Payments begin in state asbestos settlement

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More than 200 people with asbestos disease have received their portion of a $43 million state settlement to compensate those sickened by asbestos exposure from the former W.R. Grace & Co. vermiculite mine at Libby.

Attorneys for the 1,128 asbestos victims named in the settlement are close to reaching a resolution on another 600 claimants, but for hundreds of claimants it’s a waiting game prolonged by the process of getting a release from Medicare liens.

The District Court in Helena in September 2011 approved the state settlement negotiated by the McGarvey, Heberling, Sullivan & McGarvey law firm in Kalispell and the Lewis, Slovak, Kovacich & Marr law firm in Great Falls.

Jon Heberling, a Kalispell attorney and joint counsel for Libby claimants, said in a statement Friday that many asbestos disease patients are still waiting for release of Medicare liens so they can receive their settlement payments.

In cases where the Grace Libby Medical Plan or private insurance paid for medical expenses, there is no Medicare lien, Heberling said.

“Where Medicare has paid, it has a right by statute to recoup what it paid from settlements obtained by Libby asbestos disease patients,” he said. “Since September when the state of Montana settlement was approved by the court, counsel for the Libby asbestos disease patients have worked closely with Medicare officials to fast track release of the Medicare liens.”

The offices of both Sen. Max Baucus and Sen. Jon Tester have been helpful in moving the process along, Heberling noted.

 “Some fast-track approaches have worked. Some have not,” he said. “It appears we are close to resolution on two more groups of about 450 and 150 claimants.”

The remaining claimants likely will be evaluated individually. Medicare has agreed to an expedited review of these individuals and has assigned a special projects administrator, Heberling said.

In documents sent to asbestos patients as the settlement was coming to fruition, Heberling cited three key factors that brought about the settlement.

First, the Herb Orr et al versus state of Montana lawsuit filed in 2001 set the stage. It involved seven miners and one wife of a miner, all with asbestos disease. The state filed a motion to dismiss the case, claiming that the state had no duty to workers or their families under the Industrial Hygiene Act. The District Court in Helena ruled in favor of the state and dismissed the case, but the McGarvey law firm appealed the decision to the Montana Supreme Court, and ultimately the high court ruled in the victims’ favor in December 2004.

A second factor was the U.S. Bankruptcy Court injunction. In 2005, lawyers for the state and W.R. Grace petitioned the court for an injunction stopping all proceedings against the state of Montana. The Bankruptcy Court granted the injunction, and the case went through two levels of appeal. What eventually culminated was a memorandum of understanding entered in 2009 and the District Court approval of the $43 million settlement on Sept. 8.

A third impetus for the settlement, Heberling said, was Dr. Alan Whitehouse’s general expert report. Whitehouse is a pulmonary specialist who treated Libby asbestos victims for years and documented the unique nature of Libby asbestos exposure.

 “We believe that a factor in the state’s willingness to settle was that we had assembled so much medical proof that the state was unlikely to win by calling doctors to dispute the findings of the doctors at the Center for Asbestos Related Disease (CARD) clinic in Libby,” Heberling wrote to clients.

Law firms involved in the negotiations will get about $16 million of the  $43 million settlement to cover attorney fees.

Features editor Lynnette Hintze may be reached at 758-4421 or by email at

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