Asbestos Bankruptcy Trust Claims are dealt by established trusts under chapter 11 of the United States Bankruptcy Code to pay personal injury claims caused by asbestos exposure at workplace.
With scores of patients being diagnosed with mesothelioma annually after being exposed to asbestos in the workplace, many have turned to the court system for legal justice and financial compensation. While many patients have been successful in their asbestos litigation and received millions of dollars in compensation, actually getting those settlements is not always easy.
In some cases, the manufacturers of asbestos products, faced with an overwhelming number of lawsuits, have filed for bankruptcy protection. When this happens, the company must submit a reorganization plan to its creditors and the court. Part of that plan includes setting up trusts that process, settle and pay all legitimate mesothelioma personal injury claims through measures accepted by the bankruptcy court. Those plaintiffs who file claims against these companies and win must file for restitution against the trust instead of the actual company. Although the money is still coming from the company, the company legally cannot write the check; the trust must do it.
How Trusts Pay Claims
The trust, run by a board of trustees, can’t pay claims to the plaintiff until the court approves the bankruptcy plan. This can slow the payment of the asbestos bankruptcy trust claims. This process is slowed even further given the sheer number of claims and the complexities of the cases. Once the trustees receives the green light and the court approves the trust distribution procedures, payments can begin.
It is important to note that both medical and asbestos exposure requirements are different for each trust and that claims are paid out on the current payment percentage. Usually, the trust managers decide the settlement value of the claim and assigns a payment percentage — a fraction of the total worth.
Overall, asbestos bankruptcy trust claims are becoming more and more common, especially as the number of victims of asbestos exposure is increasing. Many juries are awarding substantial judgments against the asbestos manufacturers especially if the companies knowingly exposed workers to this toxic substance. This makes working with a trust very likely.