The payment will be made on behalf of its subsidiary, Bondex, which filed for bankruptcy in 2010 amid mounting mesothelioma lawsuits stemming from public use of its asbestos-containing products. The bankruptcy will establish a trust with those funds, and then individuals can file a claim for compensation from that trust.
The process to vet these claims isn’t nearly as arduous as litigation,
but it’s still extensive and necessitates the help of an experienced
mesothelioma lawyer. To date, there are approximately 60 asbestos bankruptcy
trusts established for this same purpose.
In this case, the $800 million settlement ($797.5 million, to be exact) is substantially less than the $1.25 billion that the plaintiffs’ attorneys argued the company should set aside, based on what the firm had paid to plaintiffs in previous settlements. However, it’s far more than the $135 million the company had estimated its asbestos liabilities to be when the bankruptcy was filed. The company argued its previous settlements should not be factored into determining the trust amount because it alleged many were paid out simply to rid the company of nuisance lawsuits. Company attorneys insisted the firm had not conceded liability in most of the claims.
A federal judge sided with the plaintiffs’ attorneys and ordered the company to put $1.2 billion in the trust. At that time, there were 10,000 lawsuits pending. This settlement, if approved, overrides the federal district court judge’s decision, which the company was in the process of appealing.
There was reportedly concern that if RPM, the parent company, had to shell out $1.2 billion, it would have been in jeopardy as well. The settlement, according to inside sources, was a way to compromise and curtail the cost of ongoing litigation.
The product at the source of most of these cases of injurious exposure was an asbestos-containing joint compound, which was frequently used both commercially and by private residents to help fill in drywall gaps.
Asbestos is a mineral that occurs naturally, but it is also a carcinogen known to cause chronic and fatal lung diseases, such as asbestosis, lung cancer, and mesothelioma. Litigation centering on its use by companies throughout the 20th century focuses on the fact that manufacturers knew the product was dangerous, and yet failed to warn consumers or take steps to make the products safer.
Other companies that have established bankruptcy trusts have collectively paid out billions of dollars to resolve these personal injury and wrongful death lawsuits. While the process of securing payment through a bankruptcy trust is less arduous than enduring litigation, the payout tends to be far less than what one might be awarded in a successful lawsuit.
Since people were often exposed to asbestos by more than one source, it’s not uncommon to see numerous defendants in these cases. Therefore, it would not be unreasonable for an asbestos injury plaintiff to file a claim with one or several bankruptcy trusts, and still pursue litigation against other companies.
Per this agreement, reached in the U.S. Bankruptcy Court in Delaware, RPM, based in Medina, Ohio, will submit $450 million upfront in cash to a trust once the federal bankruptcy and district courts approve the Bondex reorganization plan. The remaining $350 million will be submitted over the next four years in the form of either cash, stock, or some combination.
Help for mesothelioma victims can be found at The Ferraro Law Firm by calling (888) 554-2030. Offices in Miami and Washington, D.C.
Garlock decision could have pushed Bondex’s asbestos agreement, Aug. 14, 2014, By Heather Isringhausen Gvillo, Legal Newsline
More Blog Entries:
Judge Allows Punitive Damages in Asbestos Litigation, April 22, 2014, Mesothelioma Lawyer Blog