Texas Attorney General Ken Paxton has launched a bold legal maneuver against pharmaceutical giant Kenvue, filing a motion to block the company from paying its upcoming November 26 dividend — a move designed to prevent the maker of Tylenol from “draining” funds that could be used to compensate Texans.
At the heart of the dispute: allegations that Kenvue and its former parent company Johnson & Johnson knowingly marketed Tylenol to pregnant women while concealing evidence that acetaminophen exposure increases risks of autism and ADHD in children. The dividend payment, according to Paxton’s office, would siphon off hundreds of millions of dollars that might otherwise go toward civil penalties.
Financial Pressure Tactic
“I will not allow Big Pharma to ruin the lives of Texans with their lies and then refuse to pay the bill when it’s brought to account,” Paxton declared in a November 6 press release. “Kenvue very well may be insolvent because of its own reckless actions, and it should no longer pay fraudulent dividends as a way to avoid paying future civil penalties.”
The motion comes at a precarious time for Kenvue. The company’s stock has already plummeted 30 percent amid mounting public controversy and legal challenges, and it’s currently in negotiations for a $40 billion acquisition by Kimberly-Clark. Financial analysts suggest that blocking dividend payments could drive the stock price even lower, potentially forcing the company to settle.
“This would put a lot of pain on the company in the short term,” one market observer told The Texas Tribune. “The only real reason to own [stock in a] corporation is because it pays dividends, and if it can’t pay dividends, no one would ever want to buy it.”
Beyond Dividends: Marketing Claims Under Fire
Paxton’s legal action extends beyond financial matters. The Texas AG has also asked a federal judge to halt Kenvue from advertising Tylenol as safe for use during pregnancy, citing guidance from federal health authorities and even referencing remarks from President Trump urging caution about acetaminophen use during pregnancy.
“Kenvue continue[s] to falsely assure Texans that Tylenol is entirely safe — contrary to the specific instructions of the federal health authorities and indeed the President of the United States,” according to documents reviewed by ABC News.
What’s driving this aggressive approach? The lawsuit appears aligned with broader political messaging about pharmaceutical accountability. “Big Pharma betrayed America by profiting off of pain and pushing pills regardless of the risks,” reads a statement published in The American Journal of Managed Care. “These corporations lied for decades, knowingly endangering millions to line their pockets. By holding Big Pharma accountable for poisoning our people, we will help Make America Healthy Again.”
Company Pushes Back
Kenvue isn’t taking these accusations lying down. The company has vigorously defended acetaminophen’s safety profile, insisting it remains the safest pain relief option for pregnant women.
“Acetaminophen is the safest pain reliever option for pregnant women as needed throughout their entire pregnancy,” Kenvue stated in its response. “Without it, women face dangerous choices: suffer through conditions like fever that are potentially harmful to both mom and baby or use riskier alternatives.”
The company further emphasized that “rigorous, independent research, endorsed by leading medical professionals and global health regulators, confirms that there is no proven link between taking acetaminophen and autism.”
But Paxton seems determined to pursue the case to its conclusion. “I will be relentless in working to secure a just outcome when companies hurt our citizens,” he vowed, “and part of that process is ensuring that companies actually pay Texas when they break the law.”
For now, the fate of both Kenvue’s November dividend and the broader questions about Tylenol’s marketing claims rest with the courts — leaving millions of shareholders, pregnant women, and parents caught in a tense legal battle with no quick resolution in sight.
