Thanks to a new reorganization plan, Johnson & Johnson is on the cusp of settling more than 50,000 lawsuits linking its popular talc-based baby powder to ovarian cancer.
J&J’s subsidiary LLT Management has drafted a proposed “Plan of Reorganization” that—if confirmed—would see J&J pay ovarian cancer claimants roughly $6.48 billion over 25 years to resolve 99.75% of its remaining talc lawsuits in the U.S.
The remaining personal injury lawsuits not covered in the plan are tied to claims that J&J’s cosmetic talc products cause mesothelioma, an aggressive form of cancer around the lungs usually associated with asbestos exposure. J&J plans to address those claims outside of the reorganization plan and said in a press release Wednesday that it has already resolved 95% of mesothelioma lawsuits filed to date.
Now, ovarian cancer claimants have three months to vote for or against J&J’s plan. The company argues that approving the plan is in the best interest of claimants, who “have not recovered and will not recover anything at trial.” Aside from J&J’s success rate at overcoming talc lawsuits in the past, it would take decades to litigate the remaining cases, meaning most claimants would never have their “day in court,” according to J&J.
“Unlike the prior cases, it is the vote of the claimants—and not the conflicting financial incentives of the small minority of plaintiff lawyers who stand to receive excessive legal fees outside of a reorganization—that decides whether the Plan may proceed,” Erik Haas, J&J’s worldwide vice president of litigation, said in a statement.
Despite J&J’s insistence that the new settlement proposal is in claimants’ best interest, a coalition of lawyers representing women allegedly affected by J&J’s talc-based products came out against the plan on Wednesday. The lawyers, who work at law firms like Beasley Allen, Levin Papantonio Rafferty and Ashcraft & Gerel, argue that J&J is attempting to “weaponize unrelated claims in exchange for votes on a payment plan that would cheat victims legitimately harmed by talc.”
“We believe any bankruptcy based on this solicitation and vote will be found fraudulent and filed in bad faith under the Bankruptcy Code,” Andy Birchfield, head of the Mass Torts Section at Beasley Allen, said in a statement. “On behalf of our clients who deserve better, we are blowing the whistle on this cynical legal tactic and will resist it at every turn.”
Apart from the ovarian claims, J&J has also reached agreements in principle to resolve state consumer protection claims; plus, it has reached an agreement in principle to resolve all talc-related claims against it in bankruptcy cases filed by its talc suppliers Imerys Talc America and Cyprus Mines Corporation.
As claimants vote on the plan, J&J says it will continue to seek “final and comprehensive” resolution of its talc litigation by appealing the dismissal of LLT’s prior bankruptcy, “aggressively litigating in the tort system” against claimants who decide not to settle and pursuing affirmative claims against prior expert opinions that sewed “false and defamatory narratives” about J&J’s products.
Throughout the entire talc litigation saga, J&J has stood by the safety of its product and reiterated on Wednesday that “none of the talc-related claims against it have merit.”
“The talc claims asserted against the Company exemplify the egregious impact on U.S. businesses from meritless litigation and extreme judgments obtained by the plaintiffs’ bar through forum shopping, the distortion of scientific literature with junk science, and the unregulated and surreptitious financing of product litigation by financial institutions, including private equity and sovereign wealth funds,” J&J’s Haas added.
J&J established LLT (formerly known as LTL Management) back in October 2021, at which point the subsidiary promptly filed for bankruptcy in a bid to corral thousands of talc lawsuits. The strategy employed by LLT, often referred to as the Texas two-step, was first used decades ago as a way to mitigate costs associated with asbestos claims. The Court of Appeals for the Third Circuit dismissed LLT’s original bankruptcy filing in January 2023.
More recently, New Jersey federal district Judge Michael Shipp in March determined that J&J could get a do-over in its talc defense, citing new “relevant science” and updates to the Federal Rule of Evidence 702, which gives judges more power to discredit flawed expert testimony.
And in January, J&J agreed to a $700 million settlement across 42 states and the District of Columbia to resolve claims that the company did not warn of the potential health risks posed by its talcum-based products.
Meanwhile, J&J halted worldwide sales of its talc-based baby powder in August 2022. The company has since replaced the product with a cornstarch-based version in what J&J has insisted was a “commercial decision.”
Editor's note: This story has been updated with additional commentary from a coalition of lawyers representing women involved in the ongoing talc litigation.