North American Refractories Co.

North American Refractories Co. Logo
  • Founded: 1929

  • Years Operated: 1929 - Present

  • Headquarters: Cleveland, Ohio

  • Business: Refractories such as ceramics, hearths and related products

  • Asbestos Trust: No

  • Bankruptcy Status: Filed Jan. 4, 2002, and reorganized July 25, 2008

History

From its founding in 1929 until its acquisition by the Honeywell business conglomerate in 1979, North American Refractories Company (NARCO) was one of the nation's largest manufacturers of ceramic refractory materials, which are heat-resistant materials used to line high-temperature equipment such as furnaces. Through various mergers and strategic acquisitions, the company's product line expanded to cover more than just refractories, adding products like furnace fittings, coating installations and dozens more. The company developed these heat-resistant products during a period when asbestos use was prevalent because of the material's durability and fireproof nature.

Between 1979 and 1986, the period when Honeywell owned NARCO, the company largely sold its refractory products to steel manufacturers throughout the east coast and Midwest. NARCO's manufacturing plants occupied locations in Kentucky, Pennsylvania, Michigan and Indiana. Years later, ANH Refractories acquired NARCO. Today, NARCO and its parent companies continue dealing with the legal consequences of the company's asbestos-containing products, which led to mesothelioma and related diseases in former employees.

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Litigation & Specific Lawsuits

NARCO faced a significant number of personal injury claims throughout its history, like many other former asbestos manufacturers. By 2003, the company reportedly was named in more than 275,000 asbestos claims and reached agreements with 256,000 of them, or roughly 90 percent.

In one case involving five plaintiffs, the victims received a ruling of $130 million against NARCO and Dresser Industries for the companies’ roles in endangering the plaintiffs’ lives with asbestos use. One month later, a Texas jury ordered the company to pay $6.1 million in damages. This award went to a plaintiff who developed mesothelioma after working as a pipefitter for the company.

NARCO filed for Chapter 11 bankruptcy in 2002 as asbestos lawsuits poured in, but emerged from bankruptcy and reorganized in 2008. The company plans to establish an asbestos trust in 2013 with initial funding in the amount of $6.32 billion.

While the values of asbestos liability payments are speculative, NARCO’s parent company Honeywell anticipates paying $130 million in asbestos-related payments in its first year of the trust, with additional payments to follow in subsequent years. Both NARCO and Honeywell are likely to face additional asbestos lawsuits, as related diseases often don’t present themselves until years after initial exposure.

Industries & Occupations

Several types of workers helped in the making of NARCO’s refractories and other products. Cement workers, chemical workers, steel and metal workers, and engineers all assisted in the manufacturing process.

A large portion of NARCO’s products played roles in industrial processes and required resistance to extremely high temperatures. The company’s ceramic refractories, for example, lined furnaces that were essential to the manufacturing of cement, lime, chemicals, non-ferrous metals, glass, iron and steel. The addition of asbestos fibers to the ceramic refractories made these furnaces able to withstand temperatures of more than 1,000 degrees Fahrenheit on a regular basis.

At NARCO’s plant in Mount Union, Pennsylvania, refractories were manufactured out of ganister rock, a locally-occurring sandstone with high silicon dioxide content. The ganister was pulverized into a powder and mixed with asbestos and other bonding agents until the 1970s, when the Occupational Safety and Health Administration (OSHA) began regulating the use of asbestos in products.

Products

The company’s products include: Hearths, inwalls and other blast furnace fittings; bottom checkers, domes and other black stove fittings; the MAGNECON, developed in 1928 for rotary kiln burning zones; Shotkast flue crowns; Emisshield(TM) coating; and the Nacrogun.

Asbestos Liabilities

According to Research Well, Honeywell continuously has more than $1 billion in liabilities each year because of NARCO’s past asbestos use. In 2009, Honeywell’s estimated liability was $1.13 billion.

Additional Resources

  1. RAND Institute for Civil Justice (2010). Asbestos Bankruptcy Trusts: An Overview of Trust Structure and Activity with Detailed Reports on the Largest Trusts. Retrieved from http://www.rand.org/pubs/technical_reports/2010/RAND_TR872.pdf
  2. International Society of Automation. (2003 January 21). Honeywell outs asbestos albatross. Retrieved from http://www.isa.org/Template.cfm?Section=Communities&template=/TaggedPage/DetailDisplay.cfm&ContentID=22646
  3. Bloomberg Businessweek (2012). Company Overview of North American Refractories Company. Retrieved from http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=1465099
  4. Floor Daily (n.d.). Honeywell Expects to Make $110 Million in Asbestos. Retrieved from http://www.floordaily.net/flooring-news/Honeywell_Expects_To_Make_110_Million_In_Asbestos.aspx
  5. Research Well (2010). Honeywell estimates its asbestos liabilities at $1.69 billion at end-2009. Retrieved from: http://researchwell.com/2010/02/mesothelioma-lawsuits/
  6. General Cologne Re, Hazardous Times (2001). The Reemergence of Asbestos: More Claims, More Defendants, More Dollars. Retrieved from https://www.facworld.com/FACworld.nsf/doc/HT1101/$File/Asbestos+Reemergence+Part+1.pdf
  7. Honeywell International Inc. (2012). Form 10-K. Retrieved from http://www.sec.gov/Archives/edgar/data/773840/000093041312000976/c68029_10k.htm

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