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Johnson & Johnson

Johnson & Johnson has lost some significant cases resulting in large judgements for damages relating to ovarian cancer and mesothelioma. Our original page with background information can be read here. where we set out how this links to asbestos, which is our area of practice.

Johnson & Johnson
Figure 1. Johnson and Johnson announced in August, 2022 they would stop, globally, the use of talc in their products, effective 2023.
In October of 2021 Johnson & Johnson created a subsidiary corporation; LTL Management LLC, an entity created specifically to handle the massive liability facing Johnson & Johnson as a result of asbestos and other contaminants contained in its talc products. Johnson & Johnson is headquartered in New Brunswick, New Jersey, with corporate offices throughout the country. LTL Management was incorporated in New Jersey using the J&J headquarters address as their legal address for service.

Within days of incorporation, LTL Management filed for Chapter 11 Bankruptcy in the convivial bankruptcy court in North Carolina. This was after over 38,000 liability claims open against Johnson & Johnson were transferred into the purview of LTL Management Inc. The speed of this is an indication of the effort expended by J&J to make this happen. J&J put notices on their web site confirming they intended to use LTL Management to establish a trust to pay mesothelioma and ovarian cancer claims on October 15, 2021 immediately following LTL’s Chapter 11 proceedings issued on October 14, 2021.

Johnson & Johnson Chapter 11 provides protection from creditors, including personal injury claims. In the case of Johnson & Johnson those included claims for ovarian cancer and mesothelioma. The mass toxic tort litigation firms protested this, claiming that this was clearly a move on behalf of J&J to delay, and reduce, their litigation expenditures. This move, if allowed, would end all past, present and future litigation relating to talc against the company by channeling it to a compensation trust.

The first argument raised by a coalition of plaintiffs lawyers was about the filing of the bankruptcy petition in affable North Carolina. The corporation has no ties to the state. After the filing of extensive briefs and hours of hearings the jurisdiction for the bankruptcy proceeding was decided to be New Jersey where LTL was incorporated and based.

Johnson & Johnson’s legal counsel argued that the handling of this case in the bankruptcy court would ensure that all same level claimants would receive consistent treatment of all claims by establishing a trust similar to those established for other toxic torts. Johnson & Johnson funded LTL with the sum of $2 billion when it was incorporated, and have agreed to another $61 billion for talc injury claimants once the plan has been negotiated.

In February of 2022 a single bankruptcy court judge, Judge Michael Kaplan, decided that the formation of an asbestos style trust for the processing of claims arising from cosmetic talc would be permitted. It was his opinion that with the number of claims started against J&J it would take “thousands of years” for the cases to be individually tried and subsequently appealed, commenting that many claims were already a decade old and to the present date only 49 cases had reached a verdict; some finding for J&J and others for the plaintiffs, all of which are being appealed. Every trial comes with huge expenses to all parties involved.

Judge Kaplan further opined that the US court system is not capable of handling the 38,000 cases currently on the books. Unfortunately, most cosmetic talc claimants will be deceased before their case gets heard. On these facts he based a decision that the Chapter 11 proceedings would be allowed to continue and an asbestos style trust established.

Of note Judge Kaplan and his staff have received threats of bodily harm as a result of this decision. Plaintiffs and their lawyers are hot under the collar over this issue and some believe that it is/was judge Kaplan’s decision standing between them and a high compensation judgement. His decision was, of course, appealed.

On January 30, 2023, it was decided by a federal court panel of three appeal court judges that the Bankruptcy proceeding would not be permitted to continue. Their opinion was based upon the fact that Chapter 11 proceedings were designed to be used by companies teetering on the edge of financial ruin due to looming litigation, judgements and future liability. In the opinion of the panel, Johnson & Johnson was not in a precarious position and could afford to pay judgements for their corporate negligence. The stay of litigation granted in February of 2022 by Judge Kaplan of the New Jersey bankruptcy court was overturned.

Johnson and Johnson in response to this ruling has indicated that they will appeal to a higher court in an attempt to secure their right to establish a litigation trust rather than face thousands of individual personal injury actions that will keep their litigation department busy for decades, if not generations. No hearing date for the appeal is scheduled yet.

While the personal injury bar in the United States is pleased that they can once again sue Johnson & Johnson at will, this is not helpful to persons damaged by Johnson & Johnson products in Canada. Navigating the US court system is time consuming and very costly. A Canadian lawyer would need to associate with an American lawyer/firm licensed to practice in the state where the case is to be litigated. J&J headquarters is in New Jersey, the bankruptcy proceedings of LTL are now in New Jersey while the Chapter 11 proceedings decision was appealed to a Panel of judges in Pennsylvania. The general rule of thumb is the action should take place where the damages occurred, where the plaintiff resides or where the defendant operates.

How long the situation will remain in flux is unknown. The wheels of justice move exceedingly slow. As quoted from The Blacklist “wheels turn, justice sits.”

Toxic tort trusts have been open to applications from Canadians who apply on the same footing as American claimants. We would expect that to be the case in this scenario given their sales of talc in Canada. Having a trust established would be far better for injured Canadians, in our opinion.

A compensation trust is a long way from being established and there is a strong possibility that it never will come to pass. We are taking names in an attempt to document claims for seriously injured persons injured by J&J talc products so we can preserve any evidence before too much time passes.

If you have been diagnosed with ovarian cancer or mesothelioma and used talc products, specifically those manufactured by Johnson & Johnson, contact Brown Law to learn about other compensation options. Talking to us is free and carries no obligation.