GOP Senate Can't Curtail 'Jackpot Justice' Asbestos Lawsuits

By Christine Hall | July 7, 2008 | 8:29 PM EDT

( - Republicans may have won back the Senate, but it remains unlikely that they'll be able to reign in the "tremendous avalanche" of asbestos litigation raining down on American companies, asbestos defendants' attorney Richard Faulk said, speaking before a Federalist Society convention in Washington, D.C., on Thursday.

It still takes 60 votes to overcome a filibuster, a threshold that neither trial lawyers nor defendants' attorneys believe tort reformers can achieve in a Senate closely divided by party and dominated by political liberal and moderates.

Prominent asbestos trial lawyer Fred Baron of the Dallas firm Baron and Budd recounted the numerous times over the years he's testified before Congress on the subject of asbestos litigation, which has never yet produced a successful reform bill.

That leaves the American legal system locked in what some jurists have called an "asbestos litigation crisis," one in which over 600,000 people have filed claims and caused 60 companies to declare bankruptcy.

According to the American Academy of Actuaries, the "ultimate cost" of asbestos litigation could range from $200 billion to $275 billion.

Corporate America has long contended that asbestos litigation drives companies into bankruptcy, which takes a toll on the jobs and pensions of employees of defendant companies; that the burden of paying asbestos claims then befalls companies with peripheral connection to asbestos (like the automobile industry); and that sick and dying victims of asbestos exposure must compete for settlement dollars with asymptomatic plaintiffs (a situation some have dubbed "jackpot justice").

According to Faulk, a partner in Gardere Wynne Sewell, up to 80 percent of asbestos cases in the nation's court system are for asymptomatic plaintiffs-those who may have been exposed to asbestos sometime as a worker or consumer but have not yet developed asbestos-related diseases.

But trial lawyers vehemently dispute such facts and figures.

It's a fair point that asbestos lawsuits have become an "endless search for the solvent bystander," said asbestos trial lawyer Richard Scruggs. But, he said, those bystanders are still more culpable than the innocent victims of asbestos exposure-workers who were not told by employers of the dangers associated with exposure.

And if a lawsuit is frivolous, brought by a plaintiff without any injury, the legal system already results in those suits being dismissed, Scruggs contends. "If they're so frivolous, why don't they [defendants] try them" instead of settling them, he asked.

"[I have] a great deal of confidence" in American jurors to weigh the merits of a case, said Scruggs.

Baron assails the Rand study, saying that it examined mostly litigation costs in the early 1980s, not taking into account that such costs have since come down.

There's "no truth whatsoever" that courts are more congested with asbestos claims, said Baron, because nearly all of the annual 50,000 claims filed annually are settled before they would have come to trial.

He also challenges the notion that 60 bankrupt companies amounts to legions of unemployed workers and depleted pensions. Fifty-five of those companies have gone into Chapter 11 bankruptcy to get reorganized and wipe out liability, said Baron, not Chapter 7, which allows a bankruptcy trustee to sell property and distributes the money to creditors.

Asbestos is a naturally occurring mineral that crystallizes as long thin fibers that can be inhaled and accumulate in lungs. During most of the 20th century, asbestos was mined for use in many types of building materials because of its value as an insulator and fire retardant. The federal government placed a moratorium on the production of some types of asbestos products in the early 1970s but it was still used until the early 1980s.

Workers exposed to air-born asbestos fibers have higher risk for several types of diseases, including asbestosis (scarring of the lung tissue), mesothelioma (cancer of the pleural lining) and lung cancer. Typically, these conditions do not occur for decades after a person is exposed to asbestos.

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