A look at how Johnson & Johnson has managed through the talcum powder - ovarian cancer crisis, using the model created by Louis Pondy. This follows the company through pre-crisis, crisis, and post-crisis actions.

1. Pamela Mohar
CTAC 354
Johnson &
Johnson:
Managing
Through Crisis
Following the company through the talcum
powder-cancer crisis, using Louis Pondy’s
model of Phases of Organizational Conflict

2. How
Organizations
Manage
Through
Crisis
Based on the
model by Louis
Pondy, 1967
Image:
http://catalog.flatworldknowledge.com/bookhub/reader/7635?e=wrenchorgcom
m-27115-20150223-161255-574682

3. Pre Crisis
Latent Conflict – parties are involved in
interdependent relationships with incompatible
goals

4. The Research
1961-1985 – Multiple studies
done to prove the ability of
inert carbon particles to travel
from the vagina to the
fallopian tubes (World Health
Organization, 2010, p 402)
1971 – Henderson first
reports the presence of
talc particles in ovarian
and cervical tumors and
cervical tissue of cancer
patients (World Health
Organization, 2010, p 402)
1982 – Dr. Daniel Cramer
releases the first study to
show a statistical link
between talcum powder
and ovarian cancer
(Berfield, et al, 2016)

5. Latent Conflict
– US National Toxicology Program (NTP), 1993 – declared clear
evidence that talc is a carcinogen, regardless of the presence of
asbestos-like fibers (Bodine, 2016)
– 1999 – American Cancer Society started recommending women
use cornstarch-based products as genital powder (Berfield, et al,
2016)

6. Pre Crisis
Perceived Conflict – involved parties see their situation
characterized by incompatibility and interdependence

7. Perceived Conflict
– Alfred Wehner was hired as an outside consultant for Johnson & Johnson
– Primary task was to evaluate the research on ovarian cancer and talc
and advise the company on its response
– 1997 – in a letter to Michael Chudkowski, J&J’s manger of preclinical
toxicology, voiced concerns over the integrity of the research
documents
– Referred to statements on talc research documents provided by the
the Cosmetic Toiletry and Fragrance Association (funded heavily by
J&J) as inept, misleading, and false (Berfield, et al, 2016)

8. Pre Crisis
Felt Conflict – there is a focus on the conflict issue;
parties plan conflict management strategies

9. Felt Conflict – 1990’s
– Johnson & Johnson and supplier company, Imerys (formerly
Luzenac), spearheaded the Talc Interested Party Task Force (TIPTF)
in response to the 1993 NTP report (Berfield, et al, 2016)
– The Cosmetic Toiletry and Fragrance Association was made up
of different organizations that pooled their money in order to
defend the use of talc products through TIPTF (Bodine, 2016)

10. Felt Conflict - 2000
– NTP voted 13-2 to list talc as a potential carcinogen*, when used
perinally (Berfield, et al, 2016)
– “[We] dodged a bullet…based entirely over the confusion of the
definition issue,” Richard Zazenski, Luzanec executive, after convincing
the NTP not to declare an official status on the use of talc
– Federal Regulations in the 1970’s led the cosmetic industry to discontinue
use of dangerous materials (i.e. asbestos fibers) in the creation and
distribution of talc-based products
*As of 2016, the NTP has not released an official review of Talc (Boyle, 2016)

11. Felt Conflict - 2004
In response to the nomination of talc for the 2004 NTP list of toxic
substances, Daniel Harris, former President of Luzenac, wrote:
“The nomination category is overly broad and would be understood
by the layperson to encompass all cosmetic products containing talc,
when in fact, it appears that the intent of the Agency is to focus only on
a potential increased risk of ovarian cancer among women utilizing body
powder products in a particular manner.“
(D. Harris, personal correspondence, 19 July 2004)

12. Felt Conflict - 2006
– International Agency for the Research on Cancer, WHO, declared that
perineal use of cosmetic-grade talc was possibly carcinogenic, citing a
“modest, but unusually consistent, excess in risk” (Berfield, et al, 2016)
– Noted that bias in the studies can’t be ruled out
– Canadian government classified talc as a toxic, cancer-causing
substance in its’ Hazardous Products Act and Controlled Products
Regulations (Bodine, 2016)
– Imerys Talc began distributing talc to Johnson & Johnson that contain
warnings from the IARC and Canadian government in regards to the
classification of talc as a cancer causing substance

13. Crisis
Manifest Conflict – parties enact conflict through
communication, various strategies are used
creating cycles of escalation and de-escalation

14. Manifest Conflict
– 2009 – Diane Berg filed the first lawsuit against Johnson & Johnson, accusing
the company of gross negligent and fraud (Nwazor, 2016)
– J&J offered a $1.3 million settlement with a confidentiality clause (Nwazor,
2016)
– Berg declined the settlement, stated that creating awareness was more
important than money (Nwazor, 2016)
– South Dakota jury found in favor of Berg, stating that there was a link between
ovarian cancer and talcum powder (Nwazor, 2016)
– Awarded no monetary compensation, as the jury could not conclusively find that her
cancer was caused by the use of J&J products

15. Manifest Conflict
– February 2016 – St. Louis jury awards $72 million in damages to
the family of Jacqueline Fox, who died from ovarian cancer in 2015
(Berfield, et al, 2016)
– Jury found Johnson & Johnson liable for failing to warn women of the
risks associated with using talcum powder in the genital area
– J&J also found guilty of negligence and conspiracy
– Ruled that the talcum powder contributed to the development of her
ovarian cancer

16. Manifest Conflict
– May, 2016 - Gloria Ristesund awarded $55 million in damages against
Johnson & Johnson by a St. Louis jury (Bodine, 2016)
– A hysterectomy led to the discovery of talc in her ovarian cells
– Juror, Jerome Kendrick, on the ruling:
“They tried to cover up and influence the boards that regulate
cosmetics. They could have at least put a warning label on the box but
they didn’t. They did nothing.” (Bodine, 2016)

17. Post Crisis
Conflict Aftermath –
short-term and long-term effects on the
organization, individuals, and relationships

18. Conflict Aftermath
– Johnson & Johnson claims it will fight every lawsuit in court (Bodine, 2016)
– Alleges no scientific evidence to back up recent court rulings
– Despite having offered a settlement to Berg, presumably when they thought
a confidentiality agreement would stop their legal issues
– Court rulings have been as inconsistent as the studies about talcum powder
– Two recent cases in Atlantic City were thrown out for lack of scientific
evidence, with the judge citing the medical experts as being unreliable

19. Reception Abroad
– “Legal experts” claim that only American courts will entertain this ruling – if the
issue were brought forth to British courts, they would have been thrown out
(Potts, 2016)
– Dr. Ahmed Ismail, UK gynecologist: “This is very, very unscientific. We are
unable to detect the reasons for ovarian cancer. Whoever claims it is related to
talcum powder, that’s a fallacy. We cannot say that we know there is a
relationship between talcum powder and ovarian cancer.” (Potts, 2016)
– A Canadian class-action suit has already been filed, claiming Johnson &
Johnson’s “[failure] to disclose these defects and the resulting risks to the
health and life of the plaintiffs” (Paddon, 2016)

20. Further Discussion
– Why isn’t baby powder dangerous for babies?
Dr. Hal C Lawrence III, VP of the American College of Obstetrics and Gynecology,
says, “With the amount of powder that’s been applied to babies’ bottoms, we
would’ve seen something if talc caused cancer.” (Boyle, 2016)
– Talcum powder is not recommended for use on babies because it has been
known to cause respiratory problems, including pneumonia (Weil, 2012)
– Is American culture creating the problem?
– Turn on the TV during the day and the majority of ads fall into 1 of 2
categories: pharmacy companies pushing medication or law firms pushing
class action lawsuits against pharmacy companies

21. Johnson & Johnson:
Medical Supply Distribution Empire
– Johnson & Johnson has a huge hold on the medical supply distribution business
– Baby products only make up a small percentage of the multi-billion dollar company
– Their brand was established based on these products, and is the prime business
featured on their company home page
– Johnson & Johnson could do a favor for the pharmaceutical industry by ending
this battle
– The company is losing credibility in the medical distribution area when they refuse to
acknowledge any of the studies that show even a small link between the use of talc
powder in the genital area and ovarian cancer
– Trust issues already exist between the general public and the pharmaceutical
industry

22. References
Berfield, Susan et al. Johnson & Johnson has a baby powder problem. Bloomberg, 31 Mar 2016.
www.bloomberg.com/features/2016-baby-powder-cancer-lawsuits/.
Bodine, Larry. Behind the $55 million verdict: Johnson & Johnson knew about talcum powder cancer risks since the
1970’s. The Huffington Post, 4 May 2016. www.huffingtonpost.com/larry-bodine/behind-the-55-million-
ver_b_9833366.html.
Boyle, Darren. Cancer patient who developed disease after using Johnson & Johnson talcum powder wins $70 million
payout from the company. The Daily Mail, 28 Oct 2016. www.dailymail.co.uk/news/article-3882192/Cancer-patient-
contracted-disease-using-Johnson-Johnson-talcum-powder-wins-70million-payout-company.html.
Nwazor, Toby. The Talcum Powder Lawsuit: The Truth, The Lies, The Cancer Victims. The Huffington Post, 27 June 2016.
www.huffingtonpost.com/toby-nwazor/the-talcum-powder-lawsuit_1_b_10609474.html.
Paddon, David. Canadian class action launched over alleged Johnson’s baby powder risk. The Globe and Mail, 27 May
2016. www.theglobeandmail.com/news/national/canadian-class-action-launched-over-alleged-health-risk-in-
johnsons-baby-powder/article30189981/.
Potts, Judith. UK ovarian cancer charities respond to suggested talcum powder link. The Telegraph, 23 May 2016.
www.telegraph.co.uk/wellbeing/health-advice/uk-ovarian-cancer-charities-respond-to-suggested-talcum-powder-l/.
Talcum powder and cancer. American Cancer Society, 3 May 2016.
www.cancer.org/cancer/cancercauses/othercarcinogens/athome/talcum-powder-and-cancer.
Weil, M.D., Andrew. (8 Oct 2012). How bad is baby powder? [Message 1]. Message posted to www.drweil.com/health-
wellness/health-centers/children/how-bad-is-baby-powder/.