Homegrown FMCG major Dabur on Wednesday said its three foreign subsidiaries are facing cases in federal and state courts in the US and Canada.
The three Dabur India subsidiaries facing cases are Namaste Laboratories LLC, Dermoviva Skin Essentials Inc. and Dabur International Ltd, according to a regulatory filing.
As per the filing, certain consumers in the hair relaxer product industry have alleged that some industry players/defendants sold and/or manufactured hair relaxer products that contain certain chemicals and that the use of the hair relaxer product has caused ovarian cancer, uterine cancer and other health issues.
“Cases have been filed in both federal and state courts in the United States and Canada. The federal cases were consolidated as a Multi-District Litigation, also referred to as MDL, before the United States District Court for the Northern District of Illinois,” it said.
Currently, there are approximately 5,400 cases in the MDL, which named Namaste, Dermoviva and DINTL as defendants, along with certain other industry players, it added.
“The cases are in the pleadings and early discovery phases of litigation, which means the parties are challenging the adequacy of the plaintiffs’ complaints and, in some cases, exchanging requests for information and documents. There are various motions pending as well,” it added.
“At this stage of the litigation, any financial implication due to settlement or verdict outcome cannot be determined,” it added.
However, the company said defence costs for the litigation are expected to breach the materiality threshold in the near future.
Currently, cases are in the pleadings and early discovery phases of litigation.
“There are various motions pending as well. Since we are in the initial stage of litigation, any final quantum of claim amount is neither probable nor estimable,” it said.