Asbestos I: Executive Summary
March 11, 2003
1- Asbestos litigation has not peaked. Although 90% of asbestos claimants are unimpaired, the number of seriously injured plaintiffs remains constant. Because most states permit consolidations of sick and unimpaired claims, trials continue to expose defendants to large compensatory and punitive damage verdicts.
2- Proving liability for asbestos injuries does not require the plaintiffs’ testimony that the injury was caused by the defendants’ product because suits are based on the conspiracy theory. Proof in conspiracy suits focuses on the defendants’ agreement to conceal the known dangers of asbestos from the people who were exposed. Past verdicts against corporate conspirators make denials of conspiracy implausible if not impossible.
3- Insurance coverage does not offer reliable protection for defendants because:
- Punitive damages are not insurable;
- Insurers are grotesquely under-reserved for asbestos claims; and,
- Consequently, property and casualty insurers are virtually insolvent.
4- The bankruptcies of 71 asbestos defendants increase the exposure of premises defendants and third or fourth tier companies. Some of these solvent defendants may be held liable for the liabilities of the bankrupt companies. These companies were not sued and pursued forcefully in the 80s and 90s because the asbestos manufacturers were solvent. Most cannot now seriously deny liability.
5- Using different criteria, Verdict created a database that identifies 400 companies with significant asbestos risk out of the 6000 companies have been sued in asbestos litigation. These 400 Target Defendants are divided into a shorter list of Vulnerable Defendants that are likely to declare bankruptcy or suffer severe price erosion in the next five years.
6- Verdict is now prepared to advise investors about the asbestos risk that may exist in most domestic stocks.
- Our database will be updated continuously.
- Our database screens out stocks with relatively low asbestos risk.
- Our database facilitates additional research on specific companies.
- Asbestos research materials have also been collected on 88 companies.