Saint-Gobain Unit’s Bid to Dodge ‘Texas Two-Step’ Challenge Nixed

Saint-Gobain Corp. and its subsidiary CertainTeed LLC lost their bid to dismiss a lawsuit by asbestos victims seeking to undo their pre-bankruptcy “Texas Two-Step” maneuver designed to limit liability.

CertainTeed faces lawsuits from thousands of people who claim they developed cancer from asbestos used in the company’s building materials products. CertainTeed took advantage of a Texas corporate law and divided itself into two companies—CertainTeed and DBMP LLC. DBMP then filed bankruptcy in January 2020 to house and manage thousands of claims for asbestos-related injuries.

The maneuver, called the Texas Two-Step, has come under intense scrutiny and criticism from mass tort ...