Asbestos injury claimants have asked the U.S. Supreme Court to review a tactic deployed by building materials maker CertainTeed, a unit of French multinational Saint-Gobain, to isolate mass-tort liabilities.

The petition asked the nation's highest court to resolve a split among appeals courts over whether profitable parent companies can use bankruptcy to shield themselves from asbestos litigation.

CertainTeed created a shell entity, DBMP, using Texas' divisional merger law, known as the Texas Two-Step, shortly before placing the new unit under chapter 11 in 2020 in the U.S. Bankruptcy Court in Charlotte, N.C., along with about 60,000 asbestos-related lawsuits in the process.

The bankruptcy's automatic stay froze those lawsuits, allowing Malvern, Pa.-based CertainTeed to continue normal operations without facing trial.

The claimants urged the court to review the bankruptcy strategy "to protect the integrity of the bankruptcy system and to safeguard claimants' constitutional rights to seek redress in the nation's civil justice system."

"The Texas Two-Step is a cynical strategy for companies to avoid being held accountable after their products caused lifelong harm to millions," said Deepak Gupta, a lawyer for the claimants.

"Everyday Americans cannot simply manipulate their finances to shed their debts, and corporations should not get a free pass to do the same. We are asking the Supreme Court to make clear that these companies cannot game the system to avoid responsibility," said Gupta.

The bankruptcy court rejected the claimants' request to lift the stay, and earlier this year, the Fourth Circuit U.S. Court of Appeals affirmed the ruling.

Last week, the bankruptcy court also denied the claimants' request to rule in their favor without a trial, rejecting the argument that the Texas divisional merger unlawfully stripped assets from them.

Representatives for CertainTeed, DBMP and Saint-Gobain North America didn't return emails seeking comment on Monday.

DBMP has argued in previous court filings that its use of bankruptcy is legitimate because Congress established a special section in the bankruptcy code to resolve mass asbestos liabilities equitably and permanently by creating a trust. It contended that the code doesn't require a company to be insolvent to seek reorganization.

The Fourth Circuit affirmed the argument in February, creating a conflict with the Third Circuit, which in 2023 dismissed a similar bankruptcy filed by healthcare conglomerate Johnson & Johnson. In that case, the Third Circuit found that a shell company created through the Texas Two-Step wasn't in financial distress and therefore couldn't use chapter 11 in good faith.

J&J has faced tens of thousands of lawsuits alleging that its talc products caused ovarian cancer and mesothelioma, and after failed bankruptcy attempts, it is now pursuing a proposed $5.5 billion settlement of the remaining ovarian cancer claims.

Other companies, including Georgia-Pacific and U.S. units of Ireland's Trane Technologies, also have placed subsidiaries with tort liabilities in chapter 11 using the Texas Two-Step. Those cases are pending in the same North Carolina bankruptcy court.