Senator Durbin Blasts Johnson & Johnson's Bankruptcy Plan
Speaking from the U.S. Senate floor on February 15, Sen. Dick Durbin condemned Johnson & Johnson’s controversial bankruptcy strategy, which he labeled “shameful and indefensible”, to limit their massive legal liability to asbestos talc plaintiffs.
During his speech, he evoked powerful imagery of J&J’s influential ads, most notably for J&J Baby Powder, that generations associated with sentiments of parental love, wholesomeness, safety, and health. As long suspected and later confirmed, J&J knew that their talc products were contaminated with asbestos for decades despite their ruthless campaign to deny culpability in the courtroom.
Before long, huge plaintiff verdicts began to catch-up to J&J. They subsequently created a new company, LTL Management, LLC to deal with their talc liabilities for the express purpose of declaring it bankrupt days later, a tactic known as the Texas Two-Step.
“What a cynical move for a company to make against cancer-stricken customer across America,” declared Sen. Durbin. He told the story of a woman currently battling mesothelioma, Kimberly Naranjo, who bravely testified before the Senate earlier in the week about being deprived of having her day in court. Naranjo gave voice to herself, and all the other victims exposed to J&J’s products whose voices will be silenced by the Texas Two-Step maneuver.
According to Sen. Durbin, he wrote both the former and current CEOs of Johnson & Johnson urging them to abandon their bankruptcy plan and “hold yourself accountable to the people who trusted your product.” He reports that “Sadly, they ignored me.”
The J&J talc bankruptcy plan has been widely criticized by both legal experts and plaintiffs’ lawyers as an intentional misuse of the bankruptcy process. Even Steven Wolens, the legislator who originally wrote the Texas Two-Step bill back in 1989 said the law never would have passed had they known “the provisions could be dubiously interpreted for entities to avoid known liability such as those causing severe and permanent injury or death.”
In closing, Sen. Durbin expressed, “I hope the courts reject Johnson & Johnson’s abuse of federal bankruptcy laws. But I also believe that Congress must act to close this loophole for good. I hope Democrats and Republicans can work together on a bipartisan basis to stop this bankruptcy abuse.”
To watch Sen. Durbin’s full video: https://www.youtube.com/watch?v=ZwDchQWKU40
