How Asbestos Trusts Work

How Asbestos Trusts Work

To create trusts, asbestos companies filed for chapter 11 bankruptcy. This allowed them to reorganize to pay out to asbestos victims. This does not hurt the company, but instead helps protect it from future liability related to asbestos. Companies can pay those suffering from asbestos related diseases over time instead of completely shutting down and liquidating to pay those affected. Once companies reorganize, they are able to do business as usual and stay protected from lawsuits. The first company to do this was Johns-Manville in 1982. The Manville Personal Injury Settlement Trust was created, allowing the company to completely separate liability from people suffering due to being exposed to the company’s asbestos containing products.

There are four steps to filing a claim and receiving a payment from an asbestos trust. The first is to identify the trusts to file a claim against. Using a person’s work history, different trusts can be pinpointed to file a claim against. It is crucial that clients know their work history in order to accurately identify the trusts from which recovery can be made. Without clients knowing where they worked, we cannot file a claim against a company on their behalf. The second step is for the claim to be reviewed. The ones processing the claim determine if the work history and disease the person is suffering from are sufficient to file a claim. People are paid based on what disease they have, with there being eight total levels. The levels include mesothelioma (level VIII), lung cancer with evidence of bilateral asbestos nonmalignant disease (level VII), lung cancer without evidence of bilateral asbestos nonmalignant disease (level VI), other cancers with evidence of bilateral asbestos related disease (level V), severe asbestosis (level IV), asbestosis and pleural disease with restricted pulmonary function (level III), asbestosis without restricted pulmonary function (level II), and other asbestos disease (level I).

For certain diseases there are different criteria for diagnosis and latency. For the malignant conditions (levels V-VIII) there needs to be a diagnosis by a physical evaluation, board certified pathologist report, or a pathology report from an accredited Joint Commission hospital. Non-malignant cases (levels I-IV) need to be diagnosed by a physical evaluation (for living claimants) or be diagnosed by pathological evidence, evidence of bilateral asbestos related non-malignant disease, or while alive the patient was diagnosed by physical examination (for deceased claimants). Pulmonary function tests need to be done for levels III and IV to show diminished lung capacity and medical documentation needs to be supplied for levels III-VII showing that asbestos was a contributing factor for the disease. There also has to be proof that the person was exposed to the company’s products and was exposed occupationally, creating a link between the person and the company’s products.

The final two steps of the claim process are liquidation and payment. When a claim is liquidated, it is given a monetary value. Some of the factors that give someone a specific value include age, disability, dependents, noneconomic damages, and the settlement and verdict history of the person’s hired law firm. Once someone is given a monetary value, he or she has to accept it to be processed. If the offer is refused, binding or nonbinding arbitration is used. If the nonbinding arbitration fails, the trust can be sued, but this rarely happens. Payments are then put in a queue based on a first in first out system. Since there is a limited amount of money, payment percentages were created to help alleviate this problem. If someone is awarded a certain amount of money, this is then multiplied by the percentage to get the actual value. Payment percentages can vary and can change over time for the different trusts. There is also a maximum value that can be paid out every year (maximum annual payment or MAP). Once this is reached, there are no more payments for the year and the claimants in line move to the queue for the next year. The MAP is also divided by how severe the disease is. A certain percentage goes to malignant diseases (usually a majority) while the rest goes to the less severe nonmalignant diseases. This varies from trust to trust but when used allows the people with more severe illnesses to be paid.

If you were exposed to asbestos and now have lung cancer or mesothelioma, contact us by web or call 412-471-3980 to learn more about how we can get you compensation.

Below are the trusts that are paying out claims:

  • ABB Lummus
  • AC&S (Armstrong Contracting & Supply)
  • AP Green Industries
  • ASARCO (Lake Asbestos)
  • Armstrong World Industries
  • Babcock & Wilcox
  • Bondex
  • CE Thurston
  • Celotex
  • Combustion Engineering
  • Congoleum
  • Eagle Picher
  • Fibreboard
  • GAF
  • H.K. Porter
  • Halliburton
  • Harbison Walker
  • Hercules
  • JT Thorp
  • Kaiser
  • Keene
  • Leslie Controls
  • Manville
  • NARCO (North American Refractories Company)
  • National Gypsum
  • Owens Corning Fiberglas
  • Plibrico
  • Porter Hayden
  • Quigley & Pfizer
  • Raytech (Raybestos)
  • Shook & Fletcher
  • THAN
  • Thorp Insulation
  • Turner & Newell
  • United States Gypsum
  • United States Mineral
  • Western Asbestos
  • W.R. Grace
  • Yarway
Lloyd Dixon et al. “Asbestos Banckruptcy Trusts” Rand [Link]

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