J&J attempted to shift responsibility for talc powder injury cases by forming a new company

The United States Court of Appeals for the Third Circuit in Philadelphia has rejected a Chapter 11 petition that was submitted by a recently established subsidiary of Johnson & Johnson (J&J) named LTL Management. If approved, the petition would have permitted the pharma giant to avert having to pay out billions of dollars in trial accolades for its cancer-causing baby powder. However, the petition has been rejected.

In October, J&J established LTL Management in order to deal with more than 38,000 talcum baby powder cases that had led to a total of $3.5 billion in judgements & settlements, including one instance in which 22 women were granted a judgment that was more than $2 billion.

What would have occurred, had the Third Circuit Court not thrown down this little plan, is that J&J would have moved all obligation for these judgements & payouts onto LTL Management, which is basically a shell investment firm where all liability would have gone to die.