Johnson & Johnson announced on Wednesday that it is pushing ahead with a $6.475 billion proposed settlement for tens of thousands of lawsuits alleging that its baby powder and other talc products contain asbestos and cause ovarian cancer.
The deal, if approved, would resolve the lawsuits through a third bankruptcy filing of a subsidiary company. A three-month voting period will commence in hopes of reaching a consensus on settling all current and future ovarian cancer claims. Ovarian cancer claims make up 99% of the talc-related lawsuits filed against J&J, including approximately 54,000 lawsuits centralized in a New Jersey federal court proceeding.
J&J’s two previous attempts to resolve the lawsuits through the bankruptcy of its talc liability-absorbing subsidiary, LTL Management, were rejected by courts. Despite maintaining that its products do not contain asbestos or cause cancer, J&J stated that its settlement has the majority support of attorneys representing plaintiffs in cancer lawsuits against the company.
Confident that the deal will reach a 75% support threshold needed for a bankruptcy settlement, J&J aims to halt future lawsuits and prevent individuals from opting out of the deal to pursue separate lawsuits. The proposed deal builds upon J&J’s settlements with approximately 95% of individuals who sued the company after developing mesothelioma, a rare cancer linked to asbestos exposure, and with U.S. states alleging failure to warn consumers about the dangers of its talc products.
Mesothelioma
J&J did not disclose the value of the mesothelioma settlements but reported an incremental charge of $2.7 billion in the first quarter of 2024 for recent talc-related settlements. In its previous bankruptcy filing, LTL proposed an $8.9 billion deal addressing mesothelioma cancer lawsuits, states’ consumer protection actions, and ovarian cancer claims.
Although talc litigation was paused from 2021 to 2023 due to previous bankruptcy filings, trials have resumed since a federal judge ruled the latest bankruptcy case should be dismissed in July 2023. In March, J&J received an opportunity to contest the scientific evidence linking talc to ovarian cancer in the centralized litigation in a New Jersey federal court. The judge overseeing the cases deemed that recent changes in the law and new scientific evidence require a fresh review and asked J&J to present new arguments on the science by late July.
J&J intends to continue defending itself against the lawsuits while working to gather votes on the settlement. The company asserted its success in 95% of ovarian cases tried to date, including every ovarian case tried over the last six years. Despite this, some plaintiffs have received substantial verdicts, including a $2.12 billion award in favor of 22 women who attributed their ovarian cancer to asbestos in J&J talc. Additionally, J&J was recently ordered to pay $45 million in a mesothelioma case while winning an ovarian cancer case in the past month.
