Litigation glossary

§524(g) Trust

A bankruptcy trust that channels all current AND FUTURE asbestos claims against a debtor into a compensation fund — the model other mass-tort bankruptcies try to imitate.

Section 524(g) of the Bankruptcy Code lets an asbestos defendant fund a trust that assumes its liabilities permanently, protected by an injunction channeling every claim — including claims by people not yet sick — into the trust's payment matrix.

Insurer contributions are often the largest funding source (the Boy Scouts trust drew $800M from one insurer and $787M from another under analogous mechanics). Whether non-asbestos torts can achieve similar channeling is the fight underneath the 'Texas two-step' bankruptcies.

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