Talc Supplier to Cosmetics Firms Files Bankruptcy After Lawsuits

A talc supplier filed for bankruptcy after a South Carolina jury ordered it to pay more than $29 million to a woman who said tainted talc in cosmetic products caused her cancer.

(Bloomberg) — A talc supplier filed for bankruptcy after a South Carolina jury ordered it to pay more than $29 million to a woman who said tainted talc in cosmetic products caused her cancer.

Whittaker, Clark & Daniels Inc. said in a petition filed in New Jersey that it owes creditors more than $1 billion, much of it to law firms that specialize in suing companies on behalf of consumers. The bankruptcy petition allows it to halt lawsuits while it tries to work out a payment plan.

The bankruptcy is the latest involving talc, a substance used for decades in consumer products ranging from eyeshadow to baby powder. Tens of thousands of people have sued companies that either supplied talc or used it in their products. The lawsuits typically claim the talc was contaminated with a toxic substance.

The South Carolina lawsuit, decided in March, also named Avon, Estee Lauder Lauder Cos, Johnson & Johnson and several other consumer products companies as defendants, although only Whittaker has been found liable in the case so far. The other companies have denied wrongdoing.

Avon, Estee Lauder and J&J did not immediately respond to emails seeking comment.

Whittaker won a similar lawsuit filed in New York after an appeals court threw out a $2.9 million award. In that case, the company was accused of supplying contaminated talc to the maker of Desert Flower powder.

Outsize jury awards in tainted talc cases have sent several suppliers and miners into bankruptcy in recent years. J&J created a unit to manage its talc liabilities and put it into bankruptcy a second time in early April. The bankrupt unit, LTL Management, is seeking court approval of an $8.9 billion agreement that would end all of J&J’s current and future talc liabilities.

Whittaker’s bankruptcy case is Whittaker, Clark & Daniels Inc., 23-13575, US Bankruptcy Court, District of New Jersey (Trenton)

–With assistance from Janine Phakdeetham and Jef Feeley.

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