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Johnson & Johnson Talc Bankruptcy Petition Dismissal is a Win for Mesothelioma and Ovarian Cancer Victims

mesothelioma attorney Dave Butler

By Dave Butler

In a significant victory for injured consumers, the Third Circuit Court of Appeals dismissed the bankruptcy petition of a Johnson & Johnson subsidiary that holds the company’s liabilities for claims brought by thousands of consumers injured by exposure to asbestos-contaminated talc in Johnson & Johnson products.  The dismissal, on January 30, 2023, ends for now J&J’s efforts to avoid full responsibility for the claims of those suffering from mesothelioma, ovarian, and other cancers caused by its asbestos-contaminated products.

Through a series of corporate transactions under a unique Texas law, Johnson & Johnson created two new entities with the intention to funnel its liabilities for claims brought by thousands of injured talc claimants into a new entity which it named LTL Management; while simultaneously funneling all of its profitable business into another entity.  Two days after its formation and freshly saddled with J&J’s talc liabilities, LTL Management filed a petition under Chapter 11 of the U.S. Bankruptcy Code claiming that its talc liabilities placed it in financial distress sufficient to allow it to seek the protections afforded by U.S. bankruptcy laws.

Injured talc victims sought dismissal of the bankruptcy petition, but were denied by a federal court in New Jersey.  Victims appealed that denial to the Third Circuit Court of Appeals, which ruled that the J&J subsidiary had not demonstrated that its petition was filed in good faith and should be dismissed.

In its opinion the court found that “At base level, LTL, whose employees are all J&J employees, is essentially a shell company “formed,” almost exclusively, “to manage and defend thousands of talc-related claims” while insulating at least the assets in a non-bankrupt entity.  The court went on to find that “Because LTL was not in financial distress, it cannot show its petition served a valid bankruptcy purpose and was filed in good faith under” the United States Bankruptcy Code.  In conclusion, the court held that:

Our decision dismisses the bankruptcy filing of a company created to file for bankruptcy. It restricts J&J’s ability to move thousands of claims out of trial courts and into bankruptcy court so they may be resolved, in J&J’s words, “equitably” and “efficiently.” But given Chapter 11’s ability to redefine fundamental rights of third parties, only those facing financial distress can call on bankruptcy’s tools to do so. Applied here, while LTL faces substantial future talc liability, its funding backstop plainly mitigates any financial distress foreseen on its petition date.

Read the court’s full opinion here.

RPWB continues to seek justice for victims of exposure to Johnson & Johnson talc products. If you or a loved one has been diagnosed with mesothelioma after exposure to Johnson & Johnson talc products, please call us at u 1-866-594-8765 or fill out the form on this page to begin your case review.

Dave Butler has 30 years of experience representing mesothelioma victims and their families in cases throughout the United States. He can be reached at 1-866-594-8765 or by emailing dbutler@rpwb.com.

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    Asbestos Awareness Week Shines Light on Mesothelioma, a Cancer that Continues to Devastate

    The first week of April 2022 is Asbestos Awareness Week in the United States. Members of both houses of Congress unanimously approved resolutions making the designation.

    Once ubiquitous in worksites and homes throughout the country, we are still experiencing the negative health effects of asbestos decades after its peak use. Mesothelioma, the insidious cancer caused by asbestos, can take up to 50 years to manifest. When it does, many patients have less than two years to live, although we have seen some promising new treatments recently.

    For more than 40 years, lawyers at RPWB have worked on behalf of mesothelioma patients to get them the financial compensation they deserve from asbestos manufacturers who knew about the health consequences of the products they were selling.

    It is difficult and heartbreaking to see the men and women who built this great country die from mesothelioma due to the negligence of companies that put profits over people by hiding the ugly truth about asbestos.

    While we still see a great number of cases from older people who worked in asbestos-laden industrial worksites through the 1970s, we are now also litigating cases involving much younger individuals who have developed mesothelioma from talcum powder use. This includes young mothers and otherwise healthy people who face a very dire mesothelioma prognosis at the prime of their lives.

    Sadly, asbestos and the health consequences of it will still be with us for many more years. Contrary to common belief, asbestos is not banned in the United States and many products still contain talcum powder, which is derived from a mineral that often co-exists with asbestos in the environment.

    As asbestos lawyers, we focus on helping mesothelioma patients and their families maximize the financial compensation they get from asbestos companies that manufactured the products that caused the cancer.

    Our role as mesothelioma lawyers, however, goes beyond that.

    We hold asbestos companies responsible for the human suffering they caused for many decades, even after they knew about the devastating health consequences. It is never acceptable to value profits more than the health and well-being of people. The asbestos industry is rightfully the poster child for what happens when we do. We hope that our work will deter other types of manufacturers from producing products they know to be harmful.

    This Asbestos Awareness Week, we are remembering the thousands of mesothelioma victims we have helped in our 45-year history. We remain as committed to helping mesothelioma patients today as we did back in 1976, when our founding member Charles Patrick worked on the first successful product liability lawsuit against asbestos companies.

    We hope you never need our services, but we stand ready to assist you if you do. If you receive a mesothelioma diagnosis, give us a call anytime at 1-866-594-8765 or fill out the form on this website. In most cases, we are available to meet with you at your home or another comfortable place within just a few days of calling.

    To learn more about mesothelioma, please visit our Mesothelioma Info Center here.

    Here is the full text of the Asbestos Awareness Week Resolution:

    RESOLUTION

    Designating the first week of April 2022 as ‘‘National Asbestos Awareness Week’’.

    Whereas dangerous asbestos fibers are invisible and cannot be smelled or tasted;

    Whereas the inhalation of airborne asbestos fibers can cause significant damage;

    Whereas asbestos fibers can cause cancer, such as mesothelioma, asbestosis, and other health problems;

    Whereas symptoms of asbestos-related diseases can take between 10 and 50 years to present themselves;

    Whereas the projected life expectancy for an individual diagnosed with mesothelioma is between 6 and 24 months;

    Whereas little is known about late-stage treatment of asbestos-related diseases, and there is no cure for those diseases;

    Whereas early detection of asbestos-related diseases might give some patients increased treatment options and might improve the prognoses of those patients;

    Whereas, although the consumption of asbestos within the United States has been substantially reduced, the United States continues to consume tons of the fibrous mineral each year for use in certain products;

    Whereas thousands of people in the United States have died from asbestos-related diseases, and thousands more die every year from those diseases;

    Whereas, although individuals continue to be exposed to asbestos, safety measures relating to, and the prevention of, asbestos exposure have significantly reduced the incidence of asbestos-related diseases and can further reduce the incidence of those diseases;

    Whereas thousands of workers in the United States face significant asbestos exposure, which has been a cause of occupational cancer;

    Whereas a significant percentage of victims of asbestos-related diseases were exposed to asbestos on naval ships and in shipyards;

    Whereas asbestos was used in the construction of a significant number of office buildings and public facilities built before 1975;

    Whereas people in the small community of Libby, Montana, suffer from asbestos-related diseases, including mesothelioma, at a significantly higher rate than people in the United States as a whole; and

    Whereas the designation of a ‘‘National Asbestos Awareness Week’’ will raise public awareness about the prevalence of asbestos-related diseases and the dangers of asbestos exposure: Now, therefore, be it

    Resolved, That the Senate—

    1. designates the first week of April 2022 as ‘‘National Asbestos Awareness Week’’;
    2. urges the Surgeon General to warn and educate people about the public health issue of asbestos exposure, which may be hazardous to their health; and
    3. respectfully requests that the Secretary of the Senate transmit a copy of this resolution to the Office of the Surgeon General.

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