J&J baby powder lawsuits stay paused amid bankruptcy trial plans

Litigation alleging that Johnson & Johnson (NYSE:JNJ )'s baby powder is linked to ovarian cancer will continue to be suspended at least until mid-March. This decision comes as a subsidiary of the company seeks a conclusive resolution to the disputes through bankruptcy proceedings.

At a recent court hearing, U.S. Bankruptcy Judge Christopher Lopez chose not to extend the stay to cover other potentially liable parties, nor did he lift the stay to allow some lawsuits against Johnson & Johnson to proceed.

The health-care conglomerate is currently facing a multitude of claims, with tens of thousands of women asserting that they developed cancer due to contaminated talc in the company's baby powder.

Judge Lopez, operating out of Houston, has scheduled a trial for the end of January. The trial will determine whether to sanction Johnson & Johnson's strategy to settle the cancer-related lawsuits by allocating more than $8 billion for payouts.

The plan involves a specially created corporate entity that Johnson & Johnson established to assume the cancer claims and to seek bankruptcy protection.

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Source: Investing.com