Texas Two-Step: How Companies Evade Mass Tort Liability

The video explains the Texas Two Step, a legal strategy used by companies to manage mass tort liabilities by creating two entities: one holding liabilities and the other holding assets. Georgia Pacific's case is highlighted, where they used this strategy to handle asbestos claims. The process involves using Texas laws to split a company, placing liabilities into one entity, which then declares bankruptcy, protecting the main company's assets. The tactic faces criticism for limiting plaintiffs' access to compensation, but defenders argue it prevents chaotic litigation. The strategy has drawn congressional attention and is lucrative for law firms like Jones Day.

What is the Texas 2 step and how does it function in the context of corporate liability?

Describe the process that Georgia Pacific underwent using the Texas 2 step.

How did the Texas 2 step law come into existence and what was its original purpose?

What are the implications of the Texas 2 step for plaintiffs seeking justice?

What criticisms have been raised against the Texas 2 step tactic?