J&J talc bankruptcy stays in Texas despite ‘forum-shopping’ opposition

By Dietrich Knauth

NEW YORK (Reuters) -A Johnson & Johnson (NYSE:JNJ) subsidiary can pursue its third attempt to resolve tens of thousands of lawsuits alleging its talc products caused cancer in a Texas bankruptcy court, a judge ruled on Thursday, allowing the company to avoid a venue that shot down its two previous efforts.

U.S. Bankruptcy Judge Christopher Lopez at a hearing in Houston rejected arguments raised by the U.S. Department of Justice’s Office of the U.S. Trustee, its bankruptcy watchdog, and attorneys representing some of the women with ovarian cancer who are opposed to the settlement.

They had argued that the case should be sent to a New Jersey bankruptcy court, which oversaw two previous bankruptcies meant to resolve the same talc lawsuits.

“I think this bankruptcy case is different,” Lopez said.

J&J faces lawsuits from more than 62,000 plaintiffs alleging its baby powder and other talc products were contaminated with asbestos and caused ovarian and other cancers. J&J has said the total number of claimants is even higher when including those who have not yet sued.

The company has said its products do not contain asbestos and do not cause cancer, and that bankruptcy is the best way to equitably compensate plaintiffs, who otherwise would wait years for their cases to be heard in a “lottery-like” tort system that often results in no recovery for plaintiffs.

Erik Haas, J&J’s worldwide vice president of litigation, said Lopez’s ruling would aid the company’s settlement efforts.

“Today’s decision is another step closer to full and final resolution of the talc litigation for the benefit of all stakeholders,” Haas said.