Dow Corning has emerged from bankruptcy after nine years spent protecting itself from several hundred thousand suing women -- and perhaps a few men -- who claimed that ruptured silicone breast implants made by the company were the cause of autoimmune diseases.
As it turned out, long after the juries had found the company guilty to the tune of $7 billion, more than 30 rigorous medical studies showed no correlation between the implants and the illnesses being claimed. The autoimmune diseases were no more prevalent than would be expected through chance. That's not to suggest that having a ruptured bag of silicone gel in your chest is not problematic.
So the company has remained in bankruptcy protection nearly a decade, putting off the inevitable. And though breast implants were never more than 1% of the company's business, it will now be making billions in settlement payments to several hundred thousand claimants.
The company is jointly owned by Dow Chemical (NYSE: DOW ) , which is involved in both fuel cell and nanotechnology, and Corning (NYSE: GLW ) , a maker of fiber-optic cable and glass for flat panel displays. Fortunately for them, there is already a $2.35 billion trust set aside to handle the settlements, which is being supervised by the courts. Dow Corning had $2.87 billion in sales last year and net income of $176.6 million. So going forward it will continue to contribute significantly to its two parent companies.
Fool contributor Mark Mahorney doesn't own shares of the companies mentioned.