Time to Clean Up the Asbestos
Mess
by Dana Joel Gattuso
As James Russell
Lowell said, "Compromise makes a good umbrella but a poor
roof." An umbrella may be all we're getting in the latest
watered-down version of the asbestos litigation reform bill.
Asbestos was most
widely used in this country during World War II by the ship-building
industry. To a lesser extent, it was used in the 1950s and 1960s
as well. Since the 1970s, after its link to lung cancer became
more widely understood, asbestos usage and exposure fell dramatically.1 As might be expected, asbestos-related
illnesses also declined. Medical data show that asbestos-inflicted
cancer rates, which typically are not detected until ten to 40
years after exposure occurs,2
peaked in the early 1990s and have been falling ever since.3 Asbestosis - a nonmalignant lung disorder
linked to asbestos - is considered a "disappearing disease,"
according to various medical texts and journals.4
Asbestos litigation,
however, is an epidemic. According to RAND Corporation, the number
of claims has ballooned from 21,000 in 1982 to 730,000 by 2002.5 Yet, shockingly, most of the cases
filed today are by individuals without any real impairment. As
RAND reports, asbestos claims "in recent years were submitted
by individuals who have not incurred an injury that affects their
ability to perform activities of daily living."6 Lester Brickman, a law professor at
Yeshiva University and a leading asbestos litigation scholar,
calls asbestos litigation "a massive client recruitment
effort" and estimates that 90 percent of all asbestos claims
are "supported by baseless medical evidence."7
The litigation explosion
is the work of a handful of personal injury attorneys who have
built a $70 billion dynasty recruiting hundreds of thousands
of former industrial workers,8
typically by soliciting free X-rays and promises of revenge to
anyone whose employer at one time used an asbestos product. Through
the development of what some legal experts call "special
asbestos law," standards of proof for causation and culpability
have become so relaxed that plaintiffs can win millions of dollars
just by showing that at one time asbestos was present and that
injury could occur.9
Tragically, the
victims of this litigation abuse are the small percent of legitimate
claimants who have real grievances or even life-threatening conditions.
But too many are squeezed out by the sheer number of meritless
cases that have overwhelmed the courts and depleted available
funds.
Thirteen years ago,
U.S. Supreme Court Chief Justice William Rehnquist appointed
a special judicial committee to look into what then was considered
an emerging crisis. The report referred to asbestos litigation
as "a disaster of major proportions" and urged Congress
to fix it. At that time, trial attorneys had litigated 150,000
asbestos cases10 at a price tag of $7 billion, with
future claims estimated at the time at $100 billion.11 Today, more than 730,000 cases have
been filed, costing business a whopping $70 billion12 - with future claims pegged at $250
billion.13 And still no federal bill to stop
the hemorrhaging.
Last spring, Senator
Orin Hatch (R-UT) introduced reform legislation to create a $108
billion trust fund for resolving legitimate claims, financed
by payments from asbestos manufacturers, insurers and defendant
businesses. The bill established specific medical criteria to
ensure plaintiffs compensated have real "bodily injury."14 But organized labor and trial attorneys
- backed by the powerful Association of Trial Lawyers of America
- weighed in against the bill,15
claiming the trust fund was too small and pressuring Democrats
to vote against it.
After a year of
cave-ins in a failed attempt to gain support from labor and trial
attorneys, the revised bill would create a fund of $114 billion
- plus another $10 billion if the money dries up. Criteria ensuring
victims have legitimate grievances is now so relaxed, one has
to wonder if it would improve the current system at all. The
new legislation also relaxes restrictions that in the previous
bill ensured the medical diagnosis was accurate, extends the
statute of limitations regulating when a claimant can file and
replaces the fund's administer from an independent special federal-appointed
court to the U.S. Department of Labor.16
All told, Republicans
have conceded to 53 demands for changes by opponents.17 Yet organized labor still opposes
the bill and says they won't support it till the trust fund is
at least $153 billion.
Some legal scholars
questioned last spring how effectively the legislation would
end fallacious claims and grossly unethical behavior in the courtroom.18 Others argued it was the best one
could hope for, considering the trial attorneys' powerful grip
on the lucrative status quo. Sadly, the asbestos mess will never
be cleaned up until Congress puts the interests of real asbestos
victims before the interests of the powerful trial attorneys
who currently run the show - not only in the courtroom but also
on the Senate floor.
# # #
Dana Joel Gattuso is a senior fellow at the National Center for
Public Policy Research. Comments may be sent to dgattuso@nationalcenter.org.
Footnotes:
1 "Asbestos
Litigation: Malignancy in the Courts?" Civil Justice Forum,
Number 40, Manhattan Institute for Policy Research, New York,
New York, August 2002; Work-Related Lung Disease Surveillance
Report, 2002, U.S. Department of Health and Human Services, Public
Health Service, Centers for Disease Control and Prevention, Division
of Respiratory Disease Studies, National Institute for Occupational
Safety and Health, May 2003, pp. xxiii, 16-24 and "Asbestos,"
American Cancer Society, Atlanta, Georgia, available at http://www.cancer.org/docroot/PED/content/PED_1_3X_Asbestos.asp?sitearea=PED
as of May 11, 2004.
2 "Asbestos Litigation: Malignancy in the Courts?"
3 Barry I. Castleman, Asbestos: Medical and Legal Aspects 784
(4th ed.), 1996, as excerpted in Michelle J. White, "Why
the Asbestos Genie Won't Stay in the Bankruptcy Bottle,"
University of Cincinnati Law Review, Vol. 70, 2002, p. 1336 and
"SEER Incidence Age-Adjusted Rates, 9 Registries, 1973-2000,"
National Cancer Institute, Bethesda, Maryland, available at http://www.seer.cancer.gov/faststats/html/inc_mesoth.html
as of May 11, 2004.
4 W. Raymond Parkes, Occupational Lung Disorders 464-78 (3d ed.),
1994 and David M. Rosenber, MD, MPH, FCCP, "Asbestos-Related
Disorders: A Realistic Perspective," CHEST: The Cardiopulmonary
and Critical Care Journal, 111:1424, 1997.
5 Stephen J. Carroll, et. al., "Asbestos Litigation Costs
and Compensation," Documented Briefing, RAND Institute for
Civil Justice, RAND Corporation, Santa Monica, California, 2002,
p. 75 and Susan Cornwell, "Asbestos Costs US Companies $70
Billion So Far," Reuters, February 6, 2004.
6 Carroll, p. 21.
7 Lester Brickman, "On the Theory Class's Theories of Asbestos
Litigation: The Disconnect Between Scholarship and Reality,"
Pepperdine Law Review, Vol. 31, No. 1, December 2003, p. 33.
8 According to RAND Corporation, businesses have paid out $70
billion on asbestos-related personal injury claims (Cornwell).
9 "Asbestos Litigation: Malignancy in the Courts?"
10 Andrew Blum, "Untangling Asbestos Litigation," The
National Law Journal, Vol. 13, No. 28, March 18, 1991.
11 Suzanne L. Oliver and Leslie Spencer, "Who Will the Monster
Devour Next?" Forbes, February 18, 1991.
12 Cornwell.
13 Lester Brickman, "Asbestos Litigation," Center for
Legal Policy, Manhattan Institute for Policy Research, New York,
New York, March 10, 2004, available at http://www.manhattan-institute.org/html/clp03-10-04.htm
as of May 11,2004.
14 "Fairness in Asbestos Injury Resolution Act" (S.1125
IS), U.S. Senate, Washington, D.C., May 22, 2003.
15 The American Bar Association supports asbestos reform legislation.
16 Remarks by Senator Orin Hatch (R-UT) on the "Fairness
in Asbestos Injury Resolution Act," Congressional Record,
March 3, 2004, p. S2173.
17 Ibid.
18 Michelle J. White, "Resolving the 'Elephantine Mass,'"
Regulation, Summer 2003, pp. 53-54 and "Asbestos Dreams,"
The Wall Street Journal, October 17, 2003.
