Federal and state legislators are pushing a host of bills designed to make it harder for asbestos exposure victims to claim compensation.
Six recent bills filed in two different states and the U.S. Senate propose a variety of different methods to achieve the same purpose: limiting lawsuits over asbestos exposure and restricting remuneration claims filed with bankruptcy trusts. Many of these bills frame the goal as a means of fraud prevention.
Bankruptcy trusts are established for companies that go bankrupt but still have liabilities stemming from asbestos exposure. Accessing them can help mesothelioma patients with expensive medical bills while weighing their legal options.
These bills focus heavily on bankruptcy trusts, with some burying claimants in paperwork, while others shield companies from liability if the exposure was caused by a third party, while still others impose criminal penalties for filing false claims. In several cases, these bills even allow for immediate dismissal of a claim unless everything is done correctly.
The Federal PROTECT Act
A federal bill introduced March 3 by Sen. Thom Tillis, R-N.C., would establish a special Justice Department trustee to oversee the bankruptcy trust system, among other changes. The Providing Responsible Oversight of Trusts to Ensure Compensation and Transparency for Asbestos Victims Act — or PROTECT Act — is a word-for-word resurrection of a 2019 bill of the same name that died in committee.
Under the measure, the Justice Department’s U.S. Trustee program would establish a trustee to supervise access to bankruptcy trusts, one empowered to investigate “the administration and operation of a trust,” audit claims made to a trust, and assist in the prosecution of anyone making a false claim for payment to a trust.
The measure would also impose criminal penalties on anyone who “knowingly and fraudulently makes a false claim or demand to be paid in whole or in part by a trust.” It also requires trusts to report claims to Medicare and Medicaid. Lastly, it would make trust records of payments accessible to the public.
For Victims, Not Trial Lawyers
“This commonsense legislation ensures that the asbestos bankruptcy trusts will benefit victims of asbestos exposure, not trial lawyers,” Tillis said in an accompanying release touting the bill. The release contends that “widespread reports of fraud and mismanagement” at trusts are caused by a lack of federal oversight, and that these actions would ensure future victims are justly compensated.
While a copy of the measure wasn’t immediately available, Tillis’ press secretary, Lauren Scott, confirmed for Mesowatch that the bill is identical to the 2019 original. The current proposal is co-sponsored by John Cornyn, R-Texas, and Chuck Grassley, R-Iowa.
The measure’s chances in a Democrat-controlled Senate are likely slim, given that the previous iteration of the bill went nowhere under a Republican-controlled Senate. The original was introduced in March 2019 and never even went to a committee for review.
Georgia on my Mind
A trio of Georgia lawmakers has introduced a trio of bills in recent weeks designed to protect Georgia employers and ensure transparency in bankruptcy trust filings, according to the text of one of the bills.
Georgia House of Representatives members Mitchell Scoggins of the 14th District, Matthew Gambill of the 15th District and Trey Kelley of the 16th District collectively sponsored these three bills, all of which impose new restrictions on claims for compensation filed with an asbestos trust or a trust for silica, which can be carcinogenic as well.
Two of these measures — H.B. 638 and H.B. 687 — appear identical, even featuring edits in the same places. The two measures would impose onerous filing requirements on claimants, mandating that they provide a sworn statement containing their name, address, date of birth, Social Security number, marital status and employment information, along with all particulars of their exposure to asbestos or silica. If their claim involves witnesses, each of those witnesses has to provide the same personal information as the claimant.
The two bills also absolve companies from liability if the asbestos or silica exposure was caused by “a product or component part made or sold by a third party.” And a provision in the bills specifically prohibits class-action lawsuits, specifying that all “claims along with sworn information forms must be individually filed in separate civil actions.”
The third bill filed in Georgia, H.B. 639, also imposes filing requirements but instead mandates that claimants provide the information within 30 days of filing a claim. The required information and sworn statement don’t demand as much detail as the other bills but do have to be shared with all parties within that 30-day window. Unlike the others, this one is asbestos-specific.
It also gives defending companies leverage, allowing discovery from an asbestos trust and empowering courts to delay a trial for asbestos exposure if the judge “determines there is a sufficient basis for the plaintiff to file an asbestos trust claim identified by the defendant.”
Finally, if a victim files an asbestos trust claim after winning an exposure case, the court can reduce the judgment accordingly.
All of these measures were filed in either late February or early March.
Two recent new measures in Missouri — one filed in the state’s House of Representatives and another in its Senate — impose a series of restrictions and conditions on asbestos claims and lawsuits that eerily mirror some of the ones seen in Georgia.
For example, S.B. 331 — which was introduced by District 20 Sen. Eric Burlison — would require claimants to provide reams of sensitive information about themselves, such as their marital status, professional background and smoking history. It also includes a countdown, giving claimants 30 days to issue a sworn statement after filing a claim or a lawsuit, or else risk having their claim dismissed.
The measure also requires claimants to certify that any claim they could make to a bankruptcy trust has already been filed in advance. And finally, a judge can dismiss a claim if the filing fails to follow all procedural requirements.
According to state records, the Senate’s Judiciary and Civil and Criminal Jurisprudence Committee held a hearing on the measure March 8.
A House bill — 96th District Rep. David Gregory’s H.B. 363 — bears a number of similarities with the state Senate proposal. For example, it also has a 30-day window for claimants to provide a sworn statement after filing an asbestos claim. The sworn statement would have to include near-identical information as the Senate bill and would force plaintiffs to delay trial if the defendant determined that they had neglected to file trust claims, ala Georgia’s H.B. 639.
However, it goes beyond the others with additional requirements, such as allowing defendants to provide alternative explanations for an asbestos exposure case at trial.
An older measure imposing its own set of filing restrictions and procedural hurdles — S.B. 200 — was filed in late January.