Johnson & Johnson, which twice failed to use bankruptcy to resolve claims its baby powder caused cancer, is plotting a third Chapter 11 filing, with the potential to spark a circuit split that could put the controversial “Texas Two-Step” maneuver squarely in the U.S. Supreme Court’s sights, experts say.
After spending millions on two New Jersey bankruptcy cases, J&J is now considering a new Chapter 11 filing for its LTL unit, company litigation counsel Erik Haas said in October. But this time, J&J might ditch the Third Circuit and instead file in the Fifth Circuit’s Southern District of Texas, in a move that could trigger a conflict between the circuits.
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