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Dow Corning in shakeup
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August 25, 1997: 10:52 a.m. ET
Implant maker hopes $3.7 billion reorganization plan will end its troubles
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NEW YORK (CNNfn) - Dow Corning Corp. on Monday announced a $3.7 billion reorganization plan to settle all of silicon-gel breast implant claims in its Chapter 11 bankruptcy case.
The plan provides $2.4 billion for resolving lawsuits launched against it by women claiming the company's breast implants caused disease or injury. An additional $1.3 billion will be used to settle commercial claims against Dow Corning.
Individual payments for claims will range from up to $1,000 for an expedited claim, in which women can receive money more quickly but with less documentation, to up to $200,000 for certain medical conditions. The higher paying option will require more stringent proof and evaluation.
Dow Corning said the amounts of the payments would increase as more women signed on to the plan because the company would save money on reduced court costs.
Plaintiffs who do not sign up for the plan will have to first wait for the outcome of a trial which will attempt to find a cause and effect relationship between breast implants and disease. Only if that is proven will individual plaintiffs then be able to launch their own trials against Dow Corning.
The company, which is a joint venture between Dow Chemical and Corning Inc., filed for bankruptcy protection in 1995 in the face of billions of dollars of lawsuits. Plaintiffs contend that Dow Corning was negligent in the manufacturing of silicon-gel breast implants and knowingly hid the dangers.
However, in the proposed settlement Dow Corning did not acknowledge that the implants cause disease.
"Women with breast implants can be reassured by the overwhelming research showing that while implants can cause local complications, they pose no substantially increased risk of disease," said the company's president, Gary Anderson.
The pressure on the company may have been increased by last week's judgment against Dow Chemical in a Louisiana court. The trial, which was the first class-action lawsuit involving the breast implants, ended with a jury finding Dow guilty of keeping silent on the dangers of silicone.
-- Randy Schultz
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Dow Chemical
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