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How Does Business Bankruptcy Affect Asbestos Claims?

Nichol & Associates, Attorneys at Law Nov. 29, 2021

Businesses have known about the potential health risks of asbestos for decades. Unfortunately, many companies only did the bare minimum to comply with safety laws when they used or dealt with asbestos. Some companies didn’t even do that.

It may only be now, years later, that you realize the damage a former employer did to your health by not taking adequate precautions to protect you from asbestos. They may have their fingers crossed, hoping that you do not connect your illness with your previous work. Or, if other workers already brought claims, they may have shut up shop and declared bankruptcy. Does that mean it is too late for you to claim compensation for the ill health they caused you? No.

Business Bankruptcies Often Lead to Asbestos Trusts

Bankruptcy can help address certain debts, but it doesn’t eliminate a company’s basic legal responsibilities to the public or its former employees. Businesses filing for bankruptcy can’t just avoid responsibility for their bad practices that harmed their employees.

Companies filing for bankruptcy because they face asbestos-related claims by former workers will typically have to create an asbestos bankruptcy trust. This trust provides a source of compensation for workers who may eventually become sick because of their prior asbestos exposure in the workplace. Former workers with mesothelioma or other asbestos-related medical conditions can potentially bring a claim against a bankruptcy trust for the losses they suffered due to workplace asbestos exposure.

Much like a civil lawsuit, a claim against a bankruptcy trust can be a difficult process. Understanding your rights after workplace exposure to asbestos can increase your chances of getting the compensation you need.