Bankruptcies

Judge’s Ruling Exposes Flaws in Johnson & Johnson’s $9 Billion Talc Settlement, Highlighting Legal Challenges in Asbestos-Related Bankruptcies

by

Houston, TX — A recent decision from a bankruptcy court has cast a spotlight on the complex legal strategies corporations use to handle mass tort liabilities, revealing significant flaws and setting possible new guidelines for future legal battles. The ruling by U.S. Bankruptcy Judge Christopher Lopez on March 31 rejects a $9 billion settlement proposal from a Johnson & Johnson unit, aimed at resolving thousands of cancer claims linked to its talc-based products. Johnson & Johnson has consistently claimed that their talc products, including their iconic baby powder, are safe. However, the company has faced … Read more

Future at Risk: Will 2024 See the Collapse of Major Mass Tort Bankruptcies?

by

Washington, D.C. — As the calendar flips to 2024, the corporate legal landscape is fraught with uncertainty surrounding mass tort bankruptcies, a trend that garnered significant momentum but faced several roadblocks throughout the previous year. These judicial restructurings, typically initiated by companies embroiled in extensive liability lawsuits, such as those involving asbestos or opioid-related cases, showed signs of faltering under increased scrutiny and complex legal challenges. Legal experts suggest a key factor in the stumbling performance of these bankruptcy filings has been the heightened judicial skepticism. Courts are increasingly wary of attempts by large corporations … Read more

Supreme Court Rules on Insurance Neutrality: What Debtors Need to Know About Insurer Challenges in Mass Tort Bankruptcies

by

Washington — A recent Supreme Court ruling has set the stage for significant transformations in the handling of insurance claims within mass tort bankruptcies. In a decision that underscores the need for debtors to be more vigilant, the court sided with insurers, demanding that claims be treated with stricter scrutiny to prevent potential inequities. This new judgment addresses the often contentious issue of “insurance neutrality,” a legal stance where bankruptcy filings should not affect the handling of insurance claims. Previously, companies under mass tort claims, such as those associated with asbestos-related liabilities or large-scale product … Read more

Supreme Court Restricts Nonconsensual Releases in Chapter 11 Bankruptcies, Impacting Mass Tort Litigation

by

Washington, D.C. – In a significant ruling that may transform the landscape of bankruptcy law, the U.S. Supreme Court has decisively limited the use of “nonconsensual third-party releases” in chapter 11 reorganization plans. This decision, falling on a narrow 5-4 margin, rejected these provisions, which previously allowed for the involuntary release of claims against nondebtors, such as the controversial inclusion of the Sackler family in Purdue Pharma’s bankruptcy case. Delivering the majority opinion, Justice Neil Gorsuch, joined by Justices Clarence Thomas, Samuel Alito, Amy Coney Barrett, and Ketanji Brown Jackson, articulated that such releases improperly … Read more