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Johnson & Johnson Can Not Use Bankruptcy to Prevent Talc Lawsuits

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On February 7th, 2023, a Federal judge ruled that Johnson & Johnson (J & J) can no longer utilize bankruptcy to block a trial taking place in California over claims that its baby powder caused the deadly cancer of a 24-year-old man.

The ruling, the first of its kind since the halting of a Chapter 11 bankruptcy case that the company used to pause 40,000 cancer lawsuits, is on hold as J & J appeals and attempts to negotiate a settlement. Because the ruling is on hold, victims are still required to obtain special permissions to bring their cases to trial.

Previously, cases were on hold because Judge Michael Kaplan ruled that no trials should proceed. Judge Kaplan stated that J & J had a reasonable chance of being able to utilize bankruptcy to resolve all of these lawsuits at the same time, rather than being forced to fight them one at a time across the United States.

People bringing lawsuits against J & J have alleged that baby powder tainted with asbestos causes cancer, which the company continually denies.

Anthony Hernandez Valdez brought suit against J & J after he was diagnosed with a malignant tumor in 2022. He was allowed to file his lawsuit in June, but was prevented from moving forward to trial while the bankruptcy case was proceeding. On February 7th, Judge Kaplan ruled that the suit may proceed to a jury when a judge in California approves of it.

J & J continues to plead with the federal appeals court in Philadelphia to reconsider its decision by a three-judge panel to dismiss the bankruptcy case, in the hopes that J & J would continue to benefit from the protections in bankruptcy. If the appeal fails, J & J may have one last chance to ask the US Supreme Court to intervene in the matter. If J & J fails, the bankruptcy would be completely dismissed, and all of the cases would start to go to trial. Despite hoping that the court allows their appeal, J & J is preparing in the event that they are forced to fight the lawsuits in court.

The J & J bankruptcy case is In Re: LTL Management LLC 21-30589, U.S. Bankruptcy Court, District of New Jersey (Trenton)

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