Avon, a once-popular international beauty brand, filed for bankruptcy as part of a Texas Two-Step maneuver to avoid talc and asbestos cancer lawsuits. The holding company, Avon Products, Inc., announced in a press release earlier this month it had initiated Chapter 11 bankruptcy.
For several years, health and beauty companies that relied on talc in their products have faced a swarm of lawsuits. There are studies connecting the use of talc products to developing cancer. Avon is no different as the company has used talc in face powders and eye shadows.
The link between talc and cancer is the potential of asbestos contamination. Asbestos is a naturally occurring mineral proven to cause cancers such as mesothelioma, lung cancer and ovarian cancer. Talc is also a naturally occurring mineral often found in the same geographies as asbestos.
Talc can absorb moisture and keep skin dry, which makes it an appealing ingredient in health and beauty products. Mining for talc can lead to asbestos contamination, and therefore asbestos exposure for any consumers of talc products.
History of Avon
The Chapter 11 bankruptcy filing from Avon Products, Inc., is a historic moment for a once-proud American-made brand. The company is one of the oldest still-operating direct-selling companies in the United States. It originated in 1886 as California Perfume Company.
Avon evolved into a door-to-door cosmetic sales giant in the 20th century. The company’s first makeup product was Sweet Sixteen Face Powder – introduced in 1896. The first lipstick was introduced in 1919.
Avon was introduced as the California Perfume Company’s primary brand in 1928 and the umbrella company officially changed its name to synchronize with the Avon brand in 1939 as Avon Products, Inc.
The company’s product line was central to the female self-expression revolution in the early 20th century. This stronghold on the beauty industry continued into the 21st century.
The company’s first makeup was Sweet Sixteen Face Powder (1896) with shades pink, white and brunette. By the nineteen-teens, more color products were introduced. The first lipstick was introduced in 1919.
Why Is Avon Filing for Bankruptcy?
Avon is filing for bankruptcy to absolve the company from pending lawsuits and close the door on future lawsuits against the company. Using a “holding company” to file for Chapter 11 bankruptcy allows other companies to continue operating without needing to face further lawsuits related to talc products in question.
This tactic is known as the Texas Two-Step. It originated in Texas and is considered by many a malicious strategy to avoid paying victims of unethical business practices. Despite these feelings from the legal community and general public, the legal loophole remains an option to companies.
Johnson & Johnson, which once sold a popular talc Baby Powder, has faced tens of thousands of cancer lawsuits from people with ovarian cancer and mesothelioma. The company has created a subsidiary to hold legal liabilities and file for Chapter 11 bankruptcy.
Johnson & Johnson is making its third attempt to use the Texas Two-Step, and the filing is pending plaintiff approval and court review. Johnson & Johnson’s subsidiary company used to offload legal liabilities related to talc products is titled LLT Management.
Avon, specifically the holding company for non-U.S. operations, appears to be the next in the industry to follow this strategy.
According to the New York Post, approximately 200 talc and asbestos lawsuits have been filed against Avon Products in the last few years. The lawsuits allege that the company sold talc products contaminated with asbestos, leading to cancer.
According to the press release. Avon Products, Inc., has not sold products in the U.S. since 2016 but remains the holding company for the brand’s non-U.S. operations. Those non-U.S. operations are not part of the Chapter 11 proceedings.
In 2016, Avon Products divested its U.S., Canada and Puerto Rico-based business. Avon beauty products are sold in North America under the Avon Company umbrella, which is not affiliated with Avon Products or the bankruptcy.
What Is Mesothelioma?
Mesothelioma is a rare cancer that forms in the lining of the lungs or abdominal cavity. The disease is only caused by exposure to asbestos, which means companies that used asbestos or mined for other minerals contaminated with asbestos are responsible for victims’ diseases.
Mesothelioma affects approximately 2,500 people in the United States each year, treatments such as chemotherapy and radiation are often unable to stop the spread of tumors, and the average survival after diagnosis is just one year.
People who used talc health and beauty products, such as cosmetics or baby powders, are at risk of developing mesothelioma. There have been lawsuits filed by cancer victims alleging talc led to their cancer – due to asbestos contamination.
There have been three noteworthy mesothelioma lawsuits against Avon in recent years”
- In December 2022, a woman who sued Avon for her mesothelioma was awarded $52 million by a Los Angeles jury. She claimed talc products she used were contaminated with asbestos.
- Last month, Avon was ordered to pay $24.4 million to a former janitor at an Avon manufacturing plant in Illinois who developed mesothelioma. He blamed his cancer on exposure to asbestos at the plant.
- Earlier this year, a woman with mesothelioma filed a lawsuit against more than 30 cosmetic companies, including “New Avon,” which is the U.S., Canada and Puerto Rico-based business that split from Avon Products in 2016.
If you have been diagnosed with mesothelioma and want to learn your options, contact Mesothelioma Guide’s patient advocates today. They will help you through finding a legal expert to go over your case. Email patient advocate Carl Jewett at cjewett@mesotheliomaguide.com.
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