Controversial Asbestos Settlement Heads to Court

After more than a year of bitter legal jockeying, an attempt to begin breaking the nation's biggest courthouse logjam - lawsuits surrounding asbestos - faces a critical test on courtroom. The case is complicated by any standard: millions of potential plaintiffs, dozens of lawyers, 20 defendants and more than two decades of wrangling over damages for people suffering from asbestos exposure.

The proposal to pay an estimated 100,000 asbestos-related disease sufferers or their families about $ 1 billion over the next 10 years is even more complex with stiff opposition and allegations of misconduct.

Backers and detractors will state their positions in a fairness hearing here Tuesday before U.S. District Judge Lowell Reed.

Lawyers who negotiated the deal call it a model for a faster and better way to compensate asbestos disease victims whose needs have gone unmet in court. Opponents call it inadequate and the result of collusion between the Center for Claims Resolution, a group of 20 former asbestos makers, and two law firms: Greitzer & Locks of Philadelphia and Ness, Motley, Loadholt, Richardson & Poole of Charleston, S.C.

Under the deal, consideration for damages would be given to anyone who requests it, a vastly simpler arrangement than hiring an attorney and waiting years for a case to wind its way through the justice system, said John Aldock, a lawyer for the Center for Claims Resolution.

A nationwide asbestos resolution has proven elusive. More than 100,000 cases are lined up in state and federal courts. The litigation has cost U.S. companies an estimated $ 7 billion, some $ 4 billion of it going to lawyers.

Under the settlement, average payments range from $ 5,800 for non-malignant disorders, such as labored breathing, to $ 60,000 for mesothelioma, a terminal lung cancer. The amounts are based on historical averages, proponents said, with the neediest paid first.

Only those showing symptoms get money. Victims could request additional compensation if they develop more serious illnesses. The CCR doesn't include the biggest asbestos manufacturers, and settlement plaintiffs still could sue them.

Critics argue that in most cases plaintiffs will receive a fifth of what they could win in court. Because of docket gridlock, however, most states are hearing cases filed in the late 1980s. All federal lawsuits have been on hold since 1992.

Wages, the union leader, figures that 350,000 to 400,000 of his current and former union members were exposed to potentially deadly amounts of asbestos. Many, including himself, will not be covered by the settlement because they weren't exposed for long enough periods - at least 10 years for mesothelioma and 12 years for other ailments.

Overall, more than 27 million Americans are estimated to have job-related exposure to asbestos, a natural insulator used for decades in construction, and roughly 1 million targeted by cancer. Not all of those people were exposed to products made by the companies included in the CCR, however.

There also have been questions about whether people who don't want to join the settlement "class" were adequately informed. People who wanted to be excluded, remaining free to sue CCR companies, had to inform the court by Jan. 24.

The settlement, filed in January 1993, received preliminary approval in October by Judge Reed, who ruled that accusations of collusion between the two firms and the CCR were unfounded.

Philadelphia lawyer Ben Shein said the law firms didn't do enough to determine whether defendants could afford to pay without a settlement. The National Asbestos Victims Legal Action Organizing Committee estimates the CCR members have $ 53.6 billion in assets.

But backers said draining company assets has driven 17 former asbestos manufacturers into bankruptcy. Locks said the settlement requires insurers to pay when necessary, helping guarantee defendants solvency as cases mount.