The owner of Garlock Sealing Technologies LLC has agreed to pay $480 million to settle with current and future asbestos claimants. A new bankruptcy plan, if approved, would free the pipeline sealer and its related entities from the claims over its gaskets and other equipment for good. EnPro Industries Inc. reached an agreement with the committees representing current and future asbestos claimants in North Carolina bankruptcy court to create a trust that would eventually have $480 million in it – $400 million up front, with another $80 million added before the first anniversary of the agreement – to resolve the claims by people who say they were harmed by Garlock’s products.
The “comprehensive” agreement would permanently resolve current and future claims against Garlock and Coltec Industry Inc., the direct parent of Garlock and direct subsidiary of EnPro, and protect EnPro from facing the claims, according to the company. The settlement must be approved by the claimants, the bankruptcy court and the district court overseeing the case, EnPro said.
Barring any unexpected objections to the plan and assuming at least 75 percent of asbestos claimants will be in favor of it, the company estimates the plan could be approved by summer 2017. “This comprehensive, consensual settlement will bring us full, complete and permanent relief from asbestos litigation and will achieve complete and total peace with the asbestos Plaintiff’s bar,” EnPro CEO Steve Macadam said in a statement.
According to Macadam, the settlement will also shave off the expenses associated with the asbestos claims resolution process, which cost the company about $25 million in 2015. EnPro said the present value, after tax, of the contributions to the trust would be $284 million. The company has also promised up to $17 million, before tax, to resolve current and future Canadian asbestos claims, but negotiations for that arrangement are still underway, EnPro said.
In January 2015, Garlock had said it agreed to a $358 million settlement with future asbestos claimants, a group that had broken ranks with the rest of the claimants, court records show. The current claimants said at the time that the offer was “far from sufficient.” The personal injury asbestos claimants objected in September to Garlock’s request that 13 firms provide information on payments to thousands of non-mesothelioma claimants, telling a North Carolina bankruptcy court that such discovery would be “overkill.”
The committee is represented by Trevor W. Swett III, James P. Wehner and Elihu Inselbuch of Caplin & Drysdale Chtd. and Travis W. Moon of Moon Wright & Houston PLLC. The case is in the U.S. Bankruptcy Court for the Western District of North Carolina.
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