- A three-judge panel of the Philadelphia-based 3rd U.S. Circuit Court of Appeals ruled to dismiss Johnson & Johnson’s JNJ subsidiary’s bankruptcy case regarding talc-related claims.
- The panel said it had no legitimate claim to Chapter 11 protection because it did not face financial distress.
- U.S. Bankruptcy Judge Michael Kaplan said during a hearing in Trenton, New Jersey, that he intends to toss the Chapter 11 case once the Philadelphia-based 3rd U.S. Circuit Court of Appeals issues a formal mandate to carry out a January 30 ruling by a three-judge panel to dismiss the matter.
- The decision would force J&J back into trial courts to battle nearly 40,000 lawsuits alleging the company’s Baby Powder and other cosmetic products containing talc cause cancer, Reuters reported.
- U.S. Bankruptcy Judge Michael Kaplan was set to preside over the hearing for LTL Management, the subsidiary.
- LTL on Monday asked the full 3rd Circuit to reconsider the decision by the three-judge panel.
- In 2021, J&J offloaded several talc lawsuits it faced onto one of its newly created units, LTL, which then declared bankruptcy, the process known as Texas two-step.
- J&J has argued that the lawsuits posed a severe financial threat that could potentially cost about $4.5 billion, with no end in sight, according to bankruptcy-court filings.
- Price Action: JNJ shares are down 0.16% at $162.49 on the last check Tuesday.
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