J & J’s Talc Tango: The Lay of the Land
Imagine a big, money‑loving company, Johnson & Johnson, juggling a mountain of lawsuits about its talc products. Suddenly, they flip the table, spin off a shiny new subsidiary called LTL Management, hand over all the talc obligations, and then shove that baby into bankruptcy. Why? To lock the bad guys out while the fam gets a breather.
The “Texas Two‑Step” Shuffle
It’s exactly that: a fancy maneuver where a company creates a new entity, leashes the lawsuits to it, and then rolls that entity into bankruptcy – all to stave off the bad juju from large‑scale jury trials.
- About 38,000 cases were put on hold.
- Claims mention asbestos, mesothelioma, ovarian cancer – the usual suspects.
- Has critics called it a “bread‑and‑butter” play for the powerful.
Lawyers vs. Legal Jukes
On Monday (Sept 19), a band of cancer victims staged a remix in the Third U.S. Circuit Court of Appeals. They asked the panel to Dismantle LTL’s Bankruptcy and bring the lawsuits back into the open. “It’s a concoction ‘made to stop us from getting a full court hearing,’” they said.
Let’s meet the courtroom heroes:
- Jeffrey Lamken – terrorism‑lawyer‑turned-life‑saver, advocating that bankruptcy’s indulgent “extended settlement” is a distraction from fairness.
- David Frederick – points out it’s a slow‑motion, penny‑punching game.
- Neal Katyal – claims ongoing litigation swallows up attorneys’ fees and court costs like a bottomless cup of coffee.
Why the “Bankruptcy” Stickiness Matters
Honestly, LTL has no real business to run, no revenue to pick up. That means no rush to pay plaintiffs or bang the settlement hammer. Meanwhile, the parent company, J & J, got the exemption that all talc lawsuits can be bundled into one big settlement jugglery. They claim it’s the fastest and fairest method – a bit like a corporate lotto.
What the System Awnes
Before this legal detour, J & J was already drowning in $3.5 billion of verdicts and settlements. Remember that case where 22 women walked away with over $2 billion? Pretty hefty.
Fast‑forward:
- Over 1,500 lawsuits dismissed without a dime to J & J.
- Most jury battles ended in defense verdicts, mistrials, or the company pulling a successful appeal.
Legal Ups and Downs
The cancer lobby is pressing hard for the appeals court to overturn a New Jersey bankruptcy judge’s decision. That judge, Michael Kaplan, said the bankruptcy court can juggle mass torts more effectively than any other court.
In plain talk: “We’re curious, Mister Judge, can you tell us whether bankruptcy is actually better, or is it just a shiny, company‑favored shield?” The answer? That’s up for debate.
A Quick Takeaway
Johnson & Johnson’s “Texas two‑step” plan? A way to silence, hush, and hedge against complaints. Lawsuits under LTL? A slow‑moving rabbit who still, in the end, may need to bump into the final verdict. Some folks laughed in the courtroom, but others had to face the very real anguish of a cancer diagnosis. Let’s watch this drama unfold iron‑clad.
