Imerys North American units file bankruptcy to resolve talc litigation

By Caroline Salls

Pittsburgh, Feb. 13 – Imerys SA’s Imerys North American talc subsidiaries filed Chapter 11 bankruptcy Wednesday in the U.S. Bankruptcy Court for the District of Delaware, according to an Imerys news release.

The company said some of the group’s subsidiaries, which operate its talc business in North America, are among the defendants in the actions brought before several U.S. federal and state courts by multiple plaintiffs that make claims based on the alleged hazards related to the use of talc in specified products.

Imerys said most of the lawsuits relate to sales made before it acquired the talc business in 2011.

After evaluating a range of possible options, the company said Imerys Talc America, Imerys Talc Vermont and Imerys Talc Canada are filing bankruptcy to safeguard their long-term business interests while working toward a permanent resolution of their historic talc-related liabilities.

The Chapter 11 filing will not adversely affect the business operations, employees or customers of the group, which will continue to operate as usual and honor all its obligations to stakeholders, the release said.

The group said it continues to believe that the U.S. talc-related litigation is without merit, as the safety of talc has been confirmed by dozens of peer-reviewed studies and multiple regulatory and scientific bodies.

“The filing subsidiaries’ decision was prompted by the actual and projected increase of defense and settlement costs over the next few years,” Imerys said in the release.

“Such increase follows heightened media coverage of U.S. cosmetic talc-related lawsuits and the growing reluctance by the filing entities’ insurers and third-party contractual indemnitors to provide coverage against these increases without new and lengthy litigation by the filing subsidiaries to secure their rights.”

Imerys said the Chapter 11 filing immediately suspends all outstanding U.S. talc litigation against the filing entities “and avoids the overwhelming projected defense costs associated with the specific nature of the U.S. judicial system’s handling of product liability claims.”

The company said a plan of reorganization that resolves current and future claims related to the past sales of talc in the United States will be negotiated with representatives of existing and future claimants in the coming months.

According to court documents, Imerys Talc America, Inc. has $100 million to $500 million in assets and $50 million to $100 million in debt.

The company did not list any unsecured creditors with claims of $1 million or more.

The subsidiaries are represented in their Chapter 11 case by Richards, Layton & Finger, PA.

Imerys SA is a Paris-based producer of industrial materials. The subsidiaries’ Chapter 11 case number is 19-10289.

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