In this case, they would have recovered over $50 billion from the bankrupt company after the suit was paid off (assuming this deal covers all parties).
That they didn't need the tactic in the end doesn't make it any less sleazy to have attempted it.
On the contrary, doing that much extra work and complexity pays off mostly in organizational ways. Letting the current business operate without overly worrying about the progress of the trial (instead just having value removed by it), managing multiple plaintiffs, etc.
And if the total amount of lawsuits exceeds the value of the company, it prevents the earlier plaintiffs from getting 100% and the last plaintiffs from getting 0% (which results in more expensive lawsuits).
Which is less than the value of all of J&J, which should all be at risk for egregious misconduct.
> And if the total amount of lawsuits exceeds the value of the company, it prevents the earlier plaintiffs from getting 100% and the last plaintiffs from getting 0% (which results in more expensive lawsuits).
Sure, but it prevents everyone from getting what they should get from J&J in that scenario.
There's no way to give everyone what they're owed if there isn't enough money to go around. An orderly procedure is better than everyone rushing in with sharp elbows, and that's exactly why we have bankruptcy laws and courts - a system that works very well on the whole.
There's at least more money (significantly so!) in J&J as a whole than one of J&J's subsidiaries.
If my teenager had a car accident and injured you, I don't get to spin them off into a new standalone family unit and say "gee, sorry, you can't sue me!"
No there isn't. 61.5 billion in this subsidy, while the equity value of the whole company is 76.8 billion.
> If my teenager had a car accident and injured you, I don't get to spin them off into a new standalone family unit and say "gee, sorry, you can't sue me!"
Depends where you are; in a lot of states you wouldn't be liable.
> Depends where you are; in a lot of states you wouldn't be liable.
Take one of those states, then. In California, the parent is civilly liable if they granted the teen permission to drive the car. Should disowning your kid be a viable way out of that?
I mean, we have plenty of stories of people divorcing to avoid liability for their partner's medical/end-of-life care costs. So this stuff isn't limited to companies.
They should worry about it, that's the point of being put on trial.
You seem to be missing a simple matter - reciprocity.
These tactics are not available to me if I get sued by J&J, so why should they be available to J&J if they get sued by me?
"The Texas two-step allows solvent companies to shield their assets from litigants using protections that are normally reserved for bankrupt companies"
So I find your claims highly dubious that "wasn't as bad"
How can we make a campaign slogan specific to shit like this? Should we call it 'tough on some crime'? 'Tough on big crime?'
It’s already a slogan, there have been multiple presidential candidates in the last few years who made it a cornerstone of their campaign.