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On April 4, 2023, Johnson & Johnson announced a new proposed plan to commit $8.9 billion USD to “resolve all claims arising from cosmetic talc litigation against the Company and its affiliates in North America” through a newly filed Chapter 11 case in a US bankruptcy court.

The proposed plan relates to J&J’s talcum powder products, which were globally discontinued in 2022 (Read my prior blog, Johnson & Johnson stopping all sales of talcum-based baby powder for more info). 

J&J pledges $8.9 billion for talc claims resolution but key details remain unknown

In its press release, J&J pledged $8.9 billion USD to fund a new reorganization plan in a freshy filed case for Chapter 11 bankruptcy protection by a J&J subsidiary – LTL Management – in a New Jersey bankruptcy court. According to the company’s statement the plan would contemplate up to $8.9 billion payable over 25 years to resolve all the current and future talc claims.

The full details of the plan are not yet known, as J&J has yet to file the Plan in court.

Though J&J’s stated intent is for the new plan to resolve talcum powder claims “as quickly and efficiently as possible,” any proposed bankruptcy plan does not guarantee that victims will ultimately receive compensation any time in the near future, if at all. To become effective, a Chapter 11 Plan would need to pass an approval vote by prospective claimants, as well as receive the approval of a bankruptcy judge and survive any appeals, which may take years.

The company has yet to announce specifics as to when payouts to victims would be projected to occur over the 25-year lifespan for the Plan.

New plan marks second attempt to use bankruptcy court after initial attempt dismissed

This new case is the second time J&J will attempt to use the US bankruptcy court system to resolve talcum powder claims in North America pending against the company and its affiliates. LTL filed an initial petition in the NJ bankruptcy court back in 2021, but their initial reorganization plan would have only seen $2 billion allocated to pay the claims of cancer victims and other creditors. That initial proposed bankruptcy plan was rejected by a US Court of Appeals in January 2023 (Read my prior blog, Johnson & Johnson’s bankruptcy strategy for talcum powder cancer lawsuits rejected by US Court on the appeal decision, for more info).

Although J&J initially stated an intent to appeal the January 2023 ruling to the US Supreme Court, no appeal was filed, and the US bankruptcy court issued an order formally dismissing the original bankruptcy case on April 4, 2023. Hours later, the 2nd bankruptcy case was filed.

Canadians affected by J&J’s talcum powder products are encouraged to seek representation

Any Canadian who believes that they or a family member may have been harmed by Johnson & Johnson’s talcum powder products is encouraged to reach out to a lawyer to ensure that their potential legal interests in the new bankruptcy, if any, are protected.

Siskinds LLP is representing Canadians who have been diagnosed with cancers, including mesothelioma or cancers of the ovaries, fallopian tubes, or peritoneum, after regular use of J&J talcum powder products. If you or a loved one have impacted, contact us at [email protected] or visit our website for more info.

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