Asbestos: WR Grace's Lost Criminal Appeal increases its potential exposure

Implications: WR Grace's Lost criminal appeal may affect timing of emergence from bankruptcy. Lost criminal appeal increases WR Grace's potential exposure.

Analysis: WR Graces's 524(g) bankruptcy emergence may likely be affected by losing its criminal appeal and at the very least their potential for exposure has increased.  WR Grace had a major victory awhile back when the trial court essentially threw out the majority of the conspiracy charges based on the prosecution blowing the statute of limitations.  http://www.missoulian.com/articles/2006/06/14/news/mtregional/news06.txt  In essence, the 3 panel 9th circuit court of appeals found there may simply have been insufficient allegations that the knowing endangerment occurred within the allegedly applicable five year statute of limitations. An error in possible substance over form, but nonetheless detrimental to WR Grace's defense.  Prosecutors will now be able to introduce testimony and evidence that Grace and its officials were on notice regarding the hazards of asbestos since at least 1976. Grace is also now barred from arguing at trial that it had followed national emissions standards covering the release of hazardous materials.  All in all, with their criminal exposure increased the timing of their anticipated emergence from bankruptcy may be delayed. Point counterpoint is that the claimants' may want more time to explore their reorganization plan options and WR Grace may be more receptive to resolution as the pending criminal exposure could have obvious downside to its potential introduction in the class actions if a stay is lifted.  So much for prepackaged bankruptcy being timely!