Johnson & Johnson (J&J) is in the midst of attempting to finalize a historic settlement of thousands of cancer-related lawsuits through the bankruptcy of its subsidiary: Red River Talc. However, two U.S. federal health agencies – the Department of Veterans Affairs (VA) and the Department of Health & Human Services (HHS) – are challenging the proposal, raising concerns about the potential impact on the government’s ability to recover health care costs.
J&J’s talcum powder products – most notably Johnson & Johnson Baby Powder, which allegedly contained asbestos – have been linked to ovarian cancer and mesothelioma in numerous lawsuits.
Asbestos exposure is the only cause of mesothelioma, a rare but deadly form of cancer that affects the lining of the lungs, heart or abdomen.
While mesothelioma is less frequently discussed in Johnson & Johnson talc litigation, the presence of asbestos in talc is a serious concern.
Government Concerns Over Health Care Costs
Johnson & Johnson is using a bankruptcy strategy of creating a subsidiary company to shoulder legal liabilities and having that subsidiary file for bankruptcy. Filing for bankruptcy would shield the subsidiary from future lawsuits related to Johnson & Johnson talcum powder products, which the health care conglomerate no longer makes.
The VA and HHS are concerned that the proposed $8 billion bankruptcy settlement could prevent federal health programs such as Medicare and Medicaid – which have covered the costs of treating cancer patients harmed by J&J’s talc – from seeking reimbursement.
Asbestos-related diseases, including mesothelioma, can lead to costly long-term care, which is often covered by these programs. The agencies argue that the current bankruptcy plan lacks clarity on whether the government would retain its right to recover these expenses.
The VA also represents veterans with asbestos-related diseases. In the United States, approximately one-third (33%) of people with mesothelioma are military veterans.
In their objections, the agencies point out that the plan appears contradictory. In some sections, the bankruptcy plan suggests government rights will remain intact, while in others, it implies J&J’s liability will be erased.
Given the significant costs involved in treating asbestos-related cancers like mesothelioma, clarity on this issue is crucial for protecting federal interests.
Asbestos, Mesothelioma, and the Broader Talc Litigation
The dangers of asbestos have been well-documented for decades, and the idea that J&J’s talc products may have contained asbestos has raised alarm among those affected by both ovarian cancer and mesothelioma.
Mesothelioma, often associated with asbestos exposure from working in industrial or construction occupations, can also develop from contact with asbestos-contaminated talc.
Talc and asbestos are both naturally occurring minerals. They can mix together during mining, and asbestos can contaminate talc during manufacturing. Talc can absorb moisture and keep skin healthy, which is why companies like Johnson & Johnson used it in skincare and cosmetic products for decades. However, the presence of asbestos makes talc a dangerous ingredient.
The latency period for mesothelioma is long, meaning that people exposed to asbestos from using Johnson & Johnson Baby Powder decades ago may only now be developing symptoms, adding further complexity to the potential future claims against J&J.
Legal Challenges and the Path Forward
January 2025 marked a key deadline for objections to J&J’s bankruptcy plan. In addition to the VA and HHS, the U.S. Trustee, attorneys for cancer victims, and insurers also filed objections, arguing that the plan unfairly limits the rights of those harmed by asbestos exposure.
Many victims argue that they should be allowed to pursue their lawsuits individually rather than being forced into a settlement that may not fully compensate them for their suffering. In most cases, mesothelioma lawsuits that lead to individual settlements or verdicts give victims far more compensation than group settlements or asbestos trust fund payments.
J&J, which faces more than 58,000 ongoing talc-related lawsuits, including claims related to both ovarian cancer and mesothelioma, insists its proposed settlement is a fair and efficient resolution. The company claims more than 80% of the plaintiffs support the settlement.
The court is set to hear J&J’s defense of its bankruptcy plan later in 2025. Johnson & Johnson has already attempted this bankruptcy route twice, and both times judges blocked the maneuver. Now, the company is pushing it through the Texas bankruptcy court system, which is often more favorable to these tactics.
U.S. Bankruptcy Judge Christopher Lopez is scheduled to preside over a multi-day hearing in Houston, TX, where the competing demands of the government, cancer victims and J&J will be weighed.
Sources & Author
- US health agencies sound warning on J&J talc bankruptcy. Reuters. Retrieved from: https://www.reuters.com/legal/government/us-health-agencies-sound-warning-jj-talc-bankruptcy-2025-01-27/. Accessed: 02/10/2025.
- J&J unit files for bankruptcy to advance $10 billion talc settlement. Reuters. Retrieved from: https://www.reuters.com/business/healthcare-pharmaceuticals/jj-subsidiary-files-bankruptcy-advance-8-billion-talc-settlement-2024-09-20/. Accessed: 02/10/2025.
Sources & Author
