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Outlook Dims for Asbestos Reform in Senate

Mon Sep 27, 2004 04:52 PM ET

By Susan Cornwell

WASHINGTON (Reuters) - The outlook dimmed for establishing a fund to compensate asbestos victims this year after the Senate majority leader on Monday left it off a list of priorities for the few days left in the legislative period.

Senate Republican Leader Bill Frist said he had not given up on the legislation. But he wants the Senate to finish work by Oct. 8, so lawmakers will have time to campaign for Nov. 2 elections.

His priorities for the eight or nine remaining legislative working days are intelligence reform, spending bills and other bills already at the "conference" level of negotiations between the Senate and House, Frist told journalists.

Still, the Tennessee Republican declined a reporter's invitation to pronounce asbestos reform dead for the year. "I just don't want to rule it out," Frist said.

He said he and Senate Democratic Leader Tom Daschle had made "huge progress" on the issue and he was working on a response to Daschle's latest bid that accepted Frist's proposal to cap the fund at $140 billion.

Asbestos was widely used for fireproofing and insulation until the 1970s. Scientists say inhaled fibers are linked to cancer and other diseases.

U.S. companies have paid out tens of billions of dollars on hundreds of thousands of asbestos injury claims. Dozens of affected companies, like chemical producer W.R. Grace and Co. and car parts company Federal-Mogul Corp., have filed for bankruptcy.

Daschle and Frist have been trying to set parameters of a fund, to be financed by asbestos defendant companies and insurers, that would compensate victims, while ending their right to sue in courts.

Daschle and Frist were "very close" to a deal on the financing aspects of a fund, Frist noted, but they had not agreed on details such as how many existing asbestos injury claims could stay in court once the fund had been created.

Time constraints and continued disagreement among lawmakers have left observers doubtful a bill can be passed this year.

"I think it's virtually certain that this thing has played out ... between now and the election," said Patrick Hanlon, a Washington lawyer who represents the Asbestos Alliance, a group affiliated with the National Association of Manufacturers.

The issue could still be dealt with in a "lame duck" congressional session after the election, Hanlon noted, but said that appeared unlikely.

"The clock is running out. Nothing has been done in the House (of Representatives). Labor is not supporting this. I'm assuming the trial bar will throw everything they've got at this bill, said Julie Rochman, spokeswoman for the American Insurance Association.

But, she added: "Both sides understand how important the issue is, and neither of them wants to say it's dead."

© Reuters 2004. All Rights Reserved.

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