As the Asarco bankruptcy continues to generate issues in the environmental-bankruptcy interface, the bankruptcy court judge in Corpus Christi, Texas has appointed Louisiana bankruptcy judge to mediate in the long-standing alter ego dispute over asbestos-related
personal injury claims that bankrupt mining behemoth Asarco LLC has been fending off for years.
Asarco's subsidiaries face over 95,000 asbestos-related claims. Some of those claims, however, have been made against Asarco directly. In an attempt to reduce its liability, Asarco filed an adversary complaint against its also-bankrupt subsidiaries seeking a declaratory judgment that it was not liable to them for the asbestos or other claims, according to court documents. The plaintiffs have alleged that Asarco is the alter ego of its subsidiaries.
To handle the alter ego dispute and asbestos claims, Asarco had submitted its own proposal last week for a mediator. With his Thursday order, however, Schmidt rejected that suggestion, and appointed the Louisiana bankruptcy judge as mediator over these claims.
Asarco has until November 12th of this year to file its plan, and until January 14 to solicit approval from its creditors.
