Imerys and Cyprus Mines Seek To Establish $850 Million Trust for Asbestos Claims
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Imerys Talc America Inc. and its former parent company Cyprus Mines Corp. announced plans to establish a joint trust of more than $850 million to settle personal injury claims stemming from asbestos exposure through contaminated talc products.
The proposal was filed in Delaware’s federal bankruptcy court and outlines separate reorganization strategies including the creation of the fund. The legal move comes after both companies faced thousands of lawsuits alleging their talcum powder products caused various types of cancers, including ovarian cancer and mesothelioma, a rare and aggressive form of cancer linked to asbestos exposure, according to Lexis Legal News.
A hearing is scheduled for March 14 to consider approval of the disclosure statements related to trust. The outcome could pave the way toward a resolution for thousands of individuals who filed suit against the companies.
Imerys Talc America was a known supplier of talc to pharma giant Johnson & Johnson. Lexis Legal News reports the company was often listed as a “frequent asbestos defendant” along with Johnson & Johnson. Imerys filed for bankruptcy in 2019 amidst mounting legal troubles and more than 14,600 talcum powder lawsuits.
Cyprus Mines followed suit, filing for Chapter 11 bankruptcy in 2021.
“At the outset, it is important to emphasize that a critical goal of the Debtor’s Chapter 11 filing is to enable the Debtor to manage and resolve in a fair and comprehensive manner existing and future tort claims against it alleging personal injury resulting from exposure to talc products which were manufactured and distributed by others using talc mined and sold by the Debtor or its former subsidiaries,” Cyprus wrote in a 2021 court filing.
Asbestos in Talc Products
Manufacturers, retailers and suppliers of talc products have faced a mountain of lawsuits in recent years.
Many talcum powder lawsuits claim that talc, once a staple in personal and baby care routines, was contaminated with asbestos and led to life-threatening cancers.
Talc and asbestos are both naturally occurring minerals and form inside the earth alongside each other which can lead to cross-contamination during the mining process. Asbestos is carcinogenic to humans and highly regulated, but not banned, in the U.S.
For years, the safety of talc-based products has been a topic of concern and debate. Many companies, including Johnson & Johnson, pulled its talc-based products from shelves and reformulated using cornstarch. Johnson & Johnson maintains its stance that its talc products are safe.
Victims filing lawsuits seek compensation for illness believed to be caused by asbestos exposure through consumer products, like baby powder, and industrial applications.
Injuries named in talc lawsuits include ovarian cancer, peritoneal mesothelioma and pleural mesothelioma.
Reorganization for Joint Fund
The aim of the Imerys and Cyprus Mines Corp bankruptcy reorganization would be to manage and settle existing lawsuits and future lawsuits.
Funding for the joint fund would include $223 million from asset sales, $260 million from Zurich American Insurance Co., and contributions from other sources, including $195 million from Cyprus Mines, according to Lexus Legal News.
“There will be substantially more assets available to resolve Talc Personal Injury claims under the Plan than would be the case if there were a Chapter 7 liquidation,” Imerys debtors wrote, according to Lexus Legal News.