© Reuters. Exterior of Johnson & Johnson office in Irvine, California 10/14/2020 REUTERS/Mike Blake
(Reuters) – Johnson & Johnson’s (NYSE:) renewed attempt to settle its talc-related lawsuits through an $8.9 billion bankruptcy deal must be dismissed as a “fraudulent scheme” that violates a court order that denied the company’s earlier attempt to resolve the litigation, lawyers representing cancer victims said, according to a petition.
The lawyers, in the lawsuit filed on Monday, denounced J&J’s decision to re-file for insolvency of its subsidiary LTL Management, which is based on a controversial legal maneuver, just two hours after the first case was dismissed.
They said the company fraudulently transferred $50 billion in assets out of LTL to circumvent a court ruling that it was not in sufficient “financial distress” to qualify for bankruptcy.
The company said last week that its new bankruptcy plan was the best way to resolve current and future lawsuits alleging its talc products cause cancer, including more than 38,000 cases that were previously filed in federal court in New Jersey.
J&J claims its baby powder products are safe and do not cause cancer.
The company said 70,000 claimants had signed up to support its new $8.9 billion settlement plan, but it was not clear whether the company will reach the 75% support it needs to pass its settlement through the court.
(Por Dietrich Knauth)