Senate Bill No. 486
(By Senators Jenkins, Browning, Wells, McCabe, Williams, Foster,
Stollings, Green, D. Facemire, Fanning, Palumbo, Laird, Caruth,
Sypolt, Hall, Guills, Boley, K. Facemyer, Barnes, Deem, Oliverio,
Yost, Kessler, Plymale and Prezioso)
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[Introduced February 5 2010; referred to the Committee on the
Judiciary.]
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A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §55-7E-1, §55-7E-2,
§55-7E-3, §55-7E-4 and §55-7E-5, all relating to filing of
claims for asbestos; disclosures regarding existing and
anticipated claims involving asbestos bankruptcy trusts;
defendants' rights in asbestos action to require claimant to
show cause regarding additional bankruptcy trust claims;
certification of cause of action by court; discovery of
materials from bankruptcy trusts; value of trust claims;
sanctions for noncompliance; and rights of setoff.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §55-7E-1, §55-7E-2,
§55-7E-3, §55-7E-4 and §55-7E-5, all to read as follows:
ARTICLE 7E. ASBESTOS CLAIMS TRANSPARENCY ACT.
§55-7E-1. Short title.
This article may be cited as the "Asbestos Claims Transparency
Act."
§55-7E-2. Definitions.
As used in this article terms will have the following
meanings:
(1)"Asbestos" means chrysotile, amosite, crocidolite,
tremolite asbestos, anthophyllite asbestos, actinolite asbestos,
asbestiform winchite, asbestiform richterite, asbestiform amphibole
minerals and any of these minerals that have been chemically
treated or altered, including all minerals defined as asbestos in
29 C.F.R. §1910 at the time an asbestos claim is made.
(2) "Asbestos claim" means any claim for damages, losses,
indemnification, contribution, restitution or other relief of
whatever nature, including punitive damages, arising out of, based
on or in any way related to the alleged health effects associated
with the inhalation or ingestion of asbestos, to the extent those
claims are recognized under state law including, but not limited
to:
(A) Loss of consortium;
(B) Loss of support;
(C) Personal injury or death;
(D) Mental or emotional injury;
(E) Risk or fear of disease or other injury;
(F) The costs of medical monitoring or surveillance; or
(G) Any claim made by or on behalf of any person exposed to
asbestos, or a representative, spouse, parent, child or other
relative of the exposed person.
The term "asbestos claim" does not include a claim for
compensatory benefits pursuant to a workers' compensation law or a
veterans' benefits program.
(3) "Claimant" means any party asserting an asbestos claim,
including a plaintiff, counterclaimant, cross-claimant or third-
party plaintiff; if a claim is brought through or on behalf of an
estate, the term includes the claimant's decedent; if a claim is
brought through or on behalf of a minor or incompetent, the term
includes the claimant's parent or guardian.
(4) "Exposed person" means a person whose claimed exposure to
asbestos is the basis for an asbestos claim.
(5) "Asbestos action" means any civil proceeding seeking
compensation directly or derivatively as a result, in whole or in
part, of exposure to asbestos.
(6) "Trust claims and claims material" means all documents and
information, including, but not limited to, claim forms and
supplementary material, relevant or related to pending or potential
claims against asbestos trusts.
(7) "Trust governance documents" means documents which
determine eligibility and payment levels for the asbestos trusts
and include trust distribution procedures, plans of reorganization
and related orders.
(8) "Asbestos trusts" means all trusts or claims facilities,
created as a result of bankruptcies or other settlements,
including, but not limited to, all trusts created pursuant to 11
U.S.C. §524(g), intended to provide compensation to claimants
alleging claims as a result of asbestos exposure.
§55-7E-3. Substantive provisions.
(a) Required Disclosures. -- For any asbestos action either
currently pending or filed after the effective date of this Act, no
later than two hundred ten days before the date set for trial for
the asbestos action, a claimant shall provide to all parties a
statement verified by his or her counsel of any and all existing or
anticipated claims against asbestos trusts. The statement shall
be in addition to any existing preliminary disclosure requirements
otherwise imposed by law or applicable agreement, ruling or
judicial order. Furthermore, the statement must include under
penalty of perjury an attestation by the claimant that the
statement is based on a good faith investigation of all potential
claims against asbestos trusts. Counsel must certify that he or
she has conducted a good faith investigation of all potential
claims against asbestos trusts. The statement shall also disclose
when the claim was or will be made and whether there has been any
request for deferral, delay, suspension or tolling of the asbestos
trust claims process. If information obtained subsequent to the
submission of the statement supports the filing of additional
claims against asbestos trusts, the claimant shall update the statement by amendment filed and served within thirty days of the
receipt of the additional information but in no event later than
the date of commencement of the trial. A claimant shall also
produce to all parties within the time period specified in this
subsection in the asbestos action the following additional
materials:
(1) As to any claims already asserted against asbestos trusts,
the claimant must produce final executed proofs of claim together
with any supporting materials used to support the claim against the
asbestos trusts. A claimant must also produce all documents or
information relevant or related to the claims asserted against the
asbestos trusts, including, but not limited to, work histories,
affidavits, depositions and trial testimony of the claimant and
others as well as all medical documentation including, but not
limited to, x-rays, test results, doctors' reports and pathology
results.
(2) As to any claims that a claimant has not yet asserted
against the asbestos trusts but has disclosed pursuant to the
requirements of subdivision one regarding potential claims, all
materials described in subdivision one shall be produced,
including, at the time of its filing, the final executed proof of
claim.
(3) Claimant's asbestos action is stayed in its entirety until
the claimant certifies that all anticipated claims against asbestos
trusts have been filed and that claimant has satisfied the requirements of subdivision(2), subsection (a) of this section.
Provided, That a claimant has satisfied the requirements of that
subdivision if an asbestos trust is not yet accepting claims and
the claimant so responds or if the reasonably anticipated recovery
from the asbestos trust claim will be exceeded by the costs of
filing the claim. The claimant shall provide to the defendants the
information necessary to support the assertion that the anticipated
recovery does not exceed the costs of filing the claim as part of
the requirements of subdivision(2), subsection (a) of this section.
(b) Defendant's order to show cause regarding additional trust
claims; court certification and trust claims order. --
(1) Any defendant after thirty days of receipt of the statement
from the claimant pursuant to subsection (a) of this section or at
a later date may proceed by order to show cause in the court hearing
the asbestos action setting forth the names of additional asbestos
trusts against which the plaintiff has not made, but which the
defendant in good faith believes the claimant can make a successful
claim. The order to show cause shall set forth the factual basis
for the claim describing the evidence sufficient to meet the
asbestos trust distribution procedure requirements to file valid
claims against the asbestos trust and the amount of money the trust
should pay for the claim. In response, within ten days thereafter,
the claimant shall:
(A) File the claim with the asbestos trust as set forth by the
defendant's notice which will be dispositive as to the order to show cause as to that trust; or
(B) Show cause before the court hearing the asbestos action for
a determination that:
(i) The proof of claim should be modified and then submitted;
(ii) There is insufficient evidence to permit the claim to be
filed in good faith under the applicable asbestos trust distribution
procedures;
(iii) A trust is not yet receiving claims; or
(iv) The reasonably anticipated recovery from the asbestos
trust will be exceeded by the costs of filing the claim.
The court hearing the asbestos action shall decide the issue
on the basis of declarations, deposition excerpts, interrogatory
responses and other evidence or additional discovery as the court
deems appropriate. The claimant has the burden of proving that the
claim should be modified and then submitted or should not be filed
because it does not meet the asbestos trust distribution procedure
requirements. If the court hearing the asbestos action determines
that there is a good faith basis for filing the claim, the claimant
shall promptly file the claim with the asbestos trust as it was
submitted by the defendant or as modified by the court hearing the
asbestos action. The claimant's asbestos action is stayed until the
time as the claimant certifies that claimant has complied with the
court's order and has disclosed the materials required to be
disclosed by subsection (a), section four of this article.
Provided,
That the court may allow an asbestos action to proceed based on the rapidly deteriorating physical health of the claimant or other
exigent circumstances and a showing that the health or exigent
circumstances or conditions existed at the time the asbestos action
was filed and that the circumstances or conditions have made it
impossible for the claimant to comply with the requirements of
subsection (a) of this section in a timely manner.
(2) Not later than sixty days before the scheduled trial date
of an asbestos action, the court hearing the asbestos action must
certify in writing that the discovery described in subsection (a),
subdivisions(1) and(2) are complete. Furthermore, no trial date may
be assigned nor trial commenced absent certification of the
completion of discovery and a determination that all additional
asbestos trust claims required to be made in response to an order
to show cause have been submitted to the relevant asbestos trust or
trusts. A schedule of all asbestos trust claims made shall be
reflected in a "trust claims order" which must be entered no later
than thirty days before trial. The trust claims order is a final
order and may be amended only upon a showing of mistake,
inadvertence, surprise, excusable neglect or fraud.
(c)
Treatment of trust claims and claims material. -- Trust
claims and claims material, as well as related discovery materials,
are presumptively relevant to and discoverable in an asbestos action
and are presumed by the court to be authentic. Notwithstanding any
other provision of law or agreement, trust claims and claims
materials are presumed to not be privileged, and the trust claims and claims materials may be used by the parties in the asbestos
action to prove, without limitation, alternative causation for the
claimant's asbestos exposure as well as serve as a basis to allocate
responsibility for the claimant's claim. Further, any materials
relevant to trusts not yet accepting claims or trusts for which the
reasonably anticipated recovery is deemed to be exceeded by the
costs of filing the claim, including all information relating to the
exposure to the products or on premises of the bankrupt entities,
are discoverable and shall be made available to defendants and may
be used in the asbestos action to prove alternate causation for the
claimant's exposure as well as serve as a basis to allocate
responsibility for the claimants' claim.
(d)
Discovery of other materials. -- In addition to the
mandatory disclosure requirements of this article, additional
disclosure and discovery of information relevant to the asbestos
action may be sought by any mechanism provided by the applicable
Rules of Civil Procedure. Defendants in an asbestos action may also
seek discovery from the asbestos trusts. The claimant shall assist
in any discovery from the asbestos trusts and provide whatever
consent or expression of permission may be required by the asbestos
trusts for release of the information and materials. Claims of
privilege or confidentiality, or both, by claimants will not
preclude discovery by defendants under this article.
(e)
Asbestos trust claim values. -- If a matter proceeds to
trial before the claimant has received a decision from an asbestos trust or trusts, the court shall establish an attributed value for
purposes of calculation of verdict or settlement or credits for each
of the claim or claims, subject to the adjustment specified in
subsection (h) of this section, and subject to a finding by the
court of the following:
(1)The trust is liable to the claimant for damages arising
out of the claimant's exposure to asbestos;
(2)The damages, to a reasonable degree of certainty, will be
paid to the claimant; and
(3)The amount of damages to be paid by the trust to the
claimant is readily reducible to a sum certain.
(f)
Sanctions for noncompliance. -- Failure by a claimant to
comply with the discovery requirements outlined in this article is
a basis for sanctions against the claimant, including, at the
discretion of the court, upon a finding that the claimant willfully
failed to comply with the requirements of this article, dismissal
of the asbestos action with prejudice.
(g) Set-offs and Assignments. -- The defendants will be
entitled to set-offs or credits of the full value of the trust
claims against any judgment rendered against them in the asbestos
action. If a judgment is rendered in an asbestos action before a
claimant has received a decision from an asbestos trust or trusts
and the attributed value of the claim cannot be established in
accordance with subsection (e) of this section, the claimant shall
assign to all defendants against whom the judgment is rendered his or her rights to all the claims and the claimant shall cooperate
with and assist the defendants in obtaining damages due and owing
to claimant from each asbestos trust. It shall be the intention of
the claimant and of the court that any defendant's claim filed with
any asbestos trust will be treated exactly as if the claimant had
submitted the claim for any and all purposes under the terms,
conditions and provisions of the trust claim procedures. If a
codefendant settles or otherwise resolves the asbestos claims
against it before a verdict is rendered, and if a release or
releases are obtained for the benefit of asbestos trusts, the
defendants remaining in the asbestos action may pursue those claims
by assignment according to whatever rights were held by claimants.
To the extent that any applicable law provides broader relief to the
defendants than is set forth herein, nothing in this provision
prohibits any defendant from pursuing that broader relief.
§55-7E-4. Severability.
The provisions of this article are severable. If any portion
of this article is declared unconstitutional or the application of
any part of this article to any person or circumstance is held
invalid, the remaining portions of the article and their
applicability to any person or circumstance remain valid and
enforceable.
§55-7E-5. Effective date.
This article applies to all asbestos claims filed on or after
the effective date. This article also applies to any pending asbestos claims in which trial has not commenced as of the effective
date.
NOTE: The purpose of this bill is to establish a procedure that
requires a claimant that files an asbestos case after the effective
date of this bill to provide information to all defendants about all
claims filed or anticipated to be filed by that claimant against
asbestos bankruptcy trusts, a mechanism for the defendant to
challenge those claims, a procedure for sanctions by the court, and
for set-offs for those claims.
This article is new; therefore, strike-throughs and
underscoring have been omitted.