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ASBESTOS TRUST TRANSPARENCYMark A. Behrens*INTRODUCTIONOriginally and for many years, the primary defendants in asbestos caseswere companies that mined asbestos or manufactured amphibole-containingthermal insulation.1 Hundreds of thousands of claims were filed against themajor asbestos producers, such as Johns-Manville Corp., Owens CorningCorp., and W.R. Grace & Co.2By the late 1990s, asbestos litigation had reached such proportions that theU.S. Supreme Court noted the “elephantine mass”3 of cases and referred to thelitigation as a “crisis.”4 Mass filings pressured “most of the lead defendantsand scores of other companies” into bankruptcy, including virtually allmanufacturers of asbestos-containing thermal insulation.5Following a 2000–2002 wave of bankruptcies among asbestosmanufacturers,6 plaintiffs’ lawyers began “a search for new recruits to fill thegap in the ranks of defendants.”7 Many of today’s asbestos defendants are* Mark A. Behrens co-chairs Shook, Hardy & Bacon L.L.P.’s Washington, D.C.-based PublicPolicy Group. He advocates for asbestos litigation reform and other civil justice reforms onbehalf of business and civil justice groups. In 2015, he received the U.S. Chamber Institutefor Legal Reform’s Individual Achievement Award. He received his J.D. from VanderbiltUniversity Law School in 1990 and B.A. from the University of Wisconsin in 1987. Researchsupport for this Article was provided by the Coalition for Litigation Justice, Inc. This Articlewas prepared for the Fordham Law Review Symposium entitled Civil Litigation Reform in theTrump Era: Threats and Opportunities, held at Fordham University School of Law onFebruary 23, 2018.1. See James L. Stengel, The Asbestos End-Game, 62 N.Y.U. ANN. SURV. AM. L. 223,238 (2006) (noting “[a]s leading plaintiffs’ counsel Ron Motley and Joe Rice observed sometime ago, the first seventeen asbestos defendants to go into bankruptcy represented” between50 and 75 percent of the liability share).2. See STEPHEN J. CARROLL ET AL., ASBESTOS LITIGATION xxiv monographs/2005/RAND MG162.pdf[https://perma.cc/GH43-275B] (“Approximately 730,000 people had filed an asbestos claimthrough 2002.”).3. Ortiz v. Fibreboard Corp., 527 U.S. 815, 821 (1999).4. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 597 (1997).5. CARROLL ET AL., supra note 2, at 67.6. See Mark D. Plevin et al., Where Are They Now, Part Eight: An Update onDevelopments in Asbestos-Related Bankruptcy Cases, 16 MEALEY’S ASBESTOS BANKR. REP.,Sept. 2016, at 28, 40 chart 1 (demonstrating that there were nearly as many asbestos-relatedbankruptcies from 2000 to 2002 as in the previous two decades combined).7. Patrick M. Hanlon & Anne Smetak, Asbestos Changes, 62 N.Y.U. ANN. SURV. AM. L.525, 556 (2007); see also CARROLL ET AL., supra note 2, at xxiii (“When increasing asbestosclaims rates encouraged scores of defendants to file Chapter 11 petitions . . . the resulting stays107

108FORDHAM LAW REVIEW[Vol. 87formerly peripheral or new defendants associated with chrysotile-containingproducts “such as gaskets, pumps, automotive friction products, andresidential construction products.”8 One plaintiffs’ attorney described theasbestos litigation as an “endless search for a solvent bystander.”9There is a remedy for workers and others with asbestos-related injuriescaused by the former thermal insulation defendants and other companies thathave exited the tort system through bankruptcy.10 As part of theirreorganization, those companies established trusts that hold billions ofdollars to pay asbestos claimants.11 Filing an asbestos trust claim is similarto filing an insurance claim—it is easier and faster than bringing a lawsuit.12in litigation . . . drove plaintiff attorneys to press peripheral non-bankrupt defendants toshoulder a larger share of the value of asbestos claims and to widen their search for othercorporations that might be held liable for the costs of asbestos exposure and disease.”).8. Marc C. Scarcella et al., The Philadelphia Story: Asbestos Litigation, BankruptcyTrusts and Changes in Exposure Allegations from 1991–2010, 27 MEALEY’S LITIG. REP.:ASBESTOS, Oct. 10, 2012, at 1, 1. Chrysotile is “far less toxic than other forms of asbestos.”In re Garlock Sealing Tech., LLC., 504 B.R. 71, 75 (Bankr. W.D.N.C. 2014); see alsoRockman v. Union Carbide Corp., 266 F. Supp. 3d 839, 846 (D. Md. 2017) (“[C]hrysotileasbestos is classified in an entirely separate mineralogical family from amphibole asbestosand is widely considered less potent.”), appeal dismissed sub nom. Rockman v. GeorgiaPacific, LLC, No. 17-1883, 2017 WL 7135451 (4th Cir. Oct. 23, 2017); Bartel v. John Crane,Inc., 316 F. Supp. 2d 603, 605 (N.D. Ohio 2004) (“While there is debate in the medicalcommunity over whether chrysotile asbestos is carcinogenic, it is generally accepted that ittakes a far greater exposure to chrysotile fibers than to amphibole fibers to causemesothelioma.”), aff’d sub nom. Lindstrom v. A-C Prod. Liab. Tr., 424 F.3d 488 (6th Cir.2005).9. Richard Scruggs & Victor Schwartz, ‘Medical Monitoring and Asbestos Litigation’—a Discussion with Richard Scruggs and Victor Schwartz, 17 MEALEY’S LITIG. REP.: ASBESTOS,Mar. 1, 2002, at 1, 5. More than 10,000 companies, including subsidiaries, have been namedas asbestos defendants. See JENNI BIGGS ET AL., TOWERS WATSON, A SYNTHESIS OF d [https://perma.cc/3FAC-JYDR].10. See S. Todd Brown, How Long Is Forever This Time? The Broken Promise ofBankruptcy Trusts, 61 BUFF. L. REV. 537, 537 (2013) (“Section 524(g) of the Bankruptcy Codeauthorizes the entry of an injunction that channels all of a debtor’s asbestos-related liabilitiesto a bankruptcy trust, which is established by the debtor to pay all valid current and futureasbestos claims.”).11. See Marc C. Scarcella & Peter R. Kelso, Asbestos Bankruptcy Trusts: A 2013Overview of Trust Assets, Compensation & Governance, 12 MEALEY’S ASBESTOS BANKR.REP., June 2013, at 33, 33–34 (describing how scores of former asbestos producers “haveemerged from the 524(g) bankruptcy process leaving in their place dozens of trusts fundedwith tens of billions in assets to pay claims”).12. See John J. Hare & Daniel J. Ryan, Uncloaking Bankruptcy Trust Filings in AsbestosLitigation: Refuting the Myths About Transparency, 15 MEALEY’S ASBESTOS BANKR. REP.,Apr. 2016, at 1, 3 (“Plaintiffs’ lawyers routinely advertise their ability to file trust claims‘quickly and easily,’ and tell potential clients that paralegals evaluate potential trust claimsand undertake the filing process. The evidence also demonstrates that trust claims are paidmuch more quickly than tort claims.”); Marc C. Scarcella & Peter R. Kelso, A ReorganizedMess: The Current State of the Asbestos Bankruptcy Trust System, 14 MEALEY’S ASBESTOSBANKR. REP., Feb. 2015, at 32, 39 (“Unlike lawsuits filed in the tort system, the trustcompensation process is intended to avoid the time, expense, and resource burden oftenassociated with litigation.”).

2018]ASBESTOS TRUST TRANSPARENCY109One might assume that asbestos plaintiffs would obtain quick paymentsfrom the trusts while pursuing lengthier tort actions against solvent asbestosdefendants that may have contributed to their harm. Instead, many plaintiffsintentionally delay their asbestos trust claims until their tort cases areresolved.13 This tactic allows plaintiffs to suppress evidence of trust-relatedexposures that defendants could use to impeach plaintiffs, apportion fault tobankrupt nonparties, or prove that bankrupt entities were the sole cause of aplaintiff’s harm.14Further, “[i]n cases where defendants have been able to overcome theattempts to suppress evidence of other exposures, it has become apparent thatthe product exposures set forth in multiple trust claims differ markedly from,and are inconsistent with, the exposures being asserted by plaintiffs in thetort system.”15As this Article will demonstrate, there is a wealth of evidence proving thatdelayed trust filings and inconsistent claiming activity by asbestos plaintiffsare routine.Consequently, juries in asbestos personal injury cases are often misled tobelieve that the defendants taking part in a trial were responsible for all ormost of the plaintiff’s harm.16 Jurors do not hear about all of a plaintiff’s13. Peggy Ableman et al., A Look Behind the Curtain: Public Release of GarlockBankruptcy Discovery Confirms Widespread Pattern of Evidentiary Abuse Against Crane Co.,15 MEALEY’S LITIG. REP.: ASBESTOS, Nov. 2015, at 28, 34 (“[T]wo prominent plaintiffattorneys in Garlock’s bankruptcy gave sworn deposition testimony that it is their practice towait until the tort case has concluded to file bankruptcy trust claims.”); Joseph W. Belluck etal., The Asbestos Litigation Tsunami—Will It Ever End?, 9 J.L. ECON. & POL’Y 489, 511(2013) (quoting a New York City asbestos plaintiffs’ lawyer as stating, “we do not file thebankruptcy claims until after the case is resolved”).14. See Daniel J. Ryan & John J. Hare, Uncloaking Bankruptcy Trust Filings in AsbestosLitigation: A Survey of Solutions to the Types of Conduct Exposed in Garlock’s Bankruptcy,15 MEALEY’S ASBESTOS BANKR. REP., Aug. 2015, at 1, 2 (“[Asbestos claimants] attempt toshield their trust recoveries from disclosure in tort suits by concealing their trust claims or notfiling the claims until the tort suit has concluded.”).15. Lester Brickman, Fraud and Abuse in Mesothelioma Litigation, 88 TUL. L. REV. 1071,1088 (2014); see also Peggy L. Ableman, A Case Study from a Judicial Perspective: HowFairness and Integrity in Asbestos Tort Litigation Can Be Undermined by Lack of Access toBankruptcy Trust Claims, 88 TUL. L. REV. 1185, 1196–97 (2014) (“The absence oftransparency continues to create a loophole that allows claimants to present contradictorytheories of exposure and to manipulate causation evidence to fit the specific defendants namedin the complaint or who are left standing at trial.”); Ryan & Hare, supra note 14, at 2 (“[T]herehas been a recent focus on ensuring trust transparency in order to avoid the potential for abuse.The abuse occurs most often when claimants allege certain facts to support their trust claimsand then allege inconsistent facts to support their tort claims. For instance, claimants havealleged exposure to the products of bankrupt entities in their trust filings, but then ignore orflatly deny those exposures when they target solvent defendants in tort litigation.”); WilliamP. Shelley et al., The Need for Further Transparency Between the Tort System and Section524(g) Asbestos Trusts, 2014 Update—Judicial and Legislative Developments and OtherChanges in the Landscape Since 2008, 23 WIDENER L.J. 675, 679 (2014) (noting that claimants“make trust submissions based upon alleged exposure histories that are at stark variance fromthe tales they tell in the tort system”).16. See LLOYD DIXON & GEOFFREY MCGOVERN, ASBESTOS BANKRUPTCY TRUSTS ANDTORT COMPENSATION xiv (2011), phs/2011/RAND MG1104.pdf [https://perma.cc/MD89-7NZ3] (“When trust claims are not filed

110FORDHAM LAW REVIEW[Vol. 87exposures to asbestos, such as exposures to amphibole-containing thermalinsulation that countless plaintiffs claimed as their primary source ofexposure until those companies went bankrupt.17Because juries lack full information, solvent defendants end up payinginflated settlements and awards that disadvantage those defendants andfuture plaintiffs.18 Plaintiffs’ attorneys have essentially crafted a way to holdsolvent asbestos defendants liable for more than their “fair share,” contraryto the policy decision of the many states that have abolished or modified jointliability.19In other states, juries are not able to allocate fault to nonparties, such assettling defendants, but defendants that lose at trial are given credit forpretrial settlements received by a plaintiff.20 This approach allows a plaintiffto obtain a full recovery from a judgment defendant without receiving awindfall due to settlements received from others before trial.Here, too, asbestos plaintiff lawyers have perfected a way to “double dip.”By delaying the filing of asbestos trust claims until after an asbestos-relatedtort case is tried, judgment defendants are denied setoffs for those trustprior to trial, defendants . . . might not have the information they need to assign fault tobankrupt firms.”); see also id. at 52 (“Submission of trust claims after termination of the tortcase is desirable for the plaintiff because doing so can avoid disclosure of information thatcould aid in assigning fault to the bankrupt firms.”).17. See Sarah Beth Jones et al., 2017 Asbestos Update: Deposition Strategies forDeveloping Alternative Exposures, FOR DEF., June 2017, at 50, 51 (“Those bankruptcompanies accounted for the bulk of the asbestos market. In fact, one bankrupt company alonemanufactured more than 50 percent of the asbestos-containing insulation sold worldwide.”);Scarcella et al., supra note 8, at 11 (“The results from the study of the Philadelphia asbestoscases indicate that while exposures to thermal insulation products remain prevalent amongtoday’s plaintiff population, the identification of exposure to those products is greatlydiminished compared to the claims filed prior to the Bankruptcy Wave that had comparable(or even identical) exposure histories.”).18. See DIXON & MCGOVERN, supra note 16, at xv (“If . . . bankrupt firms are assignedless fault than would have been the case in the pre-reorganization scenario, total plaintiffcompensation and payments by the defendants that remain solvent can increase. In theextreme, the plaintiff can receive full compensation in the tort system and then receiveadditional compensation from the trusts.”); see also Editorial, The Double-Dipping LegalScam, WALL ST. J., Dec. 26, 2014, at A12 (“[N]ow we’re getting a glimpse of what has becomea widespread tort-bar con. Court documents show the ugly specifics of ‘double-dipping’—inwhich lawyers sue a company and claim its products caused their clients’ disease, even as theyfile claims with asbestos trusts blaming other products for the harm. This lets them get doubleor multiple payouts for a single illness, with a huge cut for the lawyers each time.”).19. See Laura Kingsley Hong & Robert E. Haffke, Apportioning Liability in AsbestosLitigation: A Review of the Law in Key Jurisdictions, 26 T.M. COOLEY L. REV. 681, 682(2009) (“Many jurisdictions have abandoned the doctrine of pure joint and several liability intoxic-tort cases and have instead enacted systems for apportioning liability.”).20. See DIXON & MCGOVERN, supra note 16, at 6 (“In tort litigation more generally,defendants often settle before trial, and, because those settlements are intended to compensatethe plaintiff for the alleged harm, states often allow credit to be provided to verdict defendantsfor money the plaintiff has already received.”).

2018]ASBESTOS TRUST TRANSPARENCY111payments.21 A plaintiff can recover in full from a judgment defendant, thenfile trust claims and recover again from multiple trusts for the same injury.22Why should people care if gamesmanship by asbestos plaintiffs causesdefendants to pay more than their fair share to a person dying ofmesothelioma or some other serious asbestos-related disease? The shortanswer is that it is unfair to those defendants, undermines the integrity of thecivil justice system, and may hurt future claimants. As an NPR storyexplained, “No one argues that people suffering from mesotheliomashouldn’t get compensated. Instead, it’s a matter of the right companiespaying the right amounts.”23This Article argues for legislation, such as that enacted in many states, thatrequires asbestos plaintiffs to pursue quick compensation from the trusts andallows trust-related exposures and compensation to be properly accountedfor in asbestos-related personal injury cases.24 States with substantialasbestos litigation, such as California, Illinois, New York, and Missouri, needthe legislation the most.I. THE ASBESTOS TRUST CLAIM SYSTEMOver 120 companies have declared bankruptcy due, at least in part, toasbestos-related liabilities.25 In bankruptcy, many of these companiescreated trusts to pay for asbestos-related harms caused by exposure to theirproducts.26 Approximately sixty trusts presently in operation collectively21. See id. at 56 (“When trust claims are not filed prior to trial, defendants will not receivesetoffs for trust payments . . . .”).22. See id. at 52 (“Submission of trust claims after termination of the tort case is desirablefor the plaintiff . . . because, although there are no setoffs for trust payments received after thetort case has terminated, there are setoffs to varying degrees for pre-verdict trust payments insome of the jurisdictions examined.”).23. Michael Tomsic, Case Sheds Light on the Murky World of Asbestos Litigation, NPR(Feb. 4, 2014, 4:00 PM), -light-on-themurky-world-of-asbestos-litigation [https://perma.cc/BF6L-N8ZB].24. Courts can accomplish similar reforms through case management orders. SeeAmended Pre-Trial Order No. 9 ¶ XIII(C)(7)(o)(2)(e), In re Mass. State Court Asbestos Litig.,(Mass. Super. Ct. June 27, 2012) (“Within thirty days of trial, Plaintiff will serve a certificationwith the [court] that all known bankruptcy claims have been filed.”); see also Peggy L.Ableman, The Time Has Come for Courts to Respond to the Manipulation of ExposureEvidence in Asbestos Cases: A Call for the Adoption of Uniform Case Management OrdersAcross the Country, 30 MEALEY’S LITIG. REP.: ASBESTOS, Apr. 8, 2015, at 1, 6.25. See Chart 1: Company Name and Year of Bankruptcy Filing (Chronologically),CROWELL & MORING LLP, kruptcyCases-Chronological-Order.pdf [https://perma.cc/78WH-PRFL] (last visited Aug. 24, 2018).26. Section 524(g) of the Bankruptcy Code provides a mechanism for such companies toreorganize, channel their asbestos liabilities into trusts, and emerge from bankruptcy withimmunity from asbestos-related tort claims. See 11 U.S.C. § 524(g) (2012); see also Shelley,supra note 15, at 675–76 (“These trusts answer for the tort liabilities of the great majority ofthe historically most-culpable large manufacturers that exited the tort system throughbankruptcy over the past several decades.”).

112FORDHAM LAW REVIEW[Vol. 87hold billions of dollars to pay claimants.27 The reorganized companies areimmune from asbestos lawsuits.28Asbestos trusts “compensate claimants expeditiously and at a minimalcost.”29 Further, because trust payment procedures are voted on “by theclaimants through their attorneys, and the trusts often do not contest liability,it is much easier to collect against a bankruptcy trust than a solventdefendant.”30 One commentator has “even likened the trusts to a ‘piggybank’ which asbestos attorneys can dip into at will.”31“In practice, a claimant seeking compensation from a trust must file aclaim form, which . . . requires a statement of injury; information sufficientto establish asbestos exposure attributable to the trust’s predecessor . . . underpenalty of perjury; and a determination as to whether the claimant is seekingexpedited or individual review.”32 Along with the claim form, claimantssubmit documented evidence of exposure, such as a “work history, SocialSecurity records, invoices, employer records, or deposition testimony of [a]claimant or coworkers taken in asbestos litigation,” and “medical reports orrecords sufficient to support a diagnosis for the specific disease beingclaimed or, if applicable, a copy of a death certificate.”33 Claimants may“electronically file bulk claim submissions against multiple trusts.”34If a trust determines that a claim meets the criteria for payment, the trustwill make an offer based on a percentage of the “scheduled value” for the27. See U.S. GOV’T ACCOUNTABILITY OFF., GAO-11-819, ASBESTOS INJURYCOMPENSATION: THE ROLE AND ADMINISTRATION OF ASBESTOS TRUSTS 3 (2011),https://www.gao.gov/assets/590/585380.pdf [https://perma.cc/G7HD-BSUD] (stating that, asof 2011, sixty asbestos personal injury trusts held assets totaling 36.8 billion among them);see also DIXON & MCGOVERN, supra note 16, at 2.28. See LLOYD DIXON ET AL., ASBESTOS BANKRUPTCY TRUSTS: AN OVERVIEW OF TRUSTSTRUCTURE AND ACTIVITY WITH DETAILED REPORTS ON THE LARGEST TRUSTS 3 technical reports/2010/RAND TR872.pdf[https://perma.cc/L5ZT-Y2DC].29. Marc C. Scarcella & Peter R. Kelso, Asbestos Bankruptcy Trusts: A 2013 Overviewof Trust Assets, Compensation & Governance, 12 MEALEY’S ASBESTOS BANKR. REP., June2013, at 33, 41; see also Dionne Searcey & Rob Barry, As Asbestos Claims Rise, So DoWorries About Fraud, WALL ST. J. (Mar. 11, 2013, 5:55 AM), 4304578318611662911912[https://perma.cc/M3GB77T7] (“Unlike court, where plaintiffs can be cross-examined and evidence scrutinized by ajudge, trusts generally require victims or their attorneys to supply basic medical records, workhistories and sign forms declaring their truthfulness. The payout is far quicker than a courtproceeding and the process is less expensive for attorneys.”).30. Adrienne Bramlett Kvello, The Best of Times and the Worst of Times: How BorgWarner and Bankruptcy Trusts Are Changing Asbestos Settlements in Texas, 40 ADVOCATE80, 80 (2007).31. Id. (quoting Cardozo School of Law Professor Lester Brickman); see also Thomas M.Wilson, Institutionalized Fraud in Asbestos Bankruptcy Trusts, 13 MEALEY’S LITIG. REP.:ASBESTOS, May 7, 2014, at 1, 7 (“[T]he trusts, designed by the same individuals who are nowsubmitting claims, contain ‘loopholes’ allowing for ease of payment, often without the needfor any real proof.”).32. S. Todd Brown, Bankruptcy Trusts, Transparency and the Future of AsbestosCompensation, 23 WIDENER L.J. 299, 317–18 (2013).33. See U.S. GOV’T ACCOUNTABILITY OFF., supra note 27, at 18.34. Scarcella & Kelso, supra note 29, at 42.

2018]ASBESTOS TRUST TRANSPARENCY113alleged injury.35 The general counsel of the Manville Trust has testified thatthe trust has no backlog and that an offer can be made within days aftersubmission.36 After an offer is accepted, “payments tend to be madequickly.”37The U.S. Government Accountability Office (GAO) estimates thatapproximately 97–98 percent of trust claims are processed on this expeditedbasis.38 Only a small percentage of claimants reject scheduled paymentoffers and seek individual review in the hopes of obtaining morecompensation.39 It is common for claimants to receive multiple trustpayments since each trust operates independently and workers were oftenexposed to different asbestos products.40II. ASBESTOS TRUST CLAIM MANIPULATIONAND INCONSISTENT CLAIMINGPlaintiffs can file claims with asbestos trusts and bring personal injurylawsuits against solvent defendants.41 In a bankruptcy case involving gasketand packing manufacturer Garlock Sealing Technologies, LLC., a typicalmesothelioma plaintiff’s recovery was estimated to be “between 1 and 1.5million, including an average of 560,000 in tort recoveries and about 600,000 from 22 Trusts.”42By delaying asbestos trust filings until a personal injury case is resolved,a plaintiff can suppress evidence of trust-related exposures that defendantscould use at trial, including evidence that would attach fault to a formerinsulation defendant. Delayed trust claim submissions also can denyjudgment defendants setoffs they would otherwise be entitled to receive fortrust payments to plaintiffs. These practices were described in a watershed35. U.S. GOV’T ACCOUNTABILITY OFF., supra note 27, at 17; see also Brown, supra note32, at 318.36. See Deposition of Jared Garelick at 33:10–13, Cummings v. Gen. Elec. Co., No. 13CI-006374 (Ky. Cir. Ct. Dec. 14, 2015) (“Claims are processed as they are submitted . . . .[T]he trust doesn’t have a real backlog. Things are done in realtime [sic]. So as soon as aclaim is submitted, it gets processed . . . .”).37. Brown, supra note 10, at 555.38. See U.S. GOV’T ACCOUNTABILITY OFF., supra note 27, at 20 (stating that most claimsare processed on an expedited basis with only “[2] to 3 percent of claims . . . processed throughthe individual review process”).39. See Brown, supra note 10, at 554; Deposition of Garelick, supra note 36, at 37:2–38:1.40. Brickman, supra note 15, at 1078–79.41. See LLOYD DIXON & GEOFFREY MCGOVERN, BANKRUPTCY’S EFFECT ON bs/research reports/RR900/RR907/RAND RR907.pdf [https://perma.cc/HP6P-3VZJ] (“Plaintiffs now often receive compensation both fromthe trusts and through a tort case.”); see also U.S. GOV’T ACCOUNTABILITY OFF., supra note27, at 15 (“Although 60 companies subject to asbestos-related liabilities have filed forbankruptcy under Chapter 11 and established asbestos bankruptcy trusts in accordance with§ 524(g), asbestos claimants can also seek compensation from potentially liable solventcompanies (that is, a company that has not declared bankruptcy) through the tort system.”).42. In re Garlock Sealing Tech., LLC., 504 B.R. 71, 96 (Bankr. W.D.N.C. 2014).

114FORDHAM LAW REVIEW[Vol. 87opinion, In re Garlock Sealing Technologies, LLC.,43 by a federal bankruptcyjudge in Garlock’s bankruptcy.44Historically, Garlock was a relatively small player in the asbestos tortsystem and was “very successful in settling (and rarely trying)” asbestospersonal injury lawsuits filed against it.45 After virtually all thermalinsulation defendants exited the tort system by the early 2000s, Garlockbecame a “focus of plaintiffs’ attention” because it was still solvent.46Garlock faced challenges defending itself in this new environment because“evidence of plaintiffs’ exposure to other asbestos products oftendisappeared.”47 The judge in Garlock said that this happened because of “theeffort by some plaintiffs and their lawyers to withhold evidence of exposureto other asbestos products and to delay filing claims against bankruptdefendants’ asbestos trusts until after obtaining recoveries from Garlock (andother viable defendants).”48 The judge concluded that the missing evidence“had the effect of unfairly inflating the recoveries against Garlock.”49For example, in a California case that resulted in a 9 million verdict for aformer Navy machinist mate, Garlock attempted to show that the plaintiffhad been exposed to Unibestos amphibole insulation manufactured byPittsburgh Corning.50 The plaintiff “did not admit to any exposure fromamphibole insulation . . . and claimed that 100% of his work was on gaskets,”while his lawyer told the jury there was no Unibestos insulation on his ship.51Post-verdict, however, the plaintiff’s lawyers filed fourteen asbestos trustclaims, including “several against amphibole insulation manufacturers.”52“And most important,” said the judge in Garlock, “the same lawyers whorepresented to the jury that there was no Unibestos insulation exposure had,seven months earlier, filed a ballot in the Pittsburgh Corning bankruptcy thatcertified under ‘penalty of perjury’ that the plaintiff had been exposed toUnibestos insulation.”53In a Philadelphia case that Garlock settled for 250,000, the plaintiff “didnot identify exposure to any bankrupt companies’ asbestos products.”54Further, in answers to interrogatories, the plaintiff’s lawyers said the plaintiff43. 504 B.R. 71 (Bankr. W.D.N.C. 2014).44. See id. at 82–87; see also Mt. McKinley Ins. Co. v. Pittsburgh Corning Corp., No. 131639, 2015 WL 4773425, at *5 (W.D. Pa. Aug. 12, 2015) (“The evidence uncovered in theGarlock case arguably demonstrates that asbestos plaintiffs’ law firms acted fraudulently orat least unethically in pursuing asbestos claims in the tort system and the asbestos trustsystem.”).45. In re Garlock, 504 B.R. at 73.46. Id.47. Id. at 73; see also id. at 84, 86.48. Id. at 84.49. Id. at 86; see also id. at 94 (stating that the withholding of exposure evidence byasbestos plaintiffs’ counsel was “widespread and significant”).50. See id. at 84.51. Id.52. Id.53. Id.54. Id.

2018]ASBESTOS TRUST TRANSPARENCY115had “no personal knowledge” of such exposure.55 Six weeks earlier,however, “those same lawyers had filed a statement in the Owens Corningbankruptcy case, sworn to by the plaintiff, that stated that he ‘frequently,regularly and proximately breathed asbestos dust emitted from OwensCorning . . . asbestos-containing pipe covering.’”56 In total, the plaintiff’slawyers “failed to disclose exposure to 20 different asbestos products forwhich [the plaintiff] made Trust claims,” including fourteen claims supportedby sworn statements that “contradicted the plaintiff’s denials in the tortdiscovery.”57The Garlock court also described a New York case that Garlock settledduring trial for 250,000.58 The plaintiff denied any exposure to insulationproducts, but after his tort case was settled, his lawyers filed twenty-threetrust claims on his behalf, including eight trust claims that were filed withintwenty-four hours after the settlement with Garlock was completed.59In another California case that Garlock settled for 450,000, a formersailor denied that he had ever seen anyone installing or removing pipeinsulation on his ship.60 After the plaintiff settled with Garlock, his lawyersfiled eleven trust claims on his behalf, including seven claims “based ondeclarations that he personally removed and replaced insulation andidentified, by name, the insulation products to which he was exposed.”61Since the Garlock decision was issued, numerous reports have confirmedthat “[w]e are now past the time when [the case

dollars to pay asbestos claimants.11 Filing an asbestos trust claim is similar to filing an insurance claim—it is easier and faster than bringing a lawsuit.12 in litigation . . . drove plaintiff attorneys to press peripheral non-bankrupt defendants to shoulder a larger share of the value of asbestos claims and to widen their search for other