Settlements and Releases in Asbestos Cases

Decisions in our library in which the court ruled on enforcing or interpreting a settlement or release: 203 cases, by state. Each line gives what the court held, in our words; the law differs from state to state and changes, so read the opinion and talk to a lawyer before relying on any of them.

About this issue

Most asbestos claims settle. Decisions in this section arise when a settlement goes wrong:

• Was there an enforceable agreement, and who had authority to make it?
• What claims does a release cover? A common question is whether a person who settled a claim for asbestosis or pleural disease also released a later claim for mesothelioma or lung cancer. The answer depends on the release's terms and the governing law: under some law a broad release can cover unknown future diseases, and other law limits that.
• Whom does a release cover? A release can discharge parties beyond the company that paid, such as affiliates, successors or other defendants, depending on its wording.
• Does a settlement by the injured person bar the family's later wrongful death claim? That depends on the state's wrongful death law and who signed: some states bar the later claim, others allow it.
• How are settlement payments allocated among family members, and approved for minors or estates? How do settlements affect the remaining defendants' share? See settlement credits.

Alabama

• McGUFFIE v. Mead Corporation (2014). Predicting Alabama law, the court applied a two-injury rule so the mesothelioma claim was not time-barred by an earlier asbestosis diagnosis, but an unambiguous release of a company's former parents, stockholders and successors from future asbestos claims bars the suit, because inadequate consideration alone does not invalidate a written release.

Alaska

• Peek v. Skw/clinton (1993). An employer may use the "last injurious exposure" rule as a defense where the employee settled with the last potentially liable employer who was properly before the Board. The Board's finding that the last employer's exposure was a substantial factor was supported by substantial evidence.

Arkansas

• Gray v. BNSF Railway Company (2023). Under FELA Section 5, a release containing a broad laundry list of unknown future claims and exposures does not bar a later claim. The 2004 release failed under both the Sixth Circuit's Babbitt and the Third Circuit's Wicker tests, and the 2017 release was ineffective as an overbroad general release.
• Kimmons v. Autozone, Inc. (2022). Cross-claims for indemnity, contribution, or allocation of fault are moot, with no live case or controversy, once every defendant asserting them has been dismissed from the lawsuit and no longer faces liability.

California

• Darden v. Western Asbestos Settlement Trust (In re Western Asbestos Settlement Trust) (2022). Under California law, a third party not named in a release may enforce it if a reasonable person in the releasor's position would understand it was intended to cover that party, and claim preclusion under the primary rights theory bars a second asbestos claim against a predecessor in privity with the released defendant. A trust that compensates asbestos exposure claims need not pay heirs' wrongful death claims when no underlying compensable claim exists.
• Darden v. Western Asbestos Settlement Trust (In re Western Asbestos Co.) (2021). A California wrongful death claim belongs to the heirs, so a decedent's release does not bind them. A confirmed plan and trust documents are a contract, and where they unambiguously compensate only claimants who were exposed to asbestos and have a covered disease, the trust need not pay heirs' independent wrongful death claims.
• Darden v. Western Asbestos Settlement Trust (In re Western Asbestos Co.) (2021). Under California law a third party may enforce a general release if the contracting parties intended to benefit it, and a release of a successor's 'predecessor entity' covered the predecessor's negligence liability. A dismissal with prejudice of the same primary right in the earlier suit also barred the later claim by claim preclusion.
• Khosravan v. Chevron Corporation (2nd Appellate District, 7th Division, 2021). A section 998 settlement offer that requires the plaintiff to indemnify the defendant against future claims by unidentified nonparties cannot be accurately valued, so it is not a valid offer for shifting expert witness fees.
• Alfaro v. Colgate-Palmolive Co. (Laosd Asbestos Cases) (2nd Appellate District, 4th Division, 2018). A trial court may not deny a prevailing party its statutory costs under Code of Civil Procedure sections 1032 and 1033.5 based on the losing party's inability to pay. Under section 998, the court may consider ability to pay when deciding expert witness fees, but only after assessing whether the offer was reasonable and made in good faith.
• Marteney v. Elementis Chemicals Inc. (2nd Appellate District, 4th Division, 2018). A pending appeal from the original plaintiffs' judgment did not strip the trial court of jurisdiction over the heirs' separate wrongful death claims, and a nonsettling defendant gets a section 877 credit for settlements the heirs did not sign only if those settlements bind the heirs.
• Stewart v. Union Carbide Corporation (2nd Appellate District, 4th Division, 2017). A spouse who could have sought postdeath loss of consortium damages in the injured spouse's earlier personal injury trial is barred by res judicata from claiming them in a later wrongful death action. Unallocated settlements may be credited against a wrongful death economic damages award, and an overbroad allocation is not reversible where a smaller allocation would still offset the whole award.
• Flintkote Co. v. Aviva Plc (2016). Under California law and Fuller-Austin, an excess insurer's obligation to pay amounts the insured is 'obligated to pay' to a section 524(g) asbestos trust is limited to the trust's payment percentage, not the liquidated value. California Insurance Code section 1616 mandates a bond from a nonadmitted alien insurer that files a pleading.
• Flintkote Company v. Aviva Plc (2016). Under California law, following Fuller-Austin, an insurer whose policies cover sums the insured is 'obligated to pay' owes only the payment percentage the insured's § 524(g) asbestos trust actually pays claimants, not the claims' full liquidated value. Cal. Ins. Code § 1616 makes a bond mandatory for a nonadmitted alien insurer filing pleadings.
• Hellam v. Crane Co. (1st Appellate District, 4th Division, 2015). Preverdict settlements are credited against economic damages by the Espinoza method regardless of the settling defendants' fault, while postverdict settlements are credited under the Torres method, and a settlement executed after the verdict is a postverdict settlement. A court need not reduce a judgment for uncertain future asbestos bankruptcy trust recoveries that have not been received.
• Farag v. ArvinMeritor, Inc. (2nd Appellate District, 3rd Division, 2012). A section 998 offer may be made jointly to husband and wife without allocation, because a personal injury cause of action is community property and either spouse can accept on behalf of the community. The court also noted the argument was not properly raised in the trial court.
• Adams v. Ford Motor Company (2nd Appellate District, 1st Division, 2011). A prevailing defendant's section 998 offer is presumed reasonable when it wins a more favorable judgment. The trial court has discretion to award expert fees incurred before or after the offer, and the party challenging the costs must show they were unreasonable or unnecessary.
• Hankins v. Asbestos Defendants (bhc) (1st Appellate District, 4th Division, 2010). Under Code of Civil Procedure section 377.60 and 377.61 the trial court determines the heirs' respective shares of a wrongful death award, and an appellant must show error with an adequate record; on an inadequate record the allocation was not shown to be erroneous.
• Garcia v. Duro Dyne Corporation (1st Appellate District, 1st Division, 2007). A nonsettling defendant is not entitled to a Code of Civil Procedure section 877 offset for settlement monies until they are actually paid, and cost-waiver releases with defendants who would have prevailed at trial have offset value, with the burden of proving that value on the settling plaintiffs.
• Wilson v. John Crane, Inc. (1st Appellate District, 4th Division, 2000). Civil Code section 1431.2 (Proposition 51) applies to strict products liability claims, so a defendant's liability for noneconomic damages is several only and proportional to its fault. Settlement sums allocated to loss of consortium and potential wrongful death claims are not credited against a personal injury judgment.
• General Dynamics Corp. v. Wcab (2nd Appellate District, 4th Division, 1999). Res judicata does not bar a workers' compensation claim for a different injury, and a prior compromise and release bars a later asbestos claim only if the asbestos injury existed when it was settled. The record here lacked the medical evidence needed to decide that.
• Armstrong World Industries v. Aetna Cas. & Sur. (1st Appellate District, 1st Division, 1996). For asbestos bodily injury, coverage is continuously triggered from the claimant's first exposure to the policyholder's own products, and each triggered policy must respond in full up to its limits without the policyholder sharing in uninsured periods. 'Expected' injury means injury the insured subjectively knew to be practically certain, and a company acquired after a policy expired is not a named insured under it.

Colorado

• Church v. Dana Kepner Company, Inc. (2013). Confidentiality agreements do not shield settlement information from discovery, but under Colorado's apportionment statutes settlement amounts with nonparties are not relevant to apportioning fault or calculating damages; only the fact of settlement is discoverable.

Connecticut

• RT Vanderbilt Company, Inc. v. Hartford Accident and Indemnity Company (2017). In long-latency asbestos claims, Connecticut applies a continuous trigger as a matter of law, with pro rata time-on-the-risk allocation and an unavailability-of-insurance rule. Pollution exclusions bar coverage only for traditional environmental pollution, while occupational disease exclusions reach claims by employees of any employer.
• RT Vanderbilt Co. v. Hartford Acc. & Indem. (2016). For long-latency asbestos disease claims, Connecticut applies a continuous trigger as a matter of law, with pro rata time-on-the-risk allocation and an unavailability-of-insurance rule. Standard pollution exclusions bar coverage only for traditional environmental pollution, and occupational disease exclusions unambiguously reach claims by employees of other employers.

Delaware

• Weddle v. BP Amoco Chemical Company (2020). Under 19 Del. C. § 2350(f), a claimant whose position before the Board was affirmed on appeal may receive a reasonable fee, determined using the Cox factors. The court may reduce requested hourly rates that are not shown to match rates customarily charged locally.
• Weddle v. BP Amoco Chemical Company (2019). Delaware treats each asbestos-related disease as a separate accident, so a workers' compensation settlement of an earlier disease cannot waive compensation for a different disease that had not yet manifested; such a waiver is void.
• Aiu Insurance Company v. Philips Electronics North America Corporation (2018). A contract clause giving insurers the right to "audit" payments made by an asbestos trust is ambiguous where both parties' readings are reasonable, so extrinsic evidence is needed. A non-party trust cannot be bound to the settlement agreement, and offset claims fail without pleaded conditions precedent.
• In re Viking Pump, Inc. (2016). Under New York law, anti-assignment clauses do not bar assignment of insurance rights for losses that occurred before the assignment. Whether defense costs are covered, and whether they erode limits, depends on each policy's language, with ambiguities construed against the insurer. Asbestos injury is a continuous process that begins at significant exposure and continues, so it is not limited to the period of exposure.
• In re WR Grace & Co. (2012). A Chapter 11 asbestos plan satisfies Section 524(g) and the Bankruptcy Code if its trusts, channeling injunction, claim classifications and payment procedures treat similar claims alike. Liability insurance policies and their proceeds are property of the debtor's estate, and Bankruptcy Code Section 1123(a)(5)(B) preempts anti-assignment clauses in insurance policies.
• Farrall v. Atlas Turner (In re Asbestos Litigation Limited TO Farrall) (2011). A clear and unambiguous general release covering known and unknown, unmanifested injuries from asbestos exposure bars a later suit for a long-latency disease such as mesothelioma, absent fraud, duress, coercion or mutual mistake.
• In re Federal-Mogul Global, Inc. (2010). Under the 1994 asset purchase agreement, indemnity obligations ran only between the parties to it and their successors, not to PepsiAmericas, which was not a party or third-party beneficiary and whose corporate affiliation with the seller ended before 1994.
• In re ACandS, Inc. (2004). A § 524(g) channeling injunction requires a trust that will value and pay similar present and future claims in substantially the same manner, and a plan that gives secured preference to some claimants and was driven by a plaintiffs' lawyers committee cannot be confirmed under § 1129(a)(1) or (a)(3).
• Farrall v. AC & S. Co., Inc. (1990). Under 10 Del.C. § 6304, the reduction of a plaintiff's award is the greater of the total paid by all released tortfeasors or their combined pro rata share, applied once as an aggregate and not separately for each released tortfeasor. A lump-sum settlement is credited in full and is not allocated among diseases.

District of Columbia

• Fearson v. Johns-Manville Sales Corp. (1981). A claim for lung cancer accrues when the cancer is diagnosed, not when earlier, separate asbestosis was diagnosed. A voluntary compensation settlement never approved by a deputy commissioner, judge or board is not an "award in a compensation order" that assigns the claimant's third-party rights to the employer under § 33(b).

Florida

• Taylor v. Georgia-Pacific, LLC (2015). A settlement with non-diverse defendants does not support removal on diversity grounds until those defendants are formally dismissed, and uncertainties about removal jurisdiction are resolved in favor of remand.

Hawaii

• Dias v. Fisher Controls Int'l (In re Hawaii State Asbestos Cases) (2017). Under HRS § 663-15.5 and Troyer v. Adams, a trial court has discretion to find a settlement in good faith under the totality of the circumstances. Where settlements are confidential, disclosing the settling parties and the aggregate amount can give non-settling defendants sufficient information.
• Nobriga v. Raybestos-Manhattan, Inc. (1984). Adherence to government specifications is not an absolute defense to strict liability where the product is inherently dangerous because of the specified material. Under HRS § 663-14, multiple separate releases must be treated collectively, so the verdict is reduced by the total consideration paid or the releasees' total liability share, whichever is greater.

Illinois

• Daniels v. ArvinMeritor, Inc. (1st District, 4th Division, 2019). A trial court may use the standard Illinois pattern proximate-cause instruction in an asbestos case, and need not give a 'substantial factor' instruction. A manufacturer that actually knew of the danger is not entitled to a 'state of the art' instruction, and settled defendants need not appear on the verdict form.
• John Crane, Inc. v. Admiral Insurance Company (1st District, 2nd Division, 2013). Under Zurich, coverage for asbestos personal injury claims is triggered by proof of exposure, sickness, or disease, and all triggered policies are jointly and severally liable for all sums up to their limits. Under horizontal exhaustion, the insured must exhaust the original primary limits before excess or umbrella insurers must pay, and an agreement amending those limits after the fact cannot lessen that requirement.
• John Crane, Inc. v. Admiral Insurance Company (1st District, 2nd Division, 2013). Under Zurich v. Raymark, coverage for asbestos personal injury claims is triggered by proof of exposure, sickness, or disease, and all triggered policies are jointly and severally liable rather than pro rata. Horizontal exhaustion requires the insured to exhaust all triggered primary policies at their original limits before excess coverage applies, and an insured and primary insurer cannot lessen those limits by retroactive amendment.
• Buckles v. Hopkins Goldenberg, PC (5th District, 2012). A summary judgment for one lawyer on a count about his post-discharge conduct has no res judicata effect on a separate count against his former firm for pre-discharge conduct, and proximate cause in a legal malpractice case is generally a fact question that cannot be decided as a matter of law where reasonable persons could differ.
• Pritchett v. Asbestos Claims Mgt. Corp. (5th District, 2002). An oral settlement made through an agent for a single sum is enforceable, and where it is silent on the point, the promisors are jointly and severally liable under Illinois law. Accepting a check that paid less than the full amount was not an accord and satisfaction without an honest dispute with the plaintiff over the amount due or an understanding that the check was full payment.
• US Gypsum Co. v. Admiral Ins. Co. (1st District, 5th Division, 1994). Under Illinois law, an insured's liability in the underlying cases need not be re-proved in the coverage action; asbestos-building-material property damage is covered, the own-product exclusions do not bar removal costs, and coverage is triggered continuously rather than at discovery. The number of occurrences depends on the cause of damage, and all triggered primary coverage must be exhausted before excess policies attach.
• Board of Education v. A, C & S, Inc. (1989). Friable asbestos-containing material contaminating a building can be pleaded as physical damage to other property, so tort claims are not barred by the economic loss doctrine. School districts suing to recover abatement costs assert a public right and are not subject to the statutes of limitations.

Indiana

• Aurand v. Norfolk Southern Railway Company (2010). Under FELA, a release is evidence of the parties' intent but not conclusive, and boilerplate lists of waived claims are viewed skeptically. Whether the release covered a particular disease depends on disputed facts about the parties' intent and the employee's knowledge, which a jury should usually decide.
• Casper v. LE Isley & Sons, Inc. (2007). Under Ind. Code § 22-3-7-36(b), an employer is released from liability for compensation once the employee has settled with third parties and received no compensation from the employer, so dismissal is not premature even if further bankruptcy trust claims may be filed.
• Roberts v. ACandS, Inc. (2004). Under Ind. Code 22-3-7-36(b), an employer's liability for occupational disease compensation ends only when the employee's third-party action is fully concluded by settlement or a paid judgment, not when the employee settles with just one of several third-party defendants.

Kentucky

• Fleischman v. CSX Transportation, Inc. (2007). Under Babbitt, a FELA release that settles a specific, pending asbestos claim for payment can bar a later mesothelioma claim when mesothelioma was a known possible result of asbestos exposure at signing. Under FELA's discovery rule, a claim accrues when the plaintiff knows or reasonably should know both the injury and its cause.

Louisiana

• Hotard v. Avondale Industries, Inc. (2024). Accepting the pleaded allegations as true, Avondale and Hopeman Interests stated plausible claims that their settlement agreements required Hotard to indemnify them for SeaRiver's claims. Louisiana contract-interpretation rules apply, and indemnity must be clearly expressed, so whether the agreements actually cover those claims needs further development.
• Lewis v. Taylor-Seidenbach, Inc. (2024). Under Louisiana law a settlement and release is treated as res judicata between the parties who signed it, and a release of all asbestos-related claims bars later claims on the same exposure, though a remaining defendant may still prove at trial that the released party was a joint tortfeasor to obtain a virile share credit.