Johnson & Johnson is trying to use the bankruptcy courts again to settle tens of thousands of lawsuits alleging its talc products cause cancer. The pharmaceutical company is now willing to pay $8.9 billion to the plaintiffs over 25 years.
For the second time, a J&J subsidiary called LTL filed for bankruptcy on Tuesday, a move the company says could “equitably and efficiently resolve all claims arising out of cosmetic talc litigation” in North America. , according to a regulatory document. An earlier attempt to use Chapter 11 bankruptcy protection to settle the talc lawsuits was rejected by an appeals court, which ruled the company could not file for bankruptcy because it had no financial problems.
This time, the LTL spin-off from J&J increased the offer by $6.9 billion over the initial deal of $2 billion. The company says it obtained commitments from more than 60,000 current plaintiffs against J&J to support the resolution.
The company says the settlement does not constitute an admission of wrongdoing. Johnson & Johnson has long maintained that products using talcum powder are safe to use. Although J&J claims it has won most of its talc lawsuits, juries awarded some customers billions of dollars in damages, supporting plaintiffs’ contentions that the company’s talc products caused them cancer.
“The company continues to believe that these claims are misleading and lack scientific merit,” Erik Haas, Johnson & Johnson’s vice president of worldwide litigation, said in a statement. “However, as the bankruptcy court recognized, resolving these cases in the tort system would take decades and impose significant costs on LTL and the system.”