Vol. 11 No. 1 June 1, 1996
Effective May 30th the Trust will have a new proof of claim form that corresponds to the requirements of the Trust Distribution Process (TDP). On that date, the Trust will mail the new form to all law firms which have previously filed claims.
Each firm will receive two copies of the new form from which the firm must make photocopies for use. Note that several pages are two-sided with the back sides presenting instructional material that need not be copied on the forms submitted to the Trust. The form will also be available on the Trust's Homepage on the Worldwide Web at "http://www.claimsres.com".
Firms may begin filing claims on the new form immediately. Alternatively, firms may continue to prepare claims on the current/old form for submission to the Trust through July 11, 1996. Beginning July 12th, all proofs of claim received by the Trust must be on the new form. Claims received by the Trust on the current form after July 11th will be rejected and returned to the initiating law firm.
Medical audit results were very good for the 235 firms with claims eligible to receive offers or deficiency notices in the first quarter of 1996. More than three-quarters of the 235 firms, or 179, achieved "A" list status with an average response rate of 96% and an average pass rate of 95%. These firms represented over 82% of all claims eligible to receive offers in the FIFO range between 106,401 and 136,400.
A total of 56 firms with claims eligible for payment had response rate or pass rate inadequacies sufficient enough to warrant their placement on the "B" list, with its 100% audit requirement. Of these 56, 30 firms had serious pass rate problems (i.e. an average response rate of 96% with a pass rate of 56%), and 26 had insufficient response rates averaging 34%.
The Trust has been working with firms on the "B" list to raise their response and pass rates. As part of this effort, Trust and law firm staff are trying to identify sub-populations of claims in each law firm's inventory that may disproportionately impact the firm's medical audit results. As warranted, the Trust will segregate sub-populations from the rest of a "B" listed law firm's clients and treat these differently in terms of audit requirements. This will facilitate the release of any remaining offers and deficiency notices.
The deadline for responding to second quarter audit requests has now passed. The Trust is trying to achieve an end of May target date for reviewing all second quarter audit responses. There are early indications that a number of "B" listed firms have measurably improved their audit results.
Earlier this year, the Trust began to notify claimants' counsel that it would review the circumstances surrounding entry of defense verdicts on behalf of co-defendants. Initially, if the verdict was based on a finding of no asbestos-related disease, unless claimant's counsel presented compelling contrary evidence, the Trust questioned the claimant's status as a beneficiary and would not extend an offer. Several counsel responded to this notification with objections and concerns. In response, the Trust and the Selected Counsel for the Beneficiaries have discussed and agreed upon modifications for how the Trust's review of these verdicts will be applied.
The revised guidelines that follow are the result of extensive consideration of this issue. It represents an attempt to balance the concerns of counsel whose cases have been rejected by juries or judges with the Trust's mandate to identify and pay only claimants who have sustained a compensable injury as a result of exposure to Manville asbestos. These guidelines apply to claims for which there is an adjudication that the claimant does not have an asbestos-related disease.
1. Where a defense verdict was entered on behalf of a co-defendant on a Category I or II claim, the Trust will medically audit the claim. A scheduled value offer will be based on the results of the medical audit.
2. The Trust will make a scheduled value offer on all Category III, IV, V, VI, and VII claims regardless of whether a defense verdict has been entered on behalf of a co-defendant. (See #4 below)
3. During the individual evaluation of any claim, the Trust will consider the defense verdict. If the claim proceeds to arbitration, the Trust will inform the arbitrator of the defense verdict.
4. Additional factors may affect the Trust's consideration of a defense verdict. For instance, if the Trust learns that not only was there a defense verdict, but in addition, the court found there was counsel or client misconduct in presenting the case, the Trust will consider the defense verdict with respect to a scheduled value offer.
These guidelines are subject to review by the Trust. In the event that the Trust believes the number of defense verdicts makes continuation of these guidelines unacceptable, or if a large number of defense verdicts are entered in a consolidated trial, or if other factors come to the attention of the Trust, the Trust may make revisions. The Trust will discuss any changes with the Selected Counsel for the Beneficiaries in advance and it will consider their views with respect to such a change.
As a result of these revisions, in the absence of the additional factors referred to in Paragraph 4, claims with judicial findings of no asbestos-related disease that are categorized by the Trust as Category III through VII will receive categorization offers as scheduled.
Claims categorized as Category I or II will be notified of placement in medical audit status (assuming the claim has not already been selected for medical audit).
Any questions you have regarding the impact of these guidelines on your claims should be addressed to Deputy General Counsel Jodye Marvin in the Trust's Legal Department.
In March, 1996 the Trust selected almost 700 claims from 134 law firms for payment audits on claims settled during the second half of 1995. The Trust requested copies of releases, settlement sheets and canceled checks evidencing the proper payment of the claims. Through May 9th, the Trust had received complete responses on 434 (63%) of the claims. There appears to have been compliance with the requirement that attorneys limit contingency fees to 25%. However, a small number of firms have failed to have their clients sign releases and retain copies for their files. The Trust is contacting law firms which provided incomplete responses. Failure to respond to the audit request may result in suspension of future claim offers until the firm has complied with the Trust's settlement procedures and audit requirements.
When a law firm submits medical documentation to upgrade a claimant's disease from a non-malignancy to a malignancy, the claim may qualify for expedited handling under exigent health program guidelines. To ensure immediate identification of claims that qualify for exigent health status, include with the medicals a statement as to whether the claimant is living or deceased. If living, specify whether the claimant is currently receiving treatment for his/her cancer. If the claimant has died, please provide the date of death, a copy of the death certificate, and the name of the claimant's personal representative.
During the individual evaluation stage of a claim, the Trust's negotiators consider all jurisdictional and damage factors that would be considered if the claim were being litigated. In placing values on asymptomatic pleural claims, the negotiator will review and consider jurisdictional law regarding compensability. Therefore, attorneys representing claimants from jurisdictions in which asymptomatic pleural disease is not compensable should consider that requesting individual evaluation may result in a Trust offer lower than the matrix offer.