Texas is taking further action against Tylenol-maker Kenvue.

Texas Attorney General Ken Paxton filed a motion to prevent Kenvue from paying out its November dividend.¹ According to Paxton, this is to ensure that the company has the funds available to pay for its potential loss in the state’s lawsuit against the company.

Why is Texas trying to block Kenvue's dividend?

In a press release, Paxton said, “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. 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. I will be relentless in working to secure a just outcome when companies hurt our citizens, and part of that process is ensuring that companies actually pay Texas when they break the law.”

Paxton previously filed a lawsuit against Kenvue based on unproven claims that Tylenol might increase the risk of autism when taken by pregnant women. According to the Texas Attorney General, both Kenvue and the company’s previous owner Johnson & Johnson deceptively marketed the pain medication by not divulging to apparent dangers to unborn children.

In a late-October press release, Paxton said, “Big Pharma betrayed America by profiting off of pain and pushing pills regardless of the risks. These corporations lied for decades, knowingly endangering millions to line their pockets. Additionally, seeing that the day of reckoning was coming, Johnson & Johnson attempted to escape responsibility by illegally offloading their liability onto a different company. By holding Big Pharma accountable for poisoning our people, we will help Make America Healthy Again.”

In this press release, Paxton referenced claims made by President Trump that Tylenol increases the risk of autism. However, after filing this lawsuit, HHS Secretary Robert F. Kennedy said during an unrelated press conference that there is no evidence that Tylenol causes or increases the risk of autism.

To make the situation even more complicated, Kimberly-Clark recent announced intentions to acquire Kenvue. This would bring Kenvue’s entire portfolio, including Tylenol, under Kimber-Clark’s umbrella.

In a press release issued at the time, Kimberly-Clark chairman and chief executive officer Mike Hsu said, “We are excited to bring together two iconic companies to create a global health and wellness leader. Kenvue is uniquely positioned at the intersection of CPG and healthcare, with exceptional talent and a differentiated brand offering serving attractive consumer health categories. With a shared commitment to developing science and technology to provide extraordinary care, we will serve billions of consumers across every stage of life.”

Hsu continued, “Over the last several years, Kimberly-Clark has undertaken a significant transformation to pivot our portfolio to higher-growth, higher-margin businesses while rewiring our organization to work smarter and faster. We have built the foundation, and this transaction is a powerful next step in our journey. We look forward to working with the Kenvue team to bring these companies together and are confident that we will drive significant value for our combined shareholders.”

Kimberly-Clark’s deal to purchase Kenvue is valued at about $48.7 billion. If the deal closes, Kimberly-Clark is expected to own about 54% of Kenvue shares.

This would bring Tylenol under the same umbrella as Kleenex, Huggies, Kotex, and other hygiene products.

Sources

1. Attor­ney Gen­er­al Ken Pax­ton Fights to Stop the Man­u­fac­tur­er of Tylenol from Fraud­u­lent­ly Pay­ing Div­i­dends to Avoid Fac­ing Justice. Attorney General of Texas. November 6, 2025. https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-fights-stop-manufacturer-tylenol-fraudulently-paying-dividends-avoid