The Mississippi House and Senate approved a conference report regarding asbestos bankruptcy trust transparency legislation. The bill is expected to be signed into law.
Findings of the Conference Committee include an acknowledgement that approximately 100 employers have declared bankruptcy related to asbestos litigation. Further, 85 percent of industries in the U.S. economy have been named as defendants in asbestos litigation. As a result, trusts have been established in asbestos related bankruptcy proceedings “to form a multibillion dollar asbestos bankruptcy trust compensation system outside of the tort system” and that a lack of transparency exists between the “two paths of recovery.”
The intent of the legislature is to “provide transparency with respect to asbestos bankruptcy trust claims in civil asbestos actions by creating substantive rights for defendants to obtain bankruptcy trust discovery.” Accordingly, highlights of the proposed bill will require that the plaintiff provide the court and parties within 30 days after filing a complaint a list identifying the trust claims filed, a list of claims that could be filed but have not, whether a request has been made to delay or suspend the standing of any asbestos claim. Further, the plaintiff must provide all parties the trust materials related to exposure and a custodial affidavit for the materials. Other requirements include the duty to supplement the materials every thirty days. Another right given to the defendants is the provision that prohibits trial being set until at least 180 days after the materials are produced. Defendants may also file a motion to stay the civil action where a good faith basis exists that claims that could have been filed have not yet been filed. Plaintiffs are also required to file the potential claims within 10 days of the defendant’s filing of the motion to stay or file a response requesting a finding of cost to file versus the plaintiff’s anticipated recovery.
Finally, the proposed bill also affirmatively permits defendants to discover from an asbestos trust without the plaintiff invoking privilege or confidentiality to preclude the discovery. Sanctions against plaintiffs include readjustment of a judgment.