Bankrupt Companies and Trusts

When an asbestos manufacturer faced overwhelming liability, it could reorganize under federal bankruptcy law. Part of that reorganization often involved setting up a trust funded with money and assets from the company. The trust takes over responsibility for paying current and future asbestos claims related to that company's products. In exchange, lawsuits against the reorganized company are generally channeled to the trust instead. This system was designed to make sure people diagnosed years later, like many mesothelioma patients today, could still receive compensation even though the company itself is protected from lawsuits.

Each trust has its own procedures. Generally, a claimant submits a claim form with medical records confirming the diagnosis and evidence of exposure to that company's products. Trusts often keep lists of approved job sites and products, which can make exposure easier to show. Claims may be reviewed through a faster process with set values, or through an individual review that considers more details. If approved, the trust pays according to its rules, which often include a payment percentage. That means claimants receive a portion of the scheduled value rather than the full amount.

Trust claims can usually be filed while a lawsuit against companies still in business is moving forward. One case might involve several trusts at once, depending on how many bankrupt companies' products were part of the exposure. Each trust has its own deadlines, forms and evidence requirements, so they need to be tracked carefully. Some states have rules about disclosing trust claims in court cases. Your legal team will handle these requirements and keep the trust filings consistent with the lawsuit so nothing conflicts. Ask for a simple status list covering every trust filed on your behalf.

1. 1

   Share every brand name you remember, since each may link to a different trust.

2. 2

   Provide complete medical records confirming the mesothelioma diagnosis and its date.

3. 3

   Ask your legal team which trusts have been filed and the status of each claim.

4. 4

   Keep a record of any trust payments you receive and the date each arrived.