J&J Seeks to Avoid Punitives After Losing Mesh Verdict

A jury began deliberating whether to punish Johnson & Johnson (JNJ) for a South Dakota nurse awarded $3.35 million in the first trial among 2,100 New Jersey lawsuits over its vaginal mesh.

Lawyers for Linda Gross today asked jurors in Atlantic City to require J&J, the world’s largest seller of health-care products, to pay punitive damages. The panel yesterday awarded compensatory damages to Gross after finding J&J failed to warn her surgeon of the risks of its Gynecare Prolift implant and fraudulently misled her about the risks. The jury, which met for about 30 minutes today before leaving, is scheduled to resume deliberations tomorrow.

New Jersey caps punitive damages at five times compensatory damages, or $16.75 million, although jurors weren’t told that. Gross attorney Adam Slater urged the panel of six women and three men to find that J&J and its Ethicon unit acted with willful and wanton disregard of the probable harm to his client.

“Tell them through your verdict, don’t do this again, change your way of business,” Slater told jurors today. “You’ve already found they knew what they were saying was untrue. When you make a punitive damage award and you want to deter them, you take into account how much money they have.”

Gross, 47, sued along with her husband, complaining of constant pain and 18 operations she underwent after the device was implanted to shore up weakened pelvic muscles. J&J, based in New Brunswick, New Jersey, claimed at trial that Prolift is safe and effective, and the company warned adequately of risks.

‘I Understand’

“I understand that Johnson & Johnson and Ethicon didn’t do as good a job as they could have,” J&J attorney Christy Jones told jurors in a voice barely above a whisper. “I understand they could have given better warnings” to Gross’s surgeon.

She asked jurors to review the evidence in light of the higher burden of proof for punitives, which is clear and convincing evidence, rather than a preponderance of the evidence, the standard for compensatory damages.

Jones said that Ethicon tried to teach surgeons how to minimize the risk to patients, and sought through “instructions for use” to warn of the risks.

“I asking you, I’m begging you, to think about what was done and why,” said Jones, holding her hands as if in prayer. “Please consider the burden of proof and hold the plaintiffs to their burden of proof. Please stand by your convictions and do what’s right. It’s important to all of us.”

Gross’s attorneys called a forensic economics expert, Frank Tinari, to testify about J&J’s financial condition.

Net Worth

The company, he said, had total assets of $121.3 billion and a net worth of $64.8 billion through Dec. 31. The average annual profit from 2009 to 2012 was $11.5 billion, he said. Advertising and marketing expenses were $20.9 billion last year, or $57 million a day, he said.

Under questioning by Gross’s attorney David Mazie, Tinari said that every 45 minutes, the company spends the equivalent of the $3.35 million awarded to Gross on marketing and advertising.

J&J attorney William Gage asked Tinari about a variety of other company expenses, including research and development, as well as intangible assets and goodwill.

When Gage tried to ask about J&J giving away vaccines around the world, Superior Court Judge Carol Higbee upheld an objection by Gross’s lawyers.

A J&J manager of financial reporting, Mark Schneider, testified his analysis of Prolift sales from 2005 through 2012 showed the total was $128 million, and profit was $5.6 million.

Sales Calculations

On cross-examination, Mazie suggested Schneider’s calculations were unreliable and he underreported sales. He showed Schneider a company document saying sales in the first half of 2008 alone were $55 million. Schneider said he hadn’t seen it.

In his summation, Slater went through e-mails, memos and video depositions, including one of the device’s creator, Axel Arnaud. Slater said Arnaud contradicted Ethicon’s statement that Prolift posed “rare and small risks” of complications.

“I have given you 100 percent irrefutable proof that the guy who created the procedure is telling you those statements were not true,” Slater said. “This is clear and convincing. There’s no doubt. It’s their words.”

Mazie said J&J is a “big giant,” and jurors must send a “loud message” to punish the company for its conduct.

“Provide justice today to Linda Gross and send a message to Johnson & Johnson and tell them ‘No more, no more, no more,’” he said. “Send a message and make sure it’s heard.”

J&J faces about 4,000 pelvic mesh lawsuits around the U.S.

The case is Gross v. Gynecare Inc., Atl-L-6966-10, Superior Court of Atlantic County, New Jersey (Atlantic City).

To contact the reporter on this story: David Voreacos in Atlantic City, New Jersey, at dvoreacos@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.