Published on Friday, August 4, 2000 in the Seattle Post-Intelligencer
Cheney's Firm Backed Bill To Limit Asbestos Liability
by Andrew Schneider and Lise Olsen
Dick Cheney and the giant energy company he will leave to run for vice president have contributed more than $150,000 to members of Congress who sponsored legislation that would limit the ability of workers to sue companies for asbestos exposure.

The Halliburton Co., an oil-field services company based in Dallas, and its subsidiaries have had about 273,300 suits filed against them since 1976 by workers suffering from asbestos-related disease. Many of those suits were filed before Cheney became chairman of the board and chief executive officer in 1995.

At the end of 1999, 107,650 suits for damages were still pending, including 46,400 new suits filed against the corporation last year, according to the firm's annual report filed with the Securities and Exchange Commission.

Cheney, 59, says he will resign Aug. 16 to concentrate on the Republican campaign.

Halliburton's political action committees and Cheney contributed $494,452 to congressional candidates from 1997 through mid-2000. Of that, $157,500 went to members of Congress who co-sponsored the asbestos legislation -- 59 Republicans and four Democrats. (See list of contributions)

Cheney, as an individual, donated $12,500 to members who sponsored or co-sponsored the asbestos bills.

The contributions from Cheney and the political action committees of Halliburton and its subsidiaries went to 49 of the 77 lawmakers who co-sponsored the Fairness in Asbestos Compensation Act in the House of Representatives and 14 of 29 co-sponsors of similar legislation in the Senate.

Halliburton defended their contributions and noted that they were made in full compliance with campaign laws.

"Our PAC has made contributions without regard to the pending asbestos legislation. Any similarities between the supporters of such legislation and the recipients of contributions from our PAC is purely coincidental," Zelma Branch, a company spokeswoman, said today.

Dave Gribbins, Halliburton's vice president for government affairs, added, "We give money to candidates for a variety of reasons, usually to those who are supportive of the business agenda, the things that are important to us, like taxes, trade or something specific like this asbestos issue."

A controversial bill

The legislation is a highly controversial package promoted and financed by the GAF Corp. and others in the asbestos industry. This year, for the third straight year, the bill didn't make it to the floor for a vote.

In March, the House Judiciary Committee narrowly approved the legislation by a vote of 18-15, with most Republicans supporting it and most Democrats opposed.

But seeing dwindling support, Illinois Republican Henry Hyde, the Judiciary Committee chairman, did not send the bill to the full House for a vote.

Had the bill passed, few believed that President Clinton would have signed it.

Of the 11 committee members who received the contributions from Halliburton, 10 voted in favor of the bill. The 11th member missed the vote.

The bill calls for the establishment of an Office of Asbestos Compensation under the Justice Department. Government-approved doctors, using criteria defined in the law, would be gatekeepers, issuing a pass to qualifying victims who wished to sue or seek a government-determined settlement.

Neither side disputes there is a problem that needs to be addressed.

Public-interest groups estimate that over the past 25 years, settlements have been made in more than 1 million asbestos cases industrywide, and 450,000 more may be pending.

$99 million for suits

Although Halliburton is an enormous operation with more than 100,000 employees in 120 countries, it is a relatively small player when it comes to asbestos litigation, at least when compared with W.R. Grace & Co., GAF and the Johns Manville Corp. Nevertheless, Halliburton has spent $99 million to settle or dispose of 129,650 asbestos suits, according to company records.

Asbestos was used for decades in protective clothing, insulations, pipe coatings, fireproofing and many other industrial uses. Millions of workers in hundreds of industries, including the oil business, were exposed to the deadly fibers. Fatal asbestos-related diseases often take more than 20 years after exposure to manifest themselves.

Some citizens groups were critical of the industry's efforts to push the legislation.

USAction, a health care consumer group affiliated with organizations including the American Federation of State, County and Municipal Employees; the Communication Workers of America; and the Service Employees International Union, opposes the legislation and didn't mince words when asked for its view.

"The Cheney-led Halliburton Co. has been an integral part of an asbestos industry which knowingly poisoned its own workers for years and is still trying to get off the hook. That industry -- which is counting on special treatment from a Bush-Cheney administration -- has publicly vowed that it will be bringing its bailout legislation back to Congress next year," said William McNary, president of USAction.

McNary said Halliburton should have settled its claims with the workers. "Instead, Cheney chose to gamble that federal legislation could be passed to allow his company to escape its responsibility to the people it harmed," McNary said.

A blizzard of suits

Last year, the U.S. Supreme Court said something had to be done to break the logjam of asbestos cases clogging the court system.

Chief Justice William Rehnquist said the situation cries out for a legislative solution.

The bill's sponsors insist it will end the backup of hundreds of thousands of victims waiting for their day in court and prevent personal-injury lawyers from pocketing large chunks of the settlements.

The opposition -- mostly unions, victim groups, consumer coalitions and personal-injury lawyers -- called the legislation the "Asbestos Industry Relief Act" because it will prevent thousands of terminally ill victims from filing suit or holding the industry accountable for their asbestos-related disease.

The committee debates often turned into an angry circus, with asbestos-industry lawyers accusing the attorneys for those with asbestosis, lung cancer and mesothelioma with being ambulance chasers who oppose the legislation because it will eliminate millions of dollars in legal fees.

The heart of the battle centered on the medical criteria that the government would use to screen applicants.

The criteria, developed for the most part by asbestos-industry consultants, was soundly criticized by nationally recognized pulmonary and cancer specialists, who called the proposed standards "antiquated," "exclusionary" and "barbaric."

Tears were shed in the committee hearing room as asbestos victims from Libby, Mont., some clutching tanks of oxygen, told how hundreds in their tiny town were killed or sickened from asbestos that contaminated the vermiculite dug from a mine owned by Grace.

Joan Claybrook, president of Public Citizen, denounced the legislation, saying it would relieve corporations of their responsibilities to fairly compensate workers injured by their wrongdoing.

"Wait 'til next year," was the headline of a full-page ad in a Capitol Hill newspaper for lawmakers. The ad was bought by the Coalition for Asbestos Resolution, a Washington-based lobbying group supporting the bill.

Borrowing the old Brooklyn Dodgers' battle cry, the coalition told lawmakers reading Roll Call last week that the industry-funded group would be back next year to push for passage of the bill.

The coalition is funded by the asbestos and construction industries, with most of its money coming from the GAF Corp., a private company owned almost entirely by Sam Heyman of Westport, Conn.

GAF Corp., which is leading the lobbying effort against the bill, has made about $178,500 through its PAC and its employees in donations to federal candidates from 1997 to the present, of which about $66,250 went to co-sponsors of the asbestos legislation. Although Grace has been the target of hundreds of thousands of suits, its political action committee donated nothing to the bill's supporters, according to Federal Elections Commission documents.

Millions were spent by both sides -- the asbestos industry and the trial lawyers -- in lobbying for and against the bill.

(For more background material, see previous P-I reports on the ongoing asbestos risk.)

TV ad campaign

The battle got down to the glitzy television ads saturating the home states of key members of Congress.

"This has been a high-profile, prolonged legislative face-off over the past year, not only in the Congress but on the airwaves in Montana, Minnesota and the metropolitan Washington area," said John Bell, a spokesman for the Association of Trial Lawyers of America. "We've calculated that Sam Heyman and the asbestos industry have invested some $20 million in their campaign -- and although unsuccessful so far, they've outspent us and our allies by more than 10-to-1."

Direct donations to the bill's sponsors represent only a part of the effort to influence Congress. Far more dollars are given for lobbying expenses, and in "soft money" -- donations to party political action committees that are often funneled to campaigns. Halliburton has donated at least $282,050 in "soft money," mostly to state and federal Republican Party committees.

Halliborton: An oil-industry giant

Headquarters: Dallas
1999 sales: $14.89 billion
1999 employees: 103,000
1999 market value: $17.79 billion

A timeline:

1924: Founded by Erle Halliburton
1950-1980: Expanded rapidly, acquiring many other oil-services companies, including Houston construction giant Brown & Root, an expert in offshore platforms.
1982: Halved its work force as the oil industry slumped.
1985: Brown & Root paid $750 million to settle mismanagement charges at South Texas Nuclear Project.
1990s: Halliburton expanded dramatically overseas, particularly in the Mideast and Southeast Asia.
1995: Former Defense Secretary Dick Cheney became chief executive officer. Company won contract to provide services to U.S. Army peacekeeping troops in the Balkans.
1996: Won contract to develop Canadian offshore oil field.
1998: Nearly doubled in size with $7.7 billion purchase of Dresser Industries.
1998-99: Cut more than 9,000 employees in another industry downturn.
2000: Chief Executive Cheney nominated as GOP vice presidential candidate.

--Source: Bloomberg News



2000 Seattle Post-Intelligencer