asbestos lawsuit bill

Bill in Brief

Everyone knows asbestos can make you ill - and deathly so for many Americans who have developed cancer from working with the construction material. But victims' lawsuits against corporations also can have a lethal effect on industry, having put as many as 70 companies out of business already (Rand - pdf).

With the idea of protecting both victims and companies, the Senate has been working on a bill (for years now) that would create a trust fund to pay victims of asbestos exposure while protecting companies from huge lawsuits.

That fund would, in theory, cover the settlement costs of victims whose cases are still working their way through court - or yet to be filed - and at the same time protect companies from going under by getting disproportionately hit with large claims.

After years of honing in on a bill to satisfy all political contenders, the Senate Judiciary Committee passed a bill late last year that would;

  • put the cost of the fund at about $140 billion, with contributions coming from companies and their insurers, NYT

  • create set awards for victims ranging from $25,000 to $1.1 million and capping lawyers' fees at 5%, NYT

  • give asbestos victims the right to go back to court if the fund ever runs out, and

  • force smokers with lung cancer to prove their cancer comes from asbestos exposure in order to be compensated by the fund.

What the critics say:
On the right, critics worry that the $140 billion fund will run out and that when it does, taxpayers will end up picking up the tab. The left also suspects the money won't last, but they worry that when it does victims will be stiffed of their just compensation. Many small businesses also oppose the bill, saying they'd be better off fighting
asbestos cases than having to pay into the fund (NYT).

Status: The bill was tripped up in February, 2006 by a "point of order" saying the bill puts more than a $5 billion burden on budgets 10 years into the future (something congressional rules say you can't do). In May, the bill had a new rework - with promises of stricter medical criteria, quicker access to funds and caps on how much companies would have to pay into the fund - but it never made it back to the floor. It's unlikely to get much play in 2007.

For more background:

  • A report (pdf) from RAND states the case for asbestos litigation reform.

  • The Association of Trial Lawyers of America cautions that reform should not leave victims high and dry.

  • CBO weighs in to assess the costs of the act in its 2004 version (not for the number wary).

  • The Department of Labor gives a background on asbestos' health hazards.

All those in favor: Washington Post, New York Times,

Those who say the bill is still flawed: Heritage, National Review.

Updated November, 2006.

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Asbestos and Congress

Google Answers put together a very good overview of proposed federal legislation regarding asbestos, class action lawsuits, and product liability in general:

Congressional Bills on Asbestos Class Action Lawsuits


It's worth a look, if you're interested in seeing where Congress is coming from on this issue.

Davidj (not verified) | February 20, 2008 - 11:31pm