
Once again leading the charge,
Reuters issued a special report detailing the bombshell story of how Johnson &
Johnson strategized the plan to limit compensation to asbestos talc victims.
Back in 2018, Reuters published an investigative
report concluding that “Johnson & Johnson knew for decades that asbestos
lurked in its Baby Powder”. In the past year, Reuters also broke
the story that J&J was exploring their
bankruptcy options in July 2021, foreshadowing their dodging of accountability ahead.
Now J&J’s internal company memos confirm how the healthcare and
consumer-goods conglomerate planned to freeze all litigation and instead
have plaintiffs seek compensation through a bankruptcy process.
For the past several years, tens of thousands of victims of asbestos-related
cancers have filed lawsuits against J&J alleging negligence in exposing
individuals to asbestos-contaminated products. In October 2021, in an
effort to further shield their liability and protect their corporate assets
from claims, J&J bankrupted the newly created subsidiary they formed
to handle their talc claims by invoking a dubious legal loophole known as the
Texas two-step.
Earlier this month, J&J’s bid to
block Reuters from publishing the story about its confidential company documents
was denied. Reuters spokesperson issued a statement that they “will
continue to report without fear or favor on matters of public interest.”
The documents revealed J&J’s concern with how the subsidiary’s
bankruptcy would effect their stellar credit rating and also their attempt
to limit the “large and growing amount of talc cases – some
with ‘lottery-size’ awards [which] put J&J’s consumer
products business in ‘financial distress’.”
According to legal expert, Melissa Jacoby, “Such a precedent could
allow companies to routinely pursue related-party bankruptcies to escape
accountability from juries. If a company as deeply pocketed as J&J
can do this, where does it stop?”
As revealed in the memos, J&J’s strategy essentially amounts
to an “alternative justice system” and provides a blueprint
for corporations’ intent on employing increasingly evasive tactics
to limit their legal liability.