FedSoc Forums Litigation Update: In re: LTL Management
Mar 10, 2022
59:45
In October 2021, LTL Management LLC (LTL), a newly created and separate subsidiary of Johnson & Johnson (J&J) that was established to hold and manage claims in the cosmetic talc litigation, filed for voluntary Chapter 11 bankruptcy protection. J&J also entered into a funding agreement with LTL that assures that LTL will have the same, if not greater, ability to satisfy talc claims once the parties reach a plan of reorganization. J&J submits that the Chapter 11 restructuring is the only means by which LTL and its affiliates can reach a swift and equitable resolution for current and future claimants. Opposition argues the case does not serve a valid restructuring purpose, suggesting J&J filed it in bad faith. On February 25, the bankruptcy court in New Jersey sided with LTL and denied claimants’ motion to dismiss. The claimants have indicated they will appeal the ruling.
A divisional merger is a state-law transaction where a business entity divides itself into two new entities. It is similar in substance to other state-law transactions that result in the emergence of new legal entities. Controversy has arisen when—following the divisional merger—one of the new entities initiates Chapter 11 bankruptcy proceedings, as LTL did.
Professor Tony Casey of the University of Chicago Law School will address the interplay of divisional mergers and Chapter 11 of the United States Bankruptcy Code in the context of the J&J litigation and LTL bankruptcy. He will review the purpose of Chapter 11 in preserving economic and social value, explain how a divisional merger can further that purpose in the mass tort context, and discuss how existing law protects against the potential for abuse.
Featuring:
--Prof. Anthony Casey, Deputy Dean, Donald M. Ephraim Professor of Law and Economics, ---Faculty Director, The Center on Law and Finance, University of Chicago Law School
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This Zoom event is open to public registration at the link above.
A divisional merger is a state-law transaction where a business entity divides itself into two new entities. It is similar in substance to other state-law transactions that result in the emergence of new legal entities. Controversy has arisen when—following the divisional merger—one of the new entities initiates Chapter 11 bankruptcy proceedings, as LTL did.
Professor Tony Casey of the University of Chicago Law School will address the interplay of divisional mergers and Chapter 11 of the United States Bankruptcy Code in the context of the J&J litigation and LTL bankruptcy. He will review the purpose of Chapter 11 in preserving economic and social value, explain how a divisional merger can further that purpose in the mass tort context, and discuss how existing law protects against the potential for abuse.
Featuring:
--Prof. Anthony Casey, Deputy Dean, Donald M. Ephraim Professor of Law and Economics, ---Faculty Director, The Center on Law and Finance, University of Chicago Law School
---
This Zoom event is open to public registration at the link above.