Your Check Is Not in the Mail

For asbestos victims, illness is not the only indignity they have suffered. Tens of thousands of them have also endured a seemingly endless wait for compensation from the companies that produced the mineral that has been found to cause lung cancer and other diseases. The most immediate crisis involves the Manville Personal Injury Settlement Trust, formed in 1988 as the company emerged from bankruptcy reorganization. At the time, trust officials expected to handle 100,000 cases, with an average payment of $25,000 each, but so far, they have paid an average of $43,500 each on the first 24,000 claims. By last June the trust was running out of cash, and more than 125,000 cases were pending.

Jack Weinstein, a federal judge in New York City, is leading an effort to restructure the Manville Trust and resolve 90,000 asbestos lawsuits against dozens of U.S. companies, which represent the biggest ever product-liability issue. Last week Manville announced a plan to replenish the trust's cash supply in a stock deal that will provide as much as $520 million for settling claims over a seven-year period. But the company will not make the new money available until the end of next year. At the moment, with much of the trust's income dependent on future Manville profits, victims filing now are being told they may have to wait until 2015 to see their first payments.

The judicial system is so clogged by the volume of claims that desperate judges are trying hundreds of cases at a time. Some critics complain that greedy lawyers are reaping exorbitant fees in the process. As a result, Weinstein has set a limit of 20% on contingency fees allowed lawyers for hardship settlements paid by Manville. Trust officials say they may have to handle as many as 300,000 claims.

The flood of cases may swamp other companies as well. A court-ordered study released last week said Eagle-Picher Industries of Cincinnati, a former asbestos maker, has been devastated by claims and is likely to become insolvent by the end of 1992. The company has 64,000 claims pending, with 20,000 more being filed every year. As part of his overall plan, Weinstein hopes to pool money from several companies, including Eagle-Picher, to help the firms resolve their claims.