COLUMBIA, S.C. (Legal Newsline) - The court-appointed receiver for a long-defunct insulation company in South Carolina has paid more than $27 million to settle asbestos cases, according to a new filing that provides limited financial information about one of the secretive funds the receiver uses to hold proceeds of settlements with insurance companies.
The filing also states the Covil Qualified Settlement Fund, or QSF, paid about $200,000 in administrative costs and legal fees in 2023 and 2024. The receiver, South Carolina attorney Peter Protopapas, stated neither he nor his firm got any of that money, although they collected a third of at least $50 million in insurance settlements used to fund the QSF.
The Nov. 1 filing comes after an unusual court hearing last month in which lawyers for the insurance companies and Covil explained how the settlement process and QSFs work, without providing any financial details. A total of 19 of the funds were listed, many of them Delaware partnerships that Protopapas can operate without financial reporting to the court or public statements.
Covil was a regional insulation contractor that was dissolved in 1993, but insurers continued to defend claims naming Covil for years afterward, because mesothelioma only tends to emerge decades after a worker’s exposure to asbestos.
Judge Jean H. Toal, a retired South Carolina Supreme Court justice who oversees the state’s asbestos docket, appointed Protopapas as receiver in 2018 after the firm defaulted on two asbestos cases. As in other cases, she granted Protopapas a contingency fee of 33% of any money he recovered in the name of Covil.
In the Nov. 1 filing, Protopapas said he oversaw an evidence-gathering process to find all the insurance policies that were in force when Covil was selling asbestos insulation, as well as all the worksites where it operated. That information is valuable to plaintiff lawyers, who can match up work histories of their clients with places Covil operated and add the long-dissolved firm to the list of companies they sue.
Covil has been named a defendant in 151 asbestos lawsuits, with 41 still pending, and settled an undisclosed number of those for a total of $27 million, Protopapas said in the filing. If all 110 cases were settled, it would average $245,000 per case, but in other filings Protopapas has said a significant number of cases have been dismissed without payment.
Judge Toal has ordered more detailed information to be sealed, saying it was “beneficial to the public” for settlement amounts to remain secret.
The latest filing referred to a July 2022 report detailing settlement agreements and cases pending, but all of the exhibits in that filing are sealed.
Protopapas settled lawsuits against Sentry Casualty, Ranger Insurance (now TIG), Hartford and Zurich Insurance and against two law firms for more than $50 million, two-thirds of which flowed into the Covil QSF. He has lawsuits pending against Penn National Insurance, claiming bad-faith denial of claims.