A bankruptcy judge approved a $610 million asbestos-injury compensation plan covering O-I Glass Inc., freeing it from legacy asbestos liabilities that it isolated from its glassmaking business and pushed into chapter 11, WSJ Pro Bankruptcy reported. O-I’s Paddock Enterprises LLC developed a bankruptcy plan backed by representatives for current and future asbestos claimants, “a result that nobody can have any issue with,” said Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court in Wilmington, Del. The bankruptcy plan relies on funding from the parent company’s Owens-Illinois glassmaking business to compensate individuals who allege they were exposed to asbestos from a corporate predecessor’s Kaylo insulation products. O-I used a Delaware corporate reorganization to fill Paddock with asbestos liabilities before placing it in bankruptcy, isolating them from the rest of the business. That allowed O-I to drive a resolution of the asbestos claims in bankruptcy, while keeping the valuable glassmaking operation out of chapter 11. The Delaware reorganization that landed Paddock in bankruptcy “of course raised the antennae of everyone who was in the courtroom,” Judge Silverstein said from the bench on Monday. But the resulting bankruptcy plan pays injury claims at 100 cents on the dollar, she said.
