In a significant development, pharmaceutical giant Johnson & Johnson is on the brink of settling with 42 U.S. states over allegations of misleading consumers regarding the safety of its talc products, widely accused of causing cancer. The tentative agreement, valued at around $700 million, represents a crucial step in the company’s ongoing efforts to put an end to the legal scrutiny surrounding its talc-related controversies.
The deal, which excludes private plaintiffs’ cases, marks a strategic move by Johnson & Johnson to navigate through the intricate web of litigation. Erik Haas, J&J’s worldwide vice president of litigation, emphasized the company’s commitment to achieving a comprehensive and final resolution for the talc litigation. Despite the settlement with the states, numerous private cases are still poised to go to trial later this year.
Johnson & Johnson staunchly maintains the safety of its discontinued talc products, contradicting claims that they pose a cancer risk. The company had already earmarked $400 million to address state claims, reflecting its proactive approach to dealing with legal challenges. However, the settlement doesn’t shield the company from the ongoing wave of private lawsuits, a subset of which involves individuals with mesothelioma, a cancer type associated with asbestos exposure.
In a bid to find a resolution, Johnson & Johnson attempted twice to place its talc liabilities into bankruptcy. The latest attempt, proposing an $8.9 billion payment to talc claimants, was thwarted, prompting the company to announce a potential third bankruptcy filing. The current settlement with the states may pave the way for a smoother bankruptcy process, especially considering some states’ arguments that they can pursue claims during bankruptcy proceedings, a matter yet to be conclusively addressed by the courts.
The legal landscape surrounding talc cases has witnessed a mixed record in recent years. Notable victories for plaintiffs include a substantial $2.1 billion judgment in 2020 awarded to 22 women with ovarian cancer. However, a New Jersey appeals court overturned a $223.8 million verdict against the company in October, casting doubt on the credibility of the plaintiffs’ expert witnesses.
Amidst these legal battles, Johnson & Johnson made a strategic business decision to cease the sale of talc-based baby powder, opting for cornstarch-based alternatives. The shift was attributed to a surge in lawsuits and what the company referred to as “misinformation” regarding the safety of its talc products.
As the pharmaceutical giant grapples with a myriad of legal challenges, the resolution with the U.S. states adds a new chapter to the ongoing saga, shedding light on the intricate legal maneuvers and complexities surrounding talc-related controversies.
