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Published: August, 2005; Vol 2, Num 3

Asbestos Compromise Remains Elusive

With Congress approaching its Labor Day recess, it appears unlikely that the long-sought legislative compromise on asbestos victim compensation will be enacted this summer. Indeed, even the long-range prospects for passage appear to be dimming.

During June and July, a number of lobbying alliances formed or asserted themselves, mostly in efforts to try to derail the bill (S. 852). The Coalition for Asbestos Reform (CAR) is composed mostly of insurance groups and some manufacturers. Early on, it supported the bill’s concept, but in recent months it has become increasingly vocal in opposition. From the opposite perspective but to the same effect, the Asbestos Victims Coalition has intensified its opposition. Also, some fiscally conservative House Democrats, known as the “Blue Dog Coalition,” and some Republicans issued a June letter raising serious concerns about possible taxpayer liability should the trust not work as expected.

From the bill’s beginning, three Congressional sessions back, asbestos victims groups and their lawyers generally opposed it. Introduced by Senate Judiciary Committee Chairmen Arlen Specter (R – PA) and Patrick Leahy (D – VT), the bill would require victims to abandon court claims against asbestos manufacturers and their insurers in exchange for compensation from a new, national trust fund ostensibly financed by the defendants. So many court claims have been filed – and so many more expected over the next two decades – that most manufacturers have entered bankruptcy protection and judges have asked Congress to take action to relieve the pressure that has bogged down the U.S. court system.

In contrast to the other forces which have drawn sharp lines in the sand, the AFL-CIO, with the support of LHSFNA Occupational Safety and Health Division staff, is working hard to find an effective and just compromise on the many complex and highly partisan issues involved. It cites six areas of outstanding core issues.

  • Start-up: It could take up to two years to get the fund fully operational, and those with existing claims or those about to file claims have nowhere to get compensation in the meantime. Most of these victims are in immediate need of assistance.
  • Silica claims: Individuals who suffer from both asbestos-related and silica-related diseases cannot sue for silica-related damages unless they can demonstrate that asbestos was not a substantial contributing factor; yet, the asbestos trust will not compensate them for their silica-related loss. The AFL-CIO wants to allow silica-related claims to proceed in court.
  • Sunset provisions: Because other trusts have failed in the past, everyone is concerned about what will happen if this one fails, too. Among other things, the AFL-CIO wants to require an annual projection by the trust’s administrator on its long-term prospects.
  • Settlements: The bill provides a loophole for defendants who have agreed to pending settlements to withdraw from their agreements.
  • Definition of an “asbestos claim”: The definition of what constitutes a claim is broad, and anything in that category loses the right to proceed in court. Yet, a growing list has emerged of situations that should be “excepted” from that loss of right. The problem is ensuring that no one will lose the right to sue who, also, is not covered by the trust.
  • Cap on attorneys’ fees: The low fee limit may make it impossible for some claimants to secure legal representation.

Until these are resolved to the federation’s satisfaction, the labor federation will continue to withhold support for the legislation.

[Steve Clark]