Durbin Calls Out Johnson & Johnson's Manipulation of Bankruptcy During Senate Judiciary Committee Hearing

Hearing

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"In October 2021--when [J&J shell company LTL Management] first filed for bankruptcy--J&J had a market capitalization of approximately $420 billion. In 2022--the year following LTL's bankruptcy filing--J&J generated $94.9 billion in sales and $63.9 billion in gross profit.

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"You have dismissed the claims against you for possible asbestos in your product, calling them meritless, and junk science… And yet you put [an] evaluation through LTL of $8.9 billion in these claims. How can you have it both ways? How can you be a profitable corporation worth that much money and say these meritless claims worth $8.9 billion, [that] you shouldn't be responsible for them?"

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"There's something missing here. Why would you create LTL, which made no products whatsoever but simply was there as the repository of some funds for any liability if in fact the underlying company that made this product in question was worth so few assets at the time? It doesn't follow."

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"It had nothing to do with your potential liability?"

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"Meritless, but worth $8.9 billion?"

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"You make two arguments here--meritless, claimants get nothing, they recover nothing; and yet someone comes up with a figure of $8.9 billion and you jump at it? You can't have it both ways. You just can't argue both ways. You went into bankruptcy court to limit the liability [the company was facing] Johnson & Johnson. Luckily, at one or two different levels, the court has said that this is a sham--this is a maneuver that is not anticipated by the bankruptcy code."

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