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Thursday, March 23, 2023

Johnson & Johnson subsidiary seeks bankruptcy protection to handle talc product claims

Johnson & Johnson announced Thursday that a subsidiary it recently formed to manage claims that its talc-based products caused cancer had filed for bankruptcy protection.

The company said in a statement that it hopes the filing for Chapter 11 protection will help resolve current and future claims “in an equal manner for all parties.”

J. and J. said it would provide funding for the subsidiary for an amount decided by the bankruptcy court, and that it would create a $2 billion trust for the cause. It states that certain royalty revenue streams are allocated for the subsidiary to pay any future costs.

Andy Birchfield, a lawyer for the Beasley Allen law firm who worked on the litigation against Johnson & Johnson, said in a statement that the company’s filing was an “attempt to hide behind bankruptcy.”

“It stinks,” he said. “J&J. Can run, but can’t hide.”

Mr Birchfield compared the filing to similar moves by the Boy Scouts of America and USA Gymnastics, which also filed for bankruptcy this year facing legal claims.

“Here is another example of how the rich and powerful use bankruptcy as a hiding place to protect their profits and evade responsibility,” he said. “The entire nation, Congress and more than 30,000 victims of J.&J.’s dangerous talc product say ‘no’ to this blatant and fraudulent abuse of the bankruptcy system.”

Michael Ullman, executive vice president and general counsel for Johnson & Johnson, said the company “stands firmly behind the safety of our cosmetic talc products.”

“We are taking these steps to bring certainty to all parties involved in cosmetic talc cases,” he said in a statement.

The move is the latest twist in the company’s saga of talc-based products, including its iconic baby powder. Johnson & Johnson stopped North American sales of its product last year, as the company faces thousands of lawsuits filed by customers who say its products cause cancer.

The company said the subsidiary, LTL Management, will now bear the brunt of the claims. Johnson & Johnson and its other affiliates did not file for bankruptcy protection and “will continue to conduct their business as usual,” it said.

LTL chief legal officer John Kim said in a statement that with financial backing from the parent company, the subsidiary “is confident that all parties will be treated equally throughout this process.”

Johnson & Johnson said its filing was “not a waiver of liability, but a means to achieve an equitable and efficient resolution of claims raised in cosmetic talc litigation.”

While it has prevailed in some cases, the company has suffered major losses in court on other claims. In June, a Missouri appeals court ordered the company to pay $2.1 billion in damages to women who said the company’s talcum products, including its baby powder, caused their ovarian cancer. .

In 2018, Johnson & Johnson was ordered to pay $4.69 billion to 22 women and their families who said they developed ovarian cancer from asbestos in the company’s talcum-powder products.

World Nation News Desk
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