Pluses and Minuses of an Asbestos Trust Fund
When the first mesothelioma and asbestos-related lawsuits were won on behalf of victims of asbestos exposure, it opened the doors wide for similar lawsuits to be filed all over the country by thousands of people who had been sickened.
With juries awarding significant amounts of money to mesothelioma patients, the asbestos companies began looking for a way to minimize their payouts, and began filing for bankruptcy protection.
Congress and the bankruptcy courts recognized that the cost of litigation and paying out large fees was creating too large a burden for companies to be able to survive, but also determined that the companies could not escape their responsibility to those they had harmed.
If you have been been diagnosed with mesothelioma, contact our law firm today at 1-800-706-5606 to discuss your legal options.
Establishing the Trust Fund for Bankruptcy Protection
They set forth that if a company was seeking bankruptcy protection as a result of asbestos litigation, then an asbestos trust fund had to be established using at least half of their reorganization value specifically for the payment of asbestos-related claims.
As a result, almost fifty companies that had faced numerous lawsuits for mesothelioma and other asbestos-related illnesses have established asbestos funds over the last thirty years or so,
and those funds are currently valued at approximately $30 billion dollars. Proponents of the funds say that there are certain advantages to simply filing a claim based upon the facts of the case and getting a straight-forward payment:
- The companies that are involved are punished, but are still able to operate and are able to budget for the compensation that they are expecting to pay out.
- The companies that were responsible for the asbestos exposure are consistently held responsible for paying victims rather than putting them through the rigors of having to prove their case in court.
- The amount of money that is distributed to victims is equal and predictable, so that mesothelioma victims are all treated equally rather than based upon the sympathies of a jury or the skill (or lack thereof) of their attorney.
- Payments are administered by a committee and staff whose total focus is on making the calculations and paying victims in a reasonable amount of time. There are no delays; victims get their money in a predictable amount of time.
Disadvantages of the Asbestos Trust Fund
Though there are certainly some advantages to the way that the mesothelioma trust funds are meant to be operated, there have been some problems with them as well,
and many victims’ rights advocates have expressed some concerns, particularly as Congress is considering mandating a trust fund set up under the FAIR (Fairness in Asbestos Injury Resolution) act. These concerns include:
- The amount of money that the companies that have been deemed to be responsible for asbestos exposure will be required to pay into the funds is supposed to be based upon a reasonable contribution based on their liability, but the proposals that are being made seem to be dramatically underfunded.If there isn’t enough money set aside, then mesothelioma victims will be left without compensation.
- Because mesothelioma’s incidence is so unpredictable there is no clear way to assess how many victims are likely to apply to the trust for compensation.The very first fund that was established by an individual company, which was the Johns-Manville case, did not properly estimate how many claims they would be faced with, and as a result have been unable to pay all who they were responsible for making ill.
- There are also concerns about who will be eligible to apply for compensation to an asbestos trust fund. The asbestos companies are strongly involved in the efforts to establish a law governing the FAIR Act,and are insisting that only those that have been exposed via their occupation (with a few notable exceptions such as 9/11 victims and Hurricane Katrina victims) be allowed to apply for compensation. This would preclude people who live in homes that have asbestos lurking in their walls or insulation, as well as many others.
- Bureaucracy may create a backlog that takes even longer than lawsuits do
At this time, there is approximately $30 billion dollars in the already-established trust funds, and mesothelioma victims are able to apply to those funds for compensation for their expenses and damages.
Contact Danziger & De Llano for Help
If you are not certain as to how to access those funds, need help applying for compensation from the trusts, or are not sure as to whether or not you are eligible, the experienced mesothelioma attorneys at Danziger & De Llano can provide you with answers and guidance as to what all of your options are,
what to expect, and whether the mesothelioma fund provides the best option for you. We have been working with mesothelioma victims and their families for over two decades, and are well-equipped to advise you on what to do.
Contact us today at 1-800-706-5606 and set up a Free consultation with our dedicated mesothelioma lawyers.