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Dr. Mullin illustrates the strategic importance of regulatory
and environmental changes on forecasting asbestos liabilities at ACI Conference
WASHINGTON, D.C., June 30, 2006—Dr. Charlie Mullin, a Partner in Bates
White’s Environmental and Product Liability Practice spoke at American
Conference Institute’s (ACI) 7th National Asbestos Claims Conference on
Thursday, June 15 in Las Vegas, NV. Dr. Mullin participated in a panel on “
Asbestos Legislative Initiatives for Federal And State Tort Reform.” He
discussed the impacts that the Fairness in Asbestos Injury Resolution Act (FAIR Act)
and state-level legislative and judicial tort reform have had on plaintiff settlements
and defendant company expenditures.
Dr. Mullin provided an overview of the new federal asbestos legislation
proposed by Senator Arlen Specter, the FAIR Act of 2006 (S.3274), and demonstrated
that the new FAIR Act proposal suffers from the same fundamental flaws as the
original 2005 Bill. As Bates White first showed in its September 2005 report on the
FAIR Act, the proposed combination of defined benefits and defined contributions
remains financially unviable.
Dr. Mullin supported Bates White’s conclusion by also reviewing the
June 5, 2006, Senate Committee on the Judiciary hearing in which Douglass
Holtz-Eakin—the former Director of the Congressional Budget Office (CBO)
and head of the agency at the time the original CBO analysis on the Bill
was published—provided testimony.
Dr. Holtz-Eakin noted “it is implausible
to take the FAIR Act at face value,” and concluded that the trust fund is
not financially viable in the long term.
He also gave credence to the fundamental assumptions that differentiates
Bates White’s forecast noting “it is necessary to anticipate the
behavior of claimants in an entirely new environment.” Dr. Mullin then
highlighted the effect that the uncertainties surrounding the potential passage of
the FAIR Act or similar legislation have had on the outstanding asbestos bankruptcy
cases.
Dr. Mullin’s presentation also focused on recent events and trends
taking place in today’s tort environment. He stressed the importance of
understanding these developments in the context of making informed decisions and
devising winning defenses. He demonstrated the impact on the overall claiming
environment of state legislative changes (e.g., stricter medical criteria and
inactive dockets, and judicial rulings, including Judge Jack’s Silica MDL
ruling in Texas. More specifically, he showed that properly accounting for these
changes and the economic factors that drive most non-malignant claims directly affects
future forecasts of non-malignant claim filings.
About Bates White
Bates White is a national economic consulting firm of more than 150 professionals.
Established in 1999, Bates White offers consulting services in economics,
finance,
and business analytics. Bates White has offices in Washington, D.C., and San
Diego, Calif.
www.bateswhite.com
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