Johnson & Johnson’s newly-created subsidiary, LTL Management LLC (“LTL”), filed for bankruptcy in the Western District of North Carolina on October 14, 2021, with the primary goal of resolving thousands of tort claims (and nearly 40,000 pending lawsuits) related to the company’s talcum powder-based products – LTL’s only liabilities. LTL was formed two days before the filing under a Texas law which allowed Johnson & Johnson subsidiary Johnson & Johnson Consumer Inc. to split into two new entities: one (LTL) assigned its billions in talc liability and one (“New JJCI”) assigned with its remaining assets. As part of the transaction, LTL also received certain assets, including approximately $6 million in cash and certain royalty streams, which the debtor projects will generate approximately $50 million in revenue per year over the next five years. Additionally, Johnson & Johnson and New JJCI committed to: (a) fund a trust with an aggregate amount of $2 billion to pay for current and future tac-related claims asserted against LTL; and (b) pay all costs and expenses of LTL in the normal course of business (up to the full value of New JJCI).
Continue Reading J&J Talc Bankruptcy Case: Events Leading Up To Potential Dismissal Battle