Johnson & Johnson have decided to move ahead with a proposed agreement of £6.475 billion (€6 billion) to settle a multitude of litigations that claim the company’s baby powder and other talc-based products carry asbestos and are a cause for ovarian cancer. The multinational corporation has stated the strategy in a recent announcement.
The settlement proposal would enable the company to handle all of these lawsuits through a third subsidiary bankruptcy filing. The procedure will be initiated with a three-month voting stage aiming to get a universal agreement on resolving current and future ovarian cancer claims. 99% of the lawsuits filed against Johnson & Johnson reside within the ovarian cancer claims, this includes the approximate 54,000 lawsuits that are focussed in a New Jersey federal court action.
The Courts have previously repudiated Johnson & Johnson’s two former attempts to settle the lawsuits via bankruptcy of a created subsidiary, LTL Management, whose purpose was to undertake the alleged talc liability. Johnson & Johnson, affirming that their products do not carry asbestos and are not cancer-causing, state that the majority of attorneys representing the plaintiffs, who have lodged cancer lawsuits against the corporation, are behind the settlement.
The company conveys certainty that they will be successful in reaching the required 75% agreement level for a bankruptcy resolution that would permanently close the litigation, staving off any future lawsuits and preventing individuals from leaving the agreement to raise their own individual lawsuits.
Johnson & Johnson’s settlement proposal would build off their previous settlements, which include approximately 95% of individuals who sued the company after having developed mesothelioma, this disease is a rare cancer that’s linked to asbestos exposure. Also included are settlements with various U.S. States which claim the company withheld warnings to consumers about risks that their talc products posed.
The exact value of the mesothelioma settlements has not been revealed by Johnson & Johnson, however it is known that the company noted an incremental charge of $2.7 billion within the first quarter of 2024 to take account of recent talc-related settlements. Additionally, LTL proposed an $8.9 billion agreement in their second bankruptcy filing that would not only include the ovarian cancer claims but also the mesothelioma lawsuits and state consumer protection actions.
While lawsuits were paused from 2021 until 2023 due to previous bankruptcy filings, court proceedings have started anew due to a ruling from a federal judge in July 2023, mandating the most recent bankruptcy case to be dismissed.
The New Jersey federal court recently granted J&J the opportunity to challenge the scientific substantiation that connects talc to ovarian cancer. This decision came about due to recent legislative modifications and fresh scientific evidence, with the presiding judge instructing J&J to put forth new scientific arguments by the end of July.
In response, J&J confirmed its plans to maintain its defence against the ongoing suits while simultaneously working towards securing votes for the settlement. The company asserts that it has won 95% of ovarian trials to date, including each case over the past six years.
However, plaintiffs have won substantial awards in several instances, including a remarkable $2.12 billion for 22 women claiming that J&J’s talcum powder contained asbestos, ultimately causing their ovarian cancer. In just the last month, another verdict ordered J&J to pay $45 million in a mesothelioma case, although the company triumphed in an ovarian cancer case. – Source: Reuters
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