Garlock Bankruptcy Plan Shortchanges Current and Future Mesothelioma Claimants
The bankruptcy reorganization plan submitted by Garlock Sealing Technologies LLC and The Anchor Packing Company in May of this year represents an insult to people with mesothelioma, asbestos-related lung cancer, and other diseases caused by exposure to asbestos. Under the proposed plan, the rights of current claimants would be significantly curtailed and future claimants would be shortchanged. In addition, if the Garlock plan is finally adopted and approved, it could set a precedent that would affect the ability of people injured by asbestos to receive fair compensation for themselves and their families from other companies.
Asbestos Trust Funds
Section 524(g) of the bankruptcy code was designed to ensure that people exposed to asbestos receive fair compensation, even when the companies responsible for that exposure file for bankruptcy. Under this law, a company that files for bankruptcy because of the cost of asbestos lawsuits must set up a trust fund to compensate current and future claimants.
Since mesothelioma and other asbestos-related illnesses can take decades to manifest, it is important for trust funds to contain sufficient resources to cover estimated future claims, as well as those claims currently in litigation. When determining the amount to be set aside, courts take the company’s resources into account as well.
Garlock Plan Would Lead to Reduced Asbestos Compensation
Along with the other claimants’ representatives on the Asbestos Creditors Committee (ACC), which I co-chair, we at Kazan Law oppose Garlock’s reorganization plan. The $362 million proposed asbestos trust fund falls far short of the amount needed to fairly compensate current and future claimants against Garlock and Anchor while it unjustly enriches these companies’ shareholders. Garlock has the resources to create a larger asbestos trust fund; mesothelioma victims should not suffer so shareholders can profit.
In addition, the plan put forth by Garlock creates significant roadblocks that will make it hard for people injured by asbestos exposure to receive the compensation to which they are entitled. The plan would require burdensome paperwork in order to prove eligibility and payments would be based on a matrix that sets compensation values lower than they should be.
If claimants decide their best option is to sue, the plan requires them to file their lawsuit in federal court in North Carolina. For injured people in other states, this could create such a significant obstacle that they will have effectively lost their right to have their day in court. Why should a man dying of mesothelioma in California have to spend weeks in a North Carolina courtroom to get justice?
Asbestos Victims Protect Your Rights
For the reasons above and more, all 12 members of the ACC oppose Garlock’s proposed reorganization plan. If you have suffered asbestos exposure because of Garlock or Anchor’s products, you (or your lawyer on your behalf) may be entitled to vote on the plan. Your “no” vote is a step toward further negotiations and a better outcome for all current and future claimants. You can learn more about your voting rights here. The deadline for voting is October 6, 2015.
If you are a current claimant against Garlock or Anchor, you may need to take action to protect your rights to compensation. If Garlock’s plan is approved, some current claimants may find their claims blocked if they don’t take action by the bar date of October 6, 2015. You are a current claimant if you received a diagnosis of mesothelioma or other asbestos-related illness on or before August 1, 2014 and you filed a legal action or pursued compensation from an asbestos trust fund on or before that date. To avoid being blocked from receiving the compensation you deserve, you may need to take action to assert your right. You may want to consult an asbestos attorney, to make sure your rights are protected.
Seeking Justice For Those Yet to Come
Because it takes so many years for those exposed to asbestos to become sick with mesothelioma, lung cancer, or other diseases, asbestos claims will continue to come to light over the coming years and decades. The outcome of the Garlock bankruptcy could have repercussions for asbestos settlements in other states and against other companies. That’s why we at Kazan Law take the fight to achieve a fair reorganization plan in the Garlock bankruptcy so seriously.
The plan put forth by Garlock doesn’t give enough weight to the financial and emotional hardship Garlock and Anchor’s negligence has inflicted on a yet unknown number of people. You and your family deserve better than this.
Insuring that current and future claimants are treated with the dignity and justice they deserve is a core mission of the dedicated lawyers at Kazan Law. That’s why we are committed to fighting the proposed Garlock asbestos plan.