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Hand sanitizer maker files for bankruptcy two years after recall

A woman disinfects her hand in Bogota, Colombia March 25, 2021. REUTERS/Luisa Gonzalez

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  • 4E Brands hand sanitizers may have contained methanol
  • The company will cease operations in Chapter 11

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(Reuters) – A maker whose hand sanitizers may have been contaminated with a toxic substance filed for bankruptcy protection on Tuesday to end its operations.

The company, 4E Brands Northamerica LLC, recalled all of its hand sanitizers in July 2020 after the United States Food and Drug Administration issued a warning about hand sanitizers containing methanol, a wood alcohol that is toxic to humans when absorbed through the skin. 4E Brands is owned by the non-bankrupt 4E Global SAPI de CV, which is itself a unit of Kimberly-Clark de Mexico SAB de CV.

The Chapter 11 case was filed in the U.S. Bankruptcy Court for the Southern District of Texas. The company could not immediately be reached for comment.

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4E Brands, whose products included Blumen Hand Sanitizer and Assured Hand Sanitizer, is no longer in business, the company’s chief restructuring officer, Daniel Dunn, said in court documents filed Tuesday. He lined up a $2.5 million bankruptcy loan from his parent company to fund Chapter 11 liquidation costs.

The company reported between $10 million and $50 million in debt.

Dunn said in the court filing that 4E Brands saw the availability of raw materials needed for its products drop as demand increased at the start of the COVID-19 pandemic. As a result, the company began working with new ethanol suppliers, some of whom “intentionally or by mistake supplied methanol instead of ethyl alcohol,” Dunn said.

4E Brands was unaware of the substitution, he said.

After the recall, 4E Brands ceased operations. He has been hit with several class action lawsuits, personal injury and wrongful death lawsuits.

The company is currently working to destroy all of its contaminated hand sanitizers and send all of its uncontaminated products to its parent company in Mexico, according to Dunn.

The case is In re 4E Brands Northamerica LLC, US Bankruptcy Court, Southern District of Texas, No. 22-50009.

For 4E Brands: Matthew Cavenaugh and Genevieve Graham, of Jackson Walker

For 4E Global: Patricia Tomasco, Benjamin Finestone, Daniel Holzman and Gabriel Soledad of Quinn Emanuel Urquhart & Sullivan

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