May 14, 2002

WASHINGTON, D.C. - The Small Business Survival Committee (SBSC) has published a new report focusing on a nationwide asbestos lawsuit system that has careened out-of control, proving costly for asbestos victims, for thousands of American corporations and their employees, and for the U.S. economy in general.  Among the chief findings of the report, entitled, "The Asbestos Threat," are:

1) The number of asbestos lawsuits could eventually reach a 3.1 million;
 
2) The cost of these asbestos claims could reach as high as $275 billion;

3) Many asbestos victims are not being compensated because of the expanding number of lawsuits being filed on behalf of non-sick plaintiffs;

4) Asbestos litigation has reached about 85 percent of U.S. industries, with as many as 6,000 companies being sued, including many small businesses.  

"More than 50 companies have been forced into bankruptcy due to asbestos litigation," wrote Raymond Keating, the author of the report and the SBSC's senior economist.  "That means thousands of lost jobs, declining business for related firms of all types and sizes, and trouble for retirees and investors who experience lost dividends, stock and bond values."  

"As for the economy, those potential hundreds of billions of dollars in expected costs related to asbestos lawsuits translate into less investment, less entrepreneurship, less innovation, slower economic growth, and reduced job creation."

SBSC Chairman Karen Kerrigan added: "With the pool of big corporate targets drying up, smaller firms are now under siege.  They now have been targeted as a peripheral participant, which can be any business whose product or service had some type of relationship to asbestos, no matter how insignificant."

Not once, but twice, the U.S. Supreme Court has condemned the asbestos litigation quagmire as a problem that is beyond repair by the judicial system. The Supreme Court has strongly urged that Congress pass legislation setting up a system outside the courts.  Among the recommendations for change made by Keating in his "Asbestos Threat" report are:

1) Setting up objective medical criteria for evaluating asbestos illnesses;

2)   Changing statute of limitations restrictions in order to remove the incentive to bring a legal action before becoming ill;

3) Making sure that both plaintiffs and defendants are entitled to individual trials, rather than being lost in settlements with thousands of people;

4) Prevent "jury shopping" by requiring that lawsuits be brought within the plaintiffs' resident states, or where the asbestos exposure actually occurred;

5) Offering explicit liability protection to businesses - many of them small businesses - that had little or no responsibility for asbestos ailments.

"Such legislation would be critical in redressing the many abuses going on right now in the asbestos litigation arena - abuses that not only take a heavy toll on all kinds of businesses and their employees, but also on those individuals who are truly ill due to asbestos exposure," the SBSC report stated.

"In the end, this type of asbestos reform legislation would serve all those concerned with this issue well.  Unnecessary bankruptcies --  and the accompanying fallout for employees, investors and retirees, other businesses and the overall economy -- would be avoided."

For a copy of "The Asbestos Threat," please visit SBSC's website at www.sbsc.org, or call SBSC at 202-785-0238.  The SBSC is a nonpartisan, nonprofit small business advocacy group with more than 70,000 members across the nation.

FOR MORE INFORMATION:
Raymond Keating
Chief Economist
(631) 878-3109
rkeat614@aol.com

Or

Karen Kerrigan
Chairman
(202) 785-0238
kkerrigan@att.net