An international beauty brand has filed for Chapter 11 Bankruptcy, citing the costs of hundreds of lawsuits alleging the potential carcinogenic nature of their subsidiary’s products.
In recent years, the company has been forced into payouts of tens of millions of dollars over links made between its products and the development of cancers including mesothelioma.
Hundreds of Lawsuits
The company has faced hundreds of lawsuits over many years regarding the same issue of contamination.
The many lawsuits have, over the years, meant that the total amount paid out and spent on legal defense has come to over $225 million.
Asbestos Contamination
The talc-based products sold by the company were alleged to have been contaminated with asbestos.
It has been widely understood that asbestos can lead to cancer for many decades now, and it can also lead to a host of other negative health effects.
Avon Lawsuits
Avon Products Inc filed for Chapter 11 Bankruptcy, and a major reason for this was debt accrued through legal fees and settlements.
The company paid out $52.1 million to an Arizona woman and lifelong Avon customer in 2022, and, in 2024, $24.4 million to a Chicago resident who had worked in an Avon manufacturing facility.
Direct Marketing
Avon are famous for their direct approach to selling, starting out door-to-door and now using a range of methods to promote their products.
The company has its roots almost 150 years ago, when Mrs. PFE Albee recruited saleswomen to travel to potential customers’ houses and sell products face-to-face.
Cancer Link Denial
Despite a series of successful lawsuits against the company, Avon continues to deny that asbestos can be found in their powder.
They said that their manufacturing process “only uses cosmetic grade talc which has been tested to confirm that it does not contain asbestos.”
Not the Only Talc Company
Johnson and Johnson have faced similar issues, and recently faced multi-billion dollars’ worth of lawsuits alleging a link between one of their products and cancer, including mesothelioma.
J and J also deny that their talc products cause mesothelioma, despite communications dating back to the 1950s showing J and J executives’ concerns regarding the link.
Holding Company
Avon Products Inc, the entity that filed for bankruptcy, have not sold products in the US since 2016, as they operate as a holding company linked to companies such as The Avon Company.
A holding company is often used to shift accrued legal debts in preparation for a bid for bankruptcy.
Positive Spin
The chairperson of Avon Products Inc, John Dubel, suggested that the bankruptcy move will be a positive for the company.
He said: “Today’s action … will maximize the value of our assets and enable us to address our obligations in an orderly manner.”
Talc Potential Danger
Talc, used in talcum powder, is known as being particularly susceptible to contamination with asbestos, due to their natural formation in proximities too close to be mined separately.
Despite the likelihood of contamination, and the many successful lawsuits, J and J and Avon continue to deny that asbestos contamination of their products is possible.
