Asbestos Bankruptcy Trusts
Generally, asbestos bankruptcy trusts are created by companies who have filed for bankruptcy. These trusts pay personal injury claims for asbestos exposure victims. Since the mid-1970s, at least 56 asbestos bankruptcy trusts were set up.
Armstrong World Industries Asbestos Trust
Armstrong World Industries was founded in 1890 in Pittsburgh. It is the largest wine cork maker in the world. It has more than 3000 employees and operates 26 manufacturing facilities around the world.
In the beginning the company employed asbestos in a variety of products like tiles, insulation and vinyl flooring. Workers were exposed to asbestos, which can cause serious health problems like mesothelioma and lung cancer.
The asbestos-containing products of the company were widely employed in commercial, residential, as well as military construction industries. Due to the exposure, thousands of Armstrong workers developed asbestos-related diseases.
Although asbestos is a naturally occurring mineral, it is not suitable for human consumption. It is also known as a fireproofing material. Companies have created trusts to compensate victims of the dangers of asbestos.
A trust was created to pay the victims of Armstrong World Industries’ bankruptcy. In the first two years, the trust settled more than 200,000 claims. The total amount of compensation was more than $2B.
Armor TPG Holdings, which is a private equity company holds the trust. At the start of 2013 the company controlled more than 25 percent of the fund.
According to the Asbestos Victims Compensation Trust, the company is estimated to be responsible for more than $1 billion in personal injury claims. The trust has more than $2 billion in reserves to pay claims.
Celotex Asbestos Trust
Celotex Corporation was a distributor and manufacturer of building materials. During the 1980s, Celotex Corporation was hit by a flood of lawsuits that claimed pleural asbestos-related property damage. These claims, as well as others, demanded billions of dollars in damages.
In 1990, Celotex filed for bankruptcy protection. To handle asbestos-related claims the Asbestos Settlement Trust was created through Celotex’s reorganization program. The Trust filed a claim at the United States District Court for bonusking.sk Middle District of Florida. Saiber L.L.C. represented the Trust.
In the course of the investigation, the trust sought coverage under two general liability insurance policies. One policy offered coverage for five million dollars, while the other offered coverage for 6.6 million. The trust also asked for coverage from Jim Walter Corporation. But, it did not find proof that the trust was required to send notice to the excess insurers.
The Celotex Asbestos Trust filed proofs of bodily injury claims on December 31 in 2004. The trust also moved to rescind the special master’s ruling.
Celotex had less than $7 million in primary coverage at the time of filing but believed that future asbestos litigation would affect its excess coverage. Celotex had anticipated the need for several layers of excess insurance coverage. The bankruptcy court did not find any evidence to suggest that Celotex gave adequate notice to its excess insurers.
The Celotex Asbestos Settlement Trust is an intricate procedure. It is responsible for settling claims against Philip Carey (formerly Canadian Mine) as well as providing treatment for asbestos-related illnesses.
The process can be difficult to understand. The trust provides a user-friendly claim management tool, as well as an interactive website. A page is also available on the trust’s website that addresses the issues with claims.
Christy Refractories Asbestos Trust
In the beginning, Christy Refractories’ insurance pool was worth $45 million. The company declared bankruptcy in 2010, however. The filing was made to settle asbestos lawsuits. Christy Refractories’ insurers have been in the process of settling asbestos claims at a rate of $1 million per month since.
There have been more than 20 billion dollars remitted from pleural asbestos trust funds since the late 1980s. These funds can be used to cover the loss of income and therapy costs. The Western MacArthur Trust and the M.H. Detrick Asbestos Trust, the Thorpe Insulation Settlement Trust, and the M.H. Porter asbestos survival rate (compraenred.com) Trust.
Products from the Thorpe Company included insulation and refractory materials. Asbestos was also a component in their products. The company filed for Chapter 11 bankruptcy in 2002, but later 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. Pneumo Corporation, Abex Corporation and Synkoloid 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 2,000 asbestos claims. It also supplied sealing materials to the oil extraction industry.
The Prudential Lines Trust faced hundreds of lawsuits and mass tort lawsuits, and a 20-year limitation on paying out the funds.
The Western MacArthur Asbestos Settlement Trust has paid more than $500 million in claims. It also handles 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
The trust was first filed in 2007. Federal Mogul’s Asbestos Personal Injury Trust was filed in 2007 and is an insurance trust designed to aid victims of asbestos case exposure. The Federal Mogul Asbestos PI Trust is a trust in bankruptcy that offers financial compensation for illnesses that were caused by asbestos exposure.
The initial assets of $400 million were used to create the trust in Pennsylvania. After the trust’s establishment it made payments of millions to those who claimed.
The trust is now located in Southfield, MI. It is comprised of three separate money coffers. Each is dedicated to the handling of claims against companies that manufacture asbestos-related products for Federal-Mogul.
The trust’s primary goal is to provide financial compensation for asbestos-related diseases in the 2,000 occupations that employ asbestos prognosis. The trust has paid more than $1 billion in claims.
The US Bankruptcy Court estimated the asbestos liabilities’ net value to be approximately $9 billion. It was also decided that creditors should maximize the value of 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.
The trust has established Trust Distribution Procedures, or TDPs to deal with claims. These TDPs are intended to be fair to all claimants. They are based upon previous values for nearly identical claims in the US tort system.
Reorganization protects asbestos companies against mesothelioma lawsuits
Every year thousands of asbestos lawsuits are settled through the bankruptcy courts. Large corporations are now employing new methods to gain access to the judicial system. Reorganization is a common strategy. This allows the business to continue operating and provide relief to creditors who have not been paid. It is also possible to protect the company from lawsuits by individual creditors.
For instance, in the course of a restructuring, the trust fund for asbestos victims may be established. These funds may pay out in the form of gifts, cash or other forms of payment. The reorganization discussed above consists of an initial funding proposal, followed by a court-approved plan. A trustee is appointed once an reorganization is approved. It could be an individual or a bank or an outside party. The most effective arrangement will cover all participants.
The reorganization not only announces an innovative approach to bankruptcy courts, but also unveils powerful legal tools. Hence, gravesales.com it’s no wonder that many companies have filed for chapter 11 bankruptcy protection. To ensure that they are protected asbestos companies have no other choice other than to file for chapter 7 bankruptcy. Georgia-Pacific LLC, for example, filed chapter 7 bankruptcy in 2009. The reason is simple. Georgia-Pacific filed for an order of reorganization to defend itself from a flood of mesothelioma lawsuit. It also rolled all its assets into one. It has been selling its most valuable assets to get the financial gimmicks under control.
FACT Act
The “Furthering Asbestos Claim Transparency Act” is currently in Congress. It will make it more difficult to file fraudulent claims against asbestos trusts. The legislation will make it harder to claim fraudulent claims against asbestos trusts, and will allow defendants unlimited access to information during litigation.
The FACT Act requires that asbestos trusts release a list of claimants in a public docket of court. They must also publish the names and exposure history as well as compensation amounts paid these 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. In fact the report on FACT Act by the Environmental Working Group found that 19 members of the House Judiciary Committee who voted for the bill received campaign contributions from asbestos-related companies.
The FACT Act is a giveaway to large asbestos companies. It could also delay the process of settling compensation. It also creates privacy issues for victims. The bill is also a complex piece of legislation.
In addition to the data that is required to be made public in addition to the information required to be released, the FACT Act also prohibits the release of social security numbers, medical records and other information protected by bankruptcy laws. It is also more difficult to get justice in courtrooms.
The FACT Act is a red herring, aside from the obvious question about how victims could be compensated. The Environmental Working Group studied the House Judiciary committee’s most significant accomplishments and found that 19 members were paid campaign contributions from corporations.