Johnson & Johnson’s $8.2 billion talc bankruptcy deal faces legal challenges in January trial
Johnson & Johnson’s attempt to resolve thousands of lawsuits over claims that its talc-based baby powder causes cancer now rests on a high-stakes trial set for January 2024. The case will determine whether the company’s $8.2 billion settlement plan, which J&J hopes will fast-track resolution through bankruptcy, will be approved by the court.
J&J has faced 15 years of litigation regarding allegations that its baby powder contained asbestos, causing ovarian cancer and other health issues—a claim the company denies. Despite previous failures to settle the claims through bankruptcy in New Jersey, J&J has now moved proceedings to Texas, hoping for a more favorable outcome.
While J&J announced that over 75% of claimants had voted in favor of the new deal, Andy Birchfield, an attorney representing a group of plaintiffs, has accused the company of manipulating the vote. He claims that EPIQ, the consulting firm managing the vote, allowed another attorney, Allen Smith, to improperly switch 11,434 votes from “no” to “yes.” Birchfield is demanding the votes be reversed, accusing J&J of rigging the bankruptcy process to minimize legitimate claims.
J&J’s Erik Haas, head of global litigation, defended the process, insisting the vote was conducted according to rules and reflected the claimants' desire for a quick resolution. Haas emphasized that the proposed settlement—one of the largest in mass tort history—offers fair compensation and will end years of litigation.
The controversy over the vote reflects deeper tensions between plaintiffs' attorneys. Smith, who once partnered with Birchfield on these cases, switched his clients' votes to favor the deal, citing the need to end protracted litigation. Smith, under financial pressure due to $240 million in litigation debt, argued that the revised offer provided fair compensation for clients. Birchfield, however, accused Smith of betraying former clients for financial gain and filed a lawsuit against him.
The outcome of these legal battles will shape whether EPIQ remains responsible for overseeing the bankruptcy claims process, which could yield millions in fees.
J&J is betting on the enhanced settlement and bankruptcy process to handle over 60,000 claims, arguing that it’s the only way to avoid decades of costly litigation. If approved, the bankruptcy would bind all plaintiffs, including those who opposed the deal, and establish a trust to handle future cancer claims.
However, critics warn that moving the case to Texas—considered more business-friendly—raises concerns about fairness. Judge Christopher Lopez will need to decide whether the contested votes were valid and whether the bankruptcy should proceed in Texas, especially after two previous bankruptcy attempts were blocked in New Jersey. Lopez has also halted all talc trials while the bankruptcy plan is under review.
If the bankruptcy plan succeeds, it would settle most current talc-related lawsuits and limit J&J's liability for future claims. However, an appeal is expected, potentially delaying final resolution. Larry Biegelsen, an analyst at Wells Fargo, noted that year-end resolution is possible if the court approves the deal, though the process will likely remain contested.
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K'taka govt, Taiwan's Allegiance Group sign MoU to establish industrial technology innovation park
Bengaluru (PTI): Karnataka government on Friday signed an MoU with Allegiance International Co Ltd of Taiwan to establish an Indo-Taiwan Industrial Technology Innovation Park (ITIP) in the state, with a proposed investment of around Rs 1,000 crore.
The MoU was signed by Rahul Sharanappa Sankanur, Director, Department of Electronics, IT, BT and Lawrence Chen, VP, Allegiance Group in the presence of Chief Minister Siddaramaiah, Minister for Electronics, IT & BT Priyank Kharge, and senior officials.
The project will be undertaken by the Allegiance Group with a proposed investment of around Rs 1,000 crore, leading to the creation of about 800 direct jobs via the companies setting up operations in ITIP over a period of 5 years, the IT&BT Minister's office said in a statement.
The ITIP will serve as a dedicated hub for Taiwanese companies in electronics and semiconductors, fostering advanced manufacturing, R&D, and innovation. This collaboration aims to strengthen Karnataka's position as India's leading destination for Electronics System Design and Manufacturing (ESDM) and accelerate the growth of the semiconductor ecosystem in the state.
Key highlights of the MoU include establishment of a world-class industrial park to house Taiwanese firms in electronics and semiconductor sectors; development of a robust supply chain ecosystem for components, PCBs, and chip design; creation of high-value jobs and skill development programmes in collaboration with academic institutions; and promotion of technology transfer and global best practices to enhance India's competitiveness in electronics manufacturing.
CM Siddaramaiah said this partnership marks a significant step towards realising Karnataka's vision of becoming a global hub for electronics and semiconductor innovation.
"The ITIP will attract cutting-edge technology and investments, creating opportunities for our youth and strengthening India's position in the global value chain," he said.
Minister Priyank Kharge said Karnataka has led India's technology revolution and continues to dominate in innovation, deep-tech talent, and semiconductor design.
"This partnership will accelerate our efforts to build a robust electronics and semiconductor ecosystem. We are committed to creating a level playing field and ensuring that Karnataka remains the preferred destination for global investors in advanced technologies," he said.
Lawrence Chen said, "We are excited to collaborate with Karnataka, a state known for its technology leadership. The ITIP will be a catalyst for Taiwanese companies to expand in India and contribute to the growth of the semiconductor and electronics ecosystem."
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