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For mesothelioma victims and their families in Texas, a new law is making its way through state legislation that will make it more difficult for victims to be compensated by the companies responsible for their asbestos exposure. The Texas House of Representatives has passed a bill regarding bankruptcy trusts and the tort system in a 126-11 vote in an effort to decrease what asbestos companies see as “double dipping” claims by asbestos victims. Claimants will now need to complete additional required disclosures and defendants will be allowed to stay proceedings and modify judgments under specific conditions.
Asbestos exposure can lead to a variety of health problems, including asbestosis and mesothelioma cancer—an aggressive cancer affecting the membrane lining of the lungs and abdomen. In many cases, due to the long latency period of the disease, victims were exposed decades earlier, and sometimes at their place of employment.
The bill, H.B. 1492, authored by Rep. Doug Miller, R-New Braunfels, aims to reduce “fraudulent mass filings” by asking victims to provide notice of a claim against an asbestos trust, such as documentation filed with the trust. Whereas defendants can list trusts it believes the victim could make a successful claim that are not disclosed to the claimant.
Other proponents of the law, like Harold Kim, Executive Vice President of the U.S. Chamber Institute for Legal Reform (ILR), states, “Texas can join a growing number of states including Arizona, Ohio, Oklahoma, West Virginia, and Wisconsin that have recently enacted such laws to bring transparency to the asbestos compensation system.”
Many asbestos trusts were set up under the U.S. Bankruptcy Code for bankrupt manufacturers and their insurers to be able to compensate workers and their families who were affected by companies’ asbestos exposure on the job. According to lawmakers, there are about 60 trust funds and almost $40 billion in assets currently being paid out.
Overall, this new Texas legislation means there will be a set procedure that makes plaintiffs file their asbestos bankruptcy trust claims before trail to allow the defendants’ review of the forms and supporting documentation ahead of time.
Coincidentally, H.B. 1492 is very similar to the Furthering Asbestos Claim Transparency (FACT) Act, which was recently introduced to the House of Representatives by Rep. Blake Farenthold, also of Texas, and passed with a 19-9 Judiciary Committee vote of approval. According to Rep. Farenthold, the FACT Act aims to decrease fraud in asbestos lawsuits by requiring asbestos trusts to file quarterly reports on their public bankruptcy dockets, including payment requests and proof of payments made. The law also puts a greater burden of proof on the victims, which can stall the proceedings, sometimes so much so that a victim will succumb to the disease before getting their day in court.