Myth vs. Facts
Trial lawyers and their allies claim that asbestos trust reforms like the Furthering Asbestos Claim Transparency (FACT) Act are unnecessary and will hurt asbestos victims. They’re wrong. Here’s why.
Myth 1: Reforms will hurt veterans
Claim: The Furthering Asbestos Claim Transparency (FACT) Act will make it more difficult for veterans to recover from asbestos trust funds.
Reality: Many veterans were exposed to asbestos during their service to our country. As a result, veterans are disproportionately and negatively impacted by waste, fraud, and abuse within the asbestos trust system. If asbestos trusts’ limited resources are drained by fraud and abuse, they will be unable to pay veterans legitimate claims.
Myth 2: Reforms threaten personal privacy
Claim: The Furthering Asbestos Claim Transparency (FACT) Act will expose asbestos victims’ sensitive, personally identifiable information.
Reality: The FACT Act protects asbestos trust claimants’ privacy. It bars disclosure of confidential medical records and other highly sensitive personal information. It also empowers bankruptcy judges to take additional steps to protect claimants’ privacy if necessary.
Myth 3: Reforms are bad for victims
Claim: Reforms will make it harder for asbestos victims to sue in state courts.
Reality: Nothing could be further from the truth. The Furthering Asbestos Claim Transparency (FACT) Act would not cap damages, limit claims, or change how asbestos lawsuits are handled in state courts. The proposed legislation imposes absolutely no obligations on asbestos victims. It would simply shine a light on asbestos trust funds, which are approved by federal bankruptcy courts, and ensure that assets are preserved for future victims.
Myth 4: Reforms are unnecessary
Claim: There’s no evidence of fraud in the asbestos trust system, and there’s no need for reform.
Reality: When Congress authorized the creation of asbestos bankruptcy trusts, it expected current and future victims to receive similar compensation. That hasn’t happened. Twenty-three trusts have reduced their payments since 2008. As a result, an asbestos victim who files trust claims today may receive only half as much as he would have only seven years ago. Fraud and abuse may be forcing these payment reductions. A recent government study concluded that trusts could be tricked into paying claims based on ‘‘altered work histories.” A Wall Street Journal investigation of a single trust identified thousands of questionable claims, including at least one cancer claim filed by a person who didn’t exist. Because asbestos trusts operate in secret, it’s impossible to tell how many abusive claims the trusts receive. That’s why reform is necessary.
Myth 5: Reforms will burden the trusts
Claim: Implementing reforms will be expensive, time consuming, and leave trusts with less money for asbestos victims.
Reality: Reforms won’t burden the trusts. The Furthering Asbestos Claim Transparency (FACT) Act would require trusts to provide information on the claims they receive to bankruptcy courts. Asbestos trust claims are filed and stored electronically, and experts on the trusts have testified that complying with the FACT Act would be easy and virtually costless.