This Court has recognized the danger that no compensation will be available for those with severe injuries caused by asbestos. ... It is only a matter of time before inability to pay for real illness comes to pass.
Norfolk & Western v. Ayers (2003)
Congress is once again considering a bill to end asbestos litigation and set up a $140 billion trust fund to compensate people with asbestos-related illness. The main reason to create this fund is to prevent the outcome Justice Kennedy foresaw above.
How, you might wonder, could matters come to such a pass? To reach an answer, begin with the case of Norfolk & Western v. Ayers.
Railroad workers exposed to asbestos developed asbestosis, a disease that causes scarring of the lungs and shortness of breath. They sued for damages, seeking compensation for their fear that they might someday develop mesothelioma, a fatal cancer.
Were their fears reasonable? The jury thought so and awarded between $500,000 and $1.2 million to plaintiffs whose only complaints were shortness of breath and a fear of developing cancer.
In his dissent, Justice Kennedy noted that among nonsmokers with asbestosis, 5 percent at most develop mesothelioma. By comparison, the average American male has a 44 percent chance of developing cancer during his lifetime and a 21 percent chance of dying from it. Yet American males aren't living in fear on that account.
But Kennedy's view didn't prevail. Fear was declared a cash crop, and the trial lawyers are harvesting with abandon. Today, an estimated 300,000 claims are pending, and an average of more than 67,000 new claims have been filed annually over the last three years.
Only a fraction of claimants, however, are suffering from serious illness. An estimated 2,000 to 3,000 people develop asbestos-related cancer each year. They're the ones in danger of being denied compensation. A study by the RAND Institute for Civil Justice found that 89 percent of people filing asbestos-related claims were unimpaired by any illness.
That's no accident. Trial lawyers troll the nation with advertising, urging anyone who was ever exposed to asbestos to call. "Mesothelioma" is the highest paying keyword on major Internet search engines. Trial lawyers reportedly pay as much as $92 per click to direct potential clients to their Web sites, where you find such come-ons as: "We measure our success in one way and one way only - by the money we get for our clients as compensation for their pain and suffering. Our record is unmatched."
Lawyers set up mobile units and perform assembly line chest X-rays to screen potential clients. But they're gaming the system. Last year an independent team of researchers from Johns Hopkins examined 492 chest X-rays submitted by plaintiffs' lawyers who had claimed lung damage in 96 percent of the cases. The researchers found that only 4.5 percent of the X-rays indicated possible lung damage from asbestos.
Lawsuits based largely on fear and slipshod diagnosis have already churned out $54 billion in awards and settlements. Plaintiffs collected less than half of that. The rest went for lawyers' fees and other administrative costs.
Defendants in these lawsuits have been multiplied beyond belief. Trial lawyers now list more than 8,400 corporations, spanning 90 percent of U.S. industries, as defendants. More than 60 companies have gone bankrupt trying to pay asbestos claims.
After Johns-Manville, a major supplier of asbestos, went under in the 1980s, it created a trust fund that promised to pay 100 percent of asbestos claims filed by sick people. After years of being pillaged by trial lawyers, that fund can now pay only 5 percent of claims.
There is one way to avoid the outcome Justice Kennedy foresaw: Congress can pass the FAIR Act to establish a trust fund that halts the avalanche of abusive lawsuits and compensates victims who have truly been harmed by asbestos.
This is a controversial remedy, but the way to judge it is not against some ideal solution that can't be reached by any legislative or judicial process. Gauge it against the status quo. What we have now is the longest running and most disgraceful mass tort in U.S. history.
It is a hideous abuse of civil law, and it must be stopped.