Honeywell 2007 Annual Report Download - page 122

HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
Projecting future events is subject to many uncertainties that could cause the NARCO related asbestos
liabilities or assets to be higher or lower than those projected and recorded. There is no assurance that the plan
of reorganization will become final, that insurance recoveries will be timely or whether there will be any NARCO
related asbestos claims beyond 2018. Given the inherent uncertainty in predicting future events, we review our
estimates periodically, and update them based on our experience and other relevant factors. Similarly we will
reevaluate our projections concerning our probable insurance recoveries in light of any changes to the projected
liability or other developments that may impact insurance recoveries.
Friction Products—Honeywell's Bendix friction materials (Bendix) business manufactured automotive brake
parts that contained chrysotile asbestos in an encapsulated form. There is a group of existing and potential
claimants consisting largely of individuals who allege exposure to asbestos from brakes from either performing or
being in the vicinity of individuals who performed brake replacements.
From 1981 through December 31, 2007, we have resolved approximately 113,000 Bendix related asbestos
claims. Trials covering 126 plaintiffs resulted in 125 favorable verdicts and one mistrial. Trials covering ten
individuals resulted in adverse verdicts; however, two of these verdicts were reversed on appeal, five are or
shortly will be on appeal, and the remaining three claims were settled. The following tables present information
regarding Bendix related asbestos claims activity:
Claims Activity Years Ended
December 31,
2007 2006
Claims Unresolved at the beginning of year 57,108 79,502
Claims Filed 2,771 4,391
Claims Resolved (8,221) (26,785)
Claims Unresolved at the end of year 51,658 57,108
Disease Distribution of Unresolved Claims December 31,
2007 2006
Mesothelioma and Other Cancer Claims 5,011 4,843
Other Claims 46,647 52,265
Total Claims 51,658 57,108
Approximately 45 percent of the approximately 52,000 pending claims at December 31, 2007 are on the
inactive, deferred, or similar dockets established in some jurisdictions for claimants who allege minimal or no
impairment. The approximately 52,000 pending claims also include claims filed in jurisdictions such as Texas,
Virginia, and Mississippi that historically allowed for consolidated filings. In these jurisdictions, plaintiffs were
permitted to file complaints against a pre-determined master list of defendants, regardless of whether they have
claims against each individual defendant. Many of these plaintiffs may not actually intend to assert claims against
Honeywell. Based on state rules and prior experience in these jurisdictions, we anticipate that many of these
claims will ultimately be dismissed. During 2006 approximately 16,000 cases were dismissed. More than 85
percent of these dismissals occurred in Mississippi as a result of judicial rulings relating to non-resident filings
and venue. We continue to experience dismissals in this jurisdiction.
Honeywell has experienced average resolution values per claim excluding legal costs as follows:
Years Ended December 31,
2007 2006 2005
(in whole dollars)
Malignant claims $ 33,000 $ 33,000 $ 58,000
Nonmalignant claims $ 500 $ 250 $ 600
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