J&J in talks with Holdouts for $6.5 billion talc settlement

Johnson & Johnson said Friday it was negotiating with lawyers for plaintiffs who opposed the company’s proposed settlement of lawsuits alleging baby powder and other talcum products caused cancer, trying to remove holdups on the settlement.

J&J announced plans to complete a $6.48 billion global deal through the bankruptcy of a subsidiary, after previous efforts were twice rejected by federal courts.

J&J says most plaintiffs support its settlement offer. But he paused the vote count for a short time so he could gather additional votes from the plaintiffs who until recently opposed the deal.

“We have agreed to a short extension of the certification deadline,” Erik Haas, J&J’s global vice president of litigation, said in a statement. “This will give these plaintiffs’ attorneys time to speak with their plaintiffs to now consider supporting the plan.”

Andy Birchfield, a lawyer who led opposition to J&J’s proposed bankruptcy settlement, said he welcomed negotiations with the plaintiffs but was prepared to resist another Chapter 11 filing.

“Our ultimate goal is fair and timely compensation for ovarian cancer victims. If J&J becomes more reasonable by negotiating with some plaintiffs, we applaud that,” Birchfield said in a statement.

“For now, we continue to fight for our customers, and if J&J chooses to file for bankruptcy a third time, we will oppose it and believe the company will fail.”

J&J plans to file a subsidiary into bankruptcy if it gets at least 75 percent of talc applicants to vote for its settlement proposal.

The bankruptcy settlement would end all talcum powder lawsuits alleging J&J products cause ovarian cancer and prevent similar cases from being filed in the future.

J&J is facing lawsuits from more than 62,000 plaintiffs who claim its baby powder and other talcum powder products were contaminated with asbestos and caused ovarian and other cancers. J&J denies the allegations and has said its products are safe, asbestos-free and cancer-free.

The current proposed bankruptcy settlement focuses on claims involving ovarian and other gynecological cancersrelying on the previous settlement of the company outside of Chapter 11 proceedings from most lawsuits claiming its talc caused mesothelioma, a deadly cancer linked to asbestos exposure.

By using a subsidiary’s bankruptcy to file for bankruptcy, J&J is trying to force all plaintiffs into a single settlement — without requiring J&J to file for bankruptcy.

Bankruptcy judges can enforce blanket settlements that permanently stop all related lawsuits and bar new ones.

Outside of bankruptcy, any settlement J&J reached with some customers would still leave retained or future plaintiffs the right to sue — and leave the company exposed to potential billion-dollar verdicts that have encouraged it to pursue a bankruptcy solution in the first place.

J&J has prevailed in many of the ovarian cases tried to date, but the litigation has also resulted in some large verdicts for plaintiffs, including a $2.12 billion award in favor of 22 women who put their ovarian cancer blamed on asbestos in J&J talc.