THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Thursday, August 18, 1994 TAG: 9408180512
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORT
DATELINE: PHILADELPHIA LENGTH: Medium: 87 lines
A federal judge gave final approval to a $1.3 billion settlement to resolve about 100,000 injury claims in a class-action lawsuit against 20 makers of asbestos products, lawyers for both sides said Wednesday.
It is one of the largest settlements in the history of the multi-billion-dollar asbestos litigation and could affect thousands of former shipyard workers in Hampton Roads and their family members.
U.S. District Judge Lowell Reed Jr. approved the settlement involving 20 companies that are part of a group called the Center for Claims Resolution. The participating companies include C.E. Thurston & Sons Inc. in Norfolk, as well as such industry giants as Armstrong World Industries Inc., Pfizer Inc., GAF Corp., National Gypsum Co. and Union Carbide Corp.
The settlement, reached in negotiations between attorneys for asbestos liability plaintiffs and the Princeton, N.J.-based CCR, has been endorsed by the AFL-CIO.
The lawyers will be limited to 25 percent of the award, or $300 million.
A Rand Corp. study of other asbestos cases determined that ``only 37 percent to 39 percent of money paid by defendants in conventional asbestos suits went to victims,'' with the rest going to legal fees and other costs, Reed said.
The $1.2 billion settlement does not include additional fees to the law firms that negotiated the agreement. Those fees will be paid by the asbestos companies after a court determines how much the lawyers involved should be paid.
Richard S. Glasser, a personal-injury lawyer in Norfolk who has represented many asbestos victims, said the settlement is a positive step.
``It's probably a necessary alternative to a court system that has been overburdened'' by asbestos cases, Glasser said. ``Hopefully, there will be a savings to both sides and the courts, one that will not only speed the process but add a sense of certainty'' that victims will be compensated for their injuries.
Under the settlement, workers who can show they were injured by asbestos will win damages according to a range set for each of four medical conditions. Payments, to be made over the next 10 years, will range from $2,500 to $200,000.
Glasser said Hampton Roads victims will get higher payments on average because previous area cases were generally settled for higher-than-average amounts. The payment system is adjusted to account for geographic differences in previous settlements.
The settlement applies only to people who worked in areas where asbestos was present, or their family members who were exposed to the material secondarily. Only people who had not sued any of the defendants in the case as of Jan. 15, 1993, are eligible.
Hundreds of thousands of people who were exposed to asbestos in shipyards and construction sites have sued companies involved in manufacturing and distributing the insulating material. The cost of litigation led at least 17 other companies to file for bankruptcy protection.
Glasser said as an increasing number of companies fled into bankruptcy, it became imperative to reach settlements that preserved the solvency of the remaining defendants - and thus their ability to pay victims.
``From now on, asbestos victims will receive swift, equitable compensation,'' said Lawrence Fitzpatrick, president and chief executive of the Center for Claims Resolution. ``Defendant companies will be able to plan for the future, ensuring that asbestos obligations are met.''
Under the settlement, people who show no illness but allege exposure will receive no immediate compensation. Instead, the statute of limitations has been waived to provide for future claims.
Currently, people exposed to asbestos must file claims to beat the statute of limitations. If their cases are resolved before they become ill, they must settle for less money.
Attorneys who opposed the settlement said they would appeal Reed's approval of the settlement.
``The settlement is not a fair one and we don't agree with the judge's conclusion that it is,'' said Howell K. Rosenberg of Philadelphia, one of the attorneys who had filed suit against the deal.
``There are dozens of issues that should be argued before a higher court, and they will be presented to an appellate court and perhaps even the Supreme Court,'' he said. MEMO: Staff writer Dave Mayfield and Bloomberg Business News contributed to
this report.
KEYWORDS: ASBESTOS CLASS ACTION SUIT LAWSUIT SETTLEMENT by CNB