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Imerys Talc Claims Bankruptcy, J&J Ovarian Cancer Claims Continue

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Imerys Talc America, supplier to J&J, filed Chapter 11 bankruptcy after spending tens of millions of dollars to defend itself and to settle J&J talc Ovarian Cancer Claims

Three Forks, MTFacing about 14,000 asbestos-talc cases claiming that talc causes ovarian cancer and mesothelioma, Imerys Talc America has filed for Chapter 11 bankruptcy protection. Court records indicate that defending a single case can cost Imerys $4 million and some juries have awarded damages up to $2.75 million against the company. Imerys is the sole supplier of cosmetic talc to Johnson & Johnson.

Reuters reported that a rising settlement threat and defense costs have instigated Imerys to file the bankruptcy protection claim. As well, insurers are growing reluctant to provide coverage for the talc cases, said a company representative. Imerys Talc has already settled a number of cases for undisclosed amounts. One lawsuit (and the first case that associated asbestos in talc to ovarian cancer) resulted in a jury ordering J&J to pay a record $4.69 billion to 22 women who said J&J’s baby powder caused ovarian cancer –of which Imerys settled prior to that verdict. And $117 million was awarded to a man who blamed Imerys and Johnson & Johnson for his mesothelioma.

Imerys Talc America produces in its mines about half of the country’s talc supply. Imerys talc is also used in many other products, from foods to adhesives to automotive parts. Lawsuits claim that Imerys and J&J knew for decades that talc contained asbestos but failed to warn consumers of its risks or replace it with less-toxic cornstarch.

Court documents reveal that Imerys made efforts through litigation to keep its talc from being listed as potentially carcinogenic. By 2006 the company lost interest in proving the safety of its product: an email by an Imerys executive shown to jurors by plaintiffs’ lawyers said that “the horse has already left the barn.” But the company has not acknowledged in court that its talc was tainted or dangerous.

Chapter 11 Bankruptcy

Chapter 11 bankruptcy allows companies to ward off creditors, while they can reorganize, continue operating and potentially resolve liabilities. While a California judge on February 14 asked jurors not to speculate on why the talc supplier is no longer in the case, Giorgio La Motta, President, Imerys Talc America, Imerys Talc Vermont, and Imerys Talc Canada said that “it is simply not in the best interests of our stakeholders to litigate these claims in perpetuity and incur millions of dollars in projected legal costs to defend these cases.” Imerys intends to operate its three locations as usual.

How Imerys Bankruptcy Affects J&J Talc Lawsuits

Under Chapter 11 of the U.S. Bankruptcy Code, Imerys officials will be able to negotiate payouts with those who have sued them.

When a company files bankruptcy under Chapter 11, it can set up a trust that would handle and defend it against any future claims. According to CNBC, Imerys said it plans to use bankruptcy to establish a trust to pay personal injury claims, a strategy typically used by companies facing asbestos claims. The trust can deal with current talc cases and any future claims.

However, this filing is typically used as a way to protect against billion-dollar lawsuits: it allows cases to be tried under a single judge and plaintiffs are pressured to reach a lower settlement. For instance, Johns Mansville Corp. in 1982 faced unprecedented liability for asbestos injury claims and was the first company facing asbestos litigation to file for bankruptcy under Chapter 11. By 1988 the company emerged from bankruptcy and founded the Manville Personal Injury Settlement Trust, according to

Independent trustees may decide how the money is split among talc plaintiffs and a trust could continue to operate for several years to oversee negotiation and payments of settlements. When the company leaves bankruptcy, current and future litigation claims will be channeled to the trust rather than Imerys, which will then be free from future talc lawsuits.

Imerys Talc America and Imerys Talc Vermont has listed its combined assets as $500 million and liabilities of as much as $100 million, according to the bankruptcy filing, and the Chapter 11 process is expected to end by 2020. Bloomberg Intelligence litigation analyst Holly Froum said the bankruptcy will probably have a negative impact on Johnson & Johnson in thousands of talc lawsuits as Imerys won’t be able to contribute much capital to potential settlements.


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