A continuing problem in the mass tort world is the lack of efficient intersections between tort system claiming and claiming against bankruptcy or chapter 11 trusts created to pay claims through an administrative process. One key problem is that plaintiff’s can delay claiming against trusts, thus thwarting the tort system rule against splitting claims. This problem – and others – are described in many posts on this blog (see category asbestos trusts), and in RAND’s two reports on asbestos bankruptcy trusts. To reduce the problem, some states are considering legislation to require an efficient intersection by requiring tort system plaintiffs to move forward with and disclose bankruptcy trust claims early on in the course of pursuing a tort claim. That’s an obviously sensible rule.
Some (not all) plaintiff’s lawyers are opposed to rules requiring such an efficient intersection. In short, they are opposed to transparency in claiming, probably because the asbestos bankruptcy trust system is such a great cash generation machine for some (not all) claimants and plaintiff’s firms. Baron and Budd is one of the firms opposed to transparency in trust claiming, as announced in the press release pasted below. Unfortunately, the bill was rejected and so transparency was blocked.
"DALLAS, May 30, 2012 (BUSINESS WIRE) — Last week, Baron and Budd shareholder Burton LeBlanc testified against a bill in the Louisiana Senate that threatened to curb the rights of asbestos victims. The bill would require plaintiffs in asbestos lawsuits to provide a complete list of potential bankrupt claims in the early stages of a lawsuit. Though the bill unanimously passed the House, it was defeated in the Senate in a 4-2 vote. The bill would have been the first legislation of its kind in the nation. LeBlanc was the only attorney who spoke against the bill.