WILMINGTON, Del. (Dow Jones/AP) -- An attempt to broker a deal between W.R. Grace & Co. and its asbestos creditors failed, bankruptcy lawyers said Monday.

David Bernick, lead bankruptcy lawyer for the specialty chemical company, said it had decided not to negotiate further when asbestos-claim lawyers offered nothing for shareholders.

W.R. Grace, of Columbia, Md., filed for Chapter 11 protection in 2001 in an effort to resolve liabilities stemming from products containing asbestos.

Earlier this year, U.S. Bankruptcy Judge Judith Fitzgerald appointed a mediator to attempt to settle differences between W.R. Grace and lawyers for people with asbestos-related diseases and property damage.

Lawyers for asbestos creditors also told the judge that the mediation with the company wasn't successful.

W.R. Grace wants to settle the claims of those with asbestos-related diseases and property damage without taking all the value out of the hands of its shareholders.

Lawyers for people with asbestos claims say the company is probably not worth enough to cover debts to creditors and still leave something for shareholders.

Bernick said that the negotiations with asbestos claimants could resume at some point in the future, but he added that the main priority for the company is to get an estimate of its liabilities.

A federal grand jury has indicted Grace and some top-ranking executives on charges that they tried to hide the health risks of the company's vermiculite mine in Libby. The vermiculite was contaminated with tremolite asbestos. Hundreds of people in the northwest Montana town have been sickened, some fatally, by exposure to asbestos.

Grace and its top executives were initially charged in February 2005. Prosecutors filed an amended indictment this summer after a federal judge threw out a key part of the prosecution's case because of a statute of limitations deadline.

The company and its executives have pleaded not guilty to the federal charges.