Johnson & Johnson recently announced a settlement plan to pay $6.5 billion over 25 years to resolve thousands of lawsuits in the U.S. that claim their talc-based products caused ovarian cancer. This move comes after decades of legal and public relations turmoil for the company. They firmly believe that their talc products are safe for consumers, despite the numerous lawsuits filed against them.
The settlement plan aims to put an end to the majority of talc-related lawsuits by going through a third bankruptcy filing of a subsidiary company, LTL Management. However, J&J had previously failed twice in their attempts to resolve the lawsuits through the bankruptcy of this specific subsidiary. The company will initiate a three-month voting period for claimants to secure a 75% approval needed for the bankruptcy settlement to proceed.
J&J executives have expressed confidence in the plan, stating that they have the “significant support of the overwhelming majority of the claimants.” Erik Haas, J&J’s worldwide vice president of litigation, emphasized that the settlement offers a far better recovery for claimants than they would likely receive in a trial. However, claimants have not had the opportunity to vote in previous bankruptcy cases involving LTL Management.
While the settlement plan aims to resolve the majority of talc-related lawsuits, there are still pending cases related to mesothelioma, a rare form of cancer. J&J has acknowledged that they have already settled 95% of mesothelioma lawsuits filed to date. Despite the settlement plan, some claimants have received large verdicts, such as a $2 billion award in favor of 22 women who attributed their ovarian cancer to asbestos in J&J’s talc products.
Following the announcement of the settlement plan, J&J’s shares rose more than 2% in premarket trading. The pharmaceutical giant has also resolved an investigation by a coalition of over 40 states into allegations that the company misled patients about the safety of its talc-based products. Additionally, agreements have been made to settle claims brought by suppliers of J&J’s talc.
The settlement plan proposed by Johnson & Johnson reflects their efforts to resolve the longstanding legal challenges related to their talc-based products. While the company remains confident in the plan’s success and claimants’ support, there are still pending cases and ongoing litigation that need to be addressed. The settlement plan, if approved, could potentially bring an end to years of legal battles, but the outcome remains uncertain until the claimants have cast their votes.
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