Johnson & Johnson enlist Jones Day to explore Talc bankruptcy
Johnson & Johnson has hired law firm Jones Day to advise the company as it plans to bankrupt a subsidiary to help settle thousands of personal injury claims linking talcum baby powder to cancer, said people familiar with the matter.
Jones Day advised J&J on options for dealing with talc-related claims, including a possible bankruptcy filing by a subsidiary containing those legal responsibilities, the people said. The company told personal injury attorneys during settlement discussions that such a bankruptcy filing was under consideration, the Wall Street Journal reported on Monday.
J&J said Tuesday it has not decided on a course of action regarding the thousands of lawsuits it faces except to defend the safety of talc and fight pending claims. The company declined to comment further. Jones Day did not immediately respond to a request for comment.
Filing a bankrupt subsidiary would give J&J several legal tools to resolve current liabilities and future claims regarding talc products, which the company stopped selling in the United States and Canada last year.
J&J faced 28,900 personal injury lawsuits across the United States over talc in April, according to the company’s latest quarterly report, which also indicates that the number of tort claims continues to rise.