Bethany Palmer Recht serves as partner of the law firm of Keating Muething & Klekamp in Cincinnati, Ohio, where she consults with clients on managing settlement trusts. Bethany Recht’s other responsibilities involve handling awards from mass tort actions. In a mass tort lawsuit, a group of persons who have all been affected by the same mistake on the part of a company - such as in product liability cases - seek legal redress. It is similar to a class action lawsuit, but in a mass tort each plaintiff receives a separate trial. Many events can be the subject of a mass tort. Apartment fires, air crashes, plant explosions, anti-trust actions, and pharmaceutical errors are all frequently litigated. Other reasons range from bodily injury to negligence on the part of the federal government. Mass torts are expensive to take to trial. Law firms must be well-capitalized to handle large outlays for gathering evidence, finding expert witnesses, court costs, and travel expenses. Partly because of these expenses, law firms often settle the plaintiff’s claims before trial.
Previously an associate at DLA Piper in Los Angeles, Bethany Palmer Recht is now a partner at Keating Muething & Klekamp PLL. From her Cincinnati, Ohio office, Bethany Recht represents trustees of settlement trusts and qualified settlement funds (QSFs).QSFs, also referred to as 468B trusts, are settlement tools that allow the settlement of mass tort litigation or cases involving multiple claimants. They are established pursuant to the orders of a governmental authority, resolve claims arising from an event or series of events, and segregate the assets of the fund from the transferor, in this case the defendant. Therefore, once a QSF is established, the defendant transfers assets into it and is absolved from liability while the claimants get to receive a proper settlement without going through a rigorous litigation process. QSFs have many advantages for both claimants and defendants. For defendants, not only are they released from all claims, but payments into the QSF are tax deductible, hence companies receive immediate tax deductions from such transfers. For claimants, the QSF allows for time to agree on favorable settlement options within themselves - the defendants have already settled their part, and it is now up to the claimants to agree on the allocation of funds. It also allows time to settle lien claims and in some cases, where there is the risk of insolvency of the defendant, the QSF ensures claims are settled before funds are no longer available.
