House of Representatives Pass Asbestos Lawsuits Reform Bill

The U.S. House of Representatives on Friday passed a bill that targets class action lawsuits and the asbestos injury compensation system.

H.R. 1927 combines the Fairness in Class Action Litigation Act and the Furthering Asbestos Claim Transparency Act, or FACT Act. After hours of debate and the rejection of several Democrat-proposed amendments, the Republican-controlled House passed the bill in a 211-188, with one lawmaker voting “present.” Sixteen Republicans voted against the bill, no Democrat voted for it.

The FACT Act would increase transparency in the asbestos trust system, in which approximately 100 companies that were targeted frequently by asbestos suits declared bankruptcy to establish trusts to compensate victims.

The bill would also require trusts to respond to information sought from them by defendants in asbestos lawsuits. Defendants in those suits want to ensure that plaintiffs attorneys aren’t fully blaming their products while also blaming the products of companies that established trusts.

It is a practice that was brought to light in Garlock Sealing Technologies’ bankruptcy proceeding. In January 2014, U.S. Bankruptcy Judge George Hodges ruled in a landmark decision that plaintiffs’ attorneys had been withholding evidence that could have been submitted to trusts while pursuing lawsuits against Garlock.

Before final passage, the House rejected an amendment from Rep. Ted Deutch (D-Fla.) that would exempt claims from gun owners seeking damage compensation for defective firearm manufacturing from the bill’s requirements. The Florida Democrat warned that the law preventing the Consumer Product Safety Commission from unilaterally ordering recalls of defective guns limits consumers’ options in the event something goes wrong.