J&J’s $10 Billion Asbestos Talc Settlement Trial Kicks off in Texas

For several years now, Johnson & Johnson (J&J) has been battling numerous lawsuits from tens of thousands of people who claim its talc-based products, including its well-known baby powder, caused mesothelioma and ovarian cancer due to asbestos contamination. The company has previously attempted to resolve the claims through bankruptcy, which is mainly viewed as a controversial move given that it’s one of the most profitable companies in the world. Two previous bankruptcy filings were thrown out in New Jersey and Philadelphia, but the company remains relentless. This time, it filed a bankruptcy petition in a Texas court, hoping to get the green light for a $10 billion settlement. While the company argues that the settlement plan is the fairest and fastest way to compensate victims, many claimants and government watchdogs disagree. The trial, which began on February 18, 2025, is expected to last two weeks, after which the judge will issue a verdict.

J&J has sold talc-based baby powder for many decades. However, it has faced several lawsuits alleging that its talc-based baby powder was contaminated with asbestos, a known carcinogen. Asbestos exposure is known to cause serious illnesses, including mesothelioma, a rare and aggressive form of cancer with no cure. Despite J&J’s claims that its products were safe, thousands of claimants diagnosed with mesothelioma and ovarian cancer filed lawsuits arguing that scientific studies suggest otherwise on the safety of their products and that J&J failed to warn consumers about the risks of using the products.

To resolve the many lawsuits against it, J&J created a subsidiary, Red River Talc, and transferred all its asbestos liabilities to the unit. Red River then filed for Chapter 11 bankruptcy, pausing all lawsuits against J&J while the court considered the settlement plan. This was also to force claimants into a bankruptcy settlement instead of a jury trial where verdicts could be much higher. When an asbestos company files for bankruptcy, all lawsuits are halted until the bankruptcy court decides. If successful, a company must establish a trust fund through which claimants can seek compensation based on predefined criteria. In return, the company continues its operations.

J&J’s bankruptcy move has been rejected in two courts, ruling that the company wasn’t financially distressed and could not use bankruptcy to avoid lawsuits. Regardless, the company is trying again, this time in a different bankruptcy court in Texas, hoping for a different outcome. If the plan is approved, a trust will be established to compensate victims. However, if the court rejects the plan, mesothelioma and cancer lawsuits against the company will continue, potentially leading to much higher payouts for victims through jury verdicts.

Many claim that the way J&J secured voted for the settlement was illegal, with those opposed to the plan claiming that J&J manipulated the voting process to ensure a favorable outcome. The company challenged every vote against the plan but readily accepted votes in its favor. In some cases, it is even alleged that J&J allowed votes to be changed from no to yes while refusing to allow attempts to change votes from yes to no, signifying a rigged settlement process.

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