U.S. Court of Appeals Blocks Bad Faith Bankruptcies

January 30, 2023 Press Release

Washington, D.C. — In response to news that the Third Circuit rejected Johnson & Johnson’s appeal of a ruling dismissing its subsidiary bankruptcy filing, the American Economic Liberties Project released the following statement.

“The Third Circuit set an important precedent today,” said Katherine Van Dyck, Senior Legal Counsel at the American Economic Liberties Project. “As the court said, bankruptcy proceedings were designed to give entities in genuine financial distress an opportunity to reset and try anew. Chapter 11 cannot be used as a loophole for multi-billion-dollar conglomerates facing liability after decades of wrongdoing and consumer abuse. Johnson & Johnson manufactured and sold a product that made 10s of 1000s of people seriously ill. The ruling today is a huge victory for them and for consumer rights writ large.”

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.