U.S. law firms eye global expansion of asbestos litigation

By The Madison County Record | Mar 26, 2009


The 900-lb. gorilla of American civil law is expanding globally to an even greater degree than it already has, according to a Chicago defense attorney who writes a blog on global asbestos issues.

Asbestos litigation, which the U.S. Supreme Court once described as "an elephantine mass" that "defies customary judicial administration," continues into another decade with no signs of slowing. Asbestos dockets across the country are again on the rise.

But according to defense attorney Kirk Hartley, who presented on the topic at a Beverly Hills conference among leading asbestos lawyers, judges and other professionals in early March, the push for increased litigation has already expanded abroad. For any number of reasons asbestos litigation will expand globally in the years to come, especially in countries that have failed to curtail the use of asbestos as the United States did back in the 1970s.

"Asbestos fiber use outside the U.S. far exceeded use in North America and continued for many years at high numbers," Hartley said.

While asbestos use in the United States had nearly run its course by the 1970s, it continues in other parts of the globe, particularly in the heavily populated countries of Russia, China and India, among the leading consumers and producers of asbestos in this decade.

Other factors for this global expansion include increasing global advocacy by plaintiff's firms, class actions growing "in favor around the world," entrepreneurial investment and increased publicity through the Internet, according to Hartley.

Ironically, Hartley said, that as European nations begin to feel the pressure of asbestos litigation -- including the rise of potential class action lawsuits -- the courts are seeking ways to avoid "the American result," he said.

Most attorneys in places like Madison County have no shortage of cases to file locally, be they in-state plaintiffs or ones from across the country.

For these attorneys, it is far easier to walk across the street from a law office to the Madison courthouse -- with long-established protocol -- than it is to learn the customs, language and law of another country. Nevertheless, as the rise of asbestos globally grows, American firms will play a role.

Asbestos in the UK

Claims of mesothelioma, the deadliest of asbestos-caused diseases, have risen dramatically in the United Kingdom in recent years. A 2008 update of the UK Actuaries found that insurance claims are occurring in far greater number.

"In the 2004 paper, it was estimated that around one-third of mesothelioma sufferers were making insurance claims," the UK Actuaries wrote. "The asbestos working party has obtained claimant level data that gives a more reliable estimate of this proportion, and has shown that this proportion has risen from 36 percent in 2003 to 56 percent in 2007."

Further, political negotiations could soon result in Prime Minister Gordon Brown overruling a 2007 decision by the House of Lords to disallow compensation for pleural plaques -- a disease that leads to the thickening of tissue around the lungs -- because there is no proof the condition leads to other deadly diseases like mesothelioma.

Hartley has been following this on his blog as the decision could open the door to a high number of new cases among those with far less injury than people dying of mesothelioma.

"The UK government had said it would provide its position during November 2008, but did not do so," he wrote. "On Feb. 11, however, Gordon Brown publicly said the government will 'soon' announce its view."

A British columnist wrote that Brown is likely to cave into Labour party demands on this issue and overturn the House of Lords.

"Labour MPs representing industrial areas were flooded with protests and for many it has been one of their biggest postbag issues," Toby Helm wrote in the UK Guardian. "Sufferers – there are many thousands – said that, while the proportion who went on to develop deadly illnesses was small, just being diagnosed with them was enough to cause huge anxiety and often depression."

Helm believes Brown will use the issue as a bargaining tool, and allow payements "somewhere in the region of (7,000 pounds) each."

To date, the announcement has not been made, but even if payments are allowed, it would leave open the possibility of further payments should "a second disease subsequently emerge," Hartley said.

Scotland held hearings and passed legislation allowing for plaques to be compensated, though it is waiting to see if Brown will help cover the cost.

As Hartley noted, England is just one of many countries worldwide – including those as diverse as South Korea, South Africa, Spain, Brazil and Switzerland – to be dealing with the issue of asbestos litigation.

Global entrepreneurial interests rising

The proliferation of asbestos-related disease has sparked increased interest in cross-cultural legal partnership and even outside investment in law firms from financial institutions.

As entrepreneurial efforts related to legal action grows in many areas, the billions in asbestos will find no shortage of backers to expand litigation efforts. Across the globe "litigation funders" are found in places like the Netherlands and Australia.

"Hedge funds have invested in litigation as an industry and have made capital available to fund legal ventures," Hartley said.

Hartley likens this international trend to state attorneys general hiring private lawyers to pursue large lawsuits, as was common in tobacco litigation. Hartley offered one example of the Nigerian government suing cigarette companies, with U.S. plaintiff's firms involved as co-counsel.

This type of global partnership faces a steep learning curve. American law firms have to deal with the language barrier, though Hartley admits modern tools like translation engines could potentially minimize this barrier. Differences in laws between countries remain a significant obstacle.

"Many U.S. lawyers today are relatively un-informed regarding civil law, but that is changing as firms branch out and evaluate joint ventures," he said.

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