Status of Asbestos Claims

When the actions of a company or an entire industry create the need for mass litigation involving numerous plaintiffs and defendants, it is commonly referred to as a mass tort. Asbestos litigation has been handled much differently than the mass torts that have preceded it and because there are so many litigants involved, it is almost impossible to determine the full extent of the damage done to both the industry and those who have been injured. To date, over 730,000 claims have been made and over 8,400 defendants have been named— and because mesothelioma may develop as many as forty years after asbestos exposure, there are estimations that the number of plaintiffs could reach three million before all is said and done.

Numerous Defendants Responsible in Each Claim

Because of the reach of the asbestos industry and the number of companies that manufactured asbestos laced products while knowing of the health implications, some asbestos claims involve as many as fifty defendants. A construction worker diagnosed with mesothelioma may have the right to claim compensation from his or her employer as well as the companies that produced each and every product that may have been responsible for his or her exposure to asbestos. No mass tort throughout history involved more than twelve defendants before the asbestos mass tort, making asbestos litigation much more complicated than any of the mass torts that have preceded it.

Special Rules Regarding Causation

Typical lawsuits require that the plaintiff prove that the defendant was the direct cause of his or her injuries and is therefore liable for damages. It is almost impossible to prove which manufacturer’s product was responsible for each plaintiff’s exposure to asbestos and in the majority of the cases, the responsibility is shared. Victims of asbestos exposure are not required to provide solid evidence that the defendants are the direct cause of their injuries, however, due to the fact that it takes decades for the effects of the exposure to be exhibited.

Bankruptcy Not a Viable Option for Responsible Companies

In the past, mass torts have come to a resolution because of the bankruptcy of the responsible parties. After the companies’ assets were sold off, a compensation fund was set aside to provide money for potential litigants who were to come forward in the future. However, because it requires the approval of 75% of those who have present claims for a company involved in a mass tort to file bankruptcy, any settlement will be lopsided and will address the needs of those who are currently diagnosed with illnesses that have resulted from asbestos exposure while leaving all future claimants with the short end of the stick.

Class Action Turned Down by the Supreme Court

The Supreme Court has turned down two attempts to come of a class action settlement which deterred other defendants from even trying to find a resolution through those means. The main issue with resolving this mass tort through class action is that it would be impossible to come to an agreement on which companies were obligated to settle and at which amounts. As it stands, there is still no viable solution to the matter that would be fair and address the concerns of all of the parties involved. As long as the issue remains unresolved, litigation will continue to be cumbersome to responsible companies and settlements are likely to be more expensive.

The scope of asbestos litigation has set new precedents for mass torts in the future and litigation will become more expensive in the future for companies that are found at fault for wrong doing. Unfortunately, the attitude of managers is unlikely to change and many companies will continue to choose short term profits while discounting the long term damage that will result from knowingly putting others in harm’s way.

Source:

http://www.econ.ucsd.edu/~miwhite/p183.pdf

http://en.wikipedia.org/wiki/Mass_tort

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