On December 20, 2012, Ohio Governor John Kasich signed into law House Bill 380, making a significant change to asbestos litigation in Ohio and possibly signifying the beginning of a larger shift. Ohio Rev. Code § 2307.953 is designed to prevent “double dipping” by asbestos claimants who file lawsuits after already filing claims against one of the several asbestos bankruptcy trusts.
It is estimated that these trusts control more than $36 billion in assets. Because claims against the trusts are filed outside of the litigation process, there was previously little visibility into whether a plaintiff already had been compensated for alleged asbestos injuries through a trust. Additionally, the lack of transparency has led to fraud by claimants. In some cases, plaintiffs have filed contradictory exposure allegations, or allegations that would require them to have been in multiple places at the same time, or inconsistent work histories.
Asbestos plaintiffs in Ohio are now required, within 30 days of commencement of discovery, to disclose all such trust claims made by them or on their behalf. Defendants may file a motion to stay the proceedings if they can show credible evidence that plaintiff did not disclose relevant trust claims in accordance with the new law.
Despite being on the books for only two months, the Ohio legislation is showing signs of influencing reform in other states. Madison County, Illinois is the busiest asbestos docket in the United States with 1,563 cases filed in 2012 alone (an annual record). Approximately 90% of these claims are brought by out of state residents, whose tenuous connection to Illinois leads to a lack of transparency into their previous claims against the asbestos trusts. State Rep. Dwight Kay has introduced a bill, currently before the Illinois Judiciary Committee, that mirrors the new Ohio law. Given the size of the asbestos docket, Kay says that it is “necessary to take proactive steps to ensure the transparency of asbestos claims.” A bill recently introduced in the Mississippi House also tracks the Ohio law.
And on March 6, 2013 a similar bill was introduced in the U.S. House of Representatives. Taking a slightly different approach to the same issue, the Furthering Asbestos Claim Transparency (FACT) Act of 2013 would require the asbestos trusts themselves to disclose the individuals who have filed claims against that trust, their exposure histories, and any payments made to the claimant.
Asbestos defendants and legal practitioners should stay tuned as it appears that the above changes may be just the tip of the iceberg in asbestos transparency reform.