GAO Report Examines Role, Administration Of Asbestos Personal Injury Trusts

Since the establishment of the first trust in 1988 through 2010, asbestos trusts have paid about 3.3 million claims valued at about $17.5 billion, according to a Government Accountability Office report released Oct. 19.

The report, “Asbestos Injury Compensation: The Role and Administration of Asbestos Trusts,” (GAO-11-810), was requested by House Judiciary Committee Chairman Lamar Smith (R-Texas).

Bankruptcy Code Section 524(g) allows Chapter 11 debtors to channel—by way of a channeling injunction—all future asbestos-related liabilities to an asbestos personal injury trust established as part of the company’s reorganization, the report explained.

Most asbestos trusts publish for public review annual ...