Jonathan Stempel
NEW YORK (Reuters) – Johnson & Johnson (NYSE:) has agreed to pay $700 million to settle an investigation by 42 U.S. states and Washington, D.C., into its marketing of baby powder and other talc-based products suspected of causing cancer.
The settlement resolves allegations that Johnson & Johnson misled consumers into believing the safety of its talc products, which it sold for more than a century before stopping selling them.
J&J admitted no wrongdoing in settlements with states led by Florida, North Carolina and Texas, and said its talc products are safe and do not cause cancer. The company announced a settlement in principle in January.
“This is a significant advance in consumer product safety,” Florida Attorney General Ashley Moody said in a statement.
J&J still faces tens of thousands of talc-related lawsuits and a class-action lawsuit accusing the New Brunswick (NYSE:)-based company of deceptively concealing its dangers from shareholders.
As of March 31, about 61,490 people were still suing J&J over the talc. Most were women with ovarian cancer, while a smaller number had mesothelioma, a type of cancer linked to asbestos.
Last year, J&J stopped selling talc-based baby powder worldwide, switching to cornstarch as the main ingredient. The company claims that its products do not contain asbestos.
The company twice tried to resolve the lawsuit by declaring bankruptcy of a subsidiary it created to cover its talc liabilities, but courts rejected both attempts.
On May 1, J&J offered to pay $6.48 billion to settle most of the litigation by filing a third bankruptcy filing. It has set aside a reserve of $11 billion to cover all talc liabilities.
“The Company continues to pursue multiple avenues to achieve a comprehensive and final resolution of the talc litigation,” Eric Haas, J&J’s vice president of worldwide litigation, said in a statement Tuesday.
“We will continue to address the claims of those who do not wish to participate in our proposed consensus bankruptcy resolution through litigation or settlement,” he added.