| 1 | The Business Regulation Committee recommends the following: |
| 2 |
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| 3 | Council/Committee Substitute |
| 4 | Remove the entire bill and insert: |
| 5 | A bill to be entitled |
| 6 | An act relating to asbestos-related claims; providing |
| 7 | legislative findings and intent; defining terms related to |
| 8 | asbestos-related claims; providing that the limitations of |
| 9 | liabilities in the act apply to a corporation that is a |
| 10 | successor and became a successor before January 1, 1972; |
| 11 | providing exceptions to the limitations of the act; |
| 12 | providing that the cumulative successor asbestos-related |
| 13 | liabilities of a corporation are limited to the fair |
| 14 | market value of the total gross assets of the transferor |
| 15 | determined as of the time of the merger or consolidation; |
| 16 | providing an exception; providing methods by which to |
| 17 | establish fair market value of total gross assets; |
| 18 | providing for the fair market value of total gross assets |
| 19 | at the time of a merger or consolidation to increase |
| 20 | annually; providing a methodology by which the fair market |
| 21 | value of the assets is increased; requiring that the |
| 22 | courts liberally construe the act; providing for |
| 23 | severability; providing for applicability; providing an |
| 24 | effective date. |
| 25 |
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| 26 | Be It Enacted by the Legislature of the State of Florida: |
| 27 |
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| 28 | Section 1. Legislative findings and intent.--The |
| 29 | Legislature finds that the number of asbestos-related claims has |
| 30 | increased significantly in recent years and threatens the |
| 31 | continued viability of a number of uniquely situated companies |
| 32 | that have not ever manufactured, sold, or distributed asbestos |
| 33 | or asbestos products and are liable only as successor |
| 34 | corporations. This liability has created an overpowering public |
| 35 | necessity to provide an immediate, remedial, legislative |
| 36 | solution. The Legislature intends that the cumulative recovery |
| 37 | by all asbestos claimants from innocent successors be limited |
| 38 | and intends to simply change the form of asbestos claimants' |
| 39 | remedies without impairing their substantive rights and finds |
| 40 | that there are no alternative means to meet this public |
| 41 | necessity. The Legislature finds the public interest as a whole |
| 42 | is best served by providing relief to these innocent successors |
| 43 | so that they may remain viable and continue to contribute to |
| 44 | this state. |
| 45 | Section 2. Definitions.-- |
| 46 | (1) "Asbestos claim" means any claim, wherever or whenever |
| 47 | made, for damages, losses, indemnification, contribution, or |
| 48 | other relief arising out of, based on, or in any way related to |
| 49 | asbestos, including: |
| 50 | (a) The health effects of exposure to asbestos, including |
| 51 | any claim for: |
| 52 | 1. Personal injury or death; |
| 53 | 2. Mental or emotional injury; |
| 54 | 3. Risk of disease or other injury; or |
| 55 | 4. The costs of medical monitoring or surveillance, to the |
| 56 | extent these claims are recognized under state law. |
| 57 | (b) Any claim made by or on behalf of a person exposed to |
| 58 | asbestos or a representative, spouse, parent, child, or other |
| 59 | relative of the person. |
| 60 | (c) Any claim for damage or loss caused by the |
| 61 | installation, presence, or removal of asbestos. |
| 62 | (2) "Corporation" means a corporation for profit, |
| 63 | including a domestic corporation organized under the laws of |
| 64 | this state or a foreign corporation organized under laws other |
| 65 | than the laws of this state. |
| 66 | (3) "Successor" means a corporation that assumes or |
| 67 | incurs, or has assumed or incurred, successor asbestos-related |
| 68 | liabilities. |
| 69 | (4) "Successor asbestos-related liabilities" means any |
| 70 | liabilities, whether known or unknown, asserted or unasserted, |
| 71 | absolute or contingent, accrued or unaccrued, liquidated or |
| 72 | unliquidated, or due or to become due, which are related in any |
| 73 | way to asbestos claims and were assumed or incurred by a |
| 74 | corporation as a result of or in connection with a merger or |
| 75 | consolidation, or the plan of merger or consolidation related to |
| 76 | the merger or consolidation, with or into another corporation, |
| 77 | or which are related in any way to asbestos claims based on the |
| 78 | exercise of control or the ownership of stock of the corporation |
| 79 | before the merger or consolidation. The term includes |
| 80 | liabilities that, after the time of the merger or consolidation |
| 81 | for which the fair market value of total gross assets is |
| 82 | determined under section 4 of this act, were or are paid or |
| 83 | otherwise discharged, or committed to be paid or otherwise |
| 84 | discharged, by or on behalf of the corporation, or by a |
| 85 | successor of the corporation, or by or on behalf of a transferor |
| 86 | in connection with settlements, judgments, or other discharges |
| 87 | in this state or another jurisdiction. |
| 88 | (5) "Transferor" means a corporation from which successor |
| 89 | asbestos-related liabilities are or were assumed or incurred. |
| 90 | Section 3. Applicability.-- |
| 91 | (1) The limitations in section 4 apply to a corporation |
| 92 | that is a successor and became a successor before January 1, |
| 93 | 1972, or is any of that successor corporation's successors. |
| 94 | (2) The limitations in section 4 do not apply to: |
| 95 | (a) Workers' compensation benefits paid by or on behalf of |
| 96 | an employer to an employee under chapter 440, Florida Statutes, |
| 97 | or a comparable workers' compensation law of another |
| 98 | jurisdiction; |
| 99 | (b) Any claim against a corporation that does not |
| 100 | constitute a successor asbestos-related liability; |
| 101 | (c) An insurance company, as defined in section 717.101, |
| 102 | Florida Statutes; |
| 103 | (d) Any obligations under the National Labor Relations |
| 104 | Act, as amended, or under any collective bargaining agreement; |
| 105 | or |
| 106 | (e) Any successor that, after a merger or consolidation, |
| 107 | continued in the business of mining asbestos, in the business of |
| 108 | selling or distributing asbestos fibers, or in the business of |
| 109 | manufacturing, distributing, removing, or installing asbestos- |
| 110 | containing products which were the same or substantially the |
| 111 | same as those products previously manufactured, distributed, |
| 112 | removed, or installed by the transferor. |
| 113 | Section 4. Limitations on successor asbestos-related |
| 114 | liabilities.-- |
| 115 | (1) Except as further limited in subsection (2), the |
| 116 | cumulative successor asbestos-related liabilities of a |
| 117 | corporation are limited to the fair market value of the total |
| 118 | gross assets of the transferor determined as of the time of the |
| 119 | merger or consolidation. The corporation does not have any |
| 120 | responsibility for successor asbestos-related liabilities in |
| 121 | excess of this limitation. |
| 122 | (2) If the transferor had assumed or incurred successor |
| 123 | asbestos-related liabilities in connection with a prior merger |
| 124 | or consolidation with a prior transferor, the fair market value |
| 125 | of the total assets of the prior transferor, determined as of |
| 126 | the time of the earlier merger or consolidation, shall be |
| 127 | substituted for the limitation set forth in subsection (1) for |
| 128 | purposes of determining the limitation of liability of a |
| 129 | corporation. |
| 130 | Section 5. Establishing fair market value of total gross |
| 131 | assets.-- |
| 132 | (1) A corporation may establish the fair market value of |
| 133 | total gross assets for the purpose of the limitations under |
| 134 | section 4 of this act through any method reasonable under the |
| 135 | circumstances, including: |
| 136 | (a) By reference to the going concern value of the assets |
| 137 | or to the purchase price attributable to or paid for the assets |
| 138 | in an arm's-length transaction; or |
| 139 | (b) In the absence of other readily available information |
| 140 | from which fair market value can be determined, by reference to |
| 141 | the value of the assets recorded on a balance sheet. |
| 142 | (2) Total gross assets include intangible assets. |
| 143 | (3) Total gross assets include the aggregate coverage |
| 144 | under any applicable liability insurance that was issued to the |
| 145 | transferor whose assets are being valued for purposes of this |
| 146 | section, which insurance has been collected or is collectible to |
| 147 | cover successor asbestos-related liabilities except compensation |
| 148 | for liabilities arising from workers' exposure to asbestos |
| 149 | solely during the course of their employment by the transferor. |
| 150 | A settlement of a dispute concerning the insurance coverage |
| 151 | entered into by a transferor or successor with the insurers of |
| 152 | the transferor before the effective date of this act shall be |
| 153 | determinative of the aggregate coverage of the liability |
| 154 | insurance to be included in the calculation of the transferor's |
| 155 | total gross assets. |
| 156 | Section 6. Adjustment.-- |
| 157 | (1) Except as provided in subsections (2), (3), and (4), |
| 158 | the fair market value of total gross assets at the time of a |
| 159 | merger or consolidation shall increase annually at a rate equal |
| 160 | to the sum of: |
| 161 | (a) The prime rate as listed in the first edition of the |
| 162 | Wall Street Journal published for each calendar year since the |
| 163 | merger or consolidation, unless the prime rate is not published |
| 164 | in that edition of the Wall Street Journal, in which case any |
| 165 | reasonable determination of the prime rate on the first day of |
| 166 | the year may be used; and |
| 167 | (b) One percent. |
| 168 | (2) The rate in subsection (1) may not be compounded. |
| 169 | (3) The adjustment of fair market value of total gross |
| 170 | assets shall continue as provided under subsection (1) until the |
| 171 | date the adjusted value is first exceeded by the cumulative |
| 172 | amounts of successor asbestos-related liabilities paid or |
| 173 | committed to be paid by or on behalf of the corporation or a |
| 174 | predecessor, or by or on behalf of a transferor, after the time |
| 175 | of the merger or consolidation for which the fair market value |
| 176 | of total gross assets is determined. |
| 177 | (4) No adjustment of the fair market value of total gross |
| 178 | assets shall be applied to any liability insurance otherwise |
| 179 | included in the definition of total gross assets by subsection |
| 180 | (3) of section 5. |
| 181 | Section 7. Scope.--The courts in this state shall apply, |
| 182 | to the fullest extent permissible under the United States |
| 183 | Constitution, this state's substantive law, including the |
| 184 | limitation under this act, to the issue of successor asbestos- |
| 185 | related liabilities. This act shall be construed liberally to |
| 186 | accomplish its remedial purposes. |
| 187 | Section 8. If any provision of this act or its application |
| 188 | to any person or circumstance is held invalid, the invalidity |
| 189 | shall not affect other provisions or applications of this act |
| 190 | which can be given effect without the invalid provision or |
| 191 | application, and to this end the provisions of this act are |
| 192 | severable. |
| 193 | Section 9. This act shall take effect upon becoming a law |
| 194 | and shall apply to any civil action asserting an asbestos claim |
| 195 | in which the trial has not commenced as of the effective date of |
| 196 | this act. |