Legal Troubles for Dabur India Subsidiaries in US and Canada Over Cancer Allegations

Three Dabur India Subsidiaries, Namaste Laboratories LLC, Dermoviva Skin Essentials Inc., and Dabur International Ltd., Face Legal Cases in the US and Canada Over Alleged Cancer-Related Hair Relaxer Products

Indian FMCG giant, Dabur, announced on Wednesday that three of its foreign subsidiaries are currently entangled in legal cases across federal and state courts in the United States and Canada. These subsidiaries—Namaste Laboratories LLC, Dermoviva Skin Essentials Inc., and Dabur International Ltd.—are facing allegations from consumers in the hair relaxer product industry. The consumers claim that certain companies, including the defendants, sold and manufactured hair relaxer products containing specific chemicals that have been linked to ovarian cancer, uterine cancer, and various other health issues.

According to a regulatory filing, these cases have been filed in federal and state courts in the United States and Canada, with the federal cases consolidated as a Multi-District Litigation (MDL) before the United States District Court for the Northern District of Illinois. Currently, the MDL encompasses approximately 5,400 cases that name Namaste, Dermoviva, and DINTL as defendants, along with other industry players.

The litigation is currently in the pleadings and early discovery phases, where the parties are assessing the sufficiency of the plaintiffs' complaints and exchanging information and documents. Multiple motions are pending. At this stage, it is impossible to determine the potential financial implications related to settlement or verdict outcomes.

The company, however, anticipates that defense costs for this litigation are likely to exceed the materiality threshold soon. Due to the early stage of litigation, the final amount of the claims is neither predictable nor estimable. The situation continues to evolve as the cases progress through the legal process.