Johnson & Johnson Proposes $6.5 Billion Payment to Resolve Majority of Ovarian Cancer Lawsuits Linked to Talc Powder

Bottles of Johnson & Johnson's baby powder line a drugstore shelf in New York City on Oct. 15, 2015. Lucas Jackson/Reuters

Johnson & Johnson has proposed paying $6.5 billion to resolve claims against the company and its affiliates in the United States that its branded talc products, including baby powder, caused ovarian cancer.

The pharmaceutical giant announced the proposed settlement figure in a May 1 statement, noting that the amount would be paid over 25 years to settle the ovarian cancer cases, which have been piling up fast.

That amount proposed “is a far better recovery than the claimants stand to recover at trial,” according to the company.

Johnson & Johnson is currently facing tens of thousands of lawsuits from individuals who allege that the company’s baby powder and other talc products contained traces of asbestos, which has been blamed for causing ovarian cancer and mesothelioma, a deadly cancer that affects the lining of the lungs.

The company has repeatedly stated that its talc-based baby powder does not contain asbestos and does not cause cancer.

However, in 2020, Johnson & Johnson announced that it would stop selling its baby powder in the United States and Canada over what it called “misinformation” about the product and stated that it would phase out sales of those products worldwide in 2023.

Overall, the company has set aside about $11 billion to address the talc litigation, it stated on May 1.

Proposed Settlement Details

The ovarian cancer claims that would be resolved under the latest proposed settlement would constitute 99.75 percent of the pending talc lawsuits against the company and its affiliates in the United States, Johnson & Johnson stated on May 1.

Specifically under the proposed settlement, the company will begin a three-month voting period in hopes of reaching a consensus on a settlement of all current and future ovarian cancer claims.

If 75 percent of claimants vote in favor of the plan, then the company would resolve the lawsuits through a third bankruptcy filing of a subsidiary company, LLT Management.

That will also prevent future lawsuits regarding the ovarian cancer claims and stop individuals from opting out of the deal in order to pursue separate lawsuits against the company.

Johnson & Johnson stated that attorneys representing the “overwhelming majority of current ovarian claimants” support the plan.

“The plan is the culmination of our consensual resolution strategy that we announced last October,” said Erik Haas, worldwide vice president of litigation at Johnson & Johnson. “Since then, the company has worked with counsel representing the overwhelming majority of talc claimants to bring this litigation to a close, which we expect to do through this plan.”

Courts Rebuff Bankruptcy Efforts

“Unlike the prior cases, it is the vote of the claimants—and not the conflicting financial incentives of the small minority of plaintiff lawyers who stand to receive excessive legal fees outside of a reorganization—that decides whether the Plan may proceed,” Mr. Haas said.

The reorganization plan announced on May 1 differs slightly from previous proposals announced by its subsidiary, which was created in October 2022 to take on the company’s talc-related liabilities.

However, courts have previously rebuffed its previous two efforts to resolve the lawsuits through the bankruptcy of the subsidiary, ruling that neither the company nor the subsidiary had a legitimate need for bankruptcy protection because they weren’t in “financial distress.”

The latest proposed settlement garnered mixed reactions from attorneys representing cancer victims, with some saying the deal would likely bring peace and closure to the alleged victims, and others accusing the company of attempting to “stuff the ballot box” by getting votes from lawyers who have not sued the pharmaceutical giant.

Despite the proposed settlement, Johnson & Johnson remained adamant on May 1 that the claims made against it were false and took aim at the ongoing litigation.

“The talc claims asserted against the company exemplify the egregious impact on U.S. businesses from meritless litigation and extreme judgments obtained by the plaintiffs’ bar through forum shopping, the distortion of scientific literature with junk science, and the unregulated and surreptitious financing of product litigation by financial institutions, including private equity and sovereign wealth funds,” Mr. Haas said.

Reuters contributed to this report.