Fact or Fiction: The Truth Behind the FACT Act

By Robert Craycraft

Asbestos was once used as a flame-retardant and for electrical insulation in buildings, ships and homes. Before it was discovered to cause cancer, millions of American workers and veterans handled and were otherwise exposed to deadly asbestos fibers.

An unknown amount of the hazardous material is still present in our communities. The Centers for Disease Control and Prevention report that roughly 3,000 people continue to die from mesothelioma and asbestosis every year; some experts estimate the death toll is as high as 10,000 annually when other types of asbestos-linked diseases and cancers are included.

In early February, the U.S. House of Representatives Judiciary Committee Subcommittee on Regulatory Reform, Commercial, and Antitrust Law held a hearing on H.R. 526, the Furthering Asbestos Claim Transparency Act (or FACT Act). Generally speaking, the more transparency the better. However, in this case, the asbestos industry is using the guise of “transparency” to push the FACT Act as a way to delay compensation to asbestos victims and their families. The bill would require the trusts that manage victim compensation to retroactively compile information on all claims they’ve paid and to require the trusts to answer any and all information requests by asbestos company defendants.

These paperwork requirements could have the effect of slowing or even stopping the important work of the trusts to compensate victims that have developed deadly diseases like mesothelioma due to exposure to asbestos. Rep. Hank Johnson (D-Ga.) called the FACT Act a “Trojan horse” which “guarantees that the insurance companies pay as little as possible.”

Adding insult to injury, the reporting required by the FACT Act would place personal information online – including portions of victims’ social security numbers, their claim amounts, as well as medical treatments and exposure information. This personal data would therefore be easily accessible identity thieves and scam artists. Victims’ information, once made public, is “irretrievable,” according Rep. John Conyers (D-Mich.) and makes victims “vulnerable to predators.” Additionally, the information could potentially be used by potential employers to discriminate against victims.

In short, the FACT Act does not protect victims. It exposes them to possible discrimination and identity theft – crimes which asbestos victims do not have the energy, time or money to fight.

The primary argument from the proponents of the FACT Act was that there may have been inconsistencies constituting fraud by claimants. A main line of questioning during the hearing was that victims can “double dip” into multiple trust funds, thereby claiming more compensation than they are due.

Attorney Elihu Inselbuch countered the FACT Act proponents’ argument. Victims “can sue and collect from each and every person or entity culpably responsible,” said Inselbuch, and  “each trust only pays its respective defendants’ share of the harm caused to the victim.” Thus victims who claim compensation from multiple trusts are not “double dipping” but are receiving their just compensation – compensation to which they are entitled – from the appropriate companies responsible for their illness.

As Rep. Hakeem Jeffries (D-N.Y.) said in the hearing, “[The FACT Act is] trying to correct a problem that does not exist.” There is no proof of significant fraud with these trusts, as confirmed a study completed by the Government Accountability Office .

One of the most frustrating things about the FACT Act subcommittee hearing was that the committee members heard not from the victims and their families, but from lawyers who have worked on behalf of asbestos companies. Many asbestos victims traveled from around the country to be present, but they were not invited to officially testify.

The real inconsistency around the FACT Act’s call for transparency is that asbestos companies are not required to disclose the ongoing hazards that asbestos products still pose to the public. Transparency cannot be one sided.

The House Judiciary Committee must reject the FACT Act in the name of all the workers and veterans who have been harmed by asbestos products and killed by mesothelioma or other asbestos-related diseases. Committee members must instead work on legislation that requires asbestos companies to be transparent regarding the hazards of asbestos and the locations of the buildings, homes, and ships that still contain the toxic material.

Robert Craycraft is a fellow with Public Citizen’s Congress Watch division

Take action: Tell your members of Congress to oppose the FACT Act.