*Jim Onder is speaking at our (in-person/live) Mass Tort Nexus course June 11-14 in Fort Lauderdale. He will be updating us on the state of settlement for both Talc and RoundUp. Jim holds the largest number of cases in both of these litigations. He will also be contributing information at our course, regarding the emerging litigation, Paraquat. Seating is very limited.
Johnson & Johnson continues to avoid responsibility for cruelly and intentionally destroying women’s lives by profiting from cancer-causing talc. Imerys Talc America’s bankruptcy plan has now become a pawn for J&J’s attempts to sidestep indemnification.
Just how the dust (or powder, in this case) will settle is not yet clear, but the initial disbursement plan for $233 million in Imerys assets has gained the 75% vote needed to pass.
Johnson & Johnson is eager to join the Imerys bankruptcy and obtain a channeling injunction, so as to cut off future liabilities. A channeling injunction would enable J&J to fund a trust for the benefit of past and future claimants. Thereafter, the sole claim would be against the trust.By cutting off future liability, J&J would have a finite dollar amount established with which to pay cancer claims, as opposed to being asked to write a blank check. They and their shareholders would like to see these claims to essentially go away. However, the current amount they have suggested they would pay is inadequate to compensate past and future victims.
As a threat to force acceptance of a parsimonious offer, J&J is threatening bankruptcy.
Texas Two-Step Threat
In a move that’s in line with the unscrupulous tactics they have exercised for decades, J&J are making what is likely an idle threat to declare bankruptcy in a dicey back-handed method called the “Texas two-step.” If successful, they hope to discharge their liability from talc lawsuits throughout the country.
What is the Texas Two-Step?
The State of Texas has a divisive merger statute. Essentially it allows a company to divide into two separate entities.
J&J can, in theory, split off some of their assets along with their talc liabilities into a separate inadequately funded entity in Texas.
J&J could attempt to change the domicile of that entity to North Carolina, then file bankruptcy to discharge liabilities.
While we would like to believe this is another smokescreen, the threat may be real. Three asbestos manufacturers have used this tactic, and their cases have yet to be heard in appellate court. Johnson & Johnson has a long history of unethical, self-serving behavior in their attempts to minimize compensation for victims. We’re keeping an eye on the situation and carefully weighing the validity of this and any other scare tactic they present.
We are up against a corporation that simply refuses to take responsibility. As such, we have yet to come up with a final outcome with which everybody is satisfied. We are working daily toward that end.
After nearly a year and a half of delays due to Covid, courts are slowly reopening and trial dates are being established. Several trials are now on the docket for later this summer and beyond.
Every time Johnson & Johnson has to step foot in a courtroom, it puts them under increasing pressure to settle. Their losses have already cost them hundreds of millions of dollars, and their shareholders are eager to put the bad publicity and risk behind them. We are doing all we can to ensure their tactics to avoid responsibility will fail and these trials will push them closer to a settlement.