Asbestos Corporation: rules for the claim files, and New York's reasons

The proofs of claim filed against Asbestos Corporation Limited carry what a Québec order now defines as Confidential Claim Information: everything in or submitted with a proof of claim, "including, without limitation, medical records, employment history, settlement information, claim amounts and Personally Identifiable Information." On October 21, 2026, Justice Jean-François Émond of the Superior Court of Québec, Commercial Division, in the district of Frontenac, issued the order that says who may receive that information, what they may do with it and when they must destroy it, per the Asbestos Claims Procedure Confidentiality Order, Oct. 21, 2026, paras. 14(d), 14(i), 21–22. By a second order the same day, Justice Émond extended the CCAA stay to February 26, 2027, authorized ACL to borrow from Resolute Management Services Limited up to US$75,000,000 outstanding at any time under the Third Amended Interim Financing Term Sheet, and raised the Interim Lender's Charge on its property to US$90,000,000. That order recites "the testimony of the witnesses heard"; no reasons for either order are in the record, per the Order Extending the Stay Period and Increasing the Interim Facility, Oct. 21, 2026, paras. 5, 15–16, 23.

Two days later, in New York, Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York filed the reasons for the "bottom-line" order, reported here on October 1, by which the court had affirmed the bankruptcy court's recognition of the CCAA proceeding under Chapter 15 and its extension of stay relief "to certain non-debtor third parties." The reasons affirm recognition on the bankruptcy court's alternative conclusion, that the Canadian case is a foreign nonmain proceeding, and end by directing the clerk "to enter final judgment and to close the case," per the Opinion and Order, No. 25-cv-9889 (JSR) (S.D.N.Y. Oct. 23, 2026), pp. 1, 5–6, 10.

A stay to February, and US$30 million more

The co-applicants, ACL and the London market insurers defined as CLMI, applied for the extension and the increase on October 14. Among the purposes they give for the extension are finalizing the protocol into which the claims valuation matrix will be incorporated, moving the review of claims forward, and continuing "to assess and develop a sale and investment solicitation process with respect to the Debtor's assets, which process was postponed in order to allow the Debtor and CLMI to focus primarily on proposing and developing a claims process, choosing to advance the interests and needs of the claimants as a priority," per the Co-Applicants' Application to Extend the Stay and Increase the Interim Facility, Oct. 14, 2026, paras. 53, 74, 78.

The co-applicants asked that ACL be allowed to borrow up to US$30,000,000 more, with US$36,000,000 added to the charge. "Given the current financial situation of the Debtor," the application says, the amended term sheet "is the only feasible financing alternative available to it," per the Co-Applicants' Application, Oct. 14, 2026, paras. 2(b), 86–87. The monitor, Raymond Chabot Inc., supported the increase. It reported that the cash-flow situation shown in projections ACL's management prepared with its assistance "indicates insufficient liquidity" to cover the costs of the two proceedings, the claims process and the restructuring generally; that with court approval the increase "appears sufficient to cover fees and expenses until at least February 26, 2027"; and that the charge would rank ahead of all other charges and encumbrances except the security held by Mazarin Inc. over ACL's assets and the Administration Charge, per the Eighth Report of the Monitor, Oct. 16, 2026, paras. 7.1, 7.5, 8.1, 8.5.6, 8.6.

What came back with the forms

The monitor still puts the proofs of existing asbestos claims received by the September 10 bar date at approximately 38,755. It has since identified 388 duplicates, leaving a net 38,367, figures it calls preliminary, not audited, reviewed or verified, and subject to variation. By October 16 it had also received 617 late-filed proofs of claim and 42 requests for leave to file late, outside those totals, per the Eighth Report, paras. 5.6–5.8; at September 28 the counts had been 544 and 37, per the Seventh Report of the Monitor, Sept. 30, 2026, Sch. A, Table B. By an order dated October 6, Justice Émond authorized the monitor, "but not obligated," to accept late claims for filing purposes only where, among other conditions, it is satisfied the failure resulted from excusable neglect, and declared that nothing in the order extends or reopens the bar date, per the Order Granting the Monitor Discretion to Accept Late Claims for Filing Purposes Only, Oct. 6, 2026, paras. 10, 14.

Opening a sample of each multi-claimant firm's filings, the monitor found recurring issues that it says "are likely to have an impact on the duration, the cost and the conduct" of the review. First on its list is a six-page schedule of objections to the court-approved form, appended to the proofs of claim of the claimants represented by substantially all of the U.S. law firms for which Bennett Jones had filed notices of representation or substitution, the one exception being Maune Raichle Hartley French & Mudd, LLC. As the monitor summarizes them, the general objections say, among other things, that the requirement that the signer have personal knowledge of each fact "cannot, in practice, be satisfied," the diseases being latent and the alleged exposures decades old; and that the form "contains no provision ensuring the confidentiality" of claimants' personal and settlement information. The specific objections reach parts of the form including the fee arrangement with counsel, the smoking and vaping history and prior settlements, in each instance on the position that the information is "confidential, irrelevant, unduly burdensome, inadmissible or otherwise protected," per the Eighth Report, paras. 5.9–5.10.1, 5.12–5.15, 5.20.

The monitor's answer, first given in a September 3 letter to the firm whose filing had first brought such a schedule to its attention, is that, in its report's words, it is "not open to a Claimant to unilaterally modify the Court-approved process by declining to provide information required by the Proof of Claim form while nevertheless seeking to have its claim adjudicated." The report adds that the monitor intended, "out of an abundance of caution and without admission as to the necessity thereof," to seek a confidentiality order. It now plans to tell counsel that the objections "will not be considered, same being a collateral attack of the Existing Asbestos Claims Bar Date Order," to give counsel 30 days to address the deficiencies, and failing that to write to each claimant with 60 days to cure, per the Eighth Report, paras. 5.11, 5.16–5.19. No response from the firms to that position is in the record.

Who may hold a claimant's file

The confidentiality application was the monitor's, dated October 16. It says Québec's privacy laws and the monitor's own measures "provide sufficient protection" for claimants' personal information, but that its use and protection were considered at an August 24, 2026 hearing before the U.S. Bankruptcy Court; "without conceding" that more is required, the monitor proposed the order so that each individual submitting a proof of claim "is fully apprised of the protections afforded to it," per the Monitor's Application for a Confidentiality Order, Oct. 16, 2026, paras. 5–6. The order recites that the U.S. court, in recognizing the bar date orders (reported here on September 10), made observations, among them on the protection of claimants' personal information, per the Confidentiality Order, paras. 9–11.