The Florida Supreme Court in the US recently upheld a US$ 31 million award against Owens Corning for an asbestos-related death, saying the company showed “blatant disregard for human safety.”
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The Florida Supreme Court in the US recently upheld a US$ 31 million award against Owens Corning for an asbestos-related death, saying the company showed “blatant disregard for human safety.” According to a recent report, the award was one of the largest punitive damage verdicts ever in Florida and the largest asbestos award against the big building-products maker. The man who sued Owens Corning (OWC), Deward Ballard of Aberdeen, Mississippi, died several months ago of a rare lung cancer he contracted because of exposure to Kaylo, the asbestos-contaminated insulation sold by the company. Ballard never expected to see the money, which a West Palm Beach jury awarded him in January 1997 on top of US$ 1.8 million to compensate him for lost wages and medical expenses. At the time, Ballard said he only had 12 to 15 months to live. The money will go to Ballard“s estate, according to lawyer John Venable. Ballard had said he would give whatever he wins to the Shriners Hospitals for Crippled Children. Owens-Corning sold Kaylo from 1953 to the mid-1970s. Ballard, a former electrician, said he“d been exposed to asbestos while working around the country. Ballard originally sued 22 companies that mined, manufactured or sold products with asbestos, including W.R. Grace & Co. of Boca Raton, Fla. He settled with all the companies except Owens Corning. The 4th District Court of Appeal in West Palm Beach upheld the US$ 31 million award in April 1998, ruling that Owens Corning made a “purely economic decision” not to warn its customers that exposure to Kaylo could cause cancer. Florida“s high court voted 5-1 to uphold that decision. Owens Corning had appealed the original ruling on several points, including its contention that the case shouldn“t have gone to trial in Florida and that the jury“s verdict was excessive. Owens Corning had claimed because it had 7,000 pending Kaylo-related cases, the US$ 31 million award would bankrupt the company. But the appeals court said Owens Corning showed no proof that would happen. Shares of Owens Corning have been on a roller coaster ride for the past two years because of the suits and other factors. Management missteps in 1997 derailed a turnaround campaign began in 1992, sending profits tumbling in the midst of a housing market boom. Last year saw more costly restructuring, and a US$ 1.4 billion pretax charge in the fourth quarter to finance settlement of thousands of damage claims by sufferers of asbestos-related illnesses. Potentially huge asbestos liabilities had been hanging over the company“s finances for years. In June, the US Supreme Court rejected a complex US$ 1.54 billion asbestos-related settlement, an action that could leave some companies that have huge legal liabilities no alternative to filing for bankruptcy protection. The justices ruled 7-2 that lower courts had incorrectly approved a class-action settlement involving a unit of Owens Corning. That decision put extremely tight restrictions on the so-called limited-fund class action, a popular arrangement that limits a company“s liability because there aren“t sufficient assets to pay all the claims. Eliminating that method of resolving massive claims could force companies into bankruptcy-court proceedings. However, the high court signalled that it was uncomfortable with that stark choice and said the situation “cries out for a legislative solution.” But Congress isn“t likely to make changes in rules involving class-action lawsuits. Such suits produce huge fees for trial lawyers, who are major political contributors to lawmakers.