By: Miller of Comal H.B. No. 2545

A BILL TO BE ENTITLED

AN ACT

relating to settlement credits in asbestos and silica cases.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 90.001, Civil Practice and Remedies Code, is amended to read as follows:

Sec. 90.001. DEFINITIONS. In this chapter:

(1) "Asbestos" means chrysotile, amosite, crocidolite, tremolite asbestos, anthophyllite asbestos, actinolite asbestos, and any of these minerals that have been chemically treated or altered.

(2) "Asbestos-related injury" means personal injury or death allegedly caused, in whole or in part, by inhalation or ingestion of asbestos.

(3) "Asbestos tort action" means a tort action based on an allegation that the claimant is has an asbestos-related injury.

(4) "Asbestos trust" means and encompasses all trust entities, claims agents, or claims processing facilities that are created pursuant to the jurisdiction of a United States bankruptcy court and section 524(g) of Chapter 11 of the United States Bankruptcy Code, 11 U.S.C. 524(g), or other applicable provision of law, that are formed for the purpose of compensating claimants asserting eligible asbestos claims, and that are in existence on the date initially set for trial in the asbestos tort action.

(5) "Asbestos trust claim" means any claim for compensation by an exposed person or the exposed person's representative against any asbestos trust.

(6) "Asbestosis" means bilateral diffuse interstitial fibrosis of the lungs caused by inhalation of asbestos fibers.

(7) "Cancer" means a malignant condition.

(8) [(4)] "Certified B-reader" means a person who has successfully completed the x-ray interpretation course sponsored by the National Institute for Occupational Safety and Health (NIOSH) and passed the B-reader certification examination for x-ray interpretation and whose NIOSH certification is current at the time of any readings required by this chapter.

(9) [(5)] "Chest x-ray" means chest films that are taken in accordance with all applicable state and federal regulatory standards and in the posterior-anterior view.

(10) [(6)] "Claimant" means an exposed person and any person who is seeking recovery of damages for or arising from the injury or death of an exposed person.

(11) [(7)] "Defendant" means a person against whom a claim arising from an asbestos-related injury or a silica-related injury is made.

(12) [(8)] "Exposed person" means a person who is alleged to have suffered an asbestos-related injury or a silica-related injury.

(13) [(9)] "FEV1" means forced expiratory volume in the first second, which is the maximal volume of air expelled in one second during performance of simple spirometric tests.

(14) [(10)] "FVC" means forced vital capacity, which is the maximal volume of air expired with maximum effort from a position of full inspiration.

(15) [(11)] "ILO system of classification" means the radiological rating system of the International Labor Office in "Guidelines for the Use of ILO International Classification of Radiographs of Pneumoconioses" (2000), as amended.

(16) [(12)] "MDL pretrial court" means the district court to which related cases are transferred for consolidated or coordinated pretrial proceedings under Rule 13, Texas Rules of Judicial Administration.

(17) [(13)] "MDL rules" means the rules adopted by the supreme court under Subchapter H, Chapter 74, Government Code.

(18) [(14)] "Mesothelioma" means a rare form of cancer allegedly caused in some instances by exposure to asbestos in which the cancer invades cells in the membrane lining:

(A) the lungs and chest cavity (the pleural region);

(B) the abdominal cavity (the peritoneal region); or

(C) the heart (the pericardial region).

(19) "Noncancer" means a nonmalignant condition.

(20) [(15)] "Nonmalignant asbestos-related injury" means an asbestos-related injury other than mesothelioma or other cancer.

(21) [(16)] "Nonmalignant silica-related injury" means a silica-related injury other than cancer.

(22) [(17)] "Physician board certified in internal medicine" means a physician who is certified by the American Board of Internal Medicine or the American Osteopathic Board of Internal Medicine.

(23) [(18)] "Physician board certified in occupational medicine" means a physician who is certified in the subspecialty of occupational medicine by the American Board of Preventive Medicine or the American Osteopathic Board of Preventive Medicine.

(24) [(19)] "Physician board certified in oncology" means a physician who is certified in the subspecialty of medical oncology by the American Board of Internal Medicine or the American Osteopathic Board of Internal Medicine.

(25) [(20)] "Physician board certified in pathology" means a physician who holds primary certification in anatomic pathology or clinical pathology from the American Board of Pathology or the American Osteopathic Board of Internal Medicine and whose professional practice:

(A) is principally in the field of pathology; and

(B) involves regular evaluation of pathology materials obtained from surgical or postmortem specimens.

(26) [(21)] "Physician board certified in pulmonary medicine" means a physician who is certified in the subspecialty of pulmonary medicine by the American Board of Internal Medicine or the American Osteopathic Board of Internal Medicine.

(27) [(22)] "Plethysmography" means the test for determining lung volume, also known as "body plethysmography," in which the subject of the test is enclosed in a chamber that is equipped to measure pressure, flow, or volume change.

(28) "Proof of claim" means any form of documentation that a potential claimant against an asbestos trust submits or provides to the asbestos trust that attests to or asserts the existence of any liquidated or unliquidated asbestos claim that the claimant may have against the asbestos trust or its predecessors under any theory of law.

(29) [(23)] "Pulmonary function testing" means spirometry, lung volume, and diffusion capacity testing performed in accordance with Section 90.002 using equipment, methods of calibration, and techniques that meet:

(A) the criteria incorporated in the American Medical Association Guides to the Evaluation of Permanent Impairment and reported in 20 C.F.R. Part 404, Subpart P, Appendix 1, Part (A), Sections 3.00(E) and (F)(2003); and

(B) the interpretative standards in the Official Statement of the American Thoracic Society entitled "Lung Function Testing: Selection of Reference Values and Interpretative Strategies," as published in 144 American Review of Respiratory Disease 1202-1218 (1991).

(30) [(24)] "Report" means a report required by Section 90.003, 90.004, or 90.010(f)(1).

(31) [(25)] "Respirable," with respect to silica, means particles that are less than 10 microns in diameter.

(32) [(26)] "Serve" means to serve notice on a party in compliance with Rule 21a, Texas Rules of Civil Procedure.

(33) [(27)] "Silica" means a respirable form of crystalline silicon dioxide, including alpha quartz, cristobalite, and tridymite.

(34) [(28)] "Silica-related injury" means personal injury or death allegedly caused, in whole or in part, by inhalation of silica.

(35) [(29)] "Silicosis" means interstitial fibrosis of the lungs caused by inhalation of silica, including:

(A) acute silicosis, which may occur after exposure to very high levels of silica within a period of months to five years after the initial exposure;

(B) accelerated silicosis; and

(C) chronic silicosis.

(36) "Trust claims material" means documents constituting an asbestos trust claim, including, but not limited to, claim forms, proofs of claim, and informational material required by an asbestos trust to be submitted by a claimant in order to have the claim evaluated by the asbestos trust and relied upon by the asbestos trust in making its compensation determination.

SECTION 2. Section 90.010, Civil Practice and Remedies Code, is amended to read as follows:

Sec. 90.010. MULTIDISTRICT LITIGATION PROCEEDINGS. (a) The MDL rules apply to any action pending on the date this chapter becomes law in which the claimant alleges personal injury or death from exposure to asbestos or silica unless:

(1) the action was filed before September 1, 2003, and trial has commenced or is set to commence on or before the 90th day after the date this chapter becomes law, except that the MDL rules shall apply to the action if the trial does not commence on or before the 90th day after the date this chapter becomes law;

(2) the action was filed before September 1, 2003, and the claimant serves a report that complies with Section 90.003 or 90.004 on or before the 90th day after the date this chapter becomes law; or

(3) the action was filed before September 1, 2003, and the exposed person has been diagnosed with malignant mesothelioma, other malignant asbestos-related cancer, or malignant silica-related cancer.

(b) If the claimant fails to serve a report complying with Section 90.003 or 90.004 on or before the 90th day after the date this chapter becomes law under Subsection (a)(2), the defendant may file a notice of transfer to the MDL pretrial court. If the MDL pretrial court determines that the claimant served a report that complies with Section 90.003 or 90.004 on or before the 90th day after the date this chapter becomes law, the MDL pretrial court shall remand the action to the court in which the action was filed. If the MDL pretrial court determines that the report was not served on or before the 90th day after the date this chapter becomes law or that the report served does not comply with Section 90.003 or 90.004, the MDL pretrial court shall retain jurisdiction over the action pursuant to the MDL rules.

(c) In an action transferred to an MDL pretrial court in which the exposed person is living and has been diagnosed with malignant mesothelioma, other malignant asbestos-related cancer, malignant silica-related cancer, or acute silicosis, the MDL pretrial court shall expedite the action in a manner calculated to provide the exposed person with a trial or other disposition in the shortest period that is fair to all parties and consistent with the principles of due process. The MDL pretrial court should, as far as reasonably possible, ensure that such action is brought to trial or final disposition within six months from the date the action is transferred to the MDL pretrial court, provided that all discovery and case management requirements of the MDL pretrial court have been satisfied.

(d) In an action pending on the date this chapter becomes law that is transferred to or pending in an MDL pretrial court and in which the claimant does not serve a report that complies with Section 90.003 or 90.004, the MDL pretrial court shall not dismiss the action pursuant to this chapter but shall retain jurisdiction over the action under the MDL rules. The MDL pretrial court shall not remand such action for trial unless:

(1) the claimant serves a report complying with Section 90.003 or 90.004; or

(2)(A) the claimant does not serve a report that complies with Section 90.003 or 90.004;

(B) the claimant serves a report complying with Subsection (f)(1); and

(C) the court, on motion and hearing, makes the findings required by Subsection (f)(2).

(e) In an action filed on or after the date this chapter becomes law that is transferred to an MDL pretrial court and in which the claimant does not serve on a defendant a report that complies with Section 90.003 or 90.004, the MDL pretrial court shall, on motion by a defendant, dismiss the action under Section 90.007 unless:

(1) the claimant serves a report that complies with Subsection (f)(1); and

(2) the court, on motion and hearing, makes the findings required by Subsection (f)(2).

(f) In an action in which the claimant seeks remand for trial under Subsection (d)(2) or denial of a motion to dismiss under Subsection (e):

(1) the claimant shall serve on each defendant a report that:

(A) complies with the requirements of Sections 90.003(a)(2)(A), (B), (E), and (F) and 90.003(b) or Sections 90.004(a)(1), (2), and (4) and 90.004(e); and

(B) verifies that:

(i) the physician making the report has a physician-patient relationship with the exposed person;

(ii) pulmonary function testing has been performed on the exposed person and the physician making the report has interpreted the pulmonary function testing;

(iii) the physician making the report has concluded, to a reasonable degree of medical probability, that the exposed person has radiographic, pathologic, or computed tomography evidence establishing bilateral pleural disease or bilateral parenchymal disease caused by exposure to asbestos or silica; and

(iv) the physician has concluded that the exposed person has asbestos-related or silica-related physical impairment comparable to the impairment the exposed person would have had if the exposed person met the criteria set forth in Section 90.003 or 90.004; and

(2) the MDL pretrial court shall determine whether:

(A) the report and medical opinions offered by the claimant are reliable and credible;

(B) due to unique or extraordinary physical or medical characteristics of the exposed person, the medical criteria set forth in Sections 90.003 and 90.004 do not adequately assess the exposed person's physical impairment caused by exposure to asbestos or silica; and

(C) the claimant has produced sufficient credible evidence for a finder of fact to reasonably find that the exposed person is physically impaired as the result of exposure to asbestos or silica to a degree comparable to the impairment the exposed person would have had if the exposed person met the criteria set forth in Section 90.003 or 90.004.

(g) A court's determination under Subsection (f) shall be made after conducting an evidentiary hearing at which the claimant and any defendant to the action may offer supporting or controverting evidence. The parties shall be permitted a reasonable opportunity to conduct discovery before the evidentiary hearing.

(h) The court shall state its findings under Subsection (f)(2) in writing and shall address in its findings:

(1) the unique or extraordinary physical or medical characteristics of the exposed person that justify the application of this section; and

(2) the reasons the criteria set forth in Sections 90.003 and 90.004 do not adequately assess the exposed person's physical impairment caused by exposure to asbestos or silica.

(i) Any findings made by a court under Subsection (f) are not admissible for any purpose at a trial on the merits.

(j) Subsections (d)(2) and (e)-(i) apply only in exceptional and limited circumstances in which the exposed person does not satisfy the medical criteria of Section 90.003 or 90.004 but can demonstrate meaningful asbestos-related or silica-related physical impairment that satisfies the requirements of Subsection (f). Subsections (d)(2) and (e)-(i) have limited application and shall not be used to negate the requirements of this chapter.

[(k) On or before September 1, 2010, each MDL pretrial court having jurisdiction over cases to which this chapter applies shall deliver a report to the governor, lieutenant governor, and the speaker of the house of representatives stating:

(1) the number of cases on the court's multidistrict litigation docket as of August 1, 2010;

(2) the number of cases on the court's multidistrict litigation docket as of August 1, 2010, that do not meet the criteria of Section 90.003 or 90.004, to the extent known;

(3) the court's evaluation of the effectiveness of the medical criteria established by Sections 90.003 and 90.004;

(4) the court's recommendation, if any, as to how medical criteria should be applied to the cases on the court's multidistrict litigation docket as of August 1, 2010; and

(5) any other information regarding the administration of cases in the MDL pretrial courts that the court deems appropriate.]

(k) The following provisions apply to an asbestos tort action pending in any MDL pretrial court:

(1) Within thirty days after the commencement of discovery in the action or within thirty days of the effective date of this section with respect to an asbestos tort action that is pending on that effective date of this Act and in which discovery has commenced, a claimant shall serve on all parties a sworn statement by the claimant identifying all existing asbestos trust claims made by or on behalf of the claimant and all trust claims material pertaining to each identified asbestos trust claim. The sworn statement shall disclose the date on which each asbestos trust claim against the relevant asbestos trust was made and whether any request for a deferral, delay, suspension, or tolling of the asbestos trust claims process has been submitted.

(2) The providing of a sworn statement under subsection (k)(1) shall be in addition to any disclosure requirements otherwise imposed by law, rule of procedure, court order or ruling, applicable agreement or stipulation, local rule, or case management order.

(3) If the claimant, subsequent to service of the sworn statement under subsection (k)(1) files with or submits to any asbestos trust additional asbestos trust claims not previously disclosed, the claimant shall service on all parties an amendment updating the sworn statement and identifying the additional asbestos trust claims. The claimant shall serve any such amendment within thirty days of filing an additional asbestos trust claim with, or submitting an additional asbestos trust claim to, any asbestos trust.

(4) With respect to any asbestos trust claim that a claimant discloses in an amendment to the claimant's sworn statement provided under subsection (k)(1), the claimant shall serve on all parties all trust claims material pertaining to each additional asbestos trust claim identified in that amendment. The claimant shall serve the trust claims materials as required by this subsection within thirty days of filing or submitting each additional asbestos trust claim.

(5) Failure to serve on all parties all trust claims material as required by this subsection in a timely manner shall constitute grounds for the MDL pretrial court to decline to remand the case for trial to court in which the action was filed.

(6) Nothing in this subsection prevents a court of competent jurisdiction from requiring any disclosures in addition to the disclosures required under this subsection.

(7) Not less than seventy-five days prior to the commencement of trial, any defendant in an asbestos tort action may file a motion with the MDL pretrial court for an order to stay the proceedings setting forth credible evidence demonstrating all of the following:

(A) The identities of all asbestos trusts not previously disclosed by the claimant, against which the claimant has not made any asbestos trust claims, and against which the defendant in good faith believes the claimant may make a successful asbestos trust claim;

(B) The information that the defendant believes supports the additional asbestos trust claims;

(C) A description of the information sufficient to meet the asbestos trust claim requirements of the asbestos trusts described in subsection (k)(7)(A).

(8) Notwithstanding any other provision in this subsection, if the claimant produces additional asbestos exposure information that supports the filing of an additional asbestos trust claim, the defendant may file a motion to stay the proceedings as provided in subsection (k)(7) within seven days of receiving the additional asbestos exposure information.

(9) Within fourteen days after the filing of the defendant's motion for an order to stay the proceedings under subsection (k)(7), the claimant may do any of the following:

(A) File the asbestos trust claims with or submit them to the asbestos trusts identified in the defendant's motion for an order to stay the proceedings. The submission to the court and to all of the parties in the asbestos tort action of proof demonstrating that the asbestos trust claims identified in the defendant's motion to stay the proceedings have been filed with or submitted to the appropriate asbestos trusts is dispositive of the defendant's motion for an order to stay the proceedings.

(B) File with the court a response to the defendant's motion requesting a determination by the court that the information supporting the asbestos trust claims against the asbestos trusts identified in the defendant's motion should be modified prior to the filing of an asbestos trust claim with, or the submission of an asbestos trust claim to, an asbestos trust or that there is insufficient information to file or submit the asbestos trust claim identified in the defendant's motion.

(C) File with the court a response to the defendant's motion requesting a determination by the court that the claimant's or attorney's fees and expenses to prepare the asbestos claim form and file or submit the asbestos trust claim identified in the defendant's motion exceed the claimant's reasonably anticipated recovery from the asbestos trust claim.

(10) If the defendant files a motion to stay the proceedings and if the claimant files a response pursuant to subsection (k)(9)(C), the court shall determine if the claimant's or attorney's fees and expenses to prepare the asbestos claim form and file or submit the asbestos trust claim identified in the defendant's motion exceed the claimant's reasonably anticipated recovery from the asbestos trust claim. If the court determines that the claimant's or attorney's fees and expenses exceed the claimant's reasonably anticipated recovery from the asbestos trust claim, the court shall require the claimant to file with the court a verified statement of the claimant's exposure history to the asbestos products covered by that asbestos trust.

(11) If the court determines that there is a good faith basis for filing an asbestos trust claim with, or submitting an asbestos trust claim to, an asbestos trust identified in the defendant's motion brought under subsection (k)(7), the court shall stay the proceedings until the claimant files the asbestos trust claims with or submits them to the asbestos trusts identified in the defendant's motion and has otherwise met the obligations set forth in this Chapter.

(12) A noncancer asbestos trust claim and a cancer asbestos trust claim are based on distinct injuries caused by a person's exposure to asbestos. If a claimant filed a noncancer asbestos trust claim with, or submitted a noncancer asbestos trust claim to, an asbestos trust and subsequently filed an asbestos tort action based on a cancer asbestos claim, the claimant has an obligation to include in the claimant's sworn statement and serve on the parties to the action the asbestos trust materials related to both the noncancer asbestos trust claim and the cancer asbestos claim.

(13) Asbestos trust claims and the information that is the subject of disclosure under this subsection are presumed to be authentic, relevant to, and discoverable in an asbestos tort action. Notwithstanding any agreement or confidentiality provision, trust claims material are presumed to not be privileged. The parties in the asbestos tort action may introduce at trial any trust claims material to prove alternative causation for the exposed person's claimed injury, death, or loss to person, to prove a basis to allocate responsibility for the claimant's claimed injury, death, or loss to person, and to prove issues relevant to an adjudication of the asbestos claim, unless the exclusion of the trust claims material is otherwise required by the rules of evidence.

(14) In addition to the disclosure requirements in this subsection, the parties to the asbestos tort action may seek additional disclosure and discovery of information relevant to the action by any mechanism provided by any applicable order, rule or law. Nothing in this subsection prevents any defendant in an asbestos tort action from also seeking discovery of the claimant's asbestos trust claims directly from the asbestos trusts involved.

(15) In an asbestos tort action, upon the filing by a defendant or judgment debtor of an appropriate motion seeking sanctions or other relief, the court may impose any sanction provided by a law, including, but not limited to, vacating a judgment rendered in an asbestos tort action, for a claimant's failure to comply with the disclosure requirements of this subsection.

(16) If subsequent to obtaining a judgment in an asbestos tort action in this state a claimant files any additional asbestos trust claim with, or submits any additional asbestos trust claim to, an asbestos trust that was in existence at the time the claimant obtained the judgment, the trial court, upon the filing by a defendant or judgment debtor of an appropriate motion seeking sanctions or other relief, has jurisdiction to reopen its judgment in the asbestos tort action and either adjust the judgment by the amount of any subsequent asbestos trust payments obtained by the claimant or order other relief to the parties that the court considers just and proper. A defendant or judgment debtor shall file any motion under this subsection within a reasonable time and not more than one year after the judgment was signed.

SECTION 3. The provisions of this Act shall apply to asbestos tort actions filed on or after the effective date of this Act and to pending asbestos tort actions in which trial has not commenced as of the effective date of this Act.

SECTION 4. (A) If any provision that constitutes the whole or part of a section of the Civil Practice and Remedies Code enacted by this act or if any application of any provision that constitutes the whole or part of a section of the Civil Practice and Remedies Code enacted by this act is held invalid, the invalidity does not affect other provisions of the section or applications of other provisions of the section that can be given effect without the invalid provision or application. To this end, the provisions that constitute the whole or part of the sections of the Civil Practice and Remedies Code enacted by this act and their applications are independent and severable.

(B) If any provision that constitutes the whole or part of a section of the Civil Practice and Remedies Code enacted by this act or if any application of any provision that constitutes the whole or part of a section of the Civil Practice and Remedies Code enacted by this act is held to be preempted by federal law, the preemption does not affect other provisions of the section or applications of other provisions of the section that can be given effect without the preempted provision or application. To this end, the provisions that constitute the whole or part of the sections of the Civil Practice and Remedies Code enacted by this act and their applications are independent and severable.

SECTION 5. This Act takes effect September 1, 2013.