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KEENE CHAIRMAN CALLS FOR DRASTIC CHANGES IN MANAGING ASBESTOS LTITGATION TO END COURT-CLOGGING AND FOR COMPANIES' SURVIVAL

KEENE CHAIRMAN CALLS FOR DRASTIC CHANGES IN MANAGING ASBESTOS LTITGATION
 TO END COURT-CLOGGING AND FOR COMPANIES' SURVIVAL
 PHILADELPHIA, May 21 /PRNewswire/ -- Asbestos litigation has cost the American economy $9 billion so far -- $6 billion of which has been paid to lawyers, Keene Corporation (NASDAQ: KEEN) Chairman Glenn W. Bailey told more than 100 judges, lawyers and corporate officials attending a meeting here today.
 "These billions could have been used to invest in and create more than 200,000 jobs or 90,000 new housing units," Bailey said. He warned that if the system continues in its present form, future costs may total $100 billion or more.
 Speaking at a seminar on court management techniques, Bailey predicted that unless significant and immediate changes are made in managing the more than 100,000 asbestos cases clogging the state and federal court dockets, all remaining defendants eventually will be bankrupted, thousands of plaintiffs will be left uncompensated and thousands of workers will lose their jobs.
 "We could never have purposely devised a system that would be more likely to result in hundreds of thousands of lawsuits, over 90 percent of which have been brought by people who aren't sick," noted Bailey, whose company has spent $400 million defending and resolving claims against its former subsidiary, Baldwin-Ehret-Hill, which Keene bought in 1968 and shut down in 1975. Baldwin-Ehret-Hill manufactured insulation products containing approximately 10 percent asbestos until 1972. Although Keene has settled more than 75,000 claims pending against the company, there are still 87,000 claims pending against the company, with new case filings in 1992 running at the rate of 2,000 per month, double the 1991 rate.
 However, the trend can be reversed, according to Bailey, if courts act promptly to create a uniform national system which provides fair compensation to only the truly injured, stops filing of new cases, controls lawyers fees and keeps the defendant companies in business to provide compensation for people who become impaired in the future as a result of exposure to asbestos.
 Bailey offered the judges specific management techniques to accomplish these objectives. "First, we must make sure the money gets only to sick people," Bailey said. "The best way to assure that is by establishing court-mandated pleural registries, or some similar non- trial track docket." A pleural registry would take the cases of persons who do not have any asbestos-associated impairment off the court's active docket, with the opportunity to return to the docket if they become impaired in the future. "There simply isn't enough money to pay these non-impairment claims or enough courts to process them," Bailey said.
 Additionally, the court must stop permitting juries to award punitive damages, which are "windfalls for a few and will deprive many more of compensation," Bailey predicted. Juries have awarded more than $14 million to 50 plaintiffs as punitive damages against Keene for products which haven't been manufactured for more than two decades.
 Finally, Bailey advised, mass consolidations of large numbers of claims for trial must be stopped. Although many judges use this technique to try to force settlements and control their dockets, an Alabama federal judge recently ruled that the consolidation of just 13 dissimilar asbestos personal injury claims was unduly prejudicial to defendants. In vacating a jury award of more than $40 million, the court said that the "try as many as you can" approach may reduce court congestion, but it denies the defendants a fair trial by leaving the jury "the impossible task" of trying to carefully sort out and distinguish the facts and law relating to plaintiffs who vary greatly in many critical aspects. Keene is presently a defendant in a Baltimore trial involving more than 8,500 consolidated asbestos claims, the largest consolidation in history.
 Bailey noted that the mass consolidation device is counter- productive because of its tendency to result in large verdicts, which in turn result in the filing of more asbestos cases. "Not only are consolidations incompatible with doing justice, they encourage the filing of tens of thousands of additional cases," Bailey stated.
 Keene Corporation is a manufacturer of advanced composite materials for aerospace, defense and commercial applications.
 -0- 5/21/92
 /EDITORS NOTE: Write or call Keene for a copy of the complete text of Bailey's speech./
 /CONTACT: Stuart Rickerson, 212-557-1900, or Ned Gerrity, 914-921-3606, both of Keene Corporation, 200 Park Ave., New York, NY 10166/
 (KEEN) CO: Keene Corporation ST: New York IN: ARO SU:


KD-TQ -- NY078 -- 2959 05/21/92 15:01 EDT
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Date:May 21, 1992
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