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May 22, 2015

The FACT Act: Keeping the Hands of Trial Lawyers Out of the Asbestos Coffers

If you’ve watched cable TV at all in the last few years, you’ve seen them — the torrent of ads promising asbestos victims their share of the $30 billion dollars set aside in asbestos trusts. What you don’t hear about are the plaintiffs’ attorneys behind these ads who are bleeding asbestos trusts dry with false claims.

Bankrupt companies have set aside billions of dollars in federal trusts for victims of asbestos exposure. Asbestos attorneys are exploiting a lack of transparency in these trusts to line their pockets with money meant for real victims by filing claims with multiple trusts. The attorneys are able to game the system because trusts have no way of seeing if the plaintiff has filed another claim, a practice known as trust “double dipping.” The oversight for trusts is so inadequate that claims have even been filed for individuals who do not exist.

With the median asbestos trust payment coming in at almost $200K, this is no small injustice. Which is why last week, the House Judiciary Committee took an important step toward ensuring that asbestos trusts are protected against fraudulent claims by passing the Furthering Asbestos Claim Transparency (FACT) Act of 2015.

If passed by the House and Senate, and signed into law, the FACT Act would make the asbestos claims process more transparent by requiring trusts to report their claims quarterly. Trusts would be able to check if an individual previously filed a claim, which would prevent “double dipping.”

The FACT Act will also protect companies from being hit with fraudulent lawsuits from victims who have already received compensation. In a case against Garlock Sealing Technologies, plaintiffs’ attorneys concealed evidence of exposure from other sources in order to inflate claims against Garlock. This results in a bigger payout for the plaintiffs and the law firms who are running these scams. Without congressional action, abuses like this will continue to drain the asbestos trusts and take money away from future victims.

So the next time you see the television ads promising “justice for victims” and “payments from companies who profited from their harm,” don’t be fooled. The trial lawyers behind these ads are looking to profit by siphoning money meant for real victims of asbestos exposure into their own bank accounts. The FACT Act is one step closer to curbing this corruption and making sure plaintiffs’ attorneys cannot exploit the asbestos compensation system.

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