Whether you work in the healthcare field, have a personal interest in Johnson & Johnson or know someone involved in a class-action lawsuit related to the company known for providing safe baby products, you may be interested in further developments related to allegations of Johnson & Johnson’s baby powder causing cancer. Facing more than 14,000 claims, Johnson & Johnson’s talc supplier, Imerys Talc America Inc., has filed Chapter 11 bankruptcy.
Advantages for the company
Although you might see filing bankruptcy as the end of a company, sometimes Chapter 11 allows an opportunity to regain profitability. A company filing Chapter 11 might benefit from the chance to reorganize its business. Meanwhile, though the business may seem to continue as usual, major decisions are decided by a bankruptcy court.
For Imerys and its subsidiaries, filing bankruptcy could help them regain their financial footing by:
- Establishing a trust for current and future claims related to their talc
- Having one judge oversee all cases
- Pressuring those filing claims to accept lower settlements
However, this is not the only company who has filed bankruptcy this year.
Chapter 11 filings in 2019
It may be too soon to tell what the future of companies who have filed Chapter 11 so far this year will be. But if you are interested in how bankruptcy can protect a business, you might keep an eye on:
- PG&E
- Gymboree
- Shopko
- Things Remembered
- Charlotte Russe
- FullBeauty
It is not uncommon for successful businesses to seek the protection of bankruptcy. While that is probably not your goal for your company, understanding the benefits other businesses receive through filing bankruptcy could help you understand when it might be good to explore your options.