Asbestos lawsuit forces Christy Refractories into bankruptcy
A St. Louis maker of heat-resistant products has filed for Chapter 11 bankruptcy protection, in hopes that it can better manage the legal liabilities it assumed about 13 years ago.
The Christy Refractories Co. LLC filed its petition last week in the bankruptcy court in St. Louis because of mounting asbestos lawsuits, according to a court filing.
But the lawsuits don’t stem from the company’s current operations. They are from asbestos products sold by a business that Christy acquired in 1995, the company said.
Although the old company was named in asbestos-related cases starting in the 1980s, the frequency increased about eight years ago, according to a court document filed last week.
Christy manager Frank O’Brien said Tuesday that settlements average about $1 million per month and are accelerating. He estimated that more than 1,000 separate lawsuits are pending.
Claims of asbestos-related illnesses typically are dismissed without liability or settled, according to the company’s filing.
The lawsuits include people who were exposed to the asbestos products in schools, steel mills and other commercial and industrial spaces, said Andrew O’Brien, a principal at St pay day loan lenders. Louis-based O’Brien Law Firm P.C., who is representing about 20 separate cases against the company. He is not related to Frank O’Brien.
A trust fund for the lawsuits will be established, and then the bankruptcy court will decide how much money should be put in the fund, Frank O’Brien said. He added that the trust fund will have at least $18 million.
As of Oct. 28, the company had about $18 million in remaining insurance coverage out of an original amount of $45 million, the filing said.
But the bankruptcy filing adds uncertainty for Andrew O’Brien’s clients.
"We have no idea what’s going to happen," he said.
Frank O’Brien said he intends to keep the company in business while it undergoes reorganization, which could take up to a year. As of last week, the company had 23 employees.
Christy Refractories is owned by O’Brien Industrial Holdings LLC. O’Brien Industrial, which is run by Frank O’Brien, and its other subsidiaries are not in bankruptcy.
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