Johnson & Johnson Prepares for Showdown on Reorg Votes with Ex-Talk Suppliers

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A bottle of Johnson and Johnson Baby Powder can be seen in a photo illustration taken in New York. REUTERS / Mike Segar

  • According to J&J, the voices were incorrectly switched after the deadline
  • Personal Injury Plaintiffs’ Group defends voting changes
  • Voices are key to reorganizing Imerys Talk

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(Reuters) – Johnson & Johnson on Monday will call on a judge to disqualify certain votes in favor of a reorganization plan proposed by its former talc supplier, as the votes were falsely changed to secure the necessary support from creditors for the deal.

The dispute is the latest between the pharmaceutical giant and Imerys Talc America, which filed for bankruptcy in February 2019 to process around 15,000 lawsuits alleging its products caused ovarian cancer and asbestos-related mesothelioma. While Imerys, represented by Latham & Watkins, is trying to advance a plan that would allow him to finalize bankruptcy and set up a trust company to compensate for personal injury, J&J has appealed the deal, saying Imerys is trying to make it It’s easier for cancer victims to sue J&J instead.

J&J, represented by Weil Gotshal & Manges in the Imerys Chapter 11 case, has long denied misconduct in response to litigation over its talc products. Reuters reported this summer that the company was investigating the spin-off of its talk debt to a new company and that company’s bankruptcy.

J&J has asked US bankruptcy judge Laurie Selber Silverstein to cast more than 15,000 plan votes from the law firm Bevan & Associates on behalf of individuals entitled to personal injury. A total of more than 80,000 votes were cast. The motion was tabled, but J&J tabled a publicly available document Thursday stating that Bevan’s votes were changed after the plan’s voting deadline.

J&J alleges that the votes were changed in favor of the plan after the Imerys Official Prosecutors Committee, represented by Robinson & Cole, contacted Bevan when it found there were not enough positive votes to pass the bankruptcy law threshold to reach.

Proponents of the plan want to “bury their heads in the sand and exclaim that everyone should just move on because there is nothing to see here, a vote is a vote,” J&J said in Thursday’s filing.

J&J also argued that Bevan’s applicants have no reason to support the plan as most of them are not eligible for ovarian cancer or mesothelioma and are therefore not eligible for certain escrow review procedures. But the Criminal Prosecutors Committee said any talk claims, even if unlikely to be paid, are allowed to vote as their rights will be compromised.

Bevan said in court records that the law firm’s plaintiffs were offered “no promises or incentives” in exchange for their votes.

J&J also moved to disqualify nearly 500 votes submitted by another company, Williams Hart Boundas Easterby, saying the company was wrongly offered a seat on the trust committee in exchange for changing their votes.

The Illicit Plaintiffs ‘Committee has defended the vote changes, saying on court records that its members contacted Bevan and Williams Hart to communicate “in good faith” about plaintiffs’ concerns about the plan. The committee also said that Bevan’s plaintiffs originally voted against the plan because certain provisions were misunderstood.

The committee called J & J’s efforts to cast the votes “conspiracy theories and innuendos.”

J&J representatives did not immediately respond to requests for comment. A representative from Imerys declined to comment.

Imerys, once the US subsidiary of French Imerys SA, was sold to Magris Resources Canada in 2020 for $ 223 million. This proceeds will go to a trust that will pay personal injury claims under the company’s proposed plan.

The case is In re Imerys Talc America Inc., US Bankruptcy Court, District of Delaware, No. 19-10289.

For Imerys: Jeffrey Bjork, Kimberly Posin, Helena Tseregounis and Richard Levy from Latham & Watkins and Mark Collins, Michael Merchant, Amanda Steele and Brett Haywood from Richards Layton & Finger

For Johnson & Johnson: Diane Sullivan, Gary Holtzer, Ronit Berkovich and Theodore Tsekerides from Weil Gotshal & Manges and Patrick Jackson from Faegre Drinker Biddle & Reath

For the Offenses Committee: Natalie Ramsey, Mark Fink and Michael Enright from Robinson & Cole, Rachel Strickland, Jeffrey Korn, Dan Forman and Stuart Lombardi from Willkie Farr & Gallagher and Kami Quinn and Heather Frazier from Gilbert

Continue reading:

US judge refuses to prevent J&J from splitting talc liabilities from main business

EXCLUSIVE – J&J is investigating talk debt bankruptcy

Changes to Imerys Talk’s Reorg plan create confusion and bankruptcy

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