Federal-Mogul is one of the biggest auto parts suppliers in the world. The company’s origins begin in the late 19th century. While the company has grown substantially during this period, it has also had periods of legal trouble. Federal-Mogul received much criticism when it acquired two operations that produced asbestos-containing products. The pressure from asbestos litigation ultimately forced Federal-Mogul to declare bankruptcy in 2001 and establish an asbestos trust fund.The History of Federal-Mogul
Established at the end of the 19th century, Federal-Mogul was the result of the combination of
two companies. Soon afterward, Federal-Mogul purchased Mogul Metal Company, which functions as a subsidiary. Federal-Mogul then began manufacturing diecast parts for engines.
In 1910, Federal-Mogul received its first big order when the Buick company requested 10,000 bearings. A decade later, in 1924, the Mogul Metal subsidiary combined with Federal Bearing and Bushing. This new venture became known as Federal-Mogul Corporation and continued to slowly expand.
The 1940s due to the increased commercial activity brought on by World War II saw a great deal of expansion and success for the company. Soon after, Federal-Mogul acquired various manufacturers to increase its business operations.Asbestos Litigation and Federal-Mogul
For many years, Federal-Mogul attempted to elude bankruptcy by closing facilities and paring down its workforce. None of this worked, though. By the time the company filed for bankruptcy, Federal-Mogul had over 156 subsidiaries. Many of these affiliates became involved in asbestos lawsuits.
When Federal-Mogul purchased Turner & Newall, the company placed aside around $2.1 billion
to compensate for asbestos-connected claims. This amount proved insufficient, though. Flexitallic Gasket Company was also involved in countless asbestos claims.
In 2011, one case involved 22 former Texas employees who received $35.2 in compensation due to Exposure to Flexitallic products that contained asbestos.Federal-Mogul and the Creation of an Asbestos Trust
Most of the asbestos claims that Federal-Mogul faced arose after the company manufactured an operation that produced asbestos products. Two of these acquisitions happened in 1998 when both Fel-Pro and Turner & Newall were acquired by Federal-Mogul. Fel-Pro produced gaskets and seals, while Turner & Newall manufactured construction material.
Ultimately, due to the overmounting pressure of asbestos claims, Federal-Mogul filed for bankruptcy in 2001. While Federal-Mogul increased substantially over the next few years, the company emerged from bankruptcy in 2007 with the requirement that it establish a trust to compensate asbestos exposure victims.
The trust, the Federal-Mogul Asbestos Personal Injury Trust, was created to address both present and future asbestos exposure claims. Uniquely, the trust is divided into several smaller funds. While one fund addresses Turner & Newall exposure, another fund pays other types of claims. The trust pays 8.5% of claims that are brought by asbestos exposure victims.
In 2018, Tenneco purchased Federal-Mogul for almost $1 billion.Obtain the Assistance of an Asbestos Exposure Lawyer
If someone you care about was a Federal-Mogul worker or handled Federal-Mogul products and are now facing mesothelioma, you should promptly contact an experienced attorney who will fight for the compensation you deserve. Call Throneberry Law Group today at 888-506-1131 to schedule a free case evaluation.