for the bill. They also received donations from asbestos-related organizations.
The FACT Act is a giveaway for big asbestos companies. It could also lead to delays in the process of compensation. It also creates privacy issues for victims. The bill is also a complicated piece of legislation.
The FACT Act prohibits publication of information in addition to information that must be made public. It also prohibits the disclosure of social security numbers, medical records, or other information that is protected under bankruptcy laws. It’s also more difficult to obtain justice in courts.
In addition to the obvious issue of how a victim’s compensation may be affected, the FACT Act is a red herring. The Environmental Working Group examined the House Judiciary committee’s most notable accomplishments and found that 19 members were given corporate campaign contributions.