Blatant abuse of Chapter 11? J&J says its use of 'Texas two-step' is all about fairness
As a five-day trial over Johnson & Johnson’s controversial talc bankruptcy wrapped up last week, the pharma giant had a final argument to make: That plaintiffs’ attorneys have a “perverse incentive” behind their rejection of the pharma giant’s bankruptcy strategy.
The case stems from 38,000 lawsuits claiming J&J’s widely used baby powder and other talc products contained asbestos and caused mesothelioma and ovarian cancer. As cases mounted, J&J attempted to dig itself out by spinning the talc-related liabilities into a new company called LTL Management, which then filed for bankruptcy.
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