Washington, Oct. 15--Manufacturers, trial lawyers, insurers and labor unions have been fighting over asbestos liability for 30 years. Now all the warring camps are as close as they've ever been to agreeing on a Congressional truce for one of the most expensive battles in industrial history, according to the Wall Street Journal.
But the uneasy pact could still come unglued. The bill, which next faces a full Senate vote, proposes creating a trust fund for asbestos victims and giving priority to patients with the greatest medical need. Two camps of asbestos makers, long bitter rivals, have come together to support the bill. But insurers want to be sure the fund doesn't raise their costs. Unions want the fund to grow bigger. And trial lawyers are fighting the bill, opposed to a proposed cap on total payments to plaintiffs.
Tuesday night, Senate Majority Leader Bill Frist of Tennessee put a deal on the table that would slightly increase the size of the fund, to appease the unions. He has made it clear that, without a major breakthrough this week, any legislation will probably be shelved until after the 2004 election.
The latest chapter in this saga focused on two solutions for curtailing asbestos lawsuits from rival business camps. A group called the Asbestos Alliance, comprising old-line asbestos manufacturers and insurers, proposed a plan in which plaintiffs with fatal cancer would be first in line in the courtroom and those who had been exposed but were still healthy would be last. This "medical criteria" approach appealed to trial lawyers who represent the sickest victims, because it wouldn't ultimately limit the number of cases or the size of awards. The manufacturers liked it because it would have raised the bar on who receives compensation.
The other camp includes companies who were uncertain of their legal vulnerability because they had inherited liability in acquisitions or were otherwise less directly tied to making asbestos. They wanted to establish a trust fund from which victims would be paid based on the severity of their condition. The fund would eliminate the uncertainty hanging over these companies by putting a cap on how much they each paid into the fund to compensate victims.
This camp, dubbed the Asbestos Study Group, found a politically valuable ally in organized labor, which tempered its natural allegiance to sick workers because it wanted to stem the rising numbers of jobs lost at companies seeking bankruptcy protection. Trial lawyers, though, hated the idea, and insurers were cool because it required a hefty contribution from them.
Lawsuits have forced business giants such as Johns-Manville Corp. and W.R. Grace & Co. to seek bankruptcy protection. About 300,000 settlements are pending around the country, defendants estimate. A Rand Institute study says there could be as many as 2.4 million asbestos victims yet to be found. Their claims, according to the study, could total $210 billion. Companies warn of many more bankruptcies and resultant job losses, a warning labor unions take seriously.
Senate Majority Leader Frist and Democratic Minority Leader Daschle both say they want a deal, and offers are flying back and forth. Ordinarily, such a logjam might be broken by the Bush White House, a zealous advocate of lawsuit curbs. But the administration is stuck awkwardly on the sidelines because Vice President Dick Cheney's old employer, Halliburton Co., stands to save billions from the deal.
