Eight hundred million dollars. That’s the amount RPM International, parent company to the DAP and Rust-Oleum brands, is paying to fund a trust set up to resolve asbestos injury claims relating to a business owned by its Specialty Products Holding Corp.
And that’s just one of many recent examples of big businesses getting caught up in asbestos personal injury lawsuits, the longest running mass tort in U.S. history. These lawsuits have drained billions of dollars from company profits and bankrupted many others over the past 40 years. Since the 1980s, over $30 billion has been set aside for mesothelioma victims claiming exposure to asbestos, according to a 2011 report by the U.S. Government Accountability Office (GAO).
But with existing trust funds feeling the crunch and filings for bankruptcy on the rise among bigger companies, plaintiffs and their lawyers increasingly have smaller companies in their crosshairs.
If you’re in the construction business, you could be next.
According to OSHA, over a million people in the U.S. are exposed to asbestos every day at work. And personal injury claims are no longer confined to asbestos-related pulmonary disease as they once were. More and more, claims are being filed for malignancies such as mesothelioma and asbestos-related lung cancer – and settlements can often run into the tens, even hundreds of millions of dollars.
That kind of liability judgment could quickly bankrupt you.
Your first line of defense against asbestos litigation is to control your exposures and protect your workers. Make sure you’re following these guidelines, most of which are covered by OSHA regulations:
- Provide thorough training for employees who work with asbestos
- Make sure workspaces where asbestos is used are properly ventilated and posted with instructions and warning signs
- Monitor your employees for asbestos exposure
- Require protective clothing and equipment
- Make showers and other post-exposure precautions routine
- Provide medical exams for employees exposed to high levels of asbestos
If there’s any good news on the asbestos front, it’s in the growing movement to open up the records of thousands of asbestos claims in an attempt to expose the rampant fraud, misconduct, and legal maneuvering that’s too often a part of asbestos litigation. And asbestos trusts are squarely in the crosshairs of this movement.
This movement has garnered support from bankruptcy judges, big companies such as Ford and Aetna, and the federal government. In December 2013, the House of Representatives passed H.R. 982, amending federal bankruptcy law to require asbestos trusts to file quarterly reports that outline every demand from a claimant and the basis for any payment.
These are promising signs for the future, but for now, asbestos litigation remains a serious and potentially devastating threat to your business. Even insurance companies could be hit hard. Property and casualty insurers in the U.S. have lost an average of $2 billion every year over the last five years related to asbestos exposures, according to Fitch Ratings.
Bottom line: You need to take this threat seriously and take adequate measures to protect your employees and your business. It’s your best defense against getting caught up in a lawsuit.
For more information about this evolving threat and how you can protect yourself, talk to the construction insurance experts at Higginbotham.