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Asbestos bankruptcy trust claims

The massive number of asbestos-related claims in recent decades left dozens of asbestos manufacturers and suppliers filing for bankruptcy protection.  So what does that mean for the people who were injured by their toxic products? While bankruptcy filings and settlement trusts have further complicated the asbestos issue, our attorneys are here to guide you through the process and help you get the compensation that is rightfully yours.

Bankruptcy and Settlement Trusts

Most asbestos companies that file bankruptcy do so under Chapter 11. This process is different from a traditional bankruptcy, in which a company may be forced to liquidate its assets and close its doors.

In seeking Chapter 11 bankruptcy protection, an asbestos company simply asks the court to suspend any pending or future lawsuits against the company.  Meanwhile, the company reorganizes and develops a plan, which includes a bankruptcy trust, to pay asbestos claims.  Contrary to popular belief, filing for bankruptcy does not allow asbestos companies to avoid compensating people who have been hurt by their products.

How Bankruptcy Claims Are Different from Traditional Asbestos Claims

A traditional claim against a solvent asbestos manufacturer involves filing a lawsuit within the statute of limitations, conducting litigation, and setting a court date —a process that can take years.

A claim against a bankruptcy settlement trust, on the other hand, typically moves more quickly through the system.  It does not require you to give a deposition or go through a stressful trial.  A bankruptcy claim is handled through a claim process that may involve a private arbitration rather than in a public courtroom, and the standard statute of limitations does not apply.  Even if it’s too late to file a traditional lawsuit, you may still be eligible to file a claim with an asbestos settlement trust.

In a traditional lawsuit, claims are made against defendants and are litigated in the courtroom. In a bankruptcy claim, on the other hand, you file a claim with a trust that has been set up by an asbestos manufacturer for the sole purpose of compensating asbestos victims.  If you were exposed to multiple asbestos products manufactured by several bankrupt companies, you may qualify for multiple trusts.

Finally, while large settlements in a traditional lawsuit can threaten a company’s ability to stay in business, settlement trusts are set up to ensure that funds are available for future claims.  In other words, the compensation you receive from a settlement trust will not diminish the amount available to pay an asbestos claimant who files later.

Do You Qualify for Compensation from an Asbestos Bankruptcy Trust?

If you have mesothelioma or another asbestos-related condition, you may be eligible for compensation from an existing or future bankruptcy trust.  Additionally, if you were exposed to multiple asbestos products that were made by different bankrupt companies, you may be eligible to file claims against multiple, separate trusts.  

Please keep in mind that even if the statute of limitations has passed for an asbestos lawsuit, you still may be eligible to file a bankruptcy claim. To find out if you may be entitled to compensation from an asbestos settlement trust, contact us for a free, no-obligation consultation.