On this photo, a Johnson and Johnson baby powder container is displayed on April 5, 2023 in San Anselmo, California.
Justin Sullivan | Getty’s paintings
A federal bankruptcy judge on Thursday stopped about 40,000 allegations of lawsuits Johnson & Johnsonbaby powder and other products containing talc caused cancer.
The choice is an element of J&J’s second try and settle 1000’s talc cases in bankruptcy proceedings.
J&J spun off its subsidiary, LTL Management, in 2021 to incur talc liabilities and file for Chapter 11 bankruptcy protection.
Judge Michael Kaplan during Thursday’s hearing within the U.S. Bankruptcy Court in Trenton, Recent Jersey, temporarily suspended the trials, which is able to last until mid-June, reported the Wall Street Journal.
J&J won’t need to go to court over other talc claims through the hiatus, but latest lawsuits could still be filed against the corporate, The Journal reports.
Based on the newspaper, Kaplan said through the hearing that J&J had a “difficult battle” ahead of them.
The stay will give J&J time to achieve an enduring settlement with the plaintiffs within the talc cases. The corporate recently offered a $8.9 million settlement for current and future talc claims and said it expects to file the plan in bankruptcy court in mid-May.
J&J in a press release called Kaplan’s decision “a win for claimants” because it brings them “one step closer” to having the ability to vote on the proposed settlement.
The Recent Brunswick, Recent Jersey-based company also said it believed applicants would overwhelmingly support the proposal.
J&J previously said greater than 60,000 applicants had already pledged to vote for the plan.
“Having provided a transparent and complete explanation and the chance to make an informed selection, we’re confident that applicants will approve the plan,” said Erik Haas, J&J’s vice chairman of Worldwide Litigation.
Kaplan’s decision is narrower than the one he made after LTL Management first filed for Chapter 11 in 2021.
Judge ruled in February 2022 that J&J could use the bankruptcy system to resolve the talc allegations, allowing the corporate to avoid fighting 1000’s of individual lawsuits.
Kaplan essentially confirmed J&J’s use of a method often called “Two Step Texas” which allows corporations to divide invaluable assets from liabilities through the so-called divisive merger.
But in January, the U.S. Court of Appeals for the Third Circuit overturned that ruling. The appeals court found that neither LTL nor J&J had a legitimate need for bankruptcy protection as they weren’t in “financial distress”.
Amid ongoing legal battles, J&J continues to disclaim allegations that its talc products cause cancer.
CFO Joseph Wolk said on Tuesday that it was “unlucky” that J&J needed to “dedicate dollars to frankly unsubstantiated scientific claims.”
The lawsuit alleges that J&J’s talc products were contaminated with the carcinogen asbestos, which has caused ovarian cancer in 1000’s of individuals.
Some lawsuits link several deaths to J&J talc products.