Cooper Industries pleased with asbestos decision

The origins of the case extend back to 1998 when Cooper sold its automotive products businesses to Southfield, Mich.-based Federal-Mogul. Three years later Federal-Mogul filed for bankruptcy amid about 365,000 lawsuits seeking hundreds of millions in damages in alleged asbestos liability claims. Asbestos, a fibrous mineral once commonly used for insulation and fireproofing, causes respiratory diseases, lung cancer and other ailments.

As part of its reorganization, Federal-Mogul proposed a trust that would pay all asbestos claims against it once and for all.

However, the U.S. Bankruptcy Court for the District of Delaware did not approve "the Plan A settlement whereby the Pneumo-Abex asbestos claims would be settled through the Federal Mogul Corp. Asbestos Trust," Cooper said Wednesday in a news release.

Instead, because of an earlier bankruptcy court decision, Cooper will receive $138 million from the Federal Mogul bankruptcy estate and will continue to resolve through the tort system the asbestos-related claims arising from the Abex Friction Products business that it had sold to Federal Mogul in 1998," Cooper's news release said.

Additionally, "Cooper has access to Abex insurance policies with substantial remaining limits on policies with solvent insurers."

"We are pleased that the decision has been made and can now move forward," Cooper Chief Executive Kirk S. Hachigian said in a statement.

Federal-Mogul issued an upbeat statement on Wednesday afternoon.

"The Judge's ruling effectively eliminated a remaining issue in our Chapter 11 case, and therefore allows Federal-Mogul to fully focus on its sustainable global profitable growth strategy."

Cooper shares closed down $1.69, or 4.2 percent, to $38.26; Federal-Mogul shares ended down 47 cents, or 3.8 percent, to $12.08.