As suits mount, J&J spins out talc liabilities into Chapter 11 using 'Texas two-step' maneuver
With lawsuits piling up alleging its talc baby powder products are unsafe, J&J has taken the controversial step of spinning out its related liabilities into a new company and filing for Chapter 11 bankruptcy, according to court papers filed late Thursday.
The procedures will now head to bankruptcy court in North Carolina, halting all lawsuits and their respective discovery processes. It’s a move that comes a few months after the Wall Street Journal and Reuters both reported J&J was exploring this option, and after a federal judge said the process could move forward in August.
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