Senator Hatch Wants Asbestos Bill Quickly

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Wed Mar 5, 716 PM ET

By Susan Cornwell

WASHINGTON (Reuters) - A key senator instructed feuding parties to the asbestos litigation crisis on Wednesday to unite behind a proposed solution in two weeks, saying he wanted Congress to pass a bill solving the problem this year.

"It's time to get together and come up with a solution," Senate Judiciary Chairman Orrin Hatch told industry, labor and plaintiffs representatives at a hearing on the flood of asbestos personal injury claims swamping U.S. courts.

Hatch, a Utah Republican, said he and committee Democrats would try to forge a consensus bill out of two basic approaches under discussion -- establishing medical criteria for filing claims, or setting up a trust fund for victims.

But he told the room packed with lobbyists from companies, insurers, unions and legal groups, that he needed their help to find a consensus and write a bill by the end of March and then pass it in a Congress closely divided along party lines.

"This is the year to do it if it's going to be done," Hatch said, adding"It's your last chance to get things resolved, as far as I'm concerned."

Sen. Patrick Leahy of Vermont, the ranking Democrat on the committee, said his staff would work with Hatch's on asbestos legislation. He thought a bipartisan bill could pass Congress but warned it should not be a vehicle for special interests.

"This is not a magnet for every single special interest from the left to the right," Leahy declared.

Asbestos was widely used for fireproofing and insulation until the 1970s, when scientists concluded that inhaled fibers could be linked to cancer and other diseases. The flood of claims since then has cost over $54 billion in settlements.

HATCH SAYS TRUST FUND CAN'T BE OPEN-ENDED

Hundreds of thousands of asbestos claims are blamed for driving over 60 U.S. companies into bankruptcy. A recent study by the RAND Institute for Civil Justice said up to 2.4 million more claims could be filed. Most of those suing are said to have no current physical impairment.

But some victims of cancers caused by asbestos say they cannot get the compensation due their families because so many claimants who are not sick have clogged the courts.

"It makes me angry that these (non-sick) cases are forcing defendants into bankruptcy and diverting funds from people who are sick and dying from asbestos disease," Brian Harvey, who has mesothelioma, an asbestos-caused cancer, told senators.

Hatch said he had concerns about setting up a trust fund to pay claims, the approach generally backed by labor unions. But he also was worried that a bill based solely on setting medical criteria for lawsuits might not get enough Democratic support.

He indicated he could not support a trust fund that did not have a cap on overall liability. "I'm not for a trust fund that's an open-ended situation," Hatch said.

This is one of the major points of contention. Critics of the trust fund approach say asbestos manufacturers and other companies who would have to fund it to avoid being sued, could never agree on total liability, or their share of it.

But Jonathan Hiatt, the associate general counsel of the AFL-CIO, said talks with major asbestos defendants and insurers left him optimistic that agreement among them was possible.

Estimates of the trust fund that would need to be set up ranged from $150 billion to $300 billion, Hiatt told Reuters.

DOCTORS BACK MEDICAL CRITERIA APPROACH

The group of defendants that have been talking to the unions, known as the Asbestos Study Group, are proposing a privately-funded trust that would pay victims quickly on a no-fault basis, for a wide range of asbestos-related diseases.

The overall size of the program would be set by statute, and asbestos defendants and insurance carriers would pay into the system on a yearly basis to cover annual costs, the study group said in written testimony submitted to the committee.

Study group members include Dow, Ford Motor Company,, General Electric, General Motors Halliburton, Honeywell, Pfizer and Viacom .

The idea of requiring asbestos claimants to meet medical criteria got a boost recently when the American Bar Association backed limits on lawsuits over noncancerous lung injuries.

Soon afterwards, Sen. Don Nickles, an Oklahoma Republican, introduced legislation mirroring the ABA approach.

But Melvin McCandless, a North Carolina man who suffers from asbestosis, a scarring of the lungs, testified that those criteria would exclude any claim from him.

And Montana Democrat Sen. Max Baucus told the committee that the ABA medical criteria would exclude victims from the town of Libby, where hundreds had died from exposure to asbestos-tainted dust from a vermiculite mine.

ABA president-elect Dennis Archer countered that he thought the Libby victims would be covered. In any case, he said, he was willing to work to make the criteria more flexible.

*** POSTED MARCH 6, 2003 ***