Ovarian Cancer Victims Ask Court to Block Johnson & Johnson’s ‘Texas Two-Step’ Bankruptcy Plan
NS. LOUIS, August 24, 2021 / PRNewswire / – Attorneys for thousands of women diagnosed with ovarian cancer after decades of exposure to Johnson & Johnson (NYSE: JNJ) talcum powder products are petitioning J&J or one of its affiliates to prevent from the transfer of assets to a subsidiary and its bankruptcy.
The company hasn’t denied that it has plans to shield itself $ 500 billion in assets of cancer victims by transferring their growing talc cancer liabilities to a subsidiary before that company goes bankrupt. The total damage that the current victims of talc cancer have suffered comes down to almost. estimated $ 17 billion. In the past, bankruptcy proceedings filed to resolve disputes, including those related to asbestos, often take years and almost never pay back creditors, including personal injury, in full.
In an application submitted to the regional court Missouri, the women argue that such a move amounts to a fraudulent transfer and that laws in Missouri and most other states prevent such debt transfers by solvent and profitable companies. They also point out that such an approach could instantly stop more than 34,000 ovarian cancer victims’ claims and force all related litigation to a bankruptcy court rather than giving those victims their day in court in front of judges and juries.
“Johnson & Johnson has actively threatened plaintiff attorneys with this scheme to force out-of-court settlements on pennies in the dollar Andy Birchfield, Head of Mass Offenses Beasley Allen Law firm, lawyer for three women or survivors named in the file. “J&J has cheated on its customers and withheld from the public that its asbestos-contaminated talc has been poisoning women for generations. It used its powerful marketing arm to target black women and other minorities, harassed the FDA for looking the other way, and is now trying to abuse the bankruptcy system to evade its responsibilities. ”
The strategy is known in legal circles as “Texas Two-Step” because Texas The law allows economically viable companies to be incorporated in the state and then transfer liabilities to another company with limited or no assets. In a similar case, In re DBMP LLC, US bankruptcy judge J. Craig Whitley criticized the practice and said persons who were entitled to personal injury may have been defrauded in the process. In recent years, other companies, including Georgia-Pacific LLC, have split asbestos liabilities through divisional mergers before going bankrupt.
“J&J hasn’t denied they were considering such an outrageous plan,” says Michelle Parfitt, Co-Lead Counsel at Talc Powder MDL and Senior Partner at Ashcraft and Gerel, who also represents the plaintiffs. “If J&J is willing to settle these claims in civil court, such an injunction would have no effect on J & J’s operations and should not raise any objection on its part.”
Birchfield says filing could have been in several other states, however Missouri was chosen because there are several talk-related studies pending there. The next process is about to begin 7th of September, in St. Louis.
“This scheme is part of a worrying trend,” says Alexandra Walsh, Founder of Walsh law. “If J&J is allowed to evade its obligations in this way, it will set a dangerous precedent that will lead other hugely profitable companies to use bankruptcy laws to evade responsibility for their wrongdoing.”
Dozens of specialist medical studies published over the past 35 years have found a statistically significant correlation between talc powder use and ovarian cancer. Further research has confirmed that when applied to the perineal area, talc particles can migrate into the ovaries and cause inflammation and related malignancies. In December 2018, reported to Reuters that J&J knew for decades that its talc products contained asbestos but withheld that information from regulators and the public.
In May 2020Johnson & Johnson announced that it will no longer manufacture or commercialize talc-based powders for the North American market.
In June, the US Supreme Court rejected an appeal on a $ 2.1 billion Judgment against the company registered by the Missouri Court of Appeal and confirmed by the Missouri Supreme Court. That appeals court found that J&J had for decades committed “reprehensible behavior” by repeatedly denying the presence of asbestos and the known link between talc consumption and ovarian cancer.
View original content: https://www.prnewswire.com/news-releases/ovarian-cancer-victims-ask-court-to-block-johnson–johnsons-texas-two-step-bankruptcy-plan-301362146.html
SOURCE Beasley Allen