May 8, 2002
Asbestos litigation has spun so far out of control that the U.S.
Supreme Court has agreed to hear an appeal directly from an
intermediate state court. Multi-million dollar verdicts are being
awarded to healthy plaintiffs based on speculation about possible
future harm from past exposure to asbestos.
A West Virginia state court awarded millions of dollars to a few
workers without evidence of physical or independently corroborated
emotional harm from exposure to asbestos, and without apportioning
damages based on relative culpability. The case, based on the Federal
Employers' Liability Act (which pertains to railroad workers), is
Norfolk & Western Railway Co. v. Ayers, Freeman et al.
The Supreme Court has repeatedly implored Congress to save the
courts from having to handle asbestos lawsuits. But the usual victims
of this litigation are engineering companies that lack political muscle
and are no match for the political clout of the trial lawyers.
America's top asbestos producer, Johns Manville, was forced into
bankruptcy in 1982. By 1992, Lloyds of London was averaging nearing $3
billion a year in losses, due mostly to asbestos claims.
Asbestos litigation has pushed at least 54 companies into
bankruptcy, and judgments are often imposed with little regard for
proof of wrongdoing or causation. Encouraged by porous legal
standards, asbestos attorneys have filed claims for more than 1.4
million persons, against more than 1,400 companies.
In 2000, the four major companies sent into bankruptcy by asbestos
were Armstrong World Industries (construction products), Babcock &
Wilcox (boilers), Burns and Roe (engineering and construction), and
Pittsburgh Corning (glass insulation). In 2001, asbestos litigation
casualties included the chemical and materials giant W.R. Grace, the
prominent construction materials company G.A.F., the gypsum wallboard
maker USG, and the auto-parts maker Federal-Mogul.
Just in the past six months, Fortune 500 victims of the asbestos
litigation monster have seen sudden drops in their stock prices. Hit
with a Texas-sized verdict last December, Halliburton stock abruptly
dropped 43 percent.
In February, a Manhattan jury awarded $53 million to the estate of
a deceased auto mechanic who allegedly died from exposure to asbestos
in brake linings. That decision jeopardizes the entire auto industry;
full-page ads for auto mechanics with lung cancer now run in New York
In March, a West Virginia jury ordered DuPont to pay $6.4 million
to a bank officer who died of mesothelioma. The banker was allegedly
injured by fibers that might have attached to the clothing of his
father who worked with asbestos at DuPont.
Some of the cases involve heavy, lifelong smokers who claim they
have asbestosis, an asbestos-related disease. Plaintiffs and
defendants bring in medical experts who testify to contrary diagnoses,
and the jury is left to decide, often against the corporate defendants.
In February, 2,645 plaintiffs sued asbestos attorneys, claiming
that "this case arises from corruption within the asbestos personal
injury bar." Reports are that the majority of asbestos settlements
enrich the attorneys, rather than going to the allegedly harmed
The demonizing of asbestos is an odd fate for a substance that
exists widely in nature, including the rocks supporting highly
populated cities such as San Francisco. No material can approach its
versatility and effectiveness and, for decades, asbestos saved
countless lives because of its remarkable strength, durability, and
resistance to fire.
In 1998, the prestigious New England Journal of Medicine reported
no increased risk of death from cancer because of prolonged exposure to
asbestos. Based on a thorough study of mines and mills that have the
world's greatest concentration of asbestos, the researchers concluded:
"The [Environmental Protection Agency] model overestimated the risk of
asbestos-induced lung cancer by at least a factor of 10."
Until now, the U.S. Supreme Court has been unwilling to curtail
the legal circus and its calamitous consequences. The Court has
manifested unusual restraint as verdicts were rendered, sometimes
without any proof of wrongdoing or causation by the defendants who have
been forced to pay astronomical damages.
As more claims were decided for workers involved in the
manufacture of asbestos, the trial attorneys began casting their nets
wider. Any firm that had any contact with asbestos is at risk for
unjustified litigation, so asbestos is hastily excluded and removed at
Meanwhile, observers have noted that the replacement of asbestos
with less effective material may have played a role in (1) the
explosion of the Challenger, (2) the great New Orleans Rail Yard Fire
of 1987, and (3) the premature collapse of the World Trade Towers on
9/11. The government is now contradicting itself by claiming that,
while asbestos lining within the towers would have been unsafe,
asbestos emitted by the collapse of the towers is safe.
The unusual consideration by the Supreme Court of the Norfolk &
Western Railway case may signal that the Court is no longer waiting for
congressional action. But will Court action be too little and too