Asbestos lawsuits have been a part of the American legal landscape for over 50 years, making it the biggest mass tort in our country’s history. The number of people diagnosed with mesothelioma and other conditions related to asbestos exposure continues to grow.
As of 10 years ago, approximately 730,000 people filed litigation related to alleged asbestos exposures.
The manufacturers of asbestos products and those who used them in construction materials began turning to the bankruptcy courts for financial relief. During the bankruptcy proceedings, some companies established personal injury trusts for those affected by asbestos exposures.
These trusts are used to make payments to plaintiffs, but the sheer number of claimants and trusts complicated the integration of trust compensation into our established tort system.
Congress authorized section 524(g) of the U.S. Bankruptcy Code in 1994. This permits companies who are defendants in mass tort claims over asbestos exposures to establish and provide funding for a trust that addresses and pays both present and future claims for the companies’ alleged liabilities for exposure to the deadly material.
For entities coming out of bankruptcies, their liabilities for all asbestos exposures are then assigned to this special trust, allowing a discharge of associated liability.
Funds are distributed by the trust based on Trust Distribution Procedures. Each has a separate schedule of diseases, together with medical and exposure criteria claimants have to meet in order to obtain a distribution. After establishing that they qualify as trust beneficiaries, claimants are entitled to have their claims paid out from the trust.
To learn whether your asbestos exposure qualifies you as a trust beneficiary, it may be helpful to consult an attorney familiar with litigating mesothelioma cases.
Source: American Bar Association, “Bankruptcy Trusts and Asbestos Litigation,” Lee Blanton Ziffer, accessed Sep. 04, 2015