- Johnson & Johnson's JNJ subsidiary, LTL Management, has reportedly requested a U.S. judge to delay 38,000 lawsuits again. These lawsuits accuse their baby powder and other talc products of causing cancer.
- This comes as the company makes another attempt at "resolving the litigation in bankruptcy after a federal appeals court found its first attempt improper," reports Reuters.
- Also Read: Johnson & Johnson Q1 Beats Street View On Strong Performance Across All Segments, Lifts Guidance, Dividends.
- At a Tuesday hearing, LTL Management will argue that the so-called "automatic stay" under bankruptcy law that stops lawsuits against it from moving forward while it is in Chapter 11 proceedings should also protect J&J.
- A federal appeals court in Philadelphia rejected Johnson & Johnson's use of Chapter 11 bankruptcy to offload several lawsuits over its talc products, alleging it caused cancer.
- The appellate ruling found that LTL is "highly solvent" and not entitled to file Chapter 11 bankruptcy because J&J had provided it with a $60 billion funding "safety net" to meet its talc liabilities.
- LTL argues that the lawsuits must be stopped because litigation against J&J would imperil its effort to negotiate a comprehensive settlement of all current and future talc claims in its bankruptcy.
- It has said its second bankruptcy differs from its first because it has less funding and more plaintiff support for a settlement.
- Earlier this month, LTL Management re-filed for bankruptcy to resolve all talc-based baby powder claims and agreed to contribute up to $8.9 billion over 25 years to resolve all the current and future talc claims, which is an increase of $6.9 billion over the previously committed amount.
- Price Action: JNJ shares are down 2.71% at $161.20 on the last check Tuesday.
- Photo via Wikimedia Commons
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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