Earlier this year, at least four asbestos bankruptcy trusts including WR Grace, Babcock & Wilcox, Pittsburgh Corning and Owens Corning, issued notices regarding their intent to destroy data and documents submitted by claimants that have qualified for payment.
Pursuant to these proposed record retention policies, the trusts plan to begin the destruction of data and documents in for resolved claims that (1) were issued payment more than one year ago, or (2) were withdrawn more than one year ago. Copies of these records will remain available until April. The trusts will, however, continue to maintain claimant releases, any records required for trust purposes, and records that must be kept to comply with applicable law.
According to the trusts, the proposed updated record retention policies are to enhance the protection of personal and sensitive information. On the other hand, if allowed, the destruction of data and documents relating to resolved claims would inhibit trust transparency efforts and data needed for debtors and other parties to conduct discovery in pending or future bankruptcies.
Congress amended Section 524 of the Bankruptcy Code in 1994 to allow for the creation of settlement trusts that would pay both current and future asbestos claimants. To date, approximately 60 bankruptcy trusts are in operation. Claimants today generally file claims with numerous trusts for alleged harms caused by bankrupt companies’ asbestos products.
We anticipate more asbestos trusts will issue similar notices regarding the intent to destroy data and documents pertaining to resolved claims. For now, the trusts that have issued such notices have warned that interested parties must download data and documents for resolved claims prior to their destruction.
Read the WR Grace notice here.
Read the Babcock & Wilcox notice here.
Read the Pittsburgh Corning and Owens Corning notice here.
