For the last several years, Johnson & Johnson has been ordered to pay millions of dollars in compensation to victims of mesothelioma and ovarian cancer. With tens of thousands of such claims pending, the company has made multiple attempts to convince bankruptcy judges to allow them to assign all of their asbestos liabilities to newly formed subsidiaries. Despite repeated failures, it recently established a Texas-based spinoff and proposed a $9 billion settlement offer that would allow it to shelter the company’s assets. Representatives of victims, as well as other interested parties, have lodged objections.
Mesothelioma and Ovarian Cancer Victims Call J&J Bankruptcy “Bad Faith”
Many asbestos companies facing overwhelming claims from mesothelioma victims have successfully sought bankruptcy protection under a code designed specifically for them: it allowed them to force nonconsenting victims to accept the establishment of asbestos trust funds so that they could continue their business operations.
Johnson & Johnson’s bankruptcy proposal relies on this code, but the ovarian cancer victims that it hopes to address, as well as the U.S. Department of Health and Human Services, insurance companies, and the U.S. Trustee’s Office among others are objecting to this, noting that rather than protecting ongoing business operations, J&J’s Red River Talc subsidiary was created to house the company’s talc liability, and is not in the financial distress that the bankruptcy code requires. The group says that Johnson & Johnson and its corporate affiliates’ plan to use the bankruptcy code was not proposed in good faith, which is the same reason their two previous attempts were rejected by the court.
Victims’ Advocates Point to Basis of Congress Creating Asbestos Code
In objecting to Johnson & Johnson’s use of the code to justify its bankruptcy filing, the coalition noted, “Congress enacted that section of the code to assist financially struggling companies to use their ongoing operations to fund long-term asbestos liability Here, however, the debtor is the hand-crafted product of a complex set of divisional mergers, beginning in 2021, that severed the then-manufacturer of the asbestos-laden product from the liabilities of that product.”
The group is represented by former U.S. Bankruptcy Judge Melanie Cyganowski, who said, “The Coalition for Justice for Talc Claimants has long championed the need for Johnson & Johnson to take responsibility for the harm inflicted over so many years upon women who trusted J&J by regularly using their baby powder, only to later become ill with ovarian cancer and other serious maladies.”
If you or someone you love has been diagnosed with ovarian cancer, malignant mesothelioma, or another asbestos-related disease, the Patient Advocates at Mesothelioma.net can help. Contact us today at 1-800-692-8608 to learn more.
