Trust Distribution Procedures (TDPs) Explained

A Trust Distribution Procedure (TDP) is the rulebook each asbestos bankruptcy trust uses to evaluate and pay claims. Every major trust has its own TDP — they share common structure but differ in eligibility criteria, scheduled values, and payment percentages.

The structure of a typical TDP

Each Trust Distribution Procedure document is typically 50-200 pages long and defines:

• Disease categories — usually 5-8 levels from non-malignant pleural disease through severe mesothelioma
• Scheduled values — the dollar amount associated with each disease level
• Eligibility criteria — what medical evidence and exposure documentation qualify a claimant
• Pro rata payment percentage — the fraction of the scheduled value actually paid (often 5-30% depending on the trust's funding)
• Claim review procedures — expedited review, individualized review, dispute resolution
• Filing deadlines and procedural requirements

Disease levels and scheduled values

Most TDPs use 7 or 8 disease levels, with scheduled values progressing from lowest to highest severity:

• Level I — Asbestosis with restricted lung function (lowest scheduled value)
• Level II — Asbestosis without functional impairment
• Level III — Asbestos-related lung cancer with documented asbestos exposure
• Level IV — Lung cancer (alternate compensation tier)
• Level V — Mesothelioma (typically the highest scheduled value)
• Level VI-VIII — Specialized categories including peritoneal mesothelioma, ocular mesothelioma, and other rare presentations

Mesothelioma claims typically receive the highest scheduled values across all trusts because mesothelioma is the most clearly asbestos-caused disease and produces the most severe outcomes.

The pro rata percentage — why payouts are less than scheduled values

Each trust pays only a fraction of the scheduled value, called the "pro rata" percentage. Trust funding is finite — based on the bankrupt company's contributions plus insurance proceeds. The total expected claim universe (current claims plus future claims through the latency window) determines what fraction can be paid to each claimant while still preserving funds for future victims.

Pro rata percentages range widely:

• Low pro rata trusts (2-7%) — Manville (5.1%), UNR (4%), Celotex (5.5%), TH Agriculture (5%) — older, larger trusts that funded conservatively given high expected claim volume
• Mid-range pro rata (10-20%) — Combustion Engineering (11.5%), Federal-Mogul (15%), Halliburton/Harbison-Walker (20%), Armstrong (17%)
• High pro rata trusts (25-32%) — Owens Corning/Fibreboard (26.2%), Pittsburgh Corning (28%), USG (30%), W.R. Grace (31%), Eagle-Picher (32%) — better-funded trusts that pay larger fractions

The actual payout to a claimant equals: scheduled value × pro rata percentage. For example, a mesothelioma claim with a $215,000 scheduled value at 26.2% pro rata pays approximately $56,000.

Eligibility criteria — what TDPs require

Each TDP defines what evidence is required to qualify for each disease level. Typical requirements include:

• Medical documentation — pathology reports, imaging, treating physician records, often biopsy
• Exposure documentation — proof that the claimant was exposed to the trust's specific products during the trust's "exposure window"
• Work history — employment records, union records, military service records, witness statements
• Latency window — exposure occurred at least 10-15 years before diagnosis (asbestos diseases require this latency period)

Expedited vs. individualized review

Most TDPs offer two review tracks:

• Expedited Review — fast-track processing for claims meeting standard criteria. Most claims go this route. Typical turnaround: 3-9 months.
• Individualized Review — case-by-case evaluation for unusual claims, requesting compensation above the scheduled value, or claims with non-standard documentation. Slower process, sometimes higher compensation outcomes.

How TDPs change over time

TDPs are not permanent — trustees can amend them based on changing circumstances. Pro rata percentages are adjusted periodically as claim volume and funding levels evolve. Some trusts have raised pro rata over time (when funding allowed); others have lowered pro rata (when claim volume exceeded projections). When researching a specific trust, always check the most recent TDP version for current values.

To see which trusts apply to your case and current TDP-based payout estimates, take the eligibility quiz or use the compensation calculator.