(Reuters) —Johnson & Johnson faces over 20,000 lawsuits from women who used the company’s baby powder product and developed ovarian cancer. Amidst these thousands of suits, Reuters reported that several sources familiar with the pending litigation have confirmed J&J is considering creating a separate subsidiary of the company that will file for Chapter 11 Bankruptcy.
If the subsidiary company is created and granted bankruptcy, victims who have not settled their suits against J&J would then file their claims against the subsidiary company. Often, the relief awarded is much less when distributed by a bankrupt subsidiary rather than the parent company, itself. This controversial tactic, known as “Texas two-step bankruptcy,” has been utilized by many large companies facing similar lawsuits over the last few years.
Shelby Roden filed one of the first federal talc lawsuits in the State of Alabama and will continue to monitor the ongoing litigation alleging claims related to ovarian cancer. If you or a family member have been diagnosed with ovarian cancer, please contact our office for more information.