Background
Asbestos is a generic term for a group of naturally occurring, fibrous minerals with high tensile strength, flexibility, and resistance to heat, chemicals and electricity.* First introduced more than 2,000 years ago, the material became a popular addition to commercial products during the Industrial Revolution because of its fire-resistant tendencies. Given these favorable qualities, asbestos has since been used by numerous industries for fire proofing, thermal and electrical insulation.
Exposure
Exposure most commonly occurs when asbestos fibers separate into airborne microscopic-size particles and are inhaled or ingested. The particles then become embedded in the tissues of the respiratory or digestive systems.
The most common forms of disease related to asbestos exposure are asbestosis, mesothelioma and lung cancer. Asbestosis is a chronic lung ailment that can produce shortness of breath, coughing, and permanent lung damage. Mesolthelioma is a cancer of the thin membranes that line the chest and abdomen. Latency periods for asbestos exposure commonly take from 10 to 40 years for related conditions to appear.
Asbestos Use In Shipyards
Historically, exposure to asbestos in shipyards took place during shipbuilding and ship repair operations. From the early 1940s through the 1970s, asbestos products were used extensively on US ships for insulation of steam and hot water pipes, boilers, tanks, in ceiling tile and in fire-resistant sheets in bulkheads. In 1973, Maritime Administration (MARAD) regulations permitted asbestos use solely in insulation cement in lagging for machinery casings and in lagging cloth. Since 1978, government-subsidized ships have specified that asbestos be eliminated from all lagging and insulation materials.
Currently, asbestos remediation procedures provide the greatest potential for occupational exposure due to sawing, tearing, cutting and scraping operations. Other activities aboard maritime vessels involve repair, maintenance and removal of machinery, plumbing and installation of gaskets with asbestos insulation.
Asbestos Legislation In 108th Congress
On May 22, 2003, Senator Orrin Hatch (R-Utah) introduced S. 1125. Named the Fairness in Asbestos Injury Resolution Act of 2003 (FAIR Act), the bill created a $108 billion privately subsidized, publicly administered fund to provide resources for an asbestos injury claims resolution program.
On July 10, the Senate Judiciary Committee voted 10-8 to send S. 1125 to the full Senate as amended. Senator Dianne Feinstein (D-CA) joined Republican Committee members as the only Democrat in support of the bill. Senator John Kyl (R-AZ) abstained. As amended, S. 1125 creates a no-fault, administrative compensation system for asbestos claims that would replace civil litigation in the state and federal courts. A claims process under the supervision of the United States Court of Federal Claims determines eligibility for compensation, and eligible claimants would be paid from a fund financed by contributions from insurers and from defendant companies.
Two amendments were attached to the bill by the committee. Senator Joseph Biden’s (D-DE) sunset provision causes asbestos cases to revert to the tort system if the trust fund's administrator cannot certify every year that 95 percent of the prior year's claims have been approved. Senators Dianne Feinstein (D-CA) and Herbert Kohl’s (D-WI) amendment allows the trust fund administrator to delay scheduled "step-downs" in businesses' payments if that extra money is needed to pay pending claims.
From the fall of 2003 to spring 2004, Senate Majority Leader Bill Frist (R-TN) and Senate Minority Leader Tom Daschle (D-SD), along with a host of other Senators, coordinated a series of meetings with insurers, manufacturers and labor groups. The discussions focused on the major points of disagreement that still remained in the asbestos bill. The major points included: (1) the overall trust fund size; (2) the Biden sunset provision; (3) the treatment of pending cases/settlements; and (4) the Administration of the fund.
On April 7, 2004, Senate Majority Leader Bill Frist (R-TN) introduced S. 2290, the Fairness in Asbestos Injury Resolution Act of 2004. The bill creates as much as a $124 billion trust fund to pay no-fault claims related to asbestos exposure. S. 2290 allows workers exposed to asbestos to seek no-fault monetary remedies through a created trust fund, replacing their right to sue through the federal court system. The bill mirrors Senator Orrin Hatch’s (R-UT) S. 1125, which lagged in the Senate while interested parties worked behind the scenes to craft an agreeable measure.
A cloture motion was filed regarding S. 2290 on April 20, to limit debate and proceed to formal consideration of the bill. On April 22, the motion failed to secure the 60 votes needed to pass (50-47). In order to move the process along, Senators Frist and Daschle appointed Edward Becker, former chief judge of the U.S. Court of Appeals for the 3rd Circuit in Philadelphia, to mediate the discussions between interested stakeholders. Since April 22, talks have taken place under Becker’s direction, to address the points of contention that still exist with the fund. Those talks have concluded and an agreement has yet to be reached.
Conclusion
The current system that addresses asbestos claims is not working. Those who are truly sick from asbestos exposure are not adequately compensated. According to RAND, a nonprofit institution that conducts policy research and analysis, claimants are receiving $0.43 out of every dollar spent on asbestos litigation. This is slightly better than a 1983 RAND study which found that only $0.37 per dollar went to the victims. Administrative costs, including trial lawyers fees, are a main reason why this is the case.
The vast majority of current claims have been filed by people who are not suffering from an asbestos-related illness. In a 2004 asbestos study published by Professor Lester Brickman of the Cardozo School of Law, it was estimated that 80 to 90 percent of asbestos claimants have no illness recognized by medical science. According to a 2002 RAND study, 65 percent of compensation over the last decade was paid to people claiming non-cancerous conditions.
The current system is being overwhelmed. In his statement on the Senate floor, Senator Hatch stated that in total, “more than 600,000 people have filed claims, and more than 8,400 companies have been named as defendants in asbestos litigation.” Brickman’s study estimates that in 2003, more than 100,000 new asbestos claims were filed. The average time for filed asbestos claims to be processed has risen sharply in recent years due to the sheer volume of claimants.
Since the beginning of the 1970s, over 70 companies have been forced into bankruptcy, and 60,000 jobs have been lost. Values of pensions and retirement savings for thousands of workers and their families have diminished. The current system needs to be reformed to justly compensate those sick from asbestos exposure and provide economic stability for the thousands of businesses impacted by the litigation.
For more than 20 years, a solution to resolve the asbestos litigation quandary has failed to be achieved. In the case Ortiz v. Fibreboard, Chief Justice William Rehnquist stated that the asbestos situation "cries out for a legislative solution." Congress needs to craft a solution that allows asbestos victims to be compensated while ensuring the economic viability of those companies affected by asbestos litigation. Please contact your federal representative and express your support for asbestos liability reform.
*definition of asbestos provided by the Occupational Safety and Health Administration (OSHA)