Equitable & Efficient Resolution of All Current and Future Talc Claims
LLT Management LLC (formerly known as LTL Management LLC), a subsidiary of Johnson & Johnson (the “Company”) is pursuing a proposed Plan of Reorganization (the “Plan”) for the comprehensive and final resolution of all current and future claims related to ovarian cancer arising from cosmetic talc litigation against the Company and its affiliates in the United States.
The Plan provides for a three-month solicitation period during which ovarian claimants are informed of its terms and will have the opportunity to vote for or against the Plan – an opportunity they were denied in prior bankruptcy cases.
This site is designed to provide more detailed information and background on the Plan, including third-party resources and legal filings related to LLT.
Current Status
On May 1, 2024, Johnson & Johnson announced a proposed Plan of Reorganization by its subsidiary, LLT Management LLC (“LLT”), for the comprehensive and final resolution of all current and future talc claims related to ovarian cancer arising from cosmetic talc litigation against the Company and its affiliates in the U.S. The Plan is the culmination of Johnson & Johnson’s consensual resolution strategy announced in October 2023 and would resolve 99.75% of the pending talc lawsuits against the Company and its affiliates in the U.S.
The Plan was developed with the assistance and support of counsel representing the overwhelming majority of current ovarian claimants and differs significantly from the prior reorganizations filed by LLT as it allows claimants to have their voice heard with a vote – which was previously denied to them by lawyers representing a small minority of claimants. If 75% of claimants vote in favor of the Plan, a Company subsidiary may file a consensual “prepackaged” Chapter 11 bankruptcy to secure its confirmation.
The remaining pending personal injury lawsuits relate to mesothelioma and will be addressed outside of the Plan. The Company already has resolved 95% of mesothelioma lawsuits filed to date. The State consumer protection claims will also be addressed outside the Plan; the Company already has agreements in principle to do so. Finally, and for completeness, the Company has also reached an agreement in principle to resolve all talc-related claims against it in the bankruptcy cases filed by suppliers of its talc (Imerys Talc America, Inc., Cyprus Mines Corporation, and their related parties).
Background
In October 2021, LLT filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of New Jersey to efficiently resolve claims in the cosmetic talc litigation in a manner that is equitable to all parties, including current and future claimants. Plaintiff lawyers challenged the filing with motions to dismiss the bankruptcy.
In February 2022, the Bankruptcy Court ruled that LLT commenced its initial bankruptcy case in good faith, expressing the “strong conviction that the bankruptcy court is the optimal venue for redressing the harms of both present and future talc claimants in this case – ensuring a meaningful, timely, and equitable recovery.” Plaintiff lawyers appealed this ruling to the United States Court of Appeals for the Third Circuit.
In January 2023, LLT’s bankruptcy was dismissed by a three-judge panel of the Third Circuit Court of Appeals. The Third Circuit agreed that bankruptcy is “an appropriate forum for a debtor to address mass tort liability,” but it dismissed the case on other legal grounds.
In April 2023, LLT re-filed for voluntary Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of New Jersey. The refiled case addressed concerns cited by the Court of Appeals for the Third Circuit in its dismissal and included a reorganization plan of up to $8.9 billion supported by at least 60,000 current claimants.
In July 2023, the Bankruptcy Court granted the plaintiffs’ motion to dismiss LLT’s refiled bankruptcy case. However, the Court stated that the Company and LLT had made “remarkable progress” towards “a fair, efficient and expeditious settlement” for all claimants and “strongly encouraged” the pursuit of a comprehensive resolution through another bankruptcy.
The Company and LLT followed that directive, and the Plan proposed by LLT, along with the settlement of the mesothelioma, State consumer protection claims, and disputes with Imerys and Cyprus, is the culmination of those efforts.
The Chapter 11 Process
Chapter 11 is a well-established legal process in the United States that allows a company to complete a financial or operational restructuring under the supervision of the Bankruptcy Court.
As part of the process, companies must file a Plan of Reorganization, which outlines how money that is determined to be owed to various people or organizations will be paid.
The Plan of Reorganization must be approved by a majority vote of eligible claimants and the Bankruptcy Court. This process results in a Plan of Reorganization that is fair and equitable for all stakeholders.
Why Chapter 11 Is the Best Path to Resolve the Talc Litigation
The Chapter 11 process provides a single venue for all parties to participate in the resolution process, resulting in a comprehensive, fair and efficient settlement agreement that cannot be achieved through individual jury trials.
While LLT is prepared to try every case, addressing each and every one of the talc cases on an individual basis could take decades. Even then, there is no known, definitive outcome or guarantee that all cases would reach resolution. The United States tort system is not equipped to resolve thousands of cases quickly or efficiently.
The Chapter 11 process brings everyone to the table to negotiate an agreement, provides for the quickest and most efficient resolution for people who have legal claims related to talc and provides certainty for all parties.
Importantly, Chapter 11 allows people who may make a legal claim related to talcum powder in the future to participate in the resolution through an independent representative, called a “Future Claims Representative,” appointed by the Bankruptcy Court. That Court-appointed agent assesses the number of future claims and the total amount of fair compensation and determines how compensation should be distributed.
In his review of LLT’s Chapter 11 filing, Judge Michael B. Kaplan of the U.S. Bankruptcy Court for the District of New Jersey wrote the following:
“While this Court recognizes and appreciates the passion and commitment of the Committee members and every one of the attorneys advocating for the interests of the injured cosmetic talc claimants in this case, the Court simply cannot accept the premise that continued litigation in state and federal courts serves best the interest of their constituency. Many of these cases, both in the United States and abroad, have been pending for a half dozen or more years and remain years away from trial dates, not to mention the substantial delays they face in the inevitable appeals process. Notably, since 2014, there have been only 49 trials that have proceeded to verdict.”
- Judge Michael B. Kaplan of the U.S. Bankruptcy Court for the District of New Jersey in Memorandum Opinion, Case 21-03032-MBK, Doc 184 (2/25/22)
LLT’s legal proceedings are not an admission of wrongdoing. Decades of independent scientific testing have confirmed that Johnson & Johnson’s talc-based products are safe, do not contain asbestos and do not cause cancer. The Company does not believe that any of the talc-related claims against it have merit, nor does it believe its products are responsible for any illness. However, Johnson & Johnson and LLT believe that resolving this litigation as quickly and efficiently as possible is in the best interests of claimants and all stakeholders.
For more information on the safety of Johnson & Johnson’s cosmetic talc, please visit www.FactsAboutTalc.com.
Johnson & Johnson and its other affiliates did not file for bankruptcy protection and continue to operate their businesses as usual.