Georgia-Pacific affiliate files for bankruptcy amid asbestos claims

Georgia-Pacific Tower in Atlanta. Photo Credit: Connor.carey  from Wikimedia Commons

Georgia-Pacific Tower in Atlanta. Photo Credit: Connor.carey from Wikimedia Commons

An affiliate of Georgia-Pacific LLC, Bestwall LLC, has announced that it filed a voluntary petition for Chapter 11 bankruptcy relief in the Western District of North Carolina.

In a summary, Reuters reported, “Bestwall LLC’s parent company is firing back at allegations that the joint compound maker’s Chapter 11 bankruptcy is a bad-faith sham aimed at avoiding asbestos claims, instead arguing the case is ‘entirely consistent with both the spirit and the letter of the bankruptcy process.’”

Last year the company announced, “Bestwall intends to seek court authority to establish a trust under Section 524(g) of the U.S. Bankruptcy Code to ensure that all individuals with current and future asbestos claims are treated fairly.”

Georgia-Pacific states it will continue to operate as usual.

“Today’s filing by Bestwall has no impact on Georgia-Pacific’s business operations, nor does it affect our 35,000 employees and 25,000 vendors who serve more than 15,000 customers globally,” said Tyler Woolson, senior vice president and chief financial officer of Georgia-Pacific.

Georgia-Pacific produces tissue, pulp, paper, packaging and building products.

Pensions Next Target For Cutbacks?

Courthouse workers and other public employees should take notice of a Detroit judge’s ruling that public employee pensions are just contracts, not really guarantees at all. If that ruling is upheld on appeal, it means that funds like the California Public Employee Pension System are not as protected as many thought. In effect, the judge is saying that federal laws trump state assurances.
 
The Press-Democrat newspaper in Sonoma County is among those offering analysis of the decision, writing in an editorial that “… to cover soaring retirement costs, which in some places are approaching 50 cents on every payroll dollar, cities and counties in California and across the country have laid off workers and slashed spending on parks, street maintenance and other public services. A handful have filed under Chapter 9 of the federal bankruptcy code; others are weighing the possibility”
 
You already see pensions at issue in the high-profile San Bernardino bankruptcy debate. You also hear whispers that, should public employee pensions be questioned, the issue could be real leverage in the next round of budget negotiations. Read the Press-Democrat editorial, which outlines the issue pretty well, here.