US trustee alleges Johnson & Johnson misused LTL’s Chapter 11 to escape the lawsuit

According to the US Trustee, Johnson & Johnson established LTL in 2021 to settle lawsuits related to their talc-based products, such as baby powder, which have been linked to cancer. Johnson & Johnson (J&J) has been accused by the US Trustee, an agency of the US Justice Department, of using this means to settle the case.

However, the US Trustee asserts that J&J had known about the cancer risks associated with talc for years but continued marketing the products without warnings.

The US Trustee argues that J&J is using LTL's bankruptcy filing as an attempt to avoid its legal responsibilities and escape liability.

Numerous lawsuits against the company claimed that its talc products were to blame for mesothelioma and ovarian cancer, but the company has always denied any wrongdoing and insisted that its products are safe.

If the court accepts the US Trustee's accusations of bad faith against Johnson & Johnson, the company might not be able to leverage LTL's Chapter 11 bankruptcy filing as a way to dismiss the talc cancer lawsuits. This could result in significant financial losses for the company and lead to a settlement with the plaintiffs, ending the long-running legal dispute.