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Limits to Asbestos Lawsuits Pursued by ALEC in Idaho – And a State Near You?

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An article by Associated Press correspondent John Miller, published January 29, 2012, in MSNBC.com’s Health section,[1][1] notes that the American Legislative Exchange Council (ALEC) is pursuing to limit claims from lawsuits brought by people with asbestos-related illnesses, including asbestosis, lung cancer, and mesothelioma caused by inhaling asbestos filaments and particles (used in insulation until the 1970s).

ALEC’s effort stems from the results of a years-long case involving Crown Holdings of Philadelphia, Pennsylvania. Crown’s predecessor, a New York corporation of the same name, in 1963 acquired a majority of the stock in Mundet Cork Corporation, also a New York corporation. After three months, in February 1964, Mundet sold all its assets related to its insulation (asbestos-related) business. Two years later, in February 1966, the two companies merged. In 1989, Crown’s predecessor was reincorporated as Crown [Holdings], a Pennsylvania corporation. During the brief time Crown owned Mundet, the company did not produce asbestos products; and Crown subsequently sold the company. However, Crown Holdings was named in a host of lawsuits for asbestos-related disease damages and has paid in the neighborhood of $700 million in asbestos-related damages claims. Crown Holdings makes soda and beer container tops and last year its revenue was approximately $8 billion.[2][2]

Miller says that ALEC, a “corporate-backed, conservative non-profit” has succeeded in winning legislative protections (for corporations) in a number of states, including Florida, Georgia, Indiana, Mississippi, Nebraska, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Texas, Wisconsin and Wyoming. In Texas, the Texas Legislature enacted Chapter 149 of the Texas Civil Practice and Remedies Code, which limits certain corporations’ successor liability for asbestos claims. Miller notes that efforts to protect companies from bankruptcy due to claims from asbestos-related lawsuits have been stepped up because more than 100 [asbestos-related] manufacturing companies have gone out of business since 1982. It seems important here to note that asbestos-containing products – the asbestos dust generated by these products – have killed hundreds of thousands of Americans, and continue to do so everyday, including the family members of workers who brought asbestos dust home on their clothing, unwittingly exposing their family members to this toxic dust. Holding the the "asbestos industry" (companies that made and/or sold asbestos-containing products) responsible and accountable for the harm they took part in, is the other side of the story that the "industry" does not want told. Interestingly, the industry knew or should have known of the hazards of breathing asbestos dust as early as the 1920's (and arguably earlier), and several large corporations conspired to keep these hazards from "getting out" in the 1930's – one of the most egregious and harmful conspiracies in American business history. For more on the appalling history of asbestos and industry, read Outrageous Misconduct: The Asbestos Industry on Trial, by Paul Brodeur.

The next domino ALEC hopes will fall is the state of Idaho, since the measure is currently awaiting a hearing in the Idaho House. ALEC hopes that Crown's asbestos-related liabilities would be limited to the fair market value of Mundet's total gross assets at the time of the merger. “Even adjusted for inflation, that would all but end the possibility of big payouts.” According to Miller, there are only 10 asbestos-related disease lawsuits pending in Idaho against Crown, but estimates these could cost Crown up to $250 million in coming years if the hearing doesn’t go their way. There still may be a win in this for “the little guy”, as the Idaho Constitution forbids lawmakers from passing new laws that shield companies like Crown from making good on their legal obligations, and lawyers who represent potential victims of asbestos disease in Idaho will make the case for Crown making good on its obligations. Barbara Jorden, lobbyist for the Idaho Trial Lawyers Association, says of Crown, "They need to honor those responsibilities." [3][3] ALEC, through "friendly" state legislators, has attempted to get a similar bill passed in Virginia in the recent past, with no success as of yet. Hopefully, the Virginia State Legislature will continue to protect its citizens, and not grant a special favor for a well-connected corporation. This writer suggests that Idaho do the same.



[1][1] “Company Seeks Asbestosis Liability Limit in Idaho”, Miller, John, January 29, 2012, MSNBC.com Health. http://www.msnbc.msn.com/id/46181670

[2][2]Op. Cit.

[3][3] Ibid.