In recent years, a legal maneuver known as the “Texas 2-Step” has emerged, drawing considerable ire from plaintiff lawyers. The strategy, utilized by companies like Johnson & Johnson, involves creating a subsidiary that assumes the liability for extensive tort claims. Subsequently, this subsidiary files for Chapter 11 bankruptcy, effectively stalling litigation efforts and, critics argue, undermining claimants’ ability to seek compensation in a timely manner.
Kelly Reardon of The Reardon Law Firm, representing clients in the talc-related lawsuits against Johnson & Johnson, has expressed her frustrations. She regularly counsels her clients to remain patient despite the legal strategy’s lengthy process, often stretching beyond a decade. Reardon acknowledges the emotional toll and the difficulties involved, as claimants are advised to hold on amid prolonged legal procedures.
The continued utilization of this approach by corporations has sparked significant debate within the legal community. As these cases draw out over years, many plaintiff attorneys contend that the tactic unfairly disadvantages the victims seeking justice. For more details on the intricacies of this strategy, the discussion is further explored in an analysis by the Connecticut Law Tribune.