J&J Talc Creditors Look to Sue Over Terminated Bankruptcy Funding

A cancer victim group asked for standing to sue Johnson & Johnson over the company’s termination of a $61.5 billion funding agreement with its bankrupt talc liability unit, calling it “an attempt to manufacture financial distress” to justify the Chapter 11 case.

After its first Chapter 11 case was tossed, LTL Management LLC filed its second bankruptcy to resolve several thousand lawsuits over allegedly tainted baby powder. The decision to withdraw the funding agreement in LTL’s second bankruptcy case amounts to a fraudulent transfer of the victims’ rights to the money for their compensation, an official committee of talc claimants ...