A bankruptcy trustee is accusing Nash Engineering Company’s owners and family members of fraudulently transferring assets to avoid paying mesothelioma victims and other asbestos claimants who won judgments against the pump manufacturer. He has asked a court to order a $59.7 million placeholder payment.
Trustee Says Mesothelioma Victims’ Funds Were Hidden Through Complex Asset Transfers
In a motion filed in U.S. District Court, Chapter 7 trustee George Roumeliotis accused Nash Engineering executives of systematically hiding money that should compensate mesothelioma victims and other asbestos disease claimants. The motion reveals that for at least 30 years before filing for bankruptcy in October of 2021, the company faced tens of thousands of personal injury lawsuits blaming asbestos exposure from its vacuum steam heating pumps, sewage collection systems, and pulp and paper manufacturing equipment for asbestos-related illnesses and deaths.
According to the trustee’s complaint, in the face of thousands of mesothelioma and other asbestos-related disease claims, Nash Engineering transferred “substantially all” of its cash to its corporate parent, Nash Engineering Holdings LLC, after a 2004 transaction with Gardner Denver Inc. netted approximately $44.6 million. This asset stripping occurred precisely as “TNEC experienced an explosive growth in asbestos claims filings,” with Nash Holdings subsequently distributing at least $52 million to its members between 2005 and 2018, leaving the operating company with no cash to pay judgments to victims.
The trustee has asked U.S. District Judge Janet C. Hall to impose a $59.7 million prejudgment remedy on individuals affiliated with Nash, including former CEO Mark Nordenson, director Eileen Maguire, and John Bly. The three executives have been fighting the clawback of the money meant for mesothelioma victims, claiming that their actions were based on their business judgment.
Mesothelioma Asset Recovery Complicated by Ongoing Fund Dissipation
According ot the trustee, the recovery effort on behalf of mesothelioma victims and other creditors faces new obstacles, as he recently discovered Nash Holdings is engaging in what he called “staggering ongoing dissipation” of the funds. Nash Holdings has already spent more than $1.35 million of the funds in question on legal fees with a law firm to fight the mesothelioma victims’ clawback suit.
In response to the mesothelioma asset attachment motion, U.S. Magistrate Judge Maria E. Garcia ordered family members to surrender their electronic devices for data analysis immediately. The trustee also requested attachments of family-owned real estate to prevent further concealment of funds owed to claimants and discovery of other family assets.
If you or someone you love has been diagnosed with mesothelioma or another asbestos-related disease, it’s important to have someone fight for your rights. To learn how the Patient Advocates at Mesothelioma.net can help, contact us today at 1-800-692-8608.
