- The Washington Times - Thursday, May 26, 2005

A Senate committee yesterday approved a bill to create a $140 billion fund to compensate victims of asbestos poisoning that would shield manufacturers and insurers from lawsuits.

The fund would be financed by companies facing asbestos litigation and their insurers.

Victims would be compensated only by the fund but no longer could sue for damages.

Senate critics of the legislation said it created uncertainties about how the money would be collected and disbursed.

Asbestos, a fibrous mineral commonly used until the mid-1970s in building insulation, fireproofing material and auto parts, has tiny fibers that can cause cancer and other illnesses when inhaled. The diseases can take decades to develop.

Congress has discussed ideas for resolving asbestos litigation for nearly a decade before the trust fund legislation was proposed two years ago.

“It’s really time to get this over with,” said Sen. Orrin G. Hatch, Utah Republican, shortly before the Senate Judiciary Committee approved the bill by a 13-5 vote.

Now it moves to a vote by the full Senate.

Supporters of the legislation say asbestos liability is driving companies out of business and leaving victims with little or no money for medical bills.

Sen. Arlen Specter, Pennsylvania Republican and chairman of the Senate Judiciary Committee, said many asbestos victims receive only 42 cents of every dollar they win in lawsuits while the rest pays for their legal fees after years in the court system.

A trust fund would speed money to the victims and protect companies from being sued out of existence, the supporters say.

“What we’re really talking about here is an effort to fix a broken system,” Mr. Specter said.

Several senators said the legislation failed to let asbestos victims know in advance how much money they would receive. The uncertainties could result in lawsuits against the trust fund.

Among the uncertainties, a trust fund administrator would be authorized to determine the amount of a payout rather than the courts.

If a victim disagrees with the amount of a payment, “This goes back into the court system,” said Sen. Patrick J. Leahy, Vermont Democrat and co-sponsor of the bill.

Sen. Joseph R. Biden Jr., Delaware Democrat, wanted the bill amended to eliminate vagueness about the amount of compensation.

“You can’t start a $140 billion business without having a game plan,” Mr. Biden said.

Mr. Specter, who sponsored the bill, agreed its provisions need to be refined before it is enacted.

“We will do our best to make further accommodations and improve the bill,” he said.

He said at a press conference after the vote he expects the bill to win approval by the full Senate.

However, the Association of Trial Lawyers of America predicted “controversy and contentious debate in the full Senate.”

Todd A. Smith, the association’s president, said, “This bill is about as far from perfect as you can get. It’s underfunded, unfair, unworkable and likely unconstitutional.”

The National Association of Manufacturers, a trade group that represents some former makers of asbestos, urged Congress to approve the trust fund promptly.

“The investor uncertainty that stems in no small part from ongoing asbestos lawsuit abuse has slowed the pace of our economic recovery,” said John Engler, the association’s president.

Stocks of companies facing asbestos liability were mixed following the committee’s vote.

Shares of bankrupt building-materials maker Owens Corning rose 11.43 percent to $5.46 a share, while Baltimore chemical maker W.R. Grace and Co.’s shares were unchanged at $11.00. USG Corp., another bankrupt building-materials maker, was down 3.1 percent at $46.84 a share.

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