Johnson & Johnson has increased its settlement offer to over $8.2 billion in an attempt to resolve thousands of lawsuits alleging that its baby powder caused cancer. This revised bid, up from the earlier $6.5 billion proposal, indicates that J&J might allocate an additional $1.7 billion to settle the ongoing litigation. Under the new terms, claimants may receive larger payouts along with approximately $650 million in legal fees covered.
The baby powder litigation, which has been contentious for several years, focuses on claims that talc-based versions of the product led to ovarian and other gynecological cancers. Negotiations to secure claimant support for an out-of-court settlement are crucial as J&J looks to expedite the resolution process through bankruptcy courts. Recently, the company managed to obtain backing from over 75% of baby powder claimants, a significant step forward in the settlement process. The increased offer signals the company’s continuing attempts to minimize liability while ensuring a quicker resolution.
Despite these efforts, some claimants still oppose the settlement terms. This resistance might complicate the planned filing for the latest Chapter 11 case, which J&J is expected to file in the coming days. The company maintains that its talc-based powders did not cause cancer and asserts that it has appropriately marketed the product for over a century.
J&J’s stock has seen some fluctuation amid these developments, slipping less than 1% in early Friday trading but gaining approximately 5% this year. The recent agreement with a prominent plaintiff’s group, following negotiations led by Mississippi lawyer Allen Smith—who has opposed J&J’s settlement proposals for years—might help accelerate the settlement’s progress. Analysts, such as Guggenheim’s Vamil Divan, have noted that the additional $1.1 billion in the offer is within investor expectations and likely played a role in the recent uplift in J&J’s stock value, which climbed over 13% in the past three months.
For further details, please refer to the Bloomberg Law article.