Texas Bankruptcy Court denies Johnson & Johnson request to end cancer claims

The U.S. Bankruptcy Court for the Southern District of Texas denied the request by Johnson & Johnson subsidiary Red River Talc to confirm its proposed prepackaged bankruptcy plan-notwithstanding that it offered one of the largest settlements ever proposed in a mass tort bankruptcy and was supported by the overwhelming majority of claimants. The company said, “Rather than pursue a protracted appeal, the Company will return to the tort system to litigate and defeat these meritless talc claims. The disclosures made under oath in the Red River bankruptcy affirmed that the talc litigation is a plaintiff-lawyer driven fake tort, premised on junk science and fueled by third party litigation financing including from foreign sovereign wealth funds. Consequently, the Company has no intent to settle or pay plaintiff lawyers on such meritless claims. Accordingly, the Company will reverse approximately $7 billion of the previous reserve.” “The Court has unfortunately allowed a couple of law firms with financially conflicted motives, who have conceded they have not recovered a dime for their clients in a decade of litigation, to defeat the overwhelming desire of claimants. As we have repeatedly stated, in the absence of plan confirmation, we will vigorously present our case in the tort system, starting with the adjudication of the motions pending in the Multi-District Litigation to exclude plaintiffs’ experts and to disqualify the lead counsel for its unethical breaches. In view of the learnings from the bankruptcy case, we are more confident than ever in our position in the tort system,” said Erik Haas, Worldwide VP of litigation, Johnson & Johnson. “We prevailed in 16 of 17 ovarian cases tried in the last 11 years and will devote our efforts to defeating these fake claims.” The company has settled 95% of filed mesothelioma lawsuits, concluded all state consumer protection claims, as well as all talc-supplier disputes.