Texas Judge Clears Way for Kenvue to Pay $398 Million Dividend Amid Tylenol Safety Concerns
A Texas judge has cleared the way for Kenvue to pay a $398 million shareholder dividend this month, a win for the U.S. consumer health company in a politically-charged legal battle over the safety of using Tylenol during pregnancy. Texas Attorney General Ken Paxton, a Republican who is running for a U.S. Senate seat in 2026, sued Summit, N.J.-based Kenvue on October 28, accusing it of concealing autism and other risks to children when pregnant women use Tylenol.
The lawsuit asked for an order blocking Kenvue from paying the November 26 dividend to preserve money for litigation claims and to refrain from marketing Tylenol as safe for pregnant women. Judge LeAnn Rafferty concluded that she did not have jurisdiction over the dividend claim, according to a one-page order issued Friday afternoon.
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The decision indicated an unwillingness by a local court to wade into issues fundamental to a multinational company’s business model. Rafferty, a judge in Panola County, near the Louisiana border, also rejected a request to temporarily order Kenvue to modify its marketing. Paxton’s lawsuit had repeated the scientifically unproven claim that using the popular medication during pregnancy can cause autism.
Background of the Lawsuit
The lawsuit was filed five weeks after Republican President Donald Trump and U.S. Health and Human Services Secretary Robert F. Kennedy Jr. repeated the scientifically unproven claim that using the popular medication during pregnancy can cause autism. In September, the U.S. Food and Drug Administration told doctors to alert patients to what it said was growing evidence suggesting Tylenol use during pregnancy has a link to autism.
Medical societies dispute a Tylenol link to autism. The agency is considering new labels for Tylenol and its generic versions. Kenvue repeatedly has said Tylenol is safe. Paxton has aligned himself with Trump’s agenda and is challenging incumbent U.S. Senator John Cornyn in next year’s Republican primary.
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Kenvue can move forward with dividend
Kim Bueno, a lawyer for Kenvue, said in an interview following the hearing that the problem with Texas trying to block Kenvue’s dividend is that the company is based in New Jersey and incorporated in Delaware. “There was no jurisdiction to challenge that,” she said. When asked if Kenvue would move forward with issuing the dividend, Bueno said “Yes, absolutely, as they should. That is a distribution that’s being made as part of the normal course of business.”
Paxton’s office did not immediately respond to a request for comment. Texas also sued Johnson & Johnson over issues related to the 2023 spinoff of Kenvue. Concerns about the drug have been an overhang for Kimberly-Clark’s planned $40 billion takeover of Kenvue, which was announced six days after Paxton sued.
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That merger would let the maker of Kleenex and Huggies diapers expand into higher-margin categories such as skin care and pain relief, by acquiring Kenvue brands including Band-Aid, Johnson’s Baby Shampoo, Listerine and Neutrogena. J.J. Snidow, an attorney representing the state, said protecting public health justified temporary limits on what Kenvue could say about Tylenol, citing scientific studies that he said backed a link between using the painkiller during pregnancy and autism.
Conclusion
In conclusion, the Texas judge’s decision to clear the way for Kenvue to pay a $398 million shareholder dividend is a significant development in the ongoing legal battle over the safety of using Tylenol during pregnancy. While the lawsuit and the FDA’s warnings have raised concerns about the potential risks of Tylenol, Kenvue has repeatedly stated that the medication is safe. As the situation continues to unfold, it is essential to stay informed about the latest developments and to consult with healthcare professionals for personalized advice.
Frequently Asked Questions
Q: What is the current status of the lawsuit against Kenvue?
A: The Texas judge has cleared the way for Kenvue to pay a $398 million shareholder dividend, but the lawsuit is still ongoing.
Q: Is Tylenol safe to use during pregnancy?
A: The safety of Tylenol during pregnancy is still a topic of debate. While Kenvue claims that Tylenol is safe, some studies suggest a potential link between Tylenol use and autism. It is essential to consult with a healthcare professional for personalized advice.
Q: What are the implications of the lawsuit for Kenvue and its shareholders?
A: The lawsuit has raised concerns about the potential risks of Tylenol and has led to a decrease in Kenvue’s stock price. However, the company’s ability to pay the $398 million shareholder dividend is a positive development for its shareholders.
Q: What is the role of the FDA in regulating Tylenol and its generic versions?
A: The FDA is responsible for regulating the safety and efficacy of medications, including Tylenol and its generic versions. The agency has issued warnings about the potential risks of Tylenol and is considering new labels for the medication.
