Public Citizen: Asbestos Fund Would Benefit Compan
Washington, DC, May 11--A day before the Senate Judiciary Committee resumes its work on the bill to establish a $140 billion privately-funded asbestos trust, Public Citizen released estimates of how some large companies now facing asbestos lawsuits would gain.
Meanwhile a Republican senator whose vote could be pivotal to the bill's fate said he thought it represented a "wealth transfer" from small asbestos defendant companies to large ones.
Sen. Sam Brownback of Kansas said he was hoping to amend the bill to ease the fund's burden on small companies, saying that if he succeeds, "there's a chance I could" vote for the legislation. He is one of the Judiciary Committee senators whose vote is being sought by the bill's supporters.
Asbestos fibers have been used in building materials, auto parts and other products for decades, but are linked to cancer and other diseases. Hundreds of thousands of injury claims have forced many companies into bankruptcy.
Senate Judiciary Chairman Arlen Specter and the panel's ranking Democrat, Sen. Patrick Leahy of Vermont, are the chief co-sponsors of the bill to take the claims out of the courts and have them paid instead by the fund, which would be financed by asbestos defendant companies and insurers.
Companies would pay according to a schedule that groups them according to prior asbestos expenditures, and revenues.
Public Citizen said that 10 asbestos manufacturers now in bankruptcy would reap savings of $20.3 billion -- when estimates of what they would have to put in bankruptcy trusts are compared to what they would pay to the proposed fund.
This group included chemical company W.R. Grace & Co. and building materials company USG Corp.
Eight Fortune 500 companies that used asbestos in their products also would see their asbestos liabilities substantially reduced by the bill, Public Citizen said.
For example, Dow Chemical had projected its future asbestos liability at between $1.6 billion and $2.2 billion over the next 15 years, but it will just have to pay an estimated $378.5 million over the next 30 years under the bill, Public Citizen said.
The Asbestos Study Group, which has lobbied for a bill to curb asbestos claims on behalf of large companies including Dow Chemical, responded that much of the "savings" would come from saved legal fees, since cases would no longer be in court.
The bill would benefit both businesses and victims, the Asbestos Study Group statement said. "The only losers under the trust fund proposal are trial lawyers, who have already collected nearly $20 billion in fees and anticipate tens of billions more if the current system remains unchanged," the statement said.
Brownback, speaking separately to a Reuters reporter, said some smaller companies think they are being required to pay a disproportionate amount to finance the fund.
"There are a group of companies I have met with that said, 'Now look, we're getting taken on this, and it's a wealth transfer to bigger companies,' and I happen to think they are right," he said.
His amendment seeks a reduction for companies being asked to pay more into the fund each year than their average annual expenditures on asbestos lawsuits in the past 10 years.
