Once the companies that sold asbestos and manufactured asbestos-containing products realized that the asbestos litigation could potentially go on for decades, with one lawsuit after another filed by workers diagnosed with mesothelioma and other asbestos-related illnesses, many of these companies declared bankruptcy. By doing so, they were able to limit their exposure to future asbestos lawsuits by establishing mesothelioma trust funds for victims of asbestos exposure. What many people don’t realize is that after funding the mesothelioma trusts as part of the bankruptcy process, many of these companies reorganized successfully and went back to doing business as usual. Yet because of their bankruptcy filing, they were protected from future asbestos exposure lawsuits.
Tens of thousands of lawsuits have been brought against the companies that negligently exposed their workers to toxic asbestos for decades, without warning them about the dangers of asbestos exposure or providing them with the proper equipment to protect them from the toxic mineral. Even more alarming is the fact that many of these companies knew about the devastating health risks associated with asbestos exposure and actively withheld this information from their workers, taking part in a massive asbestos exposure coverup that carried on for decades. Unfortunately, as a result of these asbestos bankruptcy trusts, workers diagnosed with mesothelioma, asbestosis or another asbestos-related illness can only file a mesothelioma lawsuit against the company responsible for their exposure if the company has not declared bankruptcy. Otherwise their only option for pursuing compensation is to file an asbestos trust claim. In many cases, claimants’ asbestos exposure occurred because of more than one company’s negligence, in which case it may be possible to file an asbestos lawsuit and an asbestos trust claim against the responsible parties.
Many of the companies hit by asbestos lawsuits responded to the litigation by seeking bankruptcy protection under Chapter 11. As part of the bankruptcy process, the companies were required to set up asbestos trust funds as a means of compensating workers and others diagnosed with asbestos-related conditions like mesothelioma. At least 56 asbestos bankruptcy trusts were established from the mid-1970s, when the first asbestos lawsuits were going to trial, to 2011, and by 2017, at least 100 large companies had declared bankruptcy due at least in part to liability related to asbestos. The asbestos bankruptcy trusts work like this: workers exposed to asbestos on the job submit a claim to the mesothelioma trust belonging to the company responsible for their asbestos exposure. Generally, claimants must be able to prove that they were exposed to asbestos at a particular worksite or that their exposure occurred because of a particular asbestos product. If the claim is successful, the trust pays the claim based on a percentage of what the claimant is actually entitled to, which could be as low as 30% or even 10%.
An asbestos lawsuit or trust claim could help pay for:
There are growing concerns about the ability of these trusts to continue making payments to claimants, especially because many of the trust fund companies are no longer in business and many trusts were underfunded to begin with. Because each asbestos bankruptcy trust is different in its structure, claim procedure, payment percentage and criteria requirements, it is in your best interest to have an asbestos injury lawyer on your side who has experience handling mesothelioma trust claims when pursuing compensation through an asbestos bankruptcy trust.
The National Institute for Occupational Safety and Health (NIOSH)
