United Gilsonite Laboratories, one of Pennsylvania’s well known manufacturers, has filed for Chapter 11 bankruptcy reorganization, according to a Times Tribune article released earlier this year.
UGL, which manufacturers paints, coatings and sealants in Dunmore, PA since 1932, cited the costs of asbestos-related litigation in its petition for protection in U.S. Bankruptcy Court for the Middle District of Pennsylvania.
The company seeks court approval to establish a trust fund to settle outstanding claims and an injunction preventing asbestos-related awards except though the trust.
UGL used asbestos in joint compound, a cement-like construction sealant, but halted the practice in the late 1970s, company president Thomas White said in a court document.
Mr. White says, UGL faces more than 900 ongoing asbestos claims. UGL and its insurers have paid more than $25 million in asbestos-related claims, including more than $2 million over the last three months, according to White.
If the court approves the establishment of a trust, UGL and its insurers would create a pool of revenue and claimants would petition a committee for payments, according to Mrs. Neary.
Neary says, “From a financial standpoint, it’s a good thing. Once the trust is funded, we’re done. Once the trust is gone, there’s no more to pull from.”
UGL recorded sales of $49 million in 2010, Mr. White’s statement said. UGL manufactures more than 80 products and also operates plants in Mississippi, Nevada and Illinois. Its flagship lines are Drylok, a waterproofing and leak-prevention compound, and Zar wood finish. UGL’s products are sold at hardware and home improvement stores and lumberyards.
Asbestos exposure can cause malignant mesothelioma, lung cancer, asbestosis and other asbestos-related cancers.