Famous Asbestos Cases:
The history of asbestos litigation starts with Ward Stephenson and Clarence Borel. In this asbestos case, Borel the plaintiff, and Stephenson the acting attorney, filed a claim against the Fireboard Paper Products Corporation. The basis of the claim stemmed from the corporations inability to reduce asbestos exposure; Borel claimed that his lung cancer was a direct result of prolonged and hazardous exposure to the company’s asbestos products. Borel’s decision to file an asbestos suit–and his ultimate victory–gave other employees and people exposed to asbestos a formal legal path to pursuit their grievances and help shape a national awareness as to the dangers of asbestos.
The primary motivation of asbestos litigation is the diseases perpetuated by asbestos exposure: pleural mesothelioma, malignant mesothelioma cancer, lung cancer and asbestosis are directly linked to asbestos exposure. These diseases are, for the most part, inoperable and incurable. Because life expectancy precipitously drops following an asbestos-related disease diagnosis, sufferers of said medical conditions are encouraged to file suits to secure compensation. The formal filing of an asbestos claim seeks to secure compensation to offset the costs associated with convalescence. Additionally, these suits compensate families of the aggrieved.
The Filing of Asbestos Lawsuit:
For over three decades (beginning in the 1930’s), Borel—a father of six children—was employed in oil refineries and shipyards along the Texas-Louisiana border. Borel was responsible for insulating steam popes, boilers and other high-temperature products using asbestos-laden materials. By the 1960’s, the constant exposure to asbestos began to damage the man’s lungs, causing him severe chest pains and making it exceedingly difficult for him to breathe. In 1969, Borel was formally diagnosed with an advanced form of asbestosis.
The following spring, Borel filed a worker’s compensation suit for injuries sustained while working on the job. He eventually settled the claim for roughly $13,000. In the fall of the 1969, Borel met with an attorney regarding his ability to seek additional compensation in the court system. Borel was seeking an alternative settlement to offset his ongoing medical costs and to provide for his fallen family. Borel’s lawyer, Ward Stephenson, filed an asbestos suit in the Eastern District of Texas against several asbestos companies and manufacturers across the nation, ultimately seeking $1 million in damages.
The case, Borel v. Fireboard Paper, ruled in favor of Borel in 1973; however, Borel never got to enjoy listening to the verdict from the United States Court of Appeals, Fifth Circuit—Borel died in June of 1970 from mesothelioma cancer.
The case filed by Stephenson marked the first time a court ruled that an asbestos company or manufacturer was liable for injuries sustained by its product. This ruling was buttressed by two significant events from the 60’s: the first was a medical finding in 1964, which proved that asbestos definitely imposed severe damage on the lungs; the second event was published by the American law Institute, claiming that any entity who sells any product in a defective manner or condition presents unreasonable risks to the consumer or user or to his/her property and is therefore liable for the injuries or harm caused by that product to the end user. The latter piece went on to explain that said products did not include unsafe products so long as they are accompanied by proper warnings or directions. When the court system decided that asbestos companies or manufacturers knew about the dangers of asbestos exposure and subsequently failed to appropriately warn employees, the floodgates opened for what would become the largest collection of asbestos settlements via tort litigation suits in American history.
Encouraged by the success of Borel v. Fireboard Company, asbestos workers opted for tort litigation to secure financial settlements for injuries sustained as a result of their job function. Between 1981 and 2003, the number of asbestos claims increased from approximately 1,400 per year to an astounding 750,000; the total number of asbestos-related companies sued during this time frame swelled from 300 to 8,400.
A tort, with regards to basic civil procedure, refers to any civil wrong doing where a damaged victim can seek legal compensation from the individual or entity that caused the harm. In the American legal system, the utilization of torts is a popular means for a party who is injured by a defective product or hazardous material to seek compensation or recourse through the court system. For an asbestos worker, an individual exposed to asbestos viewed tort litigation as a desirable alternative to other forms of reparation: government-run disability funds and workers’ compensation suits.
Tort litigation—or the filing of an asbestos claim—was viewed as the more attractive means to secure asbestos compensation because the worker’s compensation system was inherently flawed. One of the primary gripes with this system was red tape—war veterans, who were perpetually exposed to asbestos during their service—were barred from filing compensation claims. Additionally, the asbestos employee base grew increasingly frustrated with these systems because:
• The worker’s compensation system were specifically designed to provide compensation for traumatic on-the-job injuries, such as broken bones or losses of limbs—the system was not meant to compensate for occupational diseases, such as mesothelioma cancer or asbestosis.
• The worker’s compensation system allowed employers and insurers ways to lessen the associated financial costs. These entities often contested claims by refusing to admit that asbestos products was the primary cause of their suffering or by claiming that workers were not sick or disabled enough to receive financial compensation.
• State laws, particular their statutes of limitations, barred an assortment of asbestos claims because they instituted requirements that forced them to be filed within a few years after the injury took place. The problem with this time limit is that asbestos-related conditions or cancers take decades to manifest, ultimately complicating the ability to file for compensation through a worker’s compensation system.
The lack of a government-established disability trust fund also contributed to the popularity of civil litigation. Although some government programs, such as the United States Treasury’s Black Lung Disability Trust Fund, provided an assortment of benefits for coal miners and others in the industry, there was no uniform program for victims of asbestos-related medical conditions. Following decades of failed legislative attempts at the federal level, civil litigation (the filing of asbestos claims through torts) is the most viable means to secure compensation.
Effect of Tort Litigation on Asbestos Companies:
As a result of the rising popularity of asbestos tort litigation, a number of asbestos companies—who acted as defendants in asbestos related court cases—were forced into bankruptcy. Mounting litigation costs and damage payments exceeded 75 billion dollars by 2003. These costs simply suffocated asbestos-related companies. Financial analysts predict these costs to reach $200 billion within the next couple of decades.
One of the most notable asbestos bankruptcy filings occurred in 1982, when the Johns Manville Corporation—the leading asbestos manufacturing and mining company—filed for chapter 11 bankruptcy as a means to protect its assets from litigation. Asbestos companies did not alwys file bankruptcy simply because they had no money; the financial maneuver was undertaken, instead, to protect the company’s remaining assets from pillaging. In the case of the Johns Manville Corporation, the entity filed for bankruptcy protection because of the mounting asbestos claims made against it—in 1972, the company faced 159 asbestos claims; by 1976 the number grew to 792. By 1982, the number exploded to over 6,000.
Other major asbestos companies who were forced into bankruptcy include: United States Gypsum and the W.R. Grace Company. Because more and more asbestos companies are seeking bankruptcy protection, the growing contingent of asbestos class-action claims see their cases transition from federal and state court settings to bankruptcy arenas. Over time, invariable alterations in bankruptcy code were implemented as a direct response to the increasing number of mass asbestos claims. The bulk of Chapter 11 plan’s filed by these asbestos companies included a 524 (g) plan of reorganization which required asbestos case plaintiffs to submit formal claims for a settlement trust. Once established, these trusts—which were required to be evaluated by the court system—were tapped-into to be paid into for all present and future claims. This is to say that, all asbestos companies who are susceptible to acting as defendants in asbestos cases, are required to put money aside to provide for asbestos settlements. Over the past 3 decades, 57 asbestos personal injury trusts have been established. The largest half of these trusts paid a total of $11 billion to settle approximately 2.5 million claims through 2008.
What is the Future of Asbestos Litigation?
There are several competing agendas and complicated situations in the ongoing effort to confront what is commonly referred to as America’s greatest public health concern. The United States’ court system has implemented innovative means to tackle the ever-increasing number of asbestos cases; these mechanisms invariably force asbestos companies to react in a way that ultimately prolongs their existence. For instance, a defendant in a class-action asbestos suit will face multiple penalties that can put them out of business, thus forcing them to file for bankruptcy. This maneuver then puts pressure on Congress to alter bankruptcy laws to essentially eliminate this loophole. While this game of tug and war persists, Congress simultaneously holds hearings on the efficacy of personal injury claims.
Because of the long latency period of an asbestos-related disease, new claims will invariably develop in future years. As a result, concerns arose over whether the creation of asbestos trusts is adequately funded to compensate all future claims. Because of this, asbestos litigation continues to be viewed as the most effective means for securing compensation for any asbestos-related illness or injury.
A mesothelioma or asbestos lawyer will help evaluate your cases. These legal professionals will not only expedite your filing, but will also aid in the exploration of your various compensation options, including the possibility of filing a formal suit.