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Congressional Democrats Condemn Johnson & Johnson’s Declaration of Bankruptcy to Evade Accountability Over Talc Claims

Washington, D.C. – Today, Congressional sponsors of the Nondebtor Release Prohibition Act of 2021 issued the following statements condemning Johnson & Johnson for placing its liabilities for thousands of lawsuits alleging its talc-based products caused cancer into bankruptcy: 

“Once again, a corporate giant is seeking to exploit a loophole in the bankruptcy system to evade accountability for the harm inflicted on American families,” said House Judiciary Committee Chairman Jerrold Nadler (D-NY) and Antitrust, Commercial and Administrative Law Subcommittee Chairman David N. Cicilline (D-RI). “For decades, the asbestos in Johnson and Johnson’s talc products gave its customers agonizing forms of cancer, with the apparent knowledge of Johnson and Johnson’s executives. And now, like the Sackler family who made billions flooding the streets with Oxycontin, and like the people who enabled sexual predators like Larry Nassar and Harvey Weinstein, Johnson and Johnson is seeking to use bankruptcy to ‘get away with it.’ This latest ploy adds to our already urgent obligation to take up the Nondebtor Release Prohibition Act and continue to conduct rigorous oversight of the bankruptcy system to restore the principles of fairness and equal justice on which the legitimacy of our judicial system depends.”

“Johnson & Johnson’s ‘Texas two-step’ bankruptcy is a sickening attempt to avoid responsibility for their own dangerous products,” said Chairwoman of the Committee on Oversight and Reform Carolyn B. Maloney (D-NY). “Just like the Sacklers, who are using a legal loophole to escape accountability for their role in the opioid epidemic, Johnson & Johnson is blatantly abusing our bankruptcy system in a way that protects the wealthy and giant corporations, and stiffs the ordinary Americans who they have harmed. I am committed to taking additional oversight steps to hold Johnson & Johnson accountable, and Congress must pass legislation to prevent powerful bad actors from abusing our bankruptcy system.”

“I am deeply disturbed that Johnson & Johnson thinks it can run away from its problems,” said Representative Raja Krishnamoorthi (D-IL). “My investigation revealed that Johnson & Johnson knew for decades that it was poisoning people with its talc baby powder, and worked to actively cover it up. Many victims were women and babies. Now when it is being held accountable for its actions, it throws crumbs at the problem and tries to walk away.  That’s unacceptable and unconscionable.”

“Bankruptcy is there to help companies in trouble, but over time rich people in giant corporations have figured out how to game the system. Johnson & Johnson has decided to join in on the abuse of our bankruptcy system to shield its assets and evade liability for the harm it has caused people across the country. We can’t keep letting this happen and our Nondebtor Release Prohibition Act would enact critical reforms to stop it,” said U.S. Senator Elizabeth Warren (D-MA).

“Much like the Sackler family, Johnson & Johnson is taking advantage of a legal loophole to evade responsibility for the harm caused by its products. Johnson & Johnson must face responsibility for marketing talc-based products that have caused thousands of cases of ovarian cancer,” said Senate Judiciary Committee Chair Dick Durbin (D-IL). “Today’s announcement by Johnson & Johnson only reinforces the need to reform bankruptcy law so that corporations face accountability for putting profits before consumers’ health and wellbeing.”

“Johnson & Johnson’s bankruptcy filing is a shameful attempt to evade responsibility for its own negligence and wrongdoing,” said U.S. Senator Richard Blumenthal (D-CT). “Johnson & Johnson knew the devastating harm its baby powder and talc-based products could cause and, at the expense of tens of thousands of consumers spanning decades, took no steps to protect them. Now—faced with the prospect of real accountability—Johnson & Johnson wants to exploit loopholes in the Bankruptcy Code to deny them their day in court. Those harmed by Johnson & Johnson deserve better. This filing underscores the urgent need for bankruptcy reform so that bad actors and corporations can no longer dodge justice with impunity and get away with just a slap on the wrist.”

The Nondebtor Release Prohibition Act of 2021 would prevent individuals who have not filed for bankruptcy from obtaining releases from lawsuits brought by private parties, states, Tribes, municipalities, or the U.S. government in bankruptcy by:

  • Prohibiting the court from discharging, releasing, terminating or modifying the liability of and claim or cause of action against any entity other than the debtor or estate.
  • Prohibiting the court from permanently enjoining the commencement or continuation of any action with respect to an entity other than the debtor or estate.

 
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