Johnson & Johnson Files for Bankruptcy Over Talc Lawsuits for the Third Time
Johnson & Johnson (NYSE: JNJ), via its subsidiary called Red River Talc, for the third time, filed for voluntary bankruptcy to resolve thousands of lawsuits related to its talc products. Red River Talc has filed for Chapter 11 bankruptcy to equitably resolve all of JNJ’s present and future talc-related claims in a bankruptcy court in the Southern District of Texas.
JNJ faces more than 62,000 lawsuits for its talc-based products, primarily its baby powders. The lawsuits allege that its talc products contain asbestos, which caused many women to develop ovarian cancer. JNJ insists that talc-based products are safe and do not cause cancer. JNJ has permanently discontinued the sale of its talc-based Johnson’s Baby Powder.
So far this year, JNJ’s shares have risen 4.7% compared with the industry’s 23.5% increase.
Image Source: Zacks Investment Research
JNJ’s Two Failed Bankruptcy Attempts
Johnson & Johnson’s subsidiary, LTL Management, which was established to manage claims in the cosmetic talc litigation, filed for voluntary bankruptcy twice in New Jersey. However, both the bankruptcy filings were rejected by courts stating that J&J was not in enough financial stress to qualify for bankruptcy.
JNJ’s New Plan and 3rd Bankruptcy Filing
In May 2024, LTL Management proposed a new plan committing to pay claimants a present value of approximately $6.5 billion to be paid over 25 years, which could resolve 99.75% of all …
Full story available on Benzinga.com
