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Johnson & Johnson (J&J) is reviewing a bankruptcy plan to reduce debts stemming from lawsuits over health scandals related to the company's products. Pursuing bankruptcy would lead to significantly lower settlement payments for J&J's lawsuits. Currently, J&J has not made a formal decision on this matter. Consequently, J&J is facing tens of thousands of allegations regarding its talcum powder products containing asbestos, a cancer-causing compound. Moreover, the company is voluntarily recalling 5 types of sunscreen lotions after discovering cancer-causing chemicals in some samples.
Specifically, on July 14th, J&J advised customers to stop using and dispose of 5 aerosol sunscreen lotions from the company, including Neutrogena Beach Defense, Neutrogena Invisible Daily Defense, Neutrogena Ultra Sheer, Neutrogena Cool Dry Sport, and Aveeno Protect + Refresh. According to the company's information, internal testing revealed low levels of benzene in some samples, despite benzene not being listed as an ingredient. It's known that this chemical poses a cancer risk depending on the level and duration of exposure. The recall applies to all bottle sizes and SPF levels of the sunscreen.J&J states that the company is investigating the cause of the incident. According to David Light, co-founder and CEO of Valisure, the root of the problem lies in contamination during the manufacturing process, leading to errors in some batches.
J&J is currently considering the use of Texas' divisive merger law, which allows a company to split into at least two entities. For J&J, this is an advantage as it can file for bankruptcy for one entity to halt lawsuits while still having an exit strategy for the future. This tactic is also assessed by experts as a two-step bankruptcy. Previously, when faced with allegations that its talcum powder products cause cancer, J&J denied all claims, stating they were 'baseless allegations' and 'misinformation'. However, the recent recalls deal a heavy blow to consumer trust in the brand.According to (1), (2)Check out more: 
