Johnson & Johnson has proposed paying nearly $9 billion to settle tens of thousands of lawsuits in North America alleging that its baby powder and other talc-based products cause cancer.
Although the healthcare giant maintains that these claims are “specious,” it hopes that the new settlement offer will bring its legal battles to a close.
This new settlement offer represents a substantial increase from the $2 billion previously proposed. According to the company, the revised offer has garnered considerable support from those involved in the case.
Johnson & Johnson is contending with over 40,000 lawsuits filed by former customers who claim that its talc-based baby powder led to cancer, with some alleging that the product contained asbestos, a known carcinogen.
In 2020, Johnson & Johnson ceased sales of its talc-based baby powder in the US, citing “misinformation” that had diminished demand for the product, which was used to prevent nappy rash and for other cosmetic purposes such as dry shampoo. Last year, the company announced plans to end global sales of the product.
The baby powder had been sold for nearly 130 years before this decision. The company now sells a version of the product containing cornstarch.
Since 2021, Johnson & Johnson has attempted to address the lawsuits through bankruptcy court by establishing a subsidiary to handle the claims.
However, these efforts encountered difficulties when an earlier bankruptcy court ruling determined that the subsidiary was not in financial distress and thus could not utilize the bankruptcy system to settle the lawsuits.
Erik Haas, Johnson & Johnson’s worldwide vice president of litigation, stated, “The company continues to believe that these claims are specious and lack scientific merit.
However, resolving these cases through the tort system would take decades and impose significant costs on LTL and the system, with most claimants never receiving any compensation.”
Haas added, “Addressing this matter through the proposed reorganization plan is both more equitable and efficient, allowing claimants to be compensated in a timely manner and enabling the company to remain focused on our commitment to making a profound and positive impact on health.”
Johnson & Johnson reported that it has won a majority of the talc-related lawsuits against it. However, it has faced some significant losses, including a judgment of over $2 billion awarded to 22 women.
The company has indicated that approximately 60,000 current claimants have committed to supporting the new settlement terms.
