J&J Offers $9 Billion Settlement To Resolve Talc Powder Cancer Claims

Consumer GoodsLegal News

After Johnson & Johnson (J&J)’s attempt to resolve tens of thousands of lawsuits through a controversial bankruptcy plan was rejected by two different courts, the multinational corporation has agreed to pay $8.9 billion (USD) to settle claims that its talcum-powder containing products cause cancer because of asbestos contamination.

The April 4 announcement comes roughly 18 months after J&J offered to settle talc cancer claims for $2 billion. Under the terms of the proposal, J&J will not admit to any wrongdoing, maintaining its talc products are safe. J&J’s subunit, LTL Management, which was created to shoulder J&J’s talc liabilities, would pay talc plaintiffs who have been diagnosed with cancer before April 1, 2023, within one year of the plan’s approval date, via the $9 billion trust. Plaintiffs diagnosed with cancer after April 1, 2023 would be paid from the remaining amount in the settlement, which would be paid over a 25 year period.

According to J&J, approximately 60,000 claimants have agreed to the proposal. However, many plaintiffs’ attorneys consider the $9 billion sum woefully inadequate, considering that in one 2018 Missouri trial alone, 20 women were awarded $4.7 billion, a sum that was later reduced to $2.5 billion.

Currently, there are approximately 38,000 active talc lawsuits, with thousands more claims that have yet to be officially filed as lawsuits. The litigation against J&J’s talc powder products, which includes Shower-to-Shower and its iconic J&J baby powder, which the company stopped selling in 2020 (J&J replaced talc with cornstarch) resumed after a U.S. bankruptcy court ruled that LTL Management could not be placed in bankruptcy protection. The court ruled that because J&J itself was not in financial distress, LTL Management could not take advantage of Chapter 11 bankruptcy protection. The Third Circuit Court of Appeals recently rejected J&J’s request to rehear a 3-judge panel of the Third Circuit’s January decision to prevent talc litigation from being resolved via chapter 11 bankruptcy protection.

J&J announced that it would petition the U.S. Supreme Court to review the Third Circuit’s decision, however, most legal experts believe a grant of the petition is unlikely. For this reason, LTL Management, the J&J subunit, has re-filed for bankruptcy and announced that by May 14, it will officially have its restructuring plan, including the $9 billion trust to resolve talc lawsuits, for a judge to review.


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