Asbestos Suits Prompt Bankruptcy for Georgia-Pacific’s Bestwall
A division of Georgia-Pacific known as Bestwall has declared bankruptcy, reported its parent company, Koch Industries. Koch put the division into Chapter 11 after “failing to stem a rising tide of lawsuits by mesothelioma victims who attribute their disease to asbestos-containing drywall compound,” reports Forbes.
Until 1977, Bestwall manufactured a popular drywall compound – known to contractors as “mud” – that contained chrysotile (white) asbestos.
Bestwall executives report that though joint compound such as that which was sold by the company only amounted to about 1.5 percent of all asbestos-containing products sold in the U.S., the company is now named in some 75 percent of all lawsuits related to mesothelioma, asbestos-caused cancer. It’s a number they find staggering.
Georgia-Pacific reports that they have paid out $2.8 billion for such lawsuits since the turn of the millennium, including $200 million so far this year.
However, their liabilities are far from finished. There are about 64,000 additional lawsuits pending which name Bestwall as a defendant, the company said in a statement to the press.
Koch Industries opines that plaintiffs were going after Bestwall because they were still solvent while other larger players in the asbestos industry had already declared bankruptcy.
Payments from bankrupt companies are limited to what one can obtain from an asbestos trust, which includes only a certain amount of designated funds that may eventually run out.
Forbes reports that between 2013 and 2016, Bestwall settled an average of more than 1,000 mesothelioma-related claims each year. This was an eight-fold increase from 1999, the company said, adding that the increase had “no basis in science or reality,” Bestwall says: “The number of mesothelioma plaintiffs who historically had been exposed to Bestwall products did not change between 1999 and 2001.”
Koch also adds that the average payment per plaintiff increased tremendously once many large companies decided to declare bankruptcy. Whereas the average was about $21,000 before 2000, that number increased to $125,000 after that time.
This, they say, is ridiculous given the fact that chrysotile asbestos is a lot less toxic than the amphibole form of asbestos that was once used in products such as pipe insulation.
Nonetheless, studies have shown that chrysotile asbestos can and will cause mesothelioma in some individuals that have been consistently exposed to the material.
Just ask the Canadians, who mined chrysotile for well over a century and who used it in insulation in their homes. Many Canadians who were regularly exposed have been sickened with asbestos-related diseases, including mesothelioma, so there is certainly justification in the suits against Bestwall.