Dana Corp. asbestos claimants appeal Chapter 11 plan confirmation

1/6/2008

NEW YORK - A group representing "tens of thousands" of people who claim they were injured by asbestos in Dana Corp. products has appealed the confirmation of the auto-parts supplier's bankruptcy-reorganization plan.

The group, known as the ad hoc committee of asbestos claimants, filed notice of the appeal Thursday with the U.S. Bankruptcy Court in Manhattan, but provided no explanation.

The committee, however, has argued that Dana's bankruptcy plan didn't set aside enough money to settle all the asbestos personal-injury claims against the company.

Dana, based in Toledo, Ohio, last month said it had $240 million in cash and other assets to cover future asbestos and environmental contamination liabilities. The company said it has enough money to satisfy all the claims based on the number of active cases pending against it and the number of dismissed cases.

David Lilly, a spokesman for Dana, said the appeal "was not unexpected." Lilly said the appeal will not affect Dana's plans to emerge from Chapter 11 protection by the end of January.

An attorney representing the asbestos claimants didn't return calls seeking comment Friday.

Dana reached settlements with some asbestos personal-injury claimants as it worked its way through the bankruptcy process. The company agreed to pay a total of $2 million to a group of about 7,500 who claim they were injured by asbestos in Dana products. Dana's plan allows other asbestos claimants to retain their right to sue Dana once the company emerges from bankruptcy.

Dana, which makes driveshafts, axles and other parts, filed for bankruptcy in March 2006 amid a downturn in the vehicle manufacturing industry.

The company's bankruptcy plan was confirmed by Judge Burton Lifland in December. The plan calls for unsecured creditors to be repaid between 72 percent and 86 percent on their claims.