Makers of Recalled Tainted Wipes Files for Bankruptcy

Makers of recalled tainted wipes that made headlines for bacterial contamination that were associated with, not only a massive recall, but a number of illnesses and deaths, have filed for bankruptcy.

The two Wisconsin-based companies—Triad Group and H&P Industries—said NBC News, filed for Chapter 11 bankruptcy to protect their assets from creditors. NBC News noted that the provision could enable the companies to remain in business.

As we’ve written, both Triad Group and H&P Industries Inc. were accused of manufacturing and distributing alcohol products allegedly tainted with the dangerous bacteria Bacillus cereus and Elizabethkingia meningoseptica, both known to lead to rare and deadly infections.

According to NBC News, Triad Group and H&P Industries listed in excess of $37 million in liabilities against assets of under $11 million, according to the Milwaukee Journal Sentinel, which first reported the bankruptcy. Assets, said the makers’ attorney, might not be what they appear as they include very specialized equipment that would be considered of no value should the company go out of business; liabilities also include ongoing lawsuits.

At least 11 nationwide lawsuits have been filed alleging that the tainted wipes led to serious infections, illnesses, or deaths.

We previously wrote that U.S. Marshals seized $6 million worth of medical products from H&P Industries Inc., which does business as Triad Group, at the behest of the U.S. Food & Drug Administration (FDA). The raid was prompted by the failure of H&P Industries to comply with the FDA’s current good manufacturing practice (cGMP) regulations.

Triad Group issued several massive recalls of tainted alcohol prep pads, alcohol swabs, alcohol swabsticks, and other products sold under various brand names and because of potential Bacillus cereus contamination. H&P Industries issued a Povidone Iodine Prep Pad recall because of concerns they could be contaminated with Elizabethkingia meningoseptica, which is associated with flesh-eating bacteria disease, meningitis in newborn infants, and pneumonia in ventilator patients.

We also wrote that the parents of a toddler settled a wrongful death lawsuit against the maker of the tainted wipes, which were implicated in the child’s death. Two-year-old Harrison Kothari died following a fatal bout with a rare bacterial infection linked to contaminated medical wipes. Harrison’s mother, Sandra, 38, did not release information on the financial arrangement she and her husband reached on behalf of Kothari and with the Triad Group and H&P Industries. Sandra did note that she and her husband “reluctantly” settled the case on the advice of lawyers and court records confirmed the action. “Personally, for me, it’s not because I didn’t want to do it…. It was never about the money,” she previously told MSNBC.

The Kotharis sued H&P and the Triad Group in February 2011 following the massive recall, saying that the wipes caused the infection that killed Harrison. MSNBC noted that its investigation revealed that FDA officials had long known of sterilization and contamination problems, but never took any action.