In Owens Corning v. Carter, 997 S.W.2d 560 (Tex. 1999), the Texas Supreme Court upheld a 1997 state law that gave Texas courts the power to dismiss asbestos lawsuits brought by non-residents whose exposure and injuries occurred outside Texas. The ruling validated Senate Bill 220 against constitutional challenges and effectively closed Texas courthouse doors to a wave of out-of-state asbestos filings that had made the state one of the busiest asbestos venues in the country.
Why Texas Needed the Law
By the mid-1990s, plaintiffs from across the country were filing asbestos claims in Texas even when nothing about the exposure, the employer, or the plaintiff tied the case to the state. A RAND study later identified Harris, Galveston, and Jefferson counties among the top five state court venues for asbestos filings between 1994 and 1997.1Institute for Legal Reform. Facts and Figures About Asbestos Litigation The Texas Legislature later found that from 1988 to 2000, more asbestos lawsuits were filed in Texas than in any other state.2Texas Legislature. SB 15, 79th Legislature
Several features drew out-of-state filings: favorable jury pools, plaintiff-friendly procedural rules, and a longstanding exemption that kept asbestos cases outside the forum non conveniens doctrine Texas courts otherwise used to send cases to more appropriate venues. Senate Bill 220, enacted in 1997, attacked the problem on three fronts. It created a borrowing statute requiring non-resident plaintiffs to meet both Texas’s statute of limitations and the shorter limitations period of the state where the injury occurred. It eliminated the asbestos carve-out from forum non conveniens. And it created a mandatory dismissal procedure for pending asbestos claims by non-residents whose injuries arose outside Texas.3FindLaw. Owens Corning v. Carter
A trial court struck down several of these provisions as unconstitutional. The defendants, led by Owens Corning and joined by Pittsburgh Corning, A.P. Green Industries, Armstrong World Industries, CertainTeed, Dana, Quigley, U.S. Gypsum, 3M, and W.R. Grace, appealed.4vLex. Owens Corning et al. v. Carter The named plaintiffs across the five consolidated cases — Hilliard Carter, James B. Carroll, George R. Aday, Larry R. Chandler, and Austin E. Deford — had all been exposed to asbestos outside Texas and lived outside Texas when they sued.3FindLaw. Owens Corning v. Carter The Texas Supreme Court issued its decision on July 1, 1999, reversing the trial court and upholding every challenged provision.
What the Court Upheld
The Borrowing Statute
Section 71.031(a)(3) requires out-of-state plaintiffs to satisfy both Texas’s limitations period and that of the state where the injury occurred. Plaintiffs argued the provision was unconstitutionally retroactive under the Texas Constitution because it could cut off claims that remained timely under Texas law when SB 220 took effect.
The court rejected the argument. Plaintiffs had no legitimate expectation, it held, of using a more generous Texas limitations period to revive claims already barred where they lived. No “grace period” for accrued claims was constitutionally required. The statute’s purpose, preventing forum shopping, was sufficient.3FindLaw. Owens Corning v. Carter
Forum Non Conveniens for Non-Residents
Section 71.051 authorized Texas courts to dismiss claims by non-resident plaintiffs under forum non conveniens while exempting Texas residents from such dismissals. Plaintiffs argued the resident-only exemption violated the Privileges and Immunities Clause of the U.S. Constitution.
The court relied on the U.S. Supreme Court’s 1929 decision in Douglas v. New York, New Haven & Hartford Railroad Co.,5Justia. Douglas v. New York, N.H. & H.R. Co. in which Justice Holmes wrote that states may prefer residents in access to their courts for rational reasons, including that residents fund those courts. The constitutional line is between residence and citizenship: a state may not discriminate against out-of-state citizens as citizens, but it may distinguish between people who actually live there and people who do not. Because the Texas statute drew its line at residence, it survived.3FindLaw. Owens Corning v. Carter
Mandatory Asbestos Dismissals
Section 71.052 was the most targeted part of the law. It reached asbestos claims pending on May 29, 1997, where the plaintiff had not been a Texas resident when the claim arose and the injury had occurred outside Texas. Plaintiffs challenged it under the Privileges and Immunities Clause, the state and federal Equal Protection Clauses, and the Texas Constitution’s prohibition on special laws. The court held that each challenge failed, finding the Legislature had rationally acted to relieve Texas courts of claims with little or no connection to the state.4vLex. Owens Corning et al. v. Carter
How the Dismissal Mechanism Worked
Section 71.052 did not simply throw qualifying cases out. It built a tiered process keyed to when the suit had been filed, with protections meant to let plaintiffs refile elsewhere without losing ground.
For claims filed on or after January 1, 1997, dismissal was mandatory once the defendant stipulated that a new filing in another state would relate back to the Texas filing date for limitations purposes. For claims filed between August 1, 1995, and January 1, 1997, the plaintiff could choose: abate the Texas case for 180 days and refile elsewhere, or keep it in Texas subject to a cap on punitive damages. In every case, defendants also had to agree that plaintiffs could reuse discovery responses from the Texas litigation in any new action.3FindLaw. Owens Corning v. Carter
What Carter Changed for Asbestos Cases in Texas
The practical message of Carter was that the Texas Legislature could restrict access to Texas courts by non-residents provided it used residence rather than citizenship as the dividing line and offered a rational justification. For asbestos defendants, Section 71.052 became a powerful tool: a non-resident with an out-of-state injury could be forced out of Texas on motion.
Legal scholars have described Carter as part of a sequence of court victories that cleared the way for broader asbestos reform in Texas.6Houston Law Review. Administering a Cure-All or Selling Snake Oil: Implementing an Inactive Docket for Asbestos Litigation in Texas The next major step came in 2005 with Senate Bill 15, which created Chapter 90 of the Texas Civil Practice and Remedies Code. That law required asbestos plaintiffs to produce medical evidence of an actual asbestos-caused disease before proceeding to trial, moving claims that could not meet the standard to an “inactive docket.”2Texas Legislature. SB 15, 79th Legislature A 2013 amendment then led to thousands of inactive cases being dismissed without prejudice.7Texas Lawsuit Reform Foundation. The Story of Asbestos Litigation in Texas
Where Carter determined who could file in Texas, the 2005 law determined who could proceed to trial. By the time both regimes were operating, the active Texas asbestos docket consisted overwhelmingly of plaintiffs with asbestos-caused cancer.
A Hollow Victory for Many Defendants
Winning Carter did not save the companies that fought it. Owens Corning filed for Chapter 11 in October 2000, carrying roughly 243,000 pending asbestos claims. In 2005 a federal judge estimated the company’s total asbestos liability at $7 billion, between competing estimates of $2.2 billion and $16.1 billion.8Crowell & Moring. Owens Corning Estimation Proceedings The company emerged from bankruptcy on October 31, 2006, and the Owens Corning/Fibreboard Asbestos Personal Injury Trust was established the same day to handle claims going forward.9Owens Corning Fibreboard Asbestos Personal Injury Trust. OCF Asbestos Trust
Pittsburgh Corning filed for bankruptcy in April 2000 and did not complete its reorganization until 2016.10Asbestos.com. Pittsburgh Corning Corporation A.P. Green Industries filed in 2002 after facing more than 235,000 asbestos lawsuits.11Mesothelioma.com. A.P. Green Industries Carter gave the defendants a durable procedural shield in Texas; the underlying liability proved too large for that shield to matter to their corporate survival.