Federal-Mogul Corporation and Official Committee of Unsecured Creditors of Federal-Mogul Reiterate Opposition to the Fairness in Asbestos Injury Resolution Act of 2005 as a Bailout of Shareholders and Other Stakeholders of Certain Tier I Entities

SOUTHFIELD, Mich.--Feb. 8, 2005--In a statement delivered to all U.S. Senators, Federal-Mogul Corporation (OTCBB:FDMLQ) and the Official Committee of Unsecured Creditors of Federal Mogul outlined a series of flaws in, and reiterated opposition to, the discussion draft of the Fairness in Asbestos Injury Resolution (FAIR) Act of 2005 as introduced into the Congressional Record yesterday by Senator Arlen Specter (R-PA).

The statement described the inherently flawed and unfair nature of the legislation's payment allocations for Tier I -- companies presently in bankruptcy -- and other infirmities. While more than two-thirds of present and future true asbestos claims are from individuals exposed to asbestos by defendants in the building and construction trades -- an industry sector that includes, among others, the top eight Tier I defendants -- Tier I participants in the national fund would provide a mere six percent of payments. This bailout places the solvency of the national asbestos fund at risk. The statement explained an alternative analyzed by the financial advisor to the Creditors Committee that could provide approximately $12 billion in additional funding for the national trust if Tier I companies were permitted to complete their bankruptcy reorganization and have their liability addressed in a bankruptcy plan. This bankruptcy process would correctly transfer up to $12 billion from shareholders and other stakeholders of certain Tier I entities to the national trust and, thereby, to victims of asbestos exposure.

While Federal-Mogul and the Creditors Committee support efforts to reform the asbestos litigation crisis, they cannot support trust fund legislation that would require Federal-Mogul to pay more than its fair share while providing a bailout to companies with the greatest liability. Today's statement outlined a number of additional shortcomings in current draft, including the likelihood that the FAIR Act's payment structure would drive additional companies into bankruptcy; the unfair, and potentially unconstitutional, stripping away of insurance assets that will cause protracted litigation and cause additional uncertainty for victims; joint and several liability provisions that create escalating and uncertain payments for business participants; sunset and reversion language that leaves companies exposed to the tort system without any safeguards restricting venue or providing standard medical criteria; and the disproportionately high payment level imposed on Federal-Mogul through reliance on a formula that is improperly based on revenue rather than liability.

Federal-Mogul and the Creditors Committee, as they have done in the past, again urged the U.S. Senate to consider alternative legislation establishing standardized medical criteria as a more equitable solution to the asbestos litigation crisis.

Copies of the statement are available upon request.

About Federal-Mogul

Federal-Mogul is a global supplier of automotive components and sub-systems serving the world's original equipment manufacturers and the aftermarket. Headquartered in Southfield, Michigan, Federal-Mogul was founded in 1899, and today employs nearly 20,000 people in the U.S. -- with substantial operations in Alabama, Illinois, Indiana, Iowa, Michigan, Ohio, South Carolina, Tennessee and Wisconsin -- and more than 44,000 worldwide. Federal-Mogul products are sold under a variety of brands, including AE(R) engine products, Anco(R) wipers, BCA(R) bearings, Champion(R) spark plugs and wipers, Fel-Pro(R) gaskets, Ferodo(R) brake pads, Glyco(R) bearings, Goetze(R) piston rings, Moog(R) chassis products, National(R) oils seals, Nural(R) pistons, Payen(R) gaskets, Sealed Power(R) engine products and Wagner(R) lighting and brake products.

Note to Editors: There should be an umlaut over the "u" in "Nural" above.