Since 1886, Johnson & Johnson's name
has been on everything.
Baby oil, shampoo and conditioner,
moisturizer,
Dwayne "The Rock" Johnson.
But one of their most iconic products
is talcum baby powder.
And while it might have kept our downstairs dry,
it also may have caused some very harmful side effects.
NEWSWOMAN: Johnson & Johnson is facing
thousands of lawsuits over allegations
that some of its talc powder was contaminated with asbestos.
NEWSMAN: It's been a product mainstay
for Johnson & Johnson for decades.
Now talcum baby powder
is at the center of multiple investigations.
At issue, has the company hidden evidence
that its baby powder is linked to asbestos
and ovarian cancer
in women who use it around their genitals?
NEWSMAN 2: J&J has long since denied the claim,
but now documents reveal the company knew
about the presence of small amounts of asbestos
in its products as far back as 1957
but did not disclose that to the public.
NEWSMAN 3: Thousands of people have sued J&J,
some winning tens of millions of dollars in judgments.
NEWSWOMAN 2: Johnson & Johnson ordered to pay $55 million
to a South Dakota woman who blamed her ovarian cancer
on the company's talcum powder.
NEWSWOMAN 3: A St. Louis jury awarded 62-year-old Lois Slemp
more than $110 million.
NEWSWOMAN 4: A jury awarding a California woman
$417 million.
NEWSMAN 4: One single verdict for 20 women
exceeded $2 billion.
Ooh-wee!
That's a lot of lawsuits.
I mean, you know you (bleep) up
when your company is giving away more money than Powerball.
And I get why it's happening.
Because, guys, you cannot be selling baby powder
with asbestos in it.
People are rubbing the stuff all over their bodies.
Not to mention the cocaine dealers
who mix it in with their product.
Now you've got innocent cokeheads
snorting asbestos. It's unacceptable.
Now, the experts over at Johnson & Johnson,
they-they have found a cure.
But unfortunately, it's not a cure for the cancer.
It's for the company's legal problems.
Johnson & Johnson is filing for chapter 11 bankruptcy
in hopes of-- what the company says--
of disposing of 40,000 lawsuits.
In order to limit their liability
as well as to shield their corporate assets,
Johnson & Johnson pulled something that's actually known
as the Texas legal loophole,
also known as the Texas Two-Step defense.
MAN: J&J is this superrich health products company
headquartered in New Jersey.
So, J&J went to Texas,
and using a quirk of that state's laws,
they created a completely new company
called LTL.
Then Johnson & Johnson dumped all the liability
for these baby powder asbestos lawsuits,
you know, tens of billions of dollars of legal risk,
into this new firm.
Then the new company, LTL, quickly filed for bankruptcy.
NEWSWOMAN: Critics say the company
is abusing the legal system
and have called the bankruptcy filing a gimmick.
Yeehaw!
The Texas two-step.
♪ I will spin that jury round and round ♪
♪ Change your name and flee the town. ♪
(vocalizing)
Do I get a record deal?
This is insane, people.
Johnson & Johnson is pretty much trying to do
the first thing everyone thinks of
when they get caught,
blame it on their evil identical twin.
I mean, we've all tried it.
The only difference is it somehow actually works
if you're a powerful corporation.
Honestly, I'm-I'm almost impressed.
I just wish they put as much effort into COVID immunity
as they did into their legal immunity.
But, look, as-as crazy as this is,
J&J is hardly a trailblazer
when it comes to abusing bankruptcy laws
to get out of trouble.
Purdue Pharma has filed for bankruptcy,
as the maker of OxyContin tries to protect itself
from mounting lawsuits.
NEWSWOMAN: Purdue Pharma made billions
off the painkiller OxyContin.
The bankruptcy filing is seen as a way to protect Purdue Pharma
from nearly 3,000 lawsuits.
NEWSMAN: The Boy Scouts of America has filed
for bankruptcy protection after an onslaught of lawsuits
alleging rampant sexual abuse of children for decades.
They may claim that they don't have the ability
to play these-- pay these claims,
but the real reality is that they use the bankruptcy
to really continue to hide and shield themselves
from real liability and forced disclosure.
RATHER: The Roman Catholic Church is one
of the world's wealthiest institutions.
Across the United States, priest abuse victims,
now adults, are lining up to sue their diocese for damages.
But the Church is going to extraordinary lengths
to protect its assets,
and that strategy is bankruptcy.
Chapter 11 was not designed to protect organizations
who've engaged in criminal conduct
or basically protecting criminal conduct.
It was designed to give companies
who made bad business decisions a new start.
Yeah. I'm sorry, people.
Purdue Pharma is not bankrupt.
And the Catholic Church is definitely not bankrupt.
Ain't no bishops rolling into pawn shops,
asking how much they can get for that Michelangelo ceiling.
Now, the Boy Scouts are the ones where I'm like,
"Yeah, you-you might actually be broke."
I mean, these guys are rubbing sticks together to start a fire.
My man, 12-pack of Bic lighters is, like, three bucks.
Get your life together.