New Brunswick-based Johnson & Johnson said Oct. 14 that it created a new subsidiary to handle its liabilities for claims linking its talc-based products to cancer.
LTL Management LLC (LTL) was established to hold and manage claims in the cosmetic talc litigation, and has filed for voluntary Chapter 11 bankruptcy protection. This filing is intended to resolve all claims related to cosmetic talc in a manner that is equitable to all parties, including any current and future claimants.
Johnson & Johnson and its other affiliates did not file for bankruptcy protection and will continue to operate its businesses as usual.
“We are taking these actions to bring certainty to all parties involved in the cosmetic talc cases,” said Michael Ullmann, executive vice president, general counsel of Johnson & Johnson. “While we continue to stand firmly behind the safety of our cosmetic talc products, we believe resolving this matter as quickly and efficiently as possible is in the best interests of the company and all stakeholders.”
Johnson & Johnson added that it agreed to provide funding to LTL for the payment of amounts the Bankruptcy Court determines are owed by LTL and will also establish a $2 billion trust in furtherance of this purpose. In addition, LTL has been allocated certain royalty revenue streams with a present value of more than $350 million to further contribute to potential costs.
LTL Chief Legal Officer John Kim said, “With the financial backing of Johnson & Johnson, coupled with a dedicated trust and significant financial resources supporting LTL, we are confident all parties will be treated equitably during this process.”