Johnson & Johnson Boosts Cancer Lawsuit Settlement with $1.1 Billion Offer

Johnson & Johnson Boosts Cancer Lawsuit Settlement with $1.1 Billion Offer
Johnson & Johnson is working to resolve tens of thousands of cancer lawsuits accusing the company of exposing people to asbestos.

Johnson & Johnson has been accused of exposing consumers to asbestos through the use of Johnson & Johnson talcum powder and other branded products. The company filed for bankruptcy to avoid lawsuits or paying multimillion-dollar judgments, as it has had to do several times in recent years.

The healthcare giant is increasing its previous offer of $6.4 billion by $1.1 billion to settle the pending lawsuits. Johnson & Johnson hopes the additional funds will convince the pending plaintiffs to accept the settlement offer.

This is Johnson & Johnson's third attempt to resort to bankruptcy to avoid lawsuits. The first two attempts were rejected by the court.

Video: Johnson & Johnson adds $1.1 billion to proposed talc cancer settlement

Johnson & Johnson Boosts Cancer Lawsuit Settlement with $1.1 Billion Offer

Johnson & Johnson Talcum Powders and Asbestos
Johnson & Johnson's talcum powder is made from talc, a naturally occurring mineral. Talcum powder is a popular cosmetic ingredient that absorbs moisture and dries the skin.

However, talcum powder and asbestos are related, as asbestos is also a naturally occurring mineral found in geological areas. Asbestos can cause cancer, such as lung cancer, ovarian cancer, and a rare type of cancer called mesothelioma.

About 2,500 people are diagnosed with mesothelioma in the United States each year. Due to the rarity, aggressiveness, and difficulty of treatment of this cancer, survival rates are low. Nearly all of the lawsuits against Johnson & Johnson have been brought by people with ovarian cancer or mesothelioma.

How does Johnson & Johnson use the Texas two-step process?
Johnson & Johnson uses a Chapter 11 bankruptcy strategy called “Texas Two-Step.” This legal maneuver allows the company to avoid ovarian cancer and mesothelioma lawsuits.

Johnson & Johnson intends to create a subsidiary to handle all legal obligations related to talcum powder and other Johnson & Johnson products. Although the company claims that its products are safe and do not contain asbestos, it is still working to resolve the issue. With this strategy, all ongoing disputes will be consolidated into one large settlement without Johnson & Johnson having to file for bankruptcy.

The bankruptcy proposal requires the approval of 75% of the plaintiffs in the pending lawsuits. The law requires the approval of 75% of the plaintiffs before a judge can approve this type of bankruptcy settlement.

How much does Johnson & Johnson want to pay cancer patients?
The original $6.48 billion proposal seeks to treat tens of thousands of ovarian cancer cases. The company said the cash payment would amount to about $8 billion over 25 years. With the addition of $1.1 billion, the total amount exceeds $9 billion over 25 years.

Future claims would be reduced by the fund created under the bankruptcy plan. This asbestos trust fund would be designed to compensate individuals who discover asbestos-related diseases after the company's bankruptcy.

Mesothelioma, for example, develops twenty to fifty years after asbestos exposure. The cancer can continue to spread and cause symptoms even after the victim has been exposed to asbestos.

How many lawsuits are pending against Johnson & Johnson?
According to media reports, at least 60,000 lawsuits against Johnson & Johnson are pending. Most of the people who get cancer from Johnson & Johnson baby powder are women who apply the powder to themselves or their children.
Johnson & Johnson's proposed settlement only addresses the ovarian cancer lawsuits. It does not resolve the ongoing mesothelioma lawsuits. Most of the ongoing lawsuits involve ovarian cancer, which is much more common than mesothelioma.

Johnson & Johnson and Mesothelioma Cancer
Johnson & Johnson has faced widespread accusations regarding the presence of asbestos in its talcum powder products, which allegedly exposed consumers to the harmful mineral. 

Asbestos is a known carcinogen that has been linked to various cancers, including mesothelioma. Mesothelioma is a rare, aggressive form of cancer that typically affects the lining of the lungs and abdomen. It is caused almost exclusively by exposure to asbestos, and symptoms can develop decades after the initial exposure.

While Johnson & Johnson has consistently denied that its talcum powder contains asbestos, thousands of plaintiffs have alleged that long-term use of the company’s baby powder and other talc-based products led to their diagnosis of mesothelioma and ovarian cancer. 

Mesothelioma lawsuits are particularly significant because of the severity of the disease, which often results in a low survival rate and limited treatment options.

Relationship Between Johnson & Johnson and Mesothelioma Lawsuits

Johnson & Johnson’s legal battles around asbestos exposure center on allegations that the talc used in its powders was contaminated with asbestos, a naturally occurring mineral found near talc deposits. Mesothelioma is among the most serious diseases linked to asbestos exposure, and the company's talcum powder has been under intense scrutiny for years over claims that it exposed consumers to this carcinogen.

The connection between Johnson & Johnson and mesothelioma has become a focal point in many lawsuits. While the majority of pending lawsuits involve ovarian cancer claims, mesothelioma cases are also part of the broader legal landscape against the company. 

Victims argue that their mesothelioma was caused by inhaling asbestos fibers present in Johnson & Johnson products. The rarity and aggressive nature of mesothelioma make these claims particularly high-stakes for the company.

Impact of the Settlement on Mesothelioma Claims
Johnson & Johnson’s recent proposal to increase its settlement offer by $1.1 billion—bringing the total to over $9 billion—is aimed at resolving the thousands of lawsuits, predominantly those related to ovarian cancer. However, mesothelioma cases are not included in the current settlement framework, raising concerns for plaintiffs diagnosed with this deadly cancer.

Mesothelioma lawsuits remain ongoing, and the company continues to face significant legal exposure on this front. Given the long latency period of mesothelioma, future claims could also arise decades after the alleged asbestos exposure occurred. 

Johnson & Johnson’s attempt to resolve these claims through bankruptcy and the creation of a subsidiary could have major implications for those still seeking justice and compensation for mesothelioma.

Johnson & Johnson's Texas Two-Step Bankruptcy Strategy
As part of its legal defense, Johnson & Johnson has employed a controversial bankruptcy strategy known as the "Texas Two-Step," which allows the company to divide its operations and shift its asbestos-related liabilities to a newly created subsidiary. 

This tactic consolidates lawsuits and potentially limits the company’s financial exposure while keeping its primary business unaffected by bankruptcy.

Despite the company’s assurances that its talc products are safe, the ongoing lawsuits and settlement offers reflect the complexity of the legal landscape surrounding asbestos exposure and mesothelioma. 

Plaintiffs must still reach a consensus to approve the bankruptcy settlement, which will determine how current and future claims, including those involving mesothelioma, are addressed.

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