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J&J Offers $6.48 Billion to Settle Ovarian Cancer Talcum Powder Lawsuits

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Third time’s the charm, or Groundhog Day all over again?

Trenton, NJIn May, Johnson & Johnson offered to pay roughly $6.48 billion over 25 years to settle all current and future talcum powder lawsuits. These lawsuits allege that baby powder containing asbestos-contaminated talc caused ovarian cancer. Erik Haas, J&J's worldwide vice president of litigation, insists that this offer is fundamentally different than the two that courts rejected before. If accepted, it would resolve 99.75 percent of J&J’s remaining talc lawsuits in the U.S.

A coalition of plaintiffs’ attorneys has come out against the plan, deriding it as “an attempt to stuff the ballot box” and a bad faith abuse of the Bankruptcy Code, just as the two previous offers were. In any event, they insist, the likely payouts would still be inadequate to cover physical and financial damages, medical bills, lost earning capacity, severity of disease and lost quality of life.

No really, this time is different

This time, the pharmaceutical giant will give claimants 3 months to vote on whether the offer is enough to settle all current and future ovarian cancer claims related to its products. Haas was reportedly confident that the deal will get the required 75 percent support needed for a bankruptcy settlement. "The claimants get to vote, and that's the major difference here," Haas said in a call with investors.

The company argues that it is in the best interest of claimants to approve the plan because:
  • they may not recover anything at trial; and
  • in any event, it would take decades to litigate the more than 50,000 remaining cases, which means that most claimants would never have their day in court.
The universe of voters, however, includes those who have not sued J&J and patients who have types of gynecological cancers with no strong scientific link to talc. Cancer victims’ attorneys are divided on whether claimants should accept the newest deal or not. The objections fall roughly into three main categories.

Stuffing the ballot box

Some plaintiffs’ lawyers 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.” In other words, by soliciting approval from those whose claims are weaker, J&J is likely diluting the strength (and the likely payout amount) of those with stronger claims. For the claimant whose talcum powder lawsuit against J&J might otherwise fail at trial, voting for and opting into the settlement is a financially rational choice.

Same old Texas two-step

In October 2021, J&J attempted to avoid the lawsuits against the company by pushing 38,000 talc lawsuits to bankruptcy court, through a process known as the Texas two-step. This process involved the creation of an underfunded subsidiary, then called LTL Management, to which all talcum powder liabilities were shifted. LTL promptly filed for bankruptcy protection.

The proposal was blocked by an appeals court, which claimed J&J and its subsidiaries had plenty of money to cover the claims against them. The court described the maneuver as an abuse of the bankruptcy process.

In April 2023, the company, through another LTL Management bankruptcy filing, offered to pay nearly $9 billion to settle talcum powder lawsuits filed by 40,000 victims who developed cancer from the company's talc products. The company was forced to re-evaluate this offer after it was rejected by the court for being too low.

The latest offer is another try at using the bankruptcy process to limit J&J’s liability. But now, the subsidiary has been re-named LLT. The dollar amount and the class of possible claimants have changed somewhat, but the basic plan is the same.

It’s still dodgy, according to some. But time, and money and patience are not on the cancer sufferer’s side.

Just not enough

The past is no guarantee of the future, of course. But aside from J&J’s assertion that some cancer victims may recover nothing at trial, some of the settlement amounts, involving ovarian cancer and mesothelioma, have been quite large.

In 2018, a group of 22 women were awarded $4.7 billion, a verdict that was later reduced to $2.1 billion. The U.S. Supreme Court left the award in place. Shortly thereafter, the ovarian cancer talcum powder lawsuits were stayed pending the company’s bankruptcy petitions. In a separate legal action J&J has agreed to pay $700 million to settle an investigation by 42 U.S. states and Washington, D.C. into its marketing of baby powder and other talc-based products blamed for allegedly causing cancer.

Legal industry experts have estimated that the average settlement for talcum powder lawsuits is roughly $500,000 per plaintiff. However, the average settlement amount can vary widely.


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