Apr. 19, 2005 – As lawsuits stemming from asbestos-related sickness place a swelling burden on the courts, lawmakers are weighing a controversial proposal to scrap the existing litigation process in favor of a supposedly fairer system for compensating victims of the deadly industrial contaminant.
The Senate Judiciary Committee is currently weighing legislation that would create a federally administered trust fund for individuals suffering from asbestos exposure. The Fairness in Asbestos Injury Resolution Act of 2005 would establish a system for allocating financial compensation to victims while essentially outlawing civil litigation against corporations for asbestos damages. Proponents of the bill see it as a way to free up an overburdened civil court system, but many critics believe the proposed trust fund would offer no guarantee that victims would be adequately compensated for their suffering.
Similar initiatives for asbestos compensation funds in previous years have failed to muster enough public or congressional support to pass, leaving cases to be handled by the courts.
According to a draft bill released to the public, the legislation would provide a $140 billion national fund for asbestos compensation, financed by asbestos-related corporations and their insurers. Like workersâ€™ compensation, the fund is designed to dramatically reduce industry liability and to pay for medical and other expenses associated with asbestos-induced illness. Rather than taking their cases to court, victims would file a claim with the Department of Labor, which would then judge whether the personâ€™s case warrants compensation and allocate funds according to the severity of the harm caused by exposure.
The Bush administration has pushed for an asbestos compensation fund as part of its tort law reform agenda.
Asbestos, a mineral used in the production of industrial materials, has been shown to cause various lung diseases, including lung cancer and a less common form of cancer known as lmesothelioma. These illnesses have no cure and may take decades to manifest. According to the federal Agency for Toxic Substances and Disease Registry, 27 million US workers were exposed from 1940 to 1979, and high exposure risks persist in the construction and mining industries as well as contaminated residential environments.
Researchers with the Environmental Working Group, a Washington, DC-based public interest advocacy organization, have estimated that nationwide, approximately10,000 people per year die of asbestos-related diseases, including asbestosis and lung cancer.
The policy research group the RAND Institute reported earlier this year that more than 700,000 asbestos-related lawsuits have been filed in recent decades, costing industry tens of billions of dollars. The insurance industry consultancy firm Tillinghast* estimated that in 2003, asbestos litigation cost corporations a total of $8.6 billion, contributing significantly to industryâ€™s rising overall litigation costs, which reached $246 billion that year.
Victimsâ€™ advocates say the proposed fund would coddle industry with excessive legal protections for corporations and minimal financial security for victims.
The Bush administration has pushed for an asbestos compensation fund as part of its tort law reform agenda to protect corporations from financially damaging "junk lawsuits," what they see as unfounded civil claims.
Proposal Frustrates Corporations and Victims Alike
Though Sen. Specter recently announced that he was revising the bill to cultivate bi-partisan support in the judiciary committee, which he chairs, the trust fund proposal faces growing resistance from both industry and public health advocates.
Insurance groups have argued that the bill is too accommodating of claimants. On April 4, fifteen insurance corporations sent a letter to the senator dismissing the bill as an inadequate response to the "asbestos litigation nightmare."
Daniel Sweet, a Washington representative for Liberty Mutual Insurance, told The NewStandard that one of the main concerns insurers have is the possibility that if the fund were to go bankrupt, victims would regain their right to sue. Defendant corporations have called for complete immunity from litigation, to ensure, in Sweetâ€™s words, "a certain ending to this process."
Victimsâ€™ advocates, on the other hand, charge that the proposed fund would coddle industry with excessive legal protections for corporations and minimal financial security for victims. While the bill purports to offer an efficient, uniform system for compensation, some opponents believe that the actual result would be a step backward.
Jonathan Bennett, public affairs director of the New York Committee for Occupational Safety and Health, a workersâ€™ health advocacy organization, said that although the proposed compensation system would be funded by industry, corporations would still be "getting off cheap." The award amounts mandated by the legislation, he projected, would generally be far less than what victims would probably get through the court system.
Many asbestos victims and their families believe that the current plan to eliminate all industry liability could violate victimsâ€™ rights. The Committee to Protect Mesothelioma Victims, which represents asbestos victims across the country, argues that the legislation would lack the funding to ensure sustainability and would exclude too many victims through rigid medical criteria.
The groupâ€™s chairperson, Susan Vento, the widow of a mesothelioma victim, reminded Sen. Specter in a recent letter that the reason behind the current asbestos litigation burden is that in the past, "many commercial entities used the product with full knowledge of its dangers, but acted to conceal those dangers from their workers and consumers."
By eliminating the potential for legal redress, Vento contended, the proposed trust fund would silence victims against these public health abuses and impose "more legal burdens and administrative difficulties than what victims presently face in the court system."
According to the draft bill released in February, the amount a victim could receive through the fund would be calculated according to a complex methodology based on the severity of physical damage, the period of exposure, the amount of direct contact with asbestos, and other criteria, and award levels would vary widely across different groups. For instance, asbestos victims with a history of smoking would be eligible for much less compensation than non-smokers, with the implication that asbestos was not the only cause of illness.
Dow Jones News Wires reported on April 12 that senators involved in finalizing the bill had agreed to narrow eligibility even further by excluding exposed workers diagnosed with lung cancer who were unable to demonstrate other physical effects typically associated with asbestos-related illnesses.
According to Dr. Steven Markowitz, an occupational disease specialist with the City University of New York, the degree of exposure and injury required in the draft billâ€™s medical criteria is "grossly unjust" and "doesnâ€™t reflect the medical studies. It downgrades the risk of lung cancer for those who have true asbestos exposure but simply havenâ€™t developed the scarring."
Beyond Legalities, Advocates Envision Systemic Solutions
Some organizations, including the national labor federation the AFL-CIO, which represents victims of occupational asbestos exposure, and veterans groups representing those exposed through military service, have advocated a trust fund as a more consistent, if less individualized solution to the litigation burden. The rationale is that an organized public fund would reach a broader population of victims and adjudicate cases more efficiently than the court system, which carries a high degree of uncertainty for both claimants and defendants.
Nonetheless, even many of those who support a trust fund in theory remain wary that a bureaucratic mechanism that prioritizes industry over the public interest would exacerbate the asbestos health crisis.
Some advocates have cited past failures of similar trust funds established by asbestos companies to shield financial assets from lawsuits. Many of these have lacked the funding and capacity to absorb large volumes of claims and as a result had to reduce payments to a fraction of the originally entitled amounts.
Doug Larkin, co-founder of the Asbestos Disease Awareness Organization (ADAO), a national victimsâ€™ advocacy group, suggested that the current senate initiative bears the imprint of corporate interests. "The idea for setting up a trust fund should be to take care of the victims, not to limit the companyâ€™s liability," he said. "And thatâ€™s not the way the current legislation is written."
They cautioned the Judiciary Committee in January that the liability protections embedded in the trust fund plan were broad enough not only to hurt victims, but also to limit the governmentâ€™s ability to enforce environmental regulations regarding asbestos.
The ADAO has suggested that if a trust fund is established, the liability provisions should include an "opt-out" clause that would afford all victims an opportunity to pursue civil suits instead of trust fund compensation.
Some opponents of the bill believe the most important aspect of the governmentâ€™s response to asbestos contamination is not the system for compensating victims, but the reduction of future health threats.
Christopher Hahn, executive director of the Mesothelioma Applied Research Foundation, a health advocacy organization, complained that on both sides of the trust fund debate, "All this energy is going into the legal problem; no energy is going to the medical, humane crisis." Largely funded by civil litigation firms and victimsâ€™ families, the Foundation has endorsed a provision inserted into the draft legislation to ban asbestos, but continues to push for increased government funding to develop new treatments for asbestos-related diseases.
Carolyn Raffensperger, a legal advocate with the Science and Environmental Health Network, an environmental policy group, believes that although the current civil court system does fail asbestos victims because of high litigation costs and inconsistent outcomes, a government trust fund would be merely "a band-aid on a hemorrhage."
The controversy over asbestos litigation, in Raffenspergerâ€™s view, should serve as an impetus for the government to implement proactive reforms to make courts more responsive to environmental hazards and to ensure that mass tort cases are handled fairly and openly in the future.
Under the current legal system, Raffensperger said, "we give the benefit of doubt to business. â€¦ We need to give the benefit of the doubt to public health and the environment."