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Second Bankruptcy Bid Linked to Talc by J&J Turned Down

 Johnson & Johnson's (J&J) endeavor to reach an $8.9 billion settlement and seek bankruptcy protection for talc-related lawsuits has been denied for the second time, as of July 30, 2023. The decision came from Judge Michael Kaplan of the U.S. Bankruptcy Court in New Jersey, who ruled that the company's financial situation was not critically dire, as reported by the New York Times.

The rejection prompts J&J to challenge the verdict robustly, vowing to counter the lawsuits that they deem lacking in scientific basis, according to Reuters.

In response to the wave of legal actions alleging that J&J's talc-infused baby powder contained cancer-causing asbestos, the corporation established a subsidiary called LTL Management in 2021. The subsidiary filed for Chapter 11 bankruptcy protection, a move contested by J&J, leading to a series of legal maneuvers.

The initial appeal was turned down in March 2023, with noting that the parent company had sufficient resources to cover the subsidiary's liabilities. During the second bankruptcy appeal, all legal proceedings were suspended, barring an exceptional case due to the deteriorating health of plaintiff Anthony Hernandez Valadez.

On July 18, 2023, Valadez was awarded $18.8 million, asserting that J&J's talc-based baby powder caused his mesothelioma by exposing him to asbestos. Bloomberg's report on this verdict from California highlighted its potential to influence the settlement outcome, given its divergence from Valadez's hypothetical $50,000 settlement amount.

Bloomberg also conveyed J&J's intent to contest the Valadez verdict based on perceived erroneous decisions by the presiding judge. Erik Haas, J&J's worldwide VP of litigation, expressed the company's position that they were precluded from presenting evidence suggesting that Valadez's unique mesothelioma was unrelated to the baby powder. This evidence, Haas maintained, is pivotal for comprehending the safety of Johnson's Baby Powder based on extensive scientific assessments over time.

Concurrently, J&J has initiated legal action against four doctors whose studies purportedly linked talc-based personal care products to cancer through what they allege is "flimsy science," according to Reuters.