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Garlock seeks OK of $6 million asbestos trust contribution settlement
By Caroline Salls
Pittsburgh, May 26 – Garlock Sealing Technologies LLC requested court approval of a settlement reached with SPX Corp. and Fairbanks Morse Pump Corp. under which SPX will make $6 million in payments related to reimbursement of the Coltec Industries, Inc. debtor parties’ asbestos trust contributions under Garlock’s Chapter 11 plan.
Coltec sold its Fairbanks Morse Pump assets to Fairbanks in 1985.
According to the motion filed Thursday with the U.S. Bankruptcy Court for the Western District of North Carolina, Coltec has sought coverage under the policies for a portion of its trust funding obligations, and Coltec has demanded that Fairbanks indemnify it for the portion of Coltec’s contributions used to resolve asbestos claims allegedly caused by Fairbanks Morse Pump products.
The SPX parties also claim coverage under the policies to cover any losses they may incur regarding Coltec asbestos claims.
Under the proposed settlement, three installment payments will be to be made to Coltec over a nine-year period after the plan effective date.
The parties also agreed to the termination of their rights, obligations and liabilities against each other for any past, present or future asbestos claim liabilities.
In addition, the Coltec parties will designate SPX and Pentair, Inc. as asbestos protected parties entitled to the benefits of the plan’s asbestos channeling injunction.
Garlock is a subsidiary of Charlotte, N.C.-based EnPro Industries, which makes sealing products, bearings, compressors and engines. Garlock filed for bankruptcy on June 5, 2010, and its Chapter 11 case number is 10-31607.
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