Take Action! Urge Your Senator to Defeat Not "Fix" S. 1125

Act NOW Against S. 1125: A Get Out of Jail Free Card for Asbestos Corporate Defendants, A Nightmare for American Families

Some of our clients have had their cases completely resolved and wait for money promised by defendants in their case. Some have collected their settlements from defendants but await payments from current and future bankruptcy settlement trusts. Others still wait for trial. All will suffer a miscarriage of justice under S. 1125, Sen. Orrin Hatch's asbestos corporate bailout bill, which because of a series of astonishing compromises (some would say betrayals) stands dangerously close to passage.

Alarm and anger will not defeat S. 1125. Action will. We can defeat S. 1125 only if we all work together, NOW. We cannot rely on the presumed good will of our elected leaders, union officials or trial lawyer bar.

If you do not have time to read all of this letter, please go to "Part III. Call to Arms", to learn what you can do to help. Parts "I" and "II" of this letter discuss the original form of S. 1125, the "compromises" offered to the Bill, and the currently volatile situation in Congress. Quite simply, we are late in the fourth quarter and down by a few touchdowns. We need to rally.

Part I. The Original Bill: As originally proposed by Sen. Orrin Hatch, S. 1125 would:

• Immediately dismiss with prejudice all pending asbestos lawsuits and claims, including appeals filed by asbestos defendants.

  • Dismissal "with prejudice" means the suit could not be refiled.
    

  • FELA (railroad) asbestos litigation and Jones Act (maritime) asbestos litigation would also be immediately dismissed with prejudice.
    

  • All pending claims and unpaid settlements against bankrupt defendants such as Babcock & Wilcox and Harbison Walker would be voided and eliminated for all time.
    

  • Pending appeals by asbestos defendants of jury verdicts would in effect be turned into victory by the defendant on appeal, reversing the jury's verdict to a judgment of dismissal.
    

  • Unreimbursed litigation costs incurred by plaintiffs would remain unreimbursed and be borne solely by plaintiffs and their attorneys.

• Provide one payment of $750,000 for all claims -- for pain and suffering, for a wife's loss of her husband, even for an infant child's loss of her parent -- for qualifying mesothelioma patients (read on), minus prior settlements already received, with mandatory reimbursement to your medical insurance carrier of its insurance payments for your mesothelioma, up to the $750,000 limit.

  • $750,000 represents inadequate and unfair compensation for most mesothelioma claimants. Jury verdicts nationwide, on average, are several times greater, not including punitive damage awards.
    

  • If you have already received some settlement monies but have not reached the $750,000 limit, you will receive the difference between what you have already received and $750,000.
    

  • All payments by your medical carrier for treatment of your mesothelioma will be deducted from the $750,000 you will receive and paid to your insurance carrier. Such costs can exceed $200,000.
    

  • The "one size fits all" approach does not permit presentation of evidence of special financial hardship, such as a substantial lost wage claim, or medical hardship, or the loss of consortium by minor children.

• Eliminate mesothelioma household exposure claims by women and children who suffered from their husband's asbestos-contaminated clothing.

• Eliminate mesothelioma bystander claims for those who do not fall into strict job classifications eligible for compensation under S. 1125. For example, an office worker exposed to asbestos-containing joint compounds during office remodeling or construction would be ineligible for compensation, as would a homeowner exposed during home construction.

• Create a new federal bureacracy, a federal asbestos "court" packed with politically appointed judges, no resort to the jury system, an extremely limited right of appeal, and no funding for attorneys to represent claimants. It will likely take a year to 18 months before the federal bureaucracy is up and bumbling. Click Here to see the enclosed letter to the New York Times from my colleague Charles Siegel, who analyzes with excruciating if not depressing detail how long it will take for any money to trickle down to the family of a young father with mesothelioma with a wife and small daughter. Under the current system, asbestos plaintiffs attorneys desperately try to avoid federal court, because many of the relative handful of cases there have not been resolved after ten years. Imagine how long claims processing would take under a new federal bureaucracy with responsibility for all asbestos claims.

• Inadequately fund compensation and provide no recourse to future claimants when the "well runs dry," but provide a windfall to corporate America. For example, Halliburton recently agreed to settle all pending asbestos claims for a lump sum payment of about $4 billion. Under S. 1125, this agreement would be voided, and Halliburton would get to pay only about $400 million over 27 years. Halliburton could bank the $4 billion and pay most of its obligation under S. 1125 with interest on the principal!

Simply put, the original version of S. 1125 was nothing short of an outrageous violation of your rights and a gross abuse of government power. Chrysler Daimler Benz, Ford, General Electric, General Motors, Halliburton, Pfizer, and the rest of industry all lined up in favor.

Even in these times when politicians are viewed with great cynicism, one would think S. 1125 would cause an outcry from labor and some politicians who have generally stood for the rights of the individual over the rights of big business. One would think revulsion, not compromise, was in order. Think again.

Part 2: Weak , Ineffective Opposition Increases Danger of Passage

Sen. Hatch has responded to objections by floating "trial balloons" of upping compensation from $750,000 to $1 million, eliminating reimbursents to medical insurance carriers, compensating verifiable household exposure cases, and adding a "reserve" of money to fund compensation should the initial fund run out of money in 27 years. In other words, Sen. Hatch has offered to "sugarcoat" the Bill in order to ease passage with fencesitters eager to justify a "yes" vote.

Even with the sugarcoating, S. 1125 remains a bitter pill to swallow. Who wins? The asbestos wrongdoers, who poisoned Americans at such an unprecedented and massive scale that now our Government wants to bail them out. It's like solving prison overcrowding by simply letting the convicted murderers go free with a slap on the the wrists. Who loses? All asbestos cancer claimants, their families, and our Constitution, which guarantees the right to a jury trial. This is outrageous.

The response from big labor and the Democrats has been disappointing, to say the least.

The AFL-CIO, originally opposed, has now lined up in favor of S. 1125, once medical requirements for compensation of those with pleural plaques and asbestosis were redrafted. Judiciary Committee Member Sen. Edward Kennedy disappointingly countered Sen. Hatch's $1 million mesothelioma compensation offer with a feeble demand for $1.1 million. Early last week, Committee Member Sen. Patrick Leahy and Senate Minority Leader Tom Daschle said that an asbestos bill was likely to pass. With the apparent support of these and other Democrats such as Sen. Diane Feinstein for S. 1125 with minor "fixes", passage of the Bill out of the Judiciary Committee, through the Senate and into law seemed certain.

A glimmer of hope for opponents of S. 1125 came later in the week in a report released by the Congressional Budget Office (CBO). The CBO's analysis of the Bill found that S. 1125 would require three or four times more money than presently proposed to sufficiently fund the trust under the agreed upon medical criteria. Rumor has it that insufficient funding has solidified Democratic opposition to S. 1125, and Sen. Leahy's last word on the matter was that if there were a vote in the Judiciary Committee today, it would be along party lines, and therefore S. 1125 would not pass a cloture vote. The insurance industry, which would help fund the trust created by S. 1125, is also said to be unhappy with the 27-year reserve fund. Labor may switch its position again and oppose S. 1125 if the Bill does not provide adequate funding under agreed upon medical criteria.

However, given the weak and ineffective opposition already offered by labor and the Democrats, and the drive and tenacity of Sen. Hatch in enacting S. 1125, this is not the time to stand on the sidelines and hope everything will work out for the best.

I continue to believe there is only one fair compromise solution: putting unimpaired asbestos claimants in a registry which would preserve their claims should they develop a serious illness, while allowing cancer claimants and others with serious asbestos illnesses to seek redress in the courts under the current system. Such a legislative solution would stem the tide of corporate bankruptcies cited by Sen. Hatch as justification for S. 1125, but the unimpaired registry was considered and inexplicably abandoned by Congress over a year ago. Clearly, the asbestos defendants behind S. 1125 want nothing less than a final solution to their problems. Not coincidentally, share prices of many asbestos defendants have risen sharply with news favoring passage of S. 1125.

In sum, the many swings in favor and against S. 1125 have been rapid and unpredictable. Our side cannot hope to match the financial resources of the asbestos defendants, and I suspect that many of the surprising victories for the Bill's proponents have been won with commitments of cold, hard campaign cash. How can we hope to win? What do we do now?

Part 3: Call to Arms

I want each of you to understand and believe that if S. 1125 provided fair compensation to my clients, I would support it, even though this would mean the end of my representation of you. S. 1125 in my judgment pays 10 to 20 cents on the dollar to my clients. I cannot recommend this to you. If I thought the supporters of S. 1125 would "fix" the Bill so it would provide you swift and adequate justice, I would ask you to ask your Senator to "fix" the Bill. There is so much that is wrong with this Bill that if it were fixed, it would bear no resemblance to its current state. S. 1125 cannot be fixed. It must be defeated.

Each of you must make your voice heard if we are to defeat S. 1125. If you do not, you very well may lose your right to seek justice in our courts. It will take months and months before the new bureaucracy is up and running. For those of you who may not have exceeded the compensation caps, it will take years before you see a dime from the trust, assuming the wrongdoers actually fund it.

Below you will find a form letter with bullet points which you can check off if applicable. You can send in the form letter to your Senators and members of the Senate Judiciary Committee. Their names and addresses are listed below. Better yet -- we all know that most form letters get thrown in the trash with barely a glimpse (but not this letter!) -- I am encouraging you to draft a letter in your own words to these Senators expressing your outrage and opposition to S. 1125. E-mail it, fax it, and call your Senator. We need to show our Senators that there will be grave consequences for a vote in favor of S. 1125.

The Senate Judiciary will reconvene on July 10th. On that date, the Committee will vote on whether the bill, as "marked up", will proceed to the floor of the Senate a final vote. Please write your Senator now. Please call your Senator now. We must derail this doomsday train while it is still in the roundhouse.

Please help me help you and other mesothelioma patients poisoned by the asbestos industry. Act now.

Yours very truly,

Roger G. Worthington

July , 2003

VIA (E-MAIL) (TELECOPY) (and) (REGULAR U.S. MAIL)

The Honorable Senator __________
United States Senate
Washington, D.C. 20510

Dear Senator __________:

I write to express my strong opposition to S. 1125, the so-called "Fairness in Asbestos Injury Resolution Act."

I oppose S. 1125 for many reasons.

• First, you should know that INSERT EITHER { I suffer from malignant mesothelioma } OR { I am an immediate family member of a malignant mesothelioma sufferer } . The only known cause of malignant mesothelioma is asbestos exposure. I have exercised my legal rights to seek redress, I have retained counsel, and I have complied with all applicable laws.

• I know that malignant mesothelioma causes horrible pain and suffering. Many patients undergo radical surgery involving removal of a lung, the heart sac, and a portion of the diaphragm. The recovery period is long and painful, and the surgery is considered a success if the patient lives 18 months past the original diagnosis. Other treatments include radiation therapy and chemotherapy, which can cause extreme nausea, vomiting, hair loss, and weight loss. Despite the highest and best efforts, mesothelioma frequently recurs in the chest cavity or the peritoneum, the lining of the abdominal cavity. As the tumor grows, so does pressure against vital internal organs, such as the heart and liver. Such pressure commonly causes severe shortness of breath and excruciating pain. The direct cause of death is often mechanical pressure upon the internal organs; the patient is literally crushed to death.

• I understand that S. 1125 offers $750,000 as compensation for all losses suffered by the families of those suffering from mesothelioma. Senator Orrin Hatch and others cite bankruptcies by a number of asbestos manufacturers as justification for S. 1125.

• However, I understand that the bankruptcies were driven by claims filed on behalf of those with signs of asbestos exposure who were not seriously ill, the so-called unimpaired asbestos claimants. I believe that further bankruptcies could be curtailed by creating a registry for the unimpaired asbestos claimants which would preserve their right to file suit should they ever develop a serious illness. I understand that over a year ago Congress briefly considered, then inexplicably abandoned this reasonable compromise.

• In most instances, the jury system would compensate someone with mesothelioma many times more than $750,000 for his pain and suffering alone, before considering other claims such as for lost wages or loss of consortium by a wife or minor child. Because I believe an unimpaired registry would eliminate the need for S. 1125 by stemming the bankruptcy tide, I think it is unfair to eliminate the right to a jury trial for families suffering from this asbestos-related disease at such a low cost.

• The "one size fits all" approach of a $750,000 payment is unfair to those with substantial lost wage claims, and acutely unfair to those who will leave young, financially dependent children behind. All asbestos cancer victims are deserving. Yet a 45 year-old working father with three minor children who earns $50,000 per year will receive the same amount as an 85 year-old retired claimant with the same cancer.

• Prior settlements would be counted against the $750,000 cap. Fiscally solvent companies are in effect released from unpaid settlement agreements if a mesothelioma claimant has already reached the cap level. The Bill will reward corporate debtors who break their promises.

• S. 1125 immediately halts all asbestos litigation, including cases which are on the eve of trial or in trial. S. 1125 does so even in cases where mesothelioma claimants have spent tens or even hundreds of thousands in dollars in case expenses in preparing for trial, without making any provision (beyond the $750,000) to reimburse those expenses. This is a hidden cost which would be born by mesothelioma patients.

• Even where a jury has years ago awarded a verdict in favor of someone with mesothelioma, but the losing defendant has an appeal pending, the judgment is automatically reversed in favor of the defendant and the case dismissed. S. 1125 in effect punishes plaintiffs who prove and win their case and rewards the guilty who have filed frivolous appeals.

• S. 1125 creates a new federal bureacracy, a federal asbestos "court" packed with politically appointed judges, no resort to the jury system, an extremely limited right of appeal, and no funding for attorneys to represent claimants. Under the current system, asbestos plaintiffs attorneys desperately try to avoid federal court, because many of the relative handful of cases there have not been resolved after ten years. Claims processing under a new federal bureaucracy with responsibility for all asbestos claims is not the answer. The bureacracy's mandate will be to hold onto and grow their precious trust money. The bureacracy will fight against our right to full compensation. The new federal bureaucracy will be funded by our tax dollars -- another windfall to the wealthy corporate wrongdoers.

• S. 1125 is inadequately funded. I understand that the Congressional Budget Office estimates that S. 1125 would require three or four times more money than presently proposed to sufficiently fund the trust under the agreed-upon medical criteria. With a cap of $5 billion on funding per year and about 300,000 pending claims, the trust will be underfunded and essentially bankrupt from the outset. Delay will be the rule, swift fairness the extreme exception.

• S. 1125 is a windfall for corporate wrongdoers. For example, in the past year Halliburton agreed to settle all pending asbestos claims in a lump sum payment of about $4 billion. Under S. 1125, Halliburton's agreement would be voided. Instead of a $4 billion lump sum, Halliburton would pay into the Trust about $400 million over 27 years, which is only 8% of its debt.

• The companies that are in bankruptcy now, such as United States Gypsum, Owens Corning, GAF, Federal Mogul, and WR Grace, who have agreed to pay most or all of their value to present and future asbestos claimants, will now pay only a fraction of their promise. For example, Armstrong has agreed to pay $1.9 billion net present value to its bankruptcy trust under its proposed reorganization plan. But under S. 1125, Armstrong's payments would be capped at around $600 million, just over a quarter of its obligation. Asbestos companies who file bankruptcy are allowed to sell product and earn profits while they reorganize. When an asbestos cancer patient dies, he or she cannot be revived.

• If passed, S. 1125 will give immunity to some of the biggest corporations in the world, such as General Motors, Ford and Dow/Union Carbide. How can it be "fair" for the largest and most powerful corporations to get a free pass on their debts while the men and women they made sick get the shaft? Last year the C.E.O. for Honeywell, which is liable for the asbestos debts of its brake unit Bendix, reported income of over $56 million.

In sum, S. 1125 takes away the right to a jury trial for mesothelioma patients who have been poisoned with asbestos, and bails out the companies who poisoned them. Please be assured that I am motivated to fight S. 1125 with my remaining strength and hope you will join me in that fight. I have followed the history and do not believe that S. 1125 can be "fixed." It is defective and must be scrapped. Please stand up for the rule of law and hold wrongdoers accountable.

I anxiously await your response.

Sincerely,

Members of the Senate Judiciary Committee

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*** POSTED JULY 1, 2003 ***