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Friday, August 9, 2013

Debtors’ in asbestos bankruptcy case appeal estimation decision to Third Circuit

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But then came Fitzgerald’s 50-page May 20 memorandum opinion in which the Delaware-based jurist estimated the liabilities of Specialty Products Holding Corp. and Bondex International to be in the neighborhood of $1.1 billion, many millions of dollars higher than what the debtors contended the true figure to be.

An expert working for the bankrupt companies – they are referred to as ‘debtors’ in bankruptcy proceedings as opposed to ‘defendants’ in the tort system – had estimated total future liabilities at between $465 million to $700 million nominal or $300 million to $575 million net present value.

In the end, Fitzgerald, who retired from the bench shortly after rendering her decision in the case, estimated the liabilities to be closer to the figures thrown out by attorneys representing the Official Committee of Asbestos Personal Injury Claimants and the Future Claimants’ Representative, numbers that were in the billion-dollar range.

Appropriate estimate

In her May decision, Fitzgerald wrote that after considering all of the evidence in the case, exhibits and arguments presented to the court during a weeklong estimation hearing in Pittsburgh earlier this year and during subsequent briefs and other legal filings, she considered an appropriate estimate for mesothelioma claims, pending and future, to be $1.1 billion net present value.

The judge also determined that an additional six percent, or $66 million, would have to be...

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