Johnson & Johnson’s proposed settlement for its ongoing baby powder litigation has increased as it nears finalization.
The pharmaceutical giant has tacked an additional $1.1 billion onto the $6.48 billion ovarian cancer settlement that it initially proposed in May. If approved, Johnson & Johnson would pay out the settlement over 25 years, resulting in an estimated total of $9 billion paid.
Support for the settlement has continued to grow among plaintiffs. According to the Wall Street Journal, Allen Smith, a key plaintiffs’ lawyer representing thousands of cases, has agreed to back the proposal after the additional money was added.
Drugwatch had previously reported that, through a secret ballot, the settlement had already exceeded the 75% plaintiff support threshold needed to move forward. The additional support this week has likely increased that margin.
While the potential settlement will handle much of the ongoing litigation surrounding J&J baby powder’s ties to ovarian cancer, it does not cover mesothelioma cases related to talcum powder and asbestos exposure.
What Does J&J’s Upgraded Settlement Offer Mean for Talcum Powder Lawsuits?
The increased payout and the backing from a key plaintiffs’ lawyer suggest that the baby powder settlement is moving toward a legitimate resolution, with Reuters reporting that J&J is preparing to finalize it this month.
However, there are still potential obstacles to its approval, with J&J likely planning to employ what is known as the Texas-two-step bankruptcy strategy.
J&J’s plan involves LTL Management LLC, a subsidiary J&J created to manage its talc settlements. Rather than J&J filing for Chapter 11, LTL Management LLC will declare bankruptcy.
J&J has tried this strategy before, with its first attempt dating back to 2021, but has yet to see success in front of a judge. Just last month, a federal supreme court dismissed the company’s third try at this type of bankruptcy to complete its talc settlement.
The court determined that LTL Management LLC had not presented adequate evidence to prove the talc lawsuits had created enough financial stress to warrant bankruptcy.
J&J will need a favorable court ruling to achieve its settlement.
Settlement Could Mark a Resolution to Much of J&J’s Baby Powder Litigation
The pending settlement could resolve much of the ongoing litigation over J&J’s baby powder and its links to ovarian cancer. As of this week, there were nearly 58,000 talcum powder lawsuits pending in multidistrict litigation.
Lawsuits originated over claims that talcum powder causes ovarian cancer. Allegedly, J&J did not alert customers of these risks, failing to add warning labels to its products despite research showing links between the powder and cancer.
Plaintiffs have seen some notable wins in recent years, including in 2021 when the U.S. Supreme Court refused J&J’s request to overturn a $2.1 billion verdict awarded by a Missouri court to 22 women who developed ovarian cancer.
What will remain unresolved are additional claims and lawsuits that J&J baby powder causes mesothelioma due to asbestos exposure. J&J recalled 33,000 bottles of baby powder in 2019 after lab results revealed asbestos in test samples.
Courts have repeatedly sided with plaintiffs who have blamed their mesothelioma on J&J, and just awarded $63.4 million last month to a man who developed the rare and aggressive cancer after years of baby powder use.
J&J stopped selling talc-based baby powder in the U.S. in 2020, opting instead for a corn-starch-based powder.
Editor Lindsay Donaldson contributed to this article.