Dabur India, the well-known consumer goods company, has disclosed that its subsidiaries are currently facing lawsuits in the United States and Canada. These legal actions have been initiated by customers who claim that the use of certain hair relaxer products from these subsidiaries has resulted in serious health issues, including ovarian cancer and uterine cancer.
Amid the allegations, the company’s shares experienced a decline on Thursday, dropping by as much as 2.5 per cent during the morning trading session. According to a regulatory filing, the three Dabur India subsidiaries facing cases are Namaste Laboratories LLC, Dermoviva Skin Essentials Inc. and Dabur International Ltd.
Dabur India stated that the ongoing legal cases are currently in their initial stages, involving pleadings and early discovery phases. The company also emphasised that the allegations against its subsidiaries are based on what it described as an “unsubstantiated and incomplete” study.
Approximately 5,400 cases filed against various companies, including Dabur India’s three subsidiaries, have been consolidated into a multi-district litigation proceeding before a US District Court in Illinois. The units have denied liability and have retained counsel to defend them, the company said.
“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.