Chairman Goodlatte Applauds House Passage of Bill to Strengthen Asbestos Trust System
Chairman Goodlatte Applauds House Passage of Bill to Strengthen Asbestos Trust System
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Chairman Goodlatte Applauds House Passage of Bill to Strengthen Asbestos Trust System
Washington, D.C. – The House of Representatives approved H.R. 982, the Furthering Asbestos Claim Transparency Act (the FACT Act)by a vote of 221-199. Chairman Bob Goodlatte (R-Va.) and Regulatory Reform, Commercial and Antitrust Law Subcommittee Vice-Chairman Blake Farenthold (R-Texas), chief sponsor of the FACT Act, praised the bill’s passage which will strengthen the asbestos trust system by promoting transparency, reducing fraud and enhancing the recoveries of victims.
Chairman Goodlatte: “The FACT Act is common-sense legislation that I was pleased to bring to the House Floor today. The legislation promotes transparency, discourages fraud, and protects legitimate victims of asbestos through a quarterly disclosure requirement. The disclosure requires the same type of information that would be contained in public state court documents and is designed to be simple, safeguard the privacy of victims, and ensure that duplicitous and conflicting claims are detected and stopped. If asbestos trusts are to have assets available to pay victims tomorrow, Congress must take steps to assure that trust assets and victims of asbestos are better protected today.”
Subcommittee Vice-Chairman Farenthold: “The FACT Act protects asbestos exposure victims by ensuring there are funds available to compensate those whose symptoms are not apparent yet. It is unfortunate unscrupulous attorneys are gaming the system and double dipping with both state and federal claims. The FACT Act strikes a balance between transparency and privacy and should improve the asbestos trusts system. It will also help all victims of asbestos exposure get the financial support they need.”
Background:
The FACT Act amends Section 524(g) of the Bankruptcy Code to require asbestos bankruptcy trusts to file quarterly reports that include the claimant's name, the basis for the claim against the trust, payments made by the trust, and the basis for those payments. Second, the bill requires asbestos trusts to respond to requests for similar information from parties involved in asbestos litigation.
The FACT Act protects present and future victims of asbestos. By discouraging waste and fraud, the FACT Act will increase the ability of legitimate victims to obtain maximum recoveries for their injuries and illnesses. Further, congressional testimony from experts on asbestos litigation and trusts reported that preparing the quarterly disclosure requirements would be "very simple" and "take minutes." The minimal cost associated with FACT Act reporting will be more than outweighed by the benefits made available to legitimate victims when fraudulent claims are deterred.
The FACT Act protects privacy rights. The bill was carefully crafted to build upon the privacy safeguards contained in the Bankruptcy Code, and only requires the disclosure of the same amount of information that would be contained in a public state court tort pleading. The bill specifically prohibits the disclosure of confidential medical records or social security numbers in the quarterly reports. The FACT Act was carefully crafted to strike the proper balance between achieving the transparency necessary to reduce fraud and sufficient privacy protections for victims.
The FACT Act protects states' rights. The asbestos trusts subject to the FACT Act are authorized under section 524(g) of the Bankruptcy Code, a federal statute, and are overseen and subject to the rules of bankruptcy courts, which are federal courts. The bill amends the federal Bankruptcy Code and does not alter any state laws.