Johnson & Johnson (JNJ) - Get Report shares moved lower Tuesday after the U.S. Supreme Court declined to hear the company's appeal of a $2.1 billion penalty from a Missouri court judgement that linked ovarian cancer to its talc products.
The Supreme Court's decision to pass on the appeal leaves Johnson & Johnson liable for at least $2.1 billion in payments to 22 women who said they developed the cancer from the use of products -- including is iconic Baby Powder -- produced by Johnson & Johnson that included asbestos. The original damages of $4.7 billion, the largest in U.S. history at the time, were reduced on appeal last year.
In December of 2018, Reuters reported court documents linked to the case showed that Johnson & Johnson knew for decades that its iconic baby powder sometimes contained asbestos and failed to alert authorities. Reuters also said the company tried, unsuccessfully, to influence plans by U.S. regulators to reduce the amount of asbestos that could legally remain in some cosmetic talc products.
Johnson & Johnson faced at least 25,000 separate suits linked to its iconic baby powder products, with the company setting aside $3.9 billion in litigation expenses last year, even after the U.S. Food & Drug Administration said a study found "no asbestos fibers or structures in any of the samples of cosmetic-grade raw material talc or cosmetic products containing talc."
Johnson & Johnson shares were marked 1.7% lower in late morning trading Tuesday, against a 0.4% gain for the Dow Jones Industrial Average, to change hands at 166.33 each.
Johnson & Johnson also agreed in 2019 to contribute $4 billion to a liability fund amid at redressing victims in order to "provide certainty for involved parties and critical assistance for families and communities in need."
New York's state Department of Financial Services said in September of last year that it's looking to claw back some $2 billion in insurance premium overcharges for what Governor Andrew Cuomo called its 'leading role' in the crisis, a move that follows similar actions against Teva Pharmaceuticals, Endo International and Allergan Plc. earlier this year.