Johnson & Johnson balances bankruptcy plan as it considers discharging baby powder liabilities: report

[ad_1]

Fox Business Summary: Johnson & Johnson says it will stop selling talc-based baby powder in the United States.

Retailer Johnson & Johnson is said to be considering splitting liabilities from its baby powder unit due to ongoing litigation, with plans to file for bankruptcy protection for that new company.

Reuters reported on Sunday, citing seven people familiar with the discussions, that the plan would allow the company to pay lower settlements through the smaller company.

Those sources told the publication that the company could use a Texas merger law that allows companies to split into at least two entities, known as two-step bankruptcy.

Reuters added that Johnson & Johnson has not made a decision on whether to pursue the bankruptcy plan.

JOHNSON & JOHNSON Recalls Several Aerosol Sunscreens After Discovering the Carcinogen

A Johnson & Johnson spokesperson did not immediately respond to a FOX Business request for comment.

The controversy came several years ago after Reuters and The New York Times reported that the company had known and covered up the presence of asbestos in samples of talc powder. Asbestos is a carcinogen that can contaminate talc during the mining process if proper safety measures are not implemented.

Get your FOX business on the go by clicking here

A voluntary recall was issued in 2019.

The company is currently facing thousands of lawsuits and allegations that the contaminated product caused cancer.

Click here to read more about FOX BUSINESS

The Supreme Court refused to review a case earlier this year brought by a group of women who claimed they developed ovarian cancer from the company’s product. The $2 billion ruling in this case still stands.

Johnson & Johnson denies that its talc products cause cancer. Sales of products containing talc have been halted in the United States and Canada.

[ad_2]