Johnson & Johnson wins appeal to overturn $151 million hip implant verdict

[April 26, 2018]  By Nate Raymond

(Reuters) - Johnson & Johnson on Wednesday secured a favorable U.S. appellate court ruling, overturning a verdict that had awarded $151 million to five people who blamed injuries they suffered on the company's Pinnacle hip implant devices.

The 5th U.S. Circuit Court of Appeals said two of the plaintiffs' defective marketing claims were legally insufficient and a new trial was required overall in the case because of a judge's evidentiary rulings and "deceptions" by their lawyer.

U.S. Circuit Judge Jerry Smith, writing for the three-judge panel, said U.S. District Judge Ed Kinkeade in Dallas erred in allowing the hip implant recipients' lawyers to present certain "inflammatory character evidence" about J&J.

Smith said the "most problematic evidence" were bribes J&J paid to "henchmen" of Saddam Hussein in Iraq, allegations stemming from the company's agreement in 2011 to pay $70 million to resolve U.S. foreign bribery probes.

"Because the taint is unmistakable, the verdict cannot stand," Smith wrote.

He also said two of the plaintiffs, Donald Greer and Robert Peterson, had presented no evidence suggesting the doctors who treated them had even encountered the allegedly inadequate warnings the company issued about Pinnacle's risks.

Smith said "falsehoods" that the plaintiffs' lead lawyer, Mark Lanier, made at trial about whether two doctors were compensated to testify as experts had also "marred plaintiffs; victory."

Lanier said he believed the court "misunderstood" the issues but would not appeal and would seek a retrial as quickly as possible.

John Beisner, a lawyer for J&J and its DePuy unit, said the ruling "makes clear, the trial was rife with errors that made it impossible for defendants to get a fair trial." He said he looked forward to a retrial on a "level playing field."

A Johnson & Johnson building is shown in Irvine, California, U.S., January 24, 2017. REUTERS/Mike Blake

DePuy ceased selling the metal-on-metal Pinnacle devices in 2013 after the U.S. Food and Drug Administration strengthened its artificial hip regulations.

The Pinnacle devices are now the subject of around 10,000 product liability lawsuits, according to J&J.

The case at issue was a so-called bellwether, or test, trial aimed at allowing the parties to gauge the value of the remaining claims and inform potential settlement talks.

A federal jury in Dallas awarded five plaintiffs - Greer, Peterson, Margaret Aoki, Jay Christopher, and Richard Klusmann -$502 million in March 2016.

Kinkeade later reduced the award to $151 million.

DePuy prevailed in one other federal trial but was hit in two others with verdicts worth $543 million, after a post-trial reduction, and $247 million.

(Reporting by Nate Raymond in Boston; Editing by Himani Sarkar)

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