Johnson and Johnson Agree to Pay $8.9 Billion for Cancer Claims on Talc Powder

Johnson and Johnson

Johnson & Johnson announced on Tuesday that it will pay $8.9 billion over the next 25 years to settle allegations that its baby powder and other talc products caused cancer.

The proposed settlement was disclosed in a securities filing, which also mentioned that J&J’s subsidiary LTL Management refiled for Chapter 11 bankruptcy protection after an initial attempt was thwarted.

More than 60,000 claimants have agreed to support the proposed resolution, which will require approval in bankruptcy court, according to the filing.

“Resolving this matter through the proposed reorganization plan is both more equitable and more efficient, allows claimants to be compensated in a timely manner, and enables the Company to remain focused on our commitment to profoundly and positively impact health for humanity,” said Erik Haas, J&J’s worldwide vice president of litigation, in a statement.

Despite this settlement proposal, J&J continued to dispute the talc allegations.

“The Company continues to believe that these claims are specious and lack scientific merit,” Haas added.

J&J ended global sales of its talc-based baby powder this year after facing thousands of lawsuits from customers who claimed the talc products caused cancer due to contamination with the carcinogen asbestos.

Johnson’s Baby Powder (Photo: Getty Images)

In October 2021, J&J created LTL Management to manage its talc litigation and settlements. The company directed its talc lawsuits to the subsidiary, which then filed for bankruptcy protection.

In February 2022, a judge affirmed J&J’s ability to use the Chapter 11 strategy.

However, in January of this year, the U.S. Court of Appeals for the 3rd Circuit overturned that ruling, stating that neither LTL nor J&J had a legitimate need for bankruptcy protection as they were not in “financial distress.”

Leigh O’Dell, one of the lead attorneys representing plaintiffs in the talc lawsuits, told at the time that the ruling was another step toward ending J&J’s “attempted abuse of the bankruptcy system.”

On Tuesday, O’Dell criticized the new bankruptcy filing in a statement, saying, “J&J is seeking an extremely deep discount on justice and is not really offering anything other than another bankruptcy and more delay, delay, and delay.

This new filing should be viewed as a shameful attempt to run out the clock on people dying of cancer and convince some lawyers to give up.”

Mikal Watts, one of the plaintiff lawyers who negotiated the proposed settlement, stated that J&J committed to “fairly compensate these deserving women” who have battled cancer due to the talc products.

“Our job is to get our clients fairly paid for their injuries, and this settlement is the culmination of a job well done.”

Last month, J&J indicated it would take the case to the Supreme Court.

The company incurred $7.4 billion in litigation expenses between 2020 and 2021, according to an annual filing. J&J noted that talc litigation was a primary driver of legal costs during those years.

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