Johnson & Johnson and a New War on Consumer Protection

The company has spent billions on cases about one of its most popular products. As its executives try a brazen new legal strategy to stop the litigation, corporate America takes note:

Johnson & Johnson has always insisted, including to this magazine, that its baby powder is “safe, asbestos-free, and does not cause cancer”; however, a 2016 investigation by Bloomberg and subsequent revelations by Reuters and the New York Times, based in part on documents that surfaced because of discovery in suits like Berg’s, exposed the possible health risk related to its powders. Following those reports, tens of thousands of people filed suits against the company, alleging that its products had caused their cancers. In 2020, after juries awarded some of those plaintiffs damages that collectively exceeded billions of dollars, Johnson & Johnson announced that it would no longer supply the talc-based version of its product to American stores.

And then, quietly, the company embraced a strategy to circumvent juries entirely. Deploying a legal maneuver first used by Koch Industries, Johnson & Johnson, a company valued at nearly half a trillion dollars, with a credit rating higher than that of the United States government, declared bankruptcy. Because of that move, the fate of forty thousand current lawsuits and the possibility of future claims by cancer victims or their survivors now rests with a single bankruptcy judge in the company’s home state, New Jersey. If Johnson & Johnson prevails and, as Berg puts it, “weasels its way out of everything,” the case could usher in a new era in which the government has diminished power to enforce consumer-protection laws, citizens don’t get to make their case before a jury of their peers when those laws fail, and even corporations with long histories of documented harm will get to decide how much, if anything, they owe their victims.

Author: Casey Cep
Source: The New Yorker
Published: Sep 12, 2022
Length: 32 minutes (8,046 words)
Read the story