Mich. House Considers Asbestos Bill

Published August 1, 2006

On May 23, the recently organized Michigan House of Representatives Committee on Tort Reform, by a vote of five to one, reported favorably to the whole body House Bill No. 5851, which would greatly change Michigan tort law related to asbestos and silica lawsuits.

Speculative Claims Halted

According to a summary by the Michigan House Fiscal Office, the bill would “specify that a person is not entitled to an asbestos claim or silica claim unless the exposed person has a physical impairment to which asbestos or silica exposure was a substantial contributing factor.”

The requirement of an actual existing impairment would be a new requirement in Michigan, where, as in many states, exposure alone is sufficient to bring a claim, even if there is only a speculative assertion of future impairment risks.

Michigan state Rep. Edward Gaffney (R-Wayne County) introduced the bill on March 9. A floor vote had not been scheduled at press time.

Ensuring Proper Focus

The bill is strongly supported by the Property Casualty Insurers Association of America (PCIAA), a Chicago-based association of property insurers. PCIAA Senior Public Affairs Specialist Jona Van Deun said, “We’re seeing a trend in trying to make sure that injured people get treated first.”

Van Deun cited Texas as having had several large class-action suits where litigants sued before they had actual damage, which put some companies out of business and thus prevented some people with actual damages from recovering funds.

Van Deun said the Michigan bill “guarantees that each asbestos case is tried on its own merits; if they are truly sick, the claimants will get paid first.”

Hans Bader, counsel for special projects for the Competitive Enterprise Institute, a Washington, DC-based think tank, said, “It seems like simple common sense to require an existing impairment, rather than just exposure, as the [Michigan] bill rightly does.

“Many businesses have gone bankrupt paying asbestos claims, limiting their ability to satisfy all the claims against them,” added Bader. “If there’s not enough money to compensate those who are already suffering, it makes no sense to allow those who merely speculate that they may suffer in the future to collect from the limited funds available.

“It’s a simple matter of priorities,” said Bader.

Federal Bill Pending

On the national level, Sen. Arlen Specter (R-PA), chairman of the U.S. Senate Judiciary Committee, is trying to build support for S. 852, the Fairness in Asbestos Injury Resolution (FAIR) bill. Similar in many ways to the Michigan bill, the measure is a revised version of a bill that was filibustered in November 2005. Specter could not muster 60 votes at the time to end debate.

Specter and Sen. Patrick Leahy (D-VT), the ranking Democrat on the committee, introduced the new bill on May 23. A hearing on the bill was held on June 7.

The FAIR bill would create a privately financed $140 billion trust fund. The fund would pay claimants on a non-adversarial and no-fault basis. If passed and signed into law, the bill would stop all asbestos-based litigation effective the day it is enacted.

Sen. Edward Kennedy (D-MA) opposes S. 852, alleging it would not properly compensate victims. John Engler, president of the National Association of Manufacturers, testified at the June 7 hearing and said the bill would expedite assistance for victims without unduly destroying businesses that have had connections with asbestos production.

Michael Coulter ([email protected]) teaches political science at Grove City College.