Claims News Service, Jan.31, 1:11 p.m. EST — U.S. Gypsum Corporation has reached an agreement to resolve all present and future asbestos-related personal injury claims, the company announced.
USG and its subsidiaries filed bankruptcy petitions in 2001 in order to resolve asbestos claims. The resolution involved establishing and funding a personal injury trust to pay the claims. The trust will be funded initially with $900 million in cash. An additional $3.05 billion in the form of a contingent note also is required, but won't be paid immediately. According to a release from USG, the contingent note will be paid only if national trust fund legislation fails to pass a congressional vote.
The legislation in question, entitled The Fairness in Asbestos Injury Resolution Act of 2005 (FAIR), was referred in May 2005 to the House Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises. If Congress passes the FAIR Act as currently drafted, USG's payments for personal injury claims under the agreement would be limited to $900 million.
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