Bestwall Bankruptcy Ruling Brings Long-Term Impact to Asbestos Claims
On August 1, 2025, the U.S. Fourth Circuit Court of Appeals upheld the Bestwall bankruptcy, giving Georgia-Pacific’s asbestos spinoff the green light to stay in Chapter 11. With wide reaching implications beyond asbestos litigation, the court confirmed that bankruptcy protection is not limited to distressed companies—meaning even solvent businesses may reorganize asbestos liabilities under federal bankruptcy laws.
This ruling confirms the use of the controversial Texas Two-Step bankruptcy strategy, which isolates liabilities in a separate legal entity, leaving victims to seek compensation through the bankruptcy court system rather than civil jury trials.
For individuals diagnosed with mesothelioma, lung cancer, and other asbestos-related illnesses, the implications are significant.
What Happened in the Bestwall Bankruptcy Ruling?
In 2017, Georgia-Pacific created a new entity—Bestwall LLC—to carry all of its asbestos-related liabilities. Immediately after the corporate spinoff, Bestwall filed for Chapter 11 protection. More than 64,000 asbestos lawsuits were halted overnight.
Eight years later, the appellate court has upheld that structure. The court ruled that bankruptcy courts can accept filings from solvent entities, as long as they seek to resolve mass tort liability.
For victims, that means:
- Their lawsuits remain paused
- Compensation is delayed
- And their claims may be handled through a future trust system rather than the courts
Update: Texas Two-Step Strategy Confirmed by Appeals Court
👉 On August 1, 2025, the U.S. Fourth Circuit confirmed that Bestwall LLC, Georgia-Pacific’s asbestos affiliate, may stay in bankruptcy—even with financial backing from its parent company.
This effectively validates the Texas Two-Step strategy, shielding companies from trial while limiting victims to a court-controlled compensation process.
Read more about how this strategy works in our Texas Two-Step Bankruptcy Strategy article.
How This Decision Impacts Asbestos Victims
Legal Options Are Limited
The court’s decision means that individuals harmed by Georgia-Pacific products can no longer sue directly in state court. Instead, they must wait for the bankruptcy court to approve a reorganization plan that includes a trust fund.
Thousands Still Waiting
Since Bestwall filed in 2017, more than 25,000 asbestos claimants have died with their cases unresolved. Now, those still living must continue to wait—possibly for years—to access any potential compensation.
No Active Trust in Place
Although a $1 billion asbestos trust has been proposed, the court has not approved it. That means there are no payouts and no set timeline for resolution. Victims remain in legal limbo, with their illnesses progressing while the bankruptcy drags on.
Why This Sets a Legal Precedent
The Bestwall decision is part of a broader trend where companies use corporate restructuring laws to isolate risk and limit liability. Similar tactics were attempted by:
- Johnson & Johnson in its talc-related asbestos litigation
- Aldrich Pump LLC in its defense against asbestos exposure claims
- Trane Technologies and others considering divisive merger tactics
This ruling may encourage more corporations to use the Texas Two-Step playbook. The decision also increases legal complexity for asbestos victims—especially those who worked in asbestos job sites across the United States.
Your Legal Rights After the Bestwall Ruling
Even though claims against Georgia-Pacific are paused, you may still:
- File claims against other responsible manufacturers or suppliers
- Submit claims to other asbestos trusts already established
- Seek help for secondary or environmental exposure cases
At DuBose Law Firm, we help clients determine which legal options remain open after rulings like this. Our attorneys can review your exposure history, identify other potentially liable parties, and take immediate steps to preserve your claim.
We represent individuals harmed by:
- Occupational asbestos exposure
- Secondhand exposure from family members
- Environmental exposure from contaminated worksites
DuBose Law Firm Is Here to Help
The Bestwall bankruptcy ruling marks a shift in how asbestos claims may be handled in the United States. For victims and families, it’s a reminder of how critical it is to have knowledgeable legal guidance.
We’ve represented asbestos clients across the country and understand how these rulings affect your rights, your timeline, and your health.
If you or a loved one has been diagnosed with mesothelioma, asbestos-related lung cancer, or another illness caused by exposure, contact us today.
We’ll help you:
- Understand your claim
- Navigate trust and bankruptcy processes
- Identify all liable companies
- Secure compensation while you focus on your health
Frequently Asked Questions
What is the Bestwall bankruptcy ruling?
It’s a decision by the U.S. Fourth Circuit Court of Appeals allowing Georgia-Pacific’s spinoff, Bestwall LLC, to remain in Chapter 11—despite being solvent.
Why does it matter for asbestos victims?
This decision blocks lawsuits from going to trial against Georgia Pacifi and forces victims to seek compensation through a yet-to-be-approved bankruptcy trust.
Can I sue Georgia-Pacific right now?
No. All litigation is paused while the bankruptcy continues. Victims must wait for the bankruptcy court to approve a resolution plan.
Is there a trust paying claims?
Not yet. Although a $1 billion fund has been proposed, it hasn’t been approved, funded, or distributed.
What should I do if I was exposed to Georgia-Pacific products?
You should speak with an experienced asbestos attorney immediately. You may still qualify for claims against other companies or trusts.
