J&J Offers $6.48 Billion to Settle Talc Cancer Lawsuits: Can This Third Time Be the Charm?

Johnson & Johnson (J&J) is offering a fresh start in the long-running saga of talc cancer lawsuits. This time, they're putting a hefty $6.48 billion on the table and changing their approach in hopes of finally resolving the litigation.

The new proposal aims to settle tens of thousands of lawsuits alleging J&J's talc products, specifically baby powder, caused ovarian cancer. The key difference this time around? J&J wants claimants to vote on the deal before the company files for bankruptcy with a subsidiary – a strategy that backfired twice before.

Previous efforts hit a wall

J&J's past attempts to use bankruptcy to resolve the lawsuits were met with legal roadblocks. Courts dismissed their efforts, citing the company's lack of financial distress – a requirement for bankruptcy protection. 

As Reuters reported, "Courts have rebuffed J&J's two previous efforts to resolve the lawsuits through the bankruptcy of the subsidiary created to absorb the company's talc liability, ruling that the company was not in 'financial distress.'"

It's important to note that the previous bankruptcy filings put the talc litigation on hold from 2021 to 2023. Trials have resumed after a federal judge ruled the latest bankruptcy case should be dismissed in July 2023. In March, J&J received a new chance to contest the scientific evidence linking talc to ovarian cancer in the centralized litigation in New Jersey federal court. The judge overseeing the cases said recent changes in the law and new scientific evidence require a fresh review, and asked J&J to present new arguments on the science by late July.

A new approach, but will it stick?

J&J believes gathering votes beforehand will address these concerns and pave the way for a successful resolution. Erik Haas, J&J's worldwide vice president of litigation, told Reuters, "The claimants get to vote, and that's the major difference here," referring to the legal challenges that resulted in courts dismissing J&J's previous subsidiary bankruptcy filings before the ballot stage.

This new approach has divided lawyers representing cancer victims. Some, like Jim Onder who represents about 21,000 talc claimants, see the proposal as a positive step. He told Reuters, "I believe J&J's proposed plan announced today will bring peace and closure to our clients and the thousands of women who have fought by our side in the quest for justice."

However, other lawyers remain skeptical. They accuse J&J of trying to manipulate the vote by including claims not strongly linked to talc. Mike Papantonio, an attorney opposed to the deal, told Reuters, "J&J has been 'covertly soliciting law firms to accept their deal, promising a swift payday for some opportunistic lawyers.'" J&J vehemently rejects these claims, with Haas calling them "baseless and no more than a red herring."

J&J maintains innocence

The company continues to deny any wrongdoing and maintains its talc products are safe. J&J points to their success rate in defending lawsuits, emphasizing that "they have prevailed in 95% of ovarian cases tried to date, including every one tried over the last six years." The company sees the settlement as a good-faith effort to end the litigation.

J&J plans to continue defending itself against the lawsuits while trying to gather votes on the settlement. The company boasts a 95% win rate in ovarian cancer cases that have gone to trial, including a perfect record in the last six years. However, the litigation has also resulted in some large verdicts against them, including a $2.12 billion award for 22 women and a recent $45 million mesothelioma case.

J&J needs 75% of claimants to approve the deal for it to take effect. Whether this new approach, with a significant financial offer and a chance for claimants to weigh in before a bankruptcy filing, will succeed where previous attempts failed remains to be seen. J&J faces ongoing lawsuits and will likely continue defending themselves in court while pursuing this settlement.

Interestingly, J&J has stopped selling talc-based baby powder in favor of cornstarch-based products, citing an increase in lawsuits and "misinformation" about the talc product's safety.

Looking ahead

The situation continues to develop. With a hefty sum on the table and a novel approach, J&J hopes to finally resolve these long-standing legal battles. We'll see if this third attempt proves to be the company's charm offensive, or if the skepticism from some cancer victim representatives continues to be a hurdle.