Johnson & Johnson plans to increase its settlement offer by an additional $1.1 billion to resolve legal claims alleging that its talc products, including baby powder, caused cancer. This boost will elevate the total settlement amount to over $9 billion, distributed over 25 years. The company announced on September 5, 2024, that it has reached an agreement with a plaintiffs' lawyer representing 12,000 clients to recommend the enhanced settlement to them. Despite this move, J&J maintains that its talc products are safe and do not cause cancer.
To finalize the proposed settlement, J&J is preparing for a subsidiary to declare bankruptcy, aiming to complete this process by the end of the month. The company itself will not file for Chapter 11. J&J expects the increased offer to secure support from over 75% of claimants, which is necessary for a judge to approve the settlement. The plan specifically addresses claims related to ovarian and gynecological cancers but excludes those alleging asbestos-related mesothelioma. The legal maneuver involves transferring talc liabilities to a newly created subsidiary, which will then file for bankruptcy in what is known as a "Texas two-step" process.
