Dana Agrees to Settle 7,500 Asbestos Claims
The Associated Press - Dana Corp., an auto-parts supplier, is agreeing to pay over 7,000 personal injury claimants a total of $2 million to resolve their lawsuits stemming from asbestos-laden gaskets that were produced by the company.
Papers that were filed Friday with the U.S. Bankruptcy Court in Manhattan reported Dana calling the settlement a "reasonable and expedient way" to resolve the claims without going through the litigation process.
On Nov. 15 a court hearing is scheduled for the proposed settlement.
Dana Corp. makes axles, drive shafts and other automotive parts and sought Chapter 11 bankruptcy protection in March 2006. The company, which is based in Toledo, Ohio, is trying to exit bankruptcy protection through a reorganization plan that calls for unsecured creditors to collect between seventy-two and eighty-six percent on their outstanding claims.
Any asbestos-related personal-injury claims which as of June 30 totaled 150,000 will go through the bankruptcy process as planned, said Dana. The company indicated, however, that many of the claimants have not yet become ill. Court papers show that around 7 percent of the asbestos claims filed against Dana are for mesothelioma or other cancer diagnoses.
"A large majority of cases filed against Dana do not involve any of Dana's products and ultimately are dismissed," the company said. Asbestos claims "were not a significant factor in Dana's decision to file its Chapter 11 case or a driving force in its decision to move ahead with Chapter 11 proceedings."
Dana reported that it pursued settlements to avoid additional litigation costs. The latest settlement, which will total a maximum of $2 million if all claimants are able to submit the necessary proof to support their claims, will resolve around 7 percent of the mesothelioma claims and 4 percent of the cancer claims that have been filed against the automotive parts manufacturer.
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