The benefits of asbestos trust disclosure reforms

In the past few years, there has been a detrimental trend in North Carolina asbestos litigation, according to the director of the Progressive Policy Institute’s Center for Civil Justice (CCJ). The trend involves plaintiffs’ lawyers hiding pertinent facts. The CCJ director suggests that the implementation of transparency laws, such as the ones recently introduced in 12 other states, would be beneficial for current and future plaintiffs.

The CCJ director notes that evidence is being withheld from juries regarding the companies’ asbestos products to which the plaintiff was exposed. In attempts to inflate awards against more profitable companies, plaintiffs may not disclose information regarding their exposure to other, smaller companies’ asbestos products. He states that this occurs because asbestos exposure victims may be compensated through two avenues-trusts or litigation.

Plaintiffs can file claims with asbestos trust funds set up for companies that are now bankrupt. There are approximately 60 trusts and over $30 billion reserved for current and future asbestos claims. Plaintiffs may also file a lawsuit, in which they may sue the smaller, solvent companies for injuries resulting from their asbestos exposure. According to the CCJ director, these companies are often found liable despite having little to do with plaintiffs’ asbestos exposure.

Judges have recently discovered that plaintiffs often give alternative facts to support their trust and litigation claims. For example, plaintiffs would allege that they were exposed to the bankrupt companies’ asbestos products in their trust claims but allege that they were only exposed to the solvent companies’ asbestos products in their asbestos lawsuits.

According to the CCJ director, this can lead to three negative consequences. First, it leads to inflated damage awards because juries are not privy to all the evidence regarding plaintiffs’ asbestos exposure. Second, it may result in unfair consequences for local businesses. Finally, because asbestos trust funds are limited resources, it may deprive future asbestos victims of access to justice should the trusts be depleted. He therefore advocates for asbestos trust disclosure reforms which would require plaintiffs to file available trust claims and disclose those claims to companies they sue in asbestos litigation.

Source: Forbes, “Asbestos Litigation Reform That Helps Victims And Businesses,” Phil Goldberg, Aug. 10, 2017