Sunday, October 24, 2021
HomePollutionAsbestosHoneywell and Asbestos Trust Countersue Over Disputed Claims of $2.3 Billion

Honeywell and Asbestos Trust Countersue Over Disputed Claims of $2.3 Billion


Honeywell International Inc. sued a trust for victims of asbestos poisoning, claiming the fund’s managers are wrongly paying people who say they were harmed by the toxic industrial substance.

The lawsuit, filed in Pittsburgh, comes after years of acrimony between the industrial conglomerate and a trust set up to resolve the bankruptcy of Honeywell’s former affiliate, North American Refractories Co., or Narco.

Trust administrators filed their own lawsuit against Honeywell, claiming the company was trying to get out of its obligation to pay up to $150 million annually to cover claims from people harmed by Narco’s products. There’s no end date to the court-ordered payments and Honeywell estimated it could ultimately have to pay out as much as $2.3 billion, according to the trust lawsuit, also filed in Pittsburgh.

“Honeywell has evidence of severe and abusive mismanagement of the Narco Trust, including that the Trust has squandered its assets and has paid claimants who have not demonstrated exposure to any Narco product,” the company said in an emailed statement.

Long Fights

For decades, companies and advocates for asbestos victims have battled over how much to pay people who have respiratory illnesses linked to the substance. The unique lung scarring caused by asbestos is easily identified by doctors, but lawyers often battle for years to attribute the damage to a specific product and ensure that the right company pays.

“The improper purpose of Honeywell’s actions is to deny or limit compensation to very ill asbestos victims in order to improve its own bottom line,” the Narco trust managers said in an emailed statement.

Honeywell owned Narco from about 1979 until 1986. Narco made a handful of asbestos-tainted products until about 1980, when it removed the substance, according to court documents

The Narco trust was set up more than a decade ago after the company filed bankruptcy to resolve billions of dollars worth of asbestos claims. Because of its previous ownership, Honeywell agreed to help fund the Narco trust. Since it began operation, the trust has paid out about $523 million, with much of that money coming from Honeywell.

Trustees and the company began arguing about the obligations long before Honeywell made its first payment in 2019, according to court documents. Honeywell has offered to make a one-time payment of about $506 million to end all of its Narco-related asbestos liabilities, the documents show.

In its lawsuit, Honeywell accused the trust of spending millions more in administrative costs than other, similar victim funds. The company also accused the trust of hiring consultants who work for one of the three trustees who control the victims’ fund.

The victim fund was forced to increase its spending on legal fees after Honeywell’s litigation threats, the trust said in an emailed statement. Two trustees who were not affiliated with the consultants authorized their hiring more than five years ago with Honeywell’s knowledge and in compliance with the fund’s bylaws, the statement said.

The case is North American Refractories Co., 15-00204, U.S. Bankruptcy Court for the Western District of Pennsylvania (Pittsburgh).

Copyright 2021 Bloomberg.

Topics
Claims

Interested in Claims?

Get automatic alerts for this topic.



Source link

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Recent Comments