After nearly ten years of attempting the bankruptcy maneuver known as the “Texas Two-Step,” Georgia-Pacific appears to be moving toward a new bankruptcy filing to resolve tens of thousands of asbestos-related lawsuits, including claims filed by mesothelioma victims. The shift in strategy would put an end to one of the longest tests of the controversial scheme.
Nine Years of Bestwall Bankruptcy Attempt Froze Mesothelioma Claims
Georgia-Pacific is a pulp-and-paper manufacturer that was facing roughly 64,000 asbestos lawsuits, including thousands of mesothelioma cases, in 2017. That year, the company tested a novel bankruptcy strategy: It created Bestwall to house those claims, then placed the new subsidiary into bankruptcy. The tactic, which has since been attempted by health products giant Johnson & Johnson and others, effectively froze all pending claims.
Earlier this month, a bipartisan group of U.S. senators filed an amicus brief urging the Supreme Court to reject the strategy, and now law firms representing various mesothelioma and asbestos claimants say the company has “given up” and now plans to utilize one of its existing affiliates or a newly created entity to file for a new Chapter 11 bankruptcy to resolve the mesothelioma claims.
Mesothelioma Victims’ Attorneys Demand Independent Trustee as Company Plans “Next Assault”
According to a filing submitted by an attorney representing some claimants, Georgia-Pacific is trying to secure sufficient support from victims diagnosed with mesothelioma and other asbestos-related diseases before filing another bankruptcy to fast-track its new plan. Negotiations for the new approach apparently stalled when victims’ advocates asked for details of the financial terms of the settlement, as well as preservation of their rights to object to any future bankruptcy plan. The group is now requesting appointment of a Chapter 11 trustee in the Bestwall case, arguing that an independent trustee is “essential” as Georgia-Pacific is “hatching a next assault.”
The case highlights the ongoing struggle between victims seeking compensation for their mesothelioma diagnoses and corporations using bankruptcy maneuvers to limit liability. If you or someone you love has been diagnosed with mesothelioma and you need help, contact the Patient Advocates at Mesothelioma.net today at 1-800-692-8608.
