Johnson & Johnson Increases Talcum Powder Settlement Offer by $1.1B: Reuters

Johnson & Johnson is raising its offer to settle all talcum powder ovarian cancer lawsuits by more than $1 billion, increasing the total payout to about $9 billion over 25 years, as part of an effort to convince plaintiffs to allow the company to resolve the litigation through another controversial bankruptcy maneuver.

The company faces more than 62,000 Baby Powder lawsuits and Shower-to-Shower lawsuits, brought by women claiming that use of Johnson & Johnson talc products on their genitals led to the development of ovarian cancer and other malignancies.

Each of the claims raise similar allegations that information was withheld for decades about the presence of asbestos particles in Johnson & Johnson’s talc-based powders, and the company has already been hit with several massive verdicts in early cases that went before juries in recent years

As part of an attempt to resolve both current and future claims, Johnson & Johnson has made two prior bankruptcy filings, after shifting all liability the company faces for failing to warn about the talcum powder cancer risks to a new subsidiary, which then immediately filed for bankruptcy protections.  However, both of the previous filings have been rejected by federal bankruptcy judges, since Johnson & Johnson faces no real financial distress.

While the prior filings failed, the moves have successfully delayed the litigation for the better part of three years, preventing large numbers of strong cases from being prepared for individual trials to determine the amount of compensation the company should be forced to pay.

Rather than negotiating in good faith with plaintiffs, Johnson & Johnson proposed a third talcum powder bankruptcy in May 2024, including a $6.5 billion settlement fund to resolve all current and future Baby Powder lawsuits involving women diagnosed with ovarian cancer, which makes up the bulk of litigation the company currently faces.

J&J Increases Talcum Powder Cancer Settlement Offer

According to a Reuters report published on September 5, Johnson & Johnson is now increasing the offer by $1.1 billion, indicating that it is part of an attempt to win over the many plaintiffs and lawyers who have roundly rejected the recent effort. Opponents of the original settlement have not only maintained that it is an inappropriate use of the U.S. bankruptcy system, but also indicated that the proposed fund was insufficient to fairly compensate women who relied on the safety of the company’s talcum powder products.

Last month, reports indicated that 75% of eligible claimants have already voted to back the original talcum powder settlement offer in a secret poll conducted by Johnson & Johnson. However, the settlement is still not a done deal, and is expected to face legal challenges.

While not publicly acknowledging the increased talcum powder settlement offer, Johnson & Johnson issued a press release on September 4, indicating it had convinced additional attorneys representing 12,000 claims to agree to the deal.

“The agreement helps pave the way for a faster Plan confirmation process and, ultimately, an earlier recovery for all talc claimants,” Eric Haas, Worldwide Vice President of Litigation at Johnson & Johnson, said in the press release.

Opponents of the J&J talcum powder bankruptcy settlement vote have argued that it is unfair to give all claimants an equal voice about whether to accept the offer, indicating that large numbers of the claims presented are unsupportable in court, and much of the early support came from plaintiffs’ law firms that advertised and acquired large numbers of cases in the past few years, while the litigation has been ongoing for nearly a decade.

Johnson & Johnson is expected to file the proposal in Texas bankruptcy court in the near future. The company indicates it has already resolved 95% of claims alleging talcum powder exposure led to cases of mesothelioma. The remaining cases are primarily gynecological cancer claims, mainly dealing with cases of ovarian cancer.