Dana asks for approval of $2 million settlement with some asbestos-related injury claimants

By Reshmi Basu

New York, Oct. 26 - Dana Corp. asked for court approval of a $2 million settlement agreement with some asbestos-related personal injury plaintiffs, which would resolve claims that were filed through March 2, 2006, the day before the company's bankruptcy filing, according to a Friday motion filed with the U.S. Bankruptcy Court for the Southern District of New York.

As a result of the agreement, about 7,500 personal injury claims against Dana will be dismissed.

According to the request, Dana has been named a defendant in a large number of lawsuits related to the sale of certain automotive gaskets containing asbestos and the alleged exposure to those gaskets.

As of June 30, there were 150,000 pending asbestos-related personal injury claims against Dana, of which half were assigned to inactive dockets because the claimants did not show any signs of asbestos-related illness. In addition, a vast majority of those cases do not involve the company's products. The company also added that state laws and judicial rulings have imposed limits on filing by unimpaired claimants.

Against that landscape, Dana said the number of claims that it must defend and the costs associated with the litigation will remain low following its exit from bankruptcy.

Nonetheless, the company has entered into negotiations with certain claimants, noting that a settlement is in the best interest of the company.

Dana will make $2 million in payments to the claimants. In exchange, Dana will obtain a general release from them.

A hearing is scheduled for Nov. 15.

Dana, a Toledo, Ohio-based supplier of components, modules and systems to vehicle manufacturers and related aftermarkets, filed for bankruptcy on March 3, 2006. Its Chapter 11 case number is 06-10354.

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