California appeals court cuts $42 mln off J&J mesh-marketing judgment

FILE PHOTO: The Johnson & Johnson logo is displayed on a screen on the floor of the NYSE in New York
The Johnson & Johnson logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 29, 2019. REUTERS/Brendan McDermid
  • Panel finds lower court adequately weighed J&J's written statements
  • Portion of judgment attributed to oral statements overturned for insufficient evidence

(Reuters) - A California appeals court has knocked about $42 million off a $344 million judgment the state won in a case accusing Johnson & Johnson of concealing the risks of its Ethicon Inc unit's pelvic mesh products.

California's 4th District Court of Appeal ruled Monday that, while the state had proven its case concerning the written materials J&J used to market the transvaginal mesh products, it had not shown that company sales representatives made misleading statements about them in conversations with doctors.

J&J said in a statement that it would appeal and that Ethicon "responsibly communicated the risks and benefits of its transvaginal mesh products to doctors and patients."

The office of California Attorney General Rob Bonta did not immediately respond to requests for comment.

California's case, filed in 2016 in San Diego Superior Court, stemmed from a multistate investigation into J&J's marketing of its pelvic mesh devices, which were used to treat bladder problems and other conditions.

J&J and other mesh makers were already facing numerous private lawsuits by women who said they suffered pain, perforations, urinary problems, bleeding and other serious injuries. Those lawsuits have resulted in more than $7 billion in settlements thus far.

In 2019, the U.S. Food and Drug Administration ordered all pelvic mesh makers to halt sales of the devices.

Later that year, J&J and Ethicon reached a $117 million settlement with 41 states and the District of Columbia to resolve claims that they concealed the risks of the mesh products. California, which did not take part in that settlement, won its $344 million judgment in January 2020 following a bench trial.

On appeal, J&J challenged the judgment on multiple grounds, including that Superior Court Judge Eddie Sturgeon had not adequately considered whether the company's alleged misrepresentations were material. The appeals court rejected that argument, saying Sturgeon's ruling was based on the "tragic and permanent consequences" suffered by patients.

"While the trial court may not have uttered the precise word 'materiality,' the concept of materiality was unquestionably implicit in the court's findings," Presiding Justice Judith McConnell wrote for the panel, joined by Associate Justices Judith Haller and Joan Irion.

However, McConnell wrote that there was no direct evidence in the record that J&J sales representatives made misleading oral statements to doctors. The court therefore overturned the part of the judgment attributable to such statements.

The case is The People v. Johnson & Johnson, California Court of Appeal, Fourth Appellate District, Division One, No. D077945.

For J&J: Charles Lifland, Jason Zarrow, Lauren Kaplan, Steve Brody and Mattie Hutton of O'Melveny & Myers

For California: Attorney General Rob Bonta, Assistant Attorney General Nicklas Akers, Deputy Attorneys General Jon Worm, Adelina Acuña, Tina Charoenpong, Monica Zi, Gabriel Schaeffer and Daniel Osborn

Read more:

J&J vows to appeal $344 mln judgment in California AG’s mesh-marketing case

Johnson & Johnson agrees to pay about $117 million to settle U.S. states' mesh probe

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Brendan Pierson reports on product liability litigation and on all areas of health care law. He can be reached at