Asbestos Trust Disclosure Bill Heads to House Floor

The Product Safety & Liability Reporter™ provides updates on significant developments and issues in product safety and liability litigation and regulation, plus analysis from top litigators. Get...

By Bruce Kaufman

Asbestos compensation trusts would have to disclose information about claimants if a bill approved Feb. 15 by the House Judiciary Committee becomes law.

The panel voted 19-11 to approve the Furthering Asbestos Claims Transparency Act (H.R. 906).

Committee Chairman Robert Goodlatte (R-Va), a co-sponsor, said the bill is needed because bankruptcy trusts formed for the benefit of asbestos victims have been “diluted by fraudulent claims leaving these victims without their entitled recovery.”

But the committee’s top Democrat, John Conyers of Michigan, said before voting against the measure that there is “no evidence of endemic fraud to allow such an invasive bill.”

The bill, sponsored by Rep. Blake Farenthold (R-Tex), was expected to pass the House. Senate prospects are uncertain.

The U.S. Chamber of Commerce and other supporters say the legislation is needed to reduce fraudulent claims against asbestos compensation trusts for individuals harmed by bankrupt companies.

The “lack of transparency and accountability in asbestos bankruptcy trusts has led to rampant and systemic abuse that threatens their ability to meet the needs of future claimants,” Lisa Rickard, president of the U.S. Chamber Institute for Legal Reform, said in a Feb. 15 statement supporting the bill.

“The Furthering Asbestos Claim Transparency Act will reduce ‘double-dip’ claims against the trusts and in the tort system by requiring the trusts to report quarterly on who files claims. This system will protect individuals’ personal information just the same as the courts do,” Rickard said.

Opponents, including consumer groups and most veterans’ organizations, contend the measure will slow payments and is a ploy by business groups to undercut the asbestos injury compensation system.

A 2016 letter from numerous veterans’ groups, including American Veterans in Lanham, Md. and the Military Order of the Purple Heart in Springfield, Va., said the bill will require asbestos trusts to publish their “sensitive information” on a public database, and include how much money individuals received and other private data.

“Forcing our veterans to publicize their work histories, medical conditions, social security numbers, and information about their children and families is an offensive invasion of privacy to the men and women who have honorably served, and it does nothing to assure their adequate compensation or to prevent further asbestos exposure and death,” the groups said.

In 2016, the House passed a nearly identical asbestos bill by a 211-188 margin.

That measure had been combined with legislation revamping federal class action procedure. The two bills are now separate.

The 2016 Senate version (S. 357), sponsored by Rep. Jeff Flake (R-Ariz), never made it out of the Judiciary Committee.

To contact the reporter on this story: Bruce Kaufman in Washington at bkaufman@bna.com

To contact the editor responsible for this story: Steven Patrick at spatrick@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.