"RAND Institute for Civil Justice."

Includes bibliographical references (p. 187-190).

Introduction -- History of and statutory framework for asbestos bankruptcy trusts -- Trust governance, administration, and procedures for compensating claimants -- Overview of trust activity -- Conclusion -- Appendix A: List of bankruptcies with at least some asbestos liability -- Appendix B: Detailed reports on largest trusts.

This report describes the creation, organization, governance, and operation of asbestos personal-injury trusts and compiles publicly available information on the assets, outlays, claim-approval criteria, and governing boards of the 26 largest trusts. The authors find that claim payments by the 26 largest trusts totaled at least $10.9 billion through 2008. While legislative and judicial reforms have made it increasingly difficult to obtain compensation for nonmalignant diseases in the tort system, the trust system remains a source of compensation for such injuries. The authors find that the median trust is able to pay 25 percent of the value it assigns to a claim and that trust transaction costs appear favorable to those in the tort system. The publicly available data on asbestos bankruptcy trusts provide an informative overview of trust practices and activity; however, they are limited in many important ways. Perhaps the most important limitation is the inability to link payments across trusts to the same individual. The ability to understand the trusts' effect on total claimant compensation from the trusts and the tort system combined and the compensation paid by solvent defendants will depend, to a large extent, on whether solvent defendants, trusts, and plaintiffs' attorneys are willing to release individual compensation information on a confidential basis for research purposes.

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