Johnson & Johnson Reaches $6.48 Billion Settlement in Talc Lawsuits

Johnson & Johnson agrees to a $6.48 billion settlement to resolve 54,000 lawsuits alleging its talc products caused ovarian cancer due to asbestos contamination, one of the largest personal injury settlements in U.S. history.

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Aqsa Younas Rana
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Johnson & Johnson Reaches $6.48 Billion Settlement in Talc Lawsuits

Johnson & Johnson Reaches $6.48 Billion Settlement in Talc Lawsuits

Johnson & Johnson has agreed to a $6.48 billion settlement to resolve approximately 54,000 lawsuits alleging that the company's talc products, such as Johnson's Baby Powder, caused ovarian cancer due to asbestos contamination. The agreement, announced on May 2, 2024, represents one of the largest personal injury settlements in U.S. history.

The settlement comes after years of legal battles and thousands of plaintiffs claiming that Johnson & Johnson's talc products were contaminated with asbestos, a known carcinogen. The deal would allow J&J to resolve the lawsuits through a third bankruptcy filing of a subsidiary company, LTL Management LLC.

Under the proposed plan, claimants will have a three-month voting period to reach a consensus on the settlement of all current and future ovarian cancer claims, which account for 99.75% of the talc-related lawsuits filed against J&J. If 75% of claimants vote in favor, LTL Management may file for a "prepackaged" Chapter 11 bankruptcy to secure confirmation of the plan.

Why this matters: The settlement aims to provide compensation to tens of thousands of women and families who have been affected by ovarian cancer allegedly caused by J&J's talc products. It also seeks to resolve a significant portion of the talc litigation that has plagued the company for years, allowing it to move forward while continuing to defend itself against the remaining claims.

Johnson & Johnson maintains that its talc products do not contain asbestos and do not cause cancer. The company has prevailed in 95% of ovarian cases tried to date, including every ovarian case tried over the last six years. However, the litigation has also resulted in some large verdicts for plaintiffs, including a $2.12 billion award.

The proposed deal would build on J&J's previous settlements with about 95% of people who have sued the company after developing mesothelioma, a rare form of cancer linked to asbestos exposure, as well as its settlements with U.S. states. J&J has set aside a total reserve of $11 billion to account for all of its talc settlements.

Johnson & Johnson discontinued sales of its talc-based baby powder in North America in 2020 and worldwide in 2023, replacing it with a cornstarch-based formula. The company has asserted that the cases against it are "meritless litigation" but is seeking a comprehensive resolution to the talc lawsuits through various legal strategies.

The settlement plan is J&J's third attempt to resolve the talc litigation, with previous efforts in 2021 and 2023 being rejected by judges who ruled that bankruptcy court was not the appropriate venue. The company will continue to defend itself against the lawsuits while trying to gather votes on the current settlement proposal.

Key Takeaways

  • J&J agrees to $6.48B settlement to resolve 54,000 talc-cancer lawsuits
  • Settlement allows J&J to resolve lawsuits through subsidiary bankruptcy filing
  • 75% of claimants must vote in favor for settlement to be approved
  • J&J maintains talc products do not contain asbestos or cause cancer
  • J&J discontinued talc-based baby powder globally in 2023, replaced with cornstarch