Mr. Brickman spoke on "Administration of Large Bankruptcy Reorganizations: Has Competition for Big Cases Corrupted the Bankruptcy System?" before the House Judiciary Committee's Subcommittee on Commercial and Administrative Law.

The questions raised by his testimony came as the Senate leadership continues to wrestle with legislation designed to set up an alternative claims handling process for workers who allege they were injured by exposure to asbestos in the workplace.

Regarding the negotiations, Mr. Brickman said, "No end is yet in sight."

He called class action litigation over asbestos claims "a weapon of mass business destruction [that] cuts deeper and deeper into the American industrial process and product distribution system."

Mr. Brickman predicted, "If the litigation continues along its current path, many more bankruptcies will ensue?scores if not hundreds of companies, big and small, will almost certainly succumb, as will a number of insurance companies."

Among his findings is that beginning in the mid-1980s and continuing to this day, "asbestos litigation has become increasingly driven by the entrepreneurial activity of plaintiff lawyers who sponsor mass recruitment efforts by enterprises created by individuals with no background in health administration, specifically and solely to generate claims."

Regarding so-called "pre-packs," Brickman said, "? because pre-pack negotiations take place in secret, select groups of claimants whose lawyers are part of or know about the negotiations are able to receive more favorable treatment than other similarly situated claimants."

He added, "Such discriminatory actions would be objectionable in any context, but are especially objectionable because some of the targets of the discrimination are persons who have suffered actual injury."

The discrimination is in the form of pre-petition settlements in trust that pay a small group of current claimants nearly full value for their claims, leaving "much smaller" amounts to be paid to the majority of claimants after the deal is closed, "with significantly more stringent qualifying requirements," Mr. Brickman said.

Mr. Brickman also told the panel that a dominant feature of asbestos claiming today which has its origin in the early-mid-1990s "is the enormous increase" in the claims of so-called "1/0 asbestosis" by unimpaired persons.

It is these unimpaired claims that are being created by screening conducted under the auspices of trial lawyers who recruit the potential patients. He said this is occurring in "the teeth of reports of leading medical researchers who have called asbestosis a "disappearing disease," and a condition that is "exceedingly rare."

Other medical researchers have stated that "we have not seen a single case of significant asbestosis with first exposure during the past 30 years," Mr. Brickman reported.

Staff officials of the American Insurance Association, whose members include most of the insurance companies hard hit by asbestos claims, said after the hearing that Mr. Brickman's testimony confirms that change is needed in the asbestos claims settlement process.

"The entire pre-packaged bankruptcy process has been shamelessly abused and is now rife with startling conflicts of interest," said Leigh Ann Pusey, AIA senior vice president, government affairs. "As a result, pre-packaged asbestos bankruptcies have become wonderful tools for further enriching personal injury lawyers, but for people dying of asbestos-induced disease, creditors, insurers and the civil justice system, they are a travesty.

"The ?pre-packs' deserve close congressional scrutiny," she said.