Johnson & Johnson Legal Representatives Exploring Putting Talc Lawsuits Into Subsidiary For Bankruptcy Filing: Reuters

Johnson & Johnson JNJ is exploring a plan to offload liabilities from its Baby Powder litigation into a newly created business that would then seek bankruptcy protection, Reuters reports.
During settlement discussions, one of the Company's attorneys has told plaintiffs' lawyers that J&J could pursue the bankruptcy plan, resulting in lower payouts for cases that do not settle beforehand, some of the people said.
According to the report, J&J has not yet decided whether to pursue the bankruptcy plan. It is not clear whether the Company has retained restructuring lawyers to help explore the bankruptcy plan.
The Company faces legal actions from several plaintiffs alleging its Baby Powder and other talc products contained asbestos and caused cancer.
The plaintiffs include women who have ovarian cancer and others battling mesothelioma.
Attorneys representing the plaintiffs are denouncing the Company over reports it is considering bankruptcy to avoid financial responsibility.
Last month, the U.S. Supreme Court denied hearing JNJ's appeal of a $2.1 billion verdict from a 2018 trial.
Last week, Johnson & Johnson had to recall five of its sunscreen products after some samples were found to contain low levels of benzene, a chemical that can cause cancer with repeated exposure.
Price Action: JNJ shares are down 0.81% at $166.74 premarket on the last check Monday.