Johnson & Johnson offers $9B to settle 'talcum-caused cancer' claims
Pharmaceutical giant Johnson & Johnson (J&J) has been dealing with lawsuits against its talc-based baby powder for years. The company has now offered to pay $8.9 billion to settle the claims of tens of thousands of plaintiffs. Plaintiffs have claimed that J&J's talcum powder products caused cancer. The legal fight that began in 2013 has significantly hampered J&J's image worldwide.
Why does this story matter?
J&J's baby powder was never one of its top sellers. The product, however, was very popular around the world and was part of the company's identity. The history of talcum powder causing human harm dates back to as early as the 1930s. However, companies, including J&J, have refused to accept that their talc-based powders caused any harm.
Company lost suit against its talc-based products in 2013
In 2009, Deane Berg, a physician's assistant from South Dakota, filed a suit against J&J. In her case, she claimed the company's talc-based baby powder and Shower to Shower were factors behind her ovarian cancer. Berg won the suit in 2013 but did not receive any damages. However, her victory opened the floodgates, and J&J was bombarded with several similar suits.
J&J's talc products were contaminated by asbestos
Berg's victory also brought to attention another older suit filed against J&J. The suit was filed by Darlene Coker, who alleged the company's talc products contained asbestos, a known carcinogen. Coker, however, could not prove her claim then. Later, a Reuters investigation proved that J&J has been aware of the asbestos contamination of its talc-based products for several decades.
Settlement will be paid over 25 years
J&J has repeatedly denied the accusations. But the company has lost multiple lawsuits in different jurisdictions over the last few years. So, it has now offered $8.9 billion to settle the claims once and for all. The amount will be paid out over 25 years through a subsidiary, which has filed for bankruptcy to enable the $8.9 billion trust.
J&J still maintains its innocence
However, J&J is still maintaining that it did not do anything wrong. It also said the settlement is not an admission of wrongdoing. According to Erik Haas, J&J's vice president of litigation, the plaintiffs' claims lack "scientific merit." He said the company is settling because it would have taken decades and a lot of money otherwise to reach an end.
