Asbestos Companies’ Protection Through Bankruptcy Trusts

Asbestos companies have become quite clever at avoiding responsibility and shielding themselves from liability through mergers, which, in effect, hide responsible entities. They also protect their assets from legal claims by setting up bankruptcy trusts.

When those companies declare bankruptcy, they do not actually go out of business; they simply restructure their debt and liability by putting that liability into a bankruptcy trust. In fact, since the year 2000, over 70 asbestos companies have filed for bankruptcy protection against asbestos-related lawsuits. Once these companies receive that bankruptcy protection, they are required to pay only pennies on the dollar, such as a meager 10% of the actual value of the claim.

The end result of such machinations is that fewer viable companies exist that can provide recovery, and less money is available with which to pay legitimate claims. The mesothelioma case value itself, however, does not decrease. In addition, studies show that the diagnoses of asbestos-related diseases will only increase over the next decade.

The Deaton Law Firm has addressed these trends by becoming even more aggressive in locating and targeting culpable companies. We must work harder and dedicate more time and effort in research and investigation in order to reach the same settlement values of past claims. It is therefore very important that mesothelioma victims are prudent and selective in determining which law firm business model (quantity versus quality) better suits their individual needs in light of this new trend in the litigation.

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