Washington, DC, June 16--Labor, insurance and business leaders revived negotiations on Capitol Hill this weekend over federal legislation to rein in asbestos lawsuits that pose a growing threat to dozens of large manufacturers.
Talks broke down three weeks ago when labor leaders became angry about a bill introduced by Senate Judiciary Committee Chairman Orrin Hatch that would halt such suits and instead compensate people with asbestos-related illnesses through a $108 billion private trust fund, according to a Dow-Jones Report.
Officials at the AFL-CIO, the umbrella labor organization, believe a much larger fund is needed and complained that the proposal was a giveaway to companies such as General Electric, Viacom and Halliburton at the expense of injured workers. Those three companies joined with others to form a powerful lobbying organization -- The Asbestos Study Group -- that reached out last year to labor and to Hatch, a Utah Republican.
Labor officials had pulled out of the talks, complaining in part that Study Group members misled them about how much money they would put into the fund to get workers' representatives to embrace Hatch's bill. Jon Hiatt, general counsel to the AFL-CIO, says GE and its coalition are now the ones delaying the deal in order to avoid paying their share. "For such a well-financed company as GE to be holding this up simply to keep its own contribution down, we think, is regrettable," Hiatt says.
Hiatt, along with leaders of the trial bar, call the Hatch proposal a giveaway to the big companies because those companies otherwise could be liable for far more than they are being asked to pay in the bill.
Business leaders say many of labor officials' concerns--including money issues--are expected to be addressed in the renewed talks, which will include insurers as well as manufacturers. GE and Viacom have declined to comment on the negotiations and legislation. A Study Group spokesman, Joel Johnson, said last week that the Hatch bill represents a good beginning and that the coalition is looking forward to continued negotiations.
The Asbestos Study Group also includes Honeywell International, Pfizer, General Motors, Ford Motor and Dow Chemicals. The companies hired a onetime GE lobbyist, Barry Direnfeld, a lawyer with close ties to labor, as well as Hatch's former chief of staff, Kevin McGinnis, to help.
There are other connections between the Study Group and the politicians: Several members of the Judiciary Committee hold stock in its member companies--including Hatch, who owns shares of GE and Pfizer. Both holdings are valued at less than $15,000, according to congressional disclosure forms released Friday.
Those forms show Arizona Sen. Jon Kyl, a Republican on the committee who supports the legislation, owns more substantial amounts of stock in Viacom, GE, Ford, General Motors and Pfizer. Sen. Mike DeWine is the beneficiary of a fund managed by his father that holds stock in Ford, General Electric, Halliburton, and Honeywell. The Ohio Republican is one of seven co-sponsors of the Hatch bill.
Holding stock in companies affected by legislation doesn't usually raise conflict of interest questions for members of Congress. But longtime political watchdog Fred Wertheimer says legislation such as the asbestos bill requires a different level of disclosure and care.
"Senators who may significantly benefit from special legislation to help a particular industry ought to either recuse ... or they should disclose their stock holdings in the Congressional Record and explain why it is not a conflict of interest for them to vote on the legislation," he said.
