The United States Supreme Court ruled in favor of Traveler Companies, Inc. by finding a lower court erred in overturning the approval of the company's nearly $500 million settlement of asbestos-related litigation.
Reuters reports that on Thursday, the U.S. Supreme Court ruled for Travelers, one of the largest property and casualty insurance companies in the country, by reversing the decision of a U.S. appeals court on the grounds that it erred in overturning the approval of the companies' nearly $500 million settlement of all asbestos-related claims.
At issue, was a condition of the settlement that would bar any new lawsuits against Travelers stemming from its relationship with Johns Manville Corp.
Johna Manville was once the country's largest miner of asbestos and a major manufacturer of asbestos-containing products. Travelers was Manville's primary insurer from 1947 through 1976. Since that time, it has been determined that exposure to asbestos can increase the risk of lung cancer, mesothelioma and other illnesses.
In 1986, Travelers argued that all asbestos-related claims should be paid out a trust created by Johns Manville. A federal bankruptcy judge agreed and Travelers put about $80 million into the trust.
In 2003 and 2004, Travelers reached a settlement with several groups of plaintiffs in which they would pay nearly $500 million dollars on the condition that the federal court bar any similar asbestos-related lawsuits in the future.
In 2006, a bankruptcy court judge and federal judge approved the settlement. However, last year, a U.S. appeals court overturned the approval on the grounds that the bankruptcy judge lacked the authority to bar new lawsuits.
The Supreme Court disagreed and overturned the decision of the appeals court and reversed the ruling.
In a 7-2 decision, Justice David Souter, writing the opinion on behalf of the majority, stated the bankruptcy judge's orders barred state-law actions against Travelers based on allegations of its own wrongdoing while acting as Manville's insurer or misuse of information obtained from Manville.
Justice Souter added that the finality of the 1986 orders generally stand in the way of challenging their enforceability.
Author's name: Gabriel Dorman
Author's e-mail: gabedorman@gmail.com
Author's blog URL: www.criminaldefenseduilawyer.com/blog/
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