Johnson & Johnson Subsidiary ’s Talc Bankruptcy Denied Again

A U.S. judge denied a Johnson & Johnson subsidiary’s bankruptcy filing for a second time this year, hindering the company’s effort to resolve tens of thousands of talc-related lawsuits.  U.S. Bankruptcy Judge Michael Kaplan ruled that LTL Management, the Johnson & Johnson subsidiary, was not in “financial distress” and dismissed the filing. The ruling is the second time Kaplan has denied LTL’s bankruptcy bid for this reason.  “In sum, this Court smells smoke, but does not see the fire,” Kaplan wrote in the denial. “Therefore, the emphasis on certainty and immediacy of financial distress closes the door of chapter 11 to LTL at this juncture.” J&J issued a statement the day of the ruling and said it plans to appeal.  In the statement, Erik Haas, worldwide vice president of litigation for Johnson & Johnson, said J&J disagrees with the court’s conclusion that the company’s liability from talc claims “does not establish ‘immediate’ financial distress under the standard imposed by the Third Circuit, which itself is found nowhere in the Bankruptcy Code and is contrary to the persuasive authority from other Circuit Courts and directives of the Supreme Court of the United States. “The Bankruptcy Code does not require a business to be engulfed in ‘flames’ to seek a reorganization supported by the vast majority of claimants,” he said. The bankruptcy proceedings have halted the appro...
Source: Asbestos and Mesothelioma News - Category: Environmental Health Authors: Tags: Asbestos Exposure Legal Source Type: news