Joint replacements are the #1 expenditure of Medicare. The process of approving these medical devices is flawed according to the Institute of Medicine. It is time for patients' voices to be heard as stakeholders and for public support for increased medical device industry accountability and heightened protections for patients. Post-market registry. Product warranty. Patient/consumer stakeholder equity. Rescind industry pre-emptions/entitlements. All clinical trials must report all data.
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Showing posts with label defective product. Show all posts
Showing posts with label defective product. Show all posts
J&J Faces High-Stakes Appeal to Toss Pinnacle Hips Judgment
By Jef Feeley
December 7, 2017, 10:16 AM CST Bloomberg FiDA highlight
Challenge to $151 million judgment affects 10,000 other cases
Former Solicitor General Clement squares off against Ken Starr
The stakes are high as Johnson & Johnson seeks an appeals-court ruling tossing out a $151 million judgment over its Pinnacle artificial hips in a case could foreshadow the outcome for thousands of lawsuits over the devices.
J&J and its DePuy unit, which makes the artificial hips, will have former Solicitor General Paul Clement arguing Thursday that the verdict should be reversed because there was insufficient evidence that the hips were defectively designed and deceptively marketed. The companies will also attack “highly inflammatory comments” at the trial by prominent plaintiffs’ lawyer Mark Lanier.
Kenneth Starr, the Clinton-era independent counsel, will defend the verdict in favor of five hip patients who won a $502 million verdict last year, only to see it slashed to $151 million by the trial judge. Starr will argue that there was enough evidence to support the verdict, including proof that J&J knew the metal-on-metal hips were flawed and would prematurely fail but concealed its knowledge to preserve billions in sales.
J&J, winner of only one of the four Pinnacle cases that have gone to trial since 2014, faces more than 10,000 patient suits blaming the company for selling faulty hips. The argument is scheduled for Thursday afternoon in the U.S. Circuit Court in New Orleans.
Juries in federal court in Dallas have ordered the company to pay a total of more than $1.7 billion in damages over the hips, but several of the awards were later cut by U.S. District Judge Ed Kinkeade, who is overseeing a consolidation of suits over the devices. One verdict was for more than $1 billion.
J&J welcomes the court’s “review of the multiple legal issues presented by our appeal, many of which have implications for’’ the remaining Pinnacle cases, said John Beisner, a Washington-based lawyer for the company.
A central issue on appeal is whether Pinnacle’s hips were defectively designed and doomed to fail, forcing costly and painful follow-up surgeries. J&J argues that plaintiffs failed to meet a legal standard that the product was unreasonably dangerous, a safer alternative design existed, and the defect caused the injuries.
J&J also vigorously protests Kinkeade’s decision to let Lanier tell jurors at the trial about a litany of J&J’s bad acts that the company contends had nothing to do with the hips.
The judge allowed Lanier to “inflame the jury’s passions’’ by referring to almost $80 million in settlements J&J agreed to in 2011, amid claims that overseas officials bribed European doctors to implant the company’s hips and knees, the company says. Lanier should have also been barred from telling jurors that J&J paid kickbacks to “henchmen’’ of former Iraqi dictator Saddam Hussein under a United Nations program, the company argues.
The Dallas jury hit J&J with $360 million in punitive damages, which the judge reduced to $9.6 million under a Texas law limiting such awards.
Chamber Brief
The U.S. Chamber of Commerce filed a brief supporting J&J, which also argues on appeal that the plaintiffs failed to prove the company hid the risks from patients and that the trial court lacked jurisdiction.
The hip recipients say they proved a safer alternative design existed and the company’s warnings to patients were inadequate. They note that Lanier mentioned the J&J bribery scandal at the trial only after DePuy’s lawyers “opened the door’’ by hyping the company’s good works.
The plaintiffs are challenging Kinkeade’s decision to apply the punitive-damages cap, saying the measure unconstitutionally tramples on their equal-protection rights. The award was supported by the evidence, they say.
The case is Christopher v. DePuy Orthopedics, No. 16-11051, U.S. Fifth Circuit Court of Appeals (New Orleans).
https://www.youtube.com/watch?v=1hm37recd6A
Watch this video! https://www.dallasnews.com/business/health-care/2017/11/16/dallas-jury-orders-johnson-johnson-pay-247-million-hip-implant-patients
Dallas Morning News
Johnson & Johnson was ordered Thursday by a Dallas jury to pay $247 million to half a dozen patients who claimed the company hid defects in its Pinnacle artificial hips, its third big-dollar loss over the products.
Officials of the company's DePuy unit, which makes the hips, knew the devices were defective but failed to properly warn doctors and patients about the risk that they would prematurely fail, the jury ruled. The panel awarded a total of $79 million in actual damages and $168 million in punitive damages to a group of six New York residents whose hips had to be surgically removed.
The number of lawsuits accusing J&J and DePuy of mishandling the metal-on-metal hips has grown by more than 13 percent over the past year, to 9,900, according to a regulatory filing. J&J stopped selling the devices in 2013 after the U.S. Food and Drug Administration toughened artificial-hip regulations.
"These companies' behaviors were so reprehensive that it demands repeated punishment," Mark Lanier, a lawyer for the hip recipients, said after the verdict. Lanier won the previous two verdicts against J&J and DePuy.
J&J officials said Thursday in an emailed statement they acted "appropriately and responsibly" in the development and marketing of the Pinnacle hips. "We will immediately begin the appeal process and remain committed to the long-term defense of the allegations in these lawsuits,'' Stella Meirelles, a spokeswoman for DePuy, said in the release.
Johnson & Johnson won the first Pinnacle hip case to go to trial in October 2014 after a federal court jury in Dallas rejected a Montana woman's claims that the devices were defective and gave her metal poisoning.
Another Dallas jury ordered J&J last year to pay $502 million to a group of five patients who accused the company of hiding defects in the hips. A judge cut that verdict in July to about $150 million.
Earlier this year, a third Dallas jury ordered J&J and DePuy to pay more than $1 billion to six California residents whose hips had to be removed after failing. That award was later slashed by nearly half.
The Pinnacle devices weren't covered by New Brunswick, N.J.-based J&J's $2.5 billion settlement of claims over its ASR line of artificial hips. J&J recalled 93,000 of those implants worldwide in August 2010, saying 12 percent failed within five years.
The Pinnacle cases have been consolidated before U.S. District Judge Ed Kinkeade in Dallas for pretrial information exchanges and test trials. Kinkeade agreed to combine the six cases in the most recent trial.
The six New York plaintiffs in the current case are Uriel Brazel, an 88-year-old physician; Karen Kirschner, a 67-year-old elementary school teacher; Ramon Alicea, 61, a chauffeur; Hazel Miura, 60, a housing official; Eugene Stevens, 53, a health-care aide; and Michael Stevens, 52, a financial analyst.
The hip recipients argued DePuy officials rushed the Pinnacle hips to market with little testing and misled doctors about the device's safety profile, assuring them there was little risk of metal poisoning and tissue damage from the metal-on-metal product.
"They ran a grand seduction,'' Lanier, the group's lead lawyer, told jurors in closing arguments Nov. 14 "Surgeons were seduced into using metal-on-metal'' by DePuy executives' false assurances the company had "solved the metal-on-metal problem,'' the plaintiffs' lawyer added.
J&J's lawyers countered that the devices failed because of routine wear-and-tear rather than a flawed design and the company properly marketed the product.
"Not a single surgeon'' said they picked the Pinnacle hip "because of advertising or a brochure or any marketing,'' Steven Quattlebaum, J&J's lawyer, told jurors in his closing statement. "They had good experience with it before they implanted it in any of these patients.''
In their ruling, jurors found J&J DePuy relied on "intentional misrepresentations" about the hips' safety profile to bolster sales and engaged in "deceptive business practices" in their marketing of the devices, according to a verdict form.
NEW YORK (Reuters) - A federal jury in Dallas on Thursday ordered Johnson & Johnson and its DePuy Orthopaedics unit to pay $247 million to six patients who said they were injured by defective Pinnacle hip implants.
The jury found that the metal-on-metal hip implants were defectively designed and that the companies failed to warn consumers about the risks.
Six New York residents implanted with the hip devices said they experienced tissue death, bone erosion and other injuries they claimed were caused by the implants’ design flaws.
Law360, Dallas (November 16, 2017, 12:34 PM EST) -- A Texas federal jury on Thursday hit Johnson & Johnson and its DePuy Orthopaedics Inc. unit with a combined $247 million verdict in a bellwether trial over DePuy’s Pinnacle line of metal-on-metal hip implants, delivering the third consecutive nine-figure verdict in the multidistrict litigation.
The unanimous jury found J&J and DePuy liable for a series of design and manufacturing defects, fraud and deceptive business practices, and found the companies had acted with wanton, reckless or malicious conduct. They awarded $90 million in punitive damages against J&J and $78
million in punitive damages against DePuy.
For the six individual plaintiffs, each of whom is from New York, the jury awarded more than $77 million in past and future medical expenses and pain and suffering, including each plaintiffs’ actual past medical expenses, the amounts of which were stipulated to by the parties. Four of the plaintiffs’ spouses were awarded loss of consortium damages totaling $1.7 million.
"I'm stunned the amount was that high," Mark Lanier of The Lanier Law Firm, an attorney for the plaintiffs, said after the verdict. "I'm overjoyed for the clients."
Lanier said the verdict is notable because U.S. District Judge Ed Kinkeade excluded from evidence a number of inflammatory documents and emails that J&J has said shouldn't have been admitted in previous bellwether trials, and the jury still awarded nearly a quarter-billion dollars in damages.
“He kept out every piece of reprehensible evidence that he could, and I was scared to death we’d walk away with nothing," Lanier said.
Lanier said he looks forward to taking the full record of the case to the Fifth Circuit and believes the win would be upheld.
Yet J&J's lawyers said an August 31 ruling from a Fifth Circuit panel renders the verdict a "phyrric victory" for the plaintiffs. In that decision, a majority of the panel said Judge Kinkeade reached a “patently erroneous” result and clearly abused his discretion by holding J&J and DePuy had waived their right to object to his court in Texas conducting trials for plaintiffs from other states.
"This nine-week trial was a disservice to everyone involved because the verdict will do nothing to advance the ultimate resolution of this six-year old litigation," John Beisner of Skadden Arps Slate Meagher & Flom LLP said in astatement. "We will continue to seek further appellate guidance that will finally allow the fair, meaningful adjudication of these claims.”
The verdict followed a two-month trial, the fourth bellwether in multidistrict litigation that includes more than 9,000 cases alleging design defects in DePuy’s Pinnacle Ultamet line of metal-on-metal hip implants. In 2016, Texas juries found in favor of two groups of plaintiffs from Texas and California, awarding them $502 million and more than $1 billion in damages, respectively, though those verdicts were later reduced to $150 million and $543 million. In the first bellwether trial involving the Pinnacle Ultamet, a jury sided with J&J against a sole plaintiff from Montana.
The jury specifically found J&J and DePuy liable for design defect, negligent design, inadequate warning, manufacturing defect, negligent manufacture, negligent misrepresentation, intentional misrepresentation to the surgeons who performed the initial hip implant surgeries on the plaintiffs, fraudulent concealment from the plaintiffs and from the surgeons and deceptive business practices as to the plaintiffs and the surgeons. The jury also found J&J liable for negligent undertaking of a duty to provide services to DePuy and for aiding and abetting DePuy in its tortious conduct. The jury did not find J&J or DePuy liable for intentional misrepresentation to the plaintiffs.
A spokeswoman for DePuy, Stela Meirelles, said in a statement that the company acted appropriate and responsibly in developing the metal-on-metal hip implant.
“We have no greater responsibility than to the patients who use our products," Meirelles said. "We will immediately begin the appeal process and remain committed to the long-term defense of the allegations in these lawsuits.”
During the trial, the six plaintiffs told jurors they’d suffered a range of injuries, including severe tissue damage that caused permanent muscle loss, intense pain, loss of hip movement and walking with a permanent limp. They say the Pinnacle product shed microscopic metal ions into their bodies, causing side effects that J&J and DePuy didn’t warn surgeons about and that could have been avoided with a safer design.
The plaintiffs alleged J&J and DePuy valued marketing above research and development and rushed the Pinnacle product into production without any testing in humans out of a desire to capture a greater market share. They claimed the companies pushed the Pinnacle product with an incorrect statistic that it was 99 percent successful; that they’d used cheaper, less safe alternatives in the manufacturing process to keep costs down; and that the alleged defects in the product turned people’s hips into “ticking time bombs.”
In his closing statement, plaintiffs' counsel Mark Lanier of The Lanier Law Firm asked the jury to punish J&J "for being indifferent to our health” through a large punitive damages award that would capture the attention of company executives who didn’t attend the trial.
J&J and DePuy made the case during the trial that metal-on-metal was a viable, reasonable option for hip implants and that its Pinnacle Ultamet product was offered to help doctors choose the device that best fit their patients. The companies said the metal-on-metal implant was developed to solve a bone degradation problem with an existing polyethylene hip implant on the market and denied putting profits above patient safety and long-term results.
In a closing statement, defense counsel Steve Quattlebaum of Quattlebaum Grooms & Tull PLLC said the plaintiffs had made an emotional appeal and told a good story but that their allegations were not backed up by evidence or science. Quattlebaum said there’s no evidence the surgeons who treated the six plaintiffs relied on or even saw the 99 percent statistic when choosing which kind of implant to use and said there’s no evidence the plaintiffs’ injuries were caused by the product specifications the plaintiffs had complained about during the trial.
The defendants are represented by John H. Beisner, Stephen J. Harburg and Jessica Davidson Miller of Skadden Arps Slate Meagher & Flom LLP, Steven W. Quattlebaum of Quattlebaum Grooms & Tull PLLC and Tracie J. Renfroe of King & Spalding LLP.
The consolidated cases are Alicea et al. v. DePuy Orthopaedics Inc. et al., case number 3:15-cv-03489; Barzel v. DePuy et al., case number 3:16-cv-01245; Kirschner v. DePuy et al., case number 3:16-cv-01526; Miura v. DePuy et al., case number 3:13-cv-04119; Stevens v. DePuy et al., case number 3:14-cv-01776; and Stevens v. DePuy et al., case number 3:14-cv-02341, in the U.S. District Court for the Northern District of Texas.
--Editing by Rebecca Flanagan.
Update: This story has been updated with comment from representatives for the parties.
Frances Scott discusses one significant day in the jury trial that ends tomorrow.
I will post the verdict here. The closing arguments are happening tomorrow and the charges have already been read to the jury.
With another potentially $1 billion verdict on the line, two heavyweight lawyers—plaintiffs' counsel W. Mark Lanier and defense lawyer John Beisner—are trading ever-escalating accusations and barbs in court papers in a high-stakes DePuy hip implant trial.
With another potentially $1 billion verdict on the line, two heavyweight lawyers—plaintiffs’ counsel W. Mark Lanier and defense lawyer John Beisner—are trading ever-escalating accusations and barbs in court papers in a high-stakes DePuy hip implant trial.
Lanier and his team are complaining of improper conduct and frivolous objections, and lawyers for hip implant maker Johnson & Johnson’s DePuy Orthopaedics Inc. have accused plaintiffs’ attorneys of misleading the jurors and springing new evidence on them in a “trial by ambush.”
To be sure, it’s no surprise that lawyers in the fourth bellwether trial over Pinnacle hip implants are fighting tooth and nail. Two previous trials landed $502 million and $1.04 billion verdicts. And as in those trials, Johnson & Johnson faces consolidated claims made by multiple plaintiffs at the same time—six New York plaintiffs to be exact.
It’s also not the first time that Lanier and Beisner have traded barbs in the litigation, which involves more than 9,000 cases. Earlier this year, Beisner, of Skadden, Arps, Slate, Meagher & Flom in Washington, D.C., accused Lanier, of The Lanier Law Firm in Houston, of failing to disclose payments he made to two expert witnesses in the second bellwether trial.
But the accusations in the latest trial, which began on Sept. 19 in Dallas, have been excessively contentious. In the latest spat, Lanier raised questions about potential tampering with one of his witnesses—a revelation that U.S. District Judge Ed Kinkeade of the Northern District of Texas on Monday said could end up involving federal prosecutors and the FBI.
Lawyers on both sides already have slung more than a dozen motions and trial briefs at one another. Neither Lanier nor Beisner responded to calls seeking comment on this story.
Kinkeade has yet to rule on the series of motions. Here’s what’s been filed:
Plaintiffs’ lawyers have filed:
A Sept. 27 trial brief to stop defense lawyers from making “repetitive and meritless objections” during trial. “Defendants’ tactics are nothing more than improper attempts to delay and obfuscate the trial,” the brief says. Johnson & Johnson’s lawyers responded on Sept. 29 with: “The fundamental premise of plaintiffs’ brief is that defendants should only be allowed to make objections at trial if plaintiffs deem those objections to have merit. This proposal is as preposterous as it sounds.”
Trial briefs filed on Sept. 21 and Oct. 3 accuse Johnson & Johnson’s lawyers of improper conduct – in particular, telling the jury about the worldwide popularity of Pinnacle hip implants knowing that plaintiffs’ attorneys were barred from bringing up previous deferred prosecution agreements involving bribes to foreign government officials and payments to doctors. Johnson & Johnson’s lawyers, in a Sept. 26 response, accused plaintiffs’ attorneys of mischaracterizing those agreements.
At a hearing on Monday, Kinkeade heard arguments about the statements of doctor that a DePuy sales representative told him “there could be ramifications” for his medical practice in connection with his upcoming testimony for the plaintiff. “He said the lawyers were ‘on him like crazy,’” according to an Oct. 15 affidavit filed by Dr. David Shein. Kinkeade called the developments “certainly disturbing and disconcerting to me.” He said he wanted the U.S. Attorney’s Office and the FBI to interview the sale rep and any lawyers who contacted him.
Johnson & Johnson’s lawyers have filed:
An Oct. 11 motion for mistrial based on Lanier’s references during witness questioning to prior cases involving DePuy hip implants. The motion notes that Lanier has done this before. “As demonstrated by the last MDL trial—where similar improper questioning and testimony culminated in gargantuan verdicts—improper references to ‘hundreds of other lawsuits’ are uniquely prejudicial because they tend to inflate any damages award.” The motion claims Lanier’s references violate a motion in limine order and, although some of the defense’s objections were sustained, “the horse was already out of the barn and the damage had been done.” On Oct. 15, Lanier denied any violations of court orders and insisted that the references are necessary to show witness bias and establish claims for punitive damages.
An Oct. 9 motion to exclude or limit the testimony of Dr. Bernard Morrey—one of the experts whose payments Beisner accused Lanier of failing to disclose in an earlier trial. In a Sept. 18 order, Kinkeade allowed Morrey to testify as long as he provided a written report to Johnson & Johnson three days prior to testimony. The motion, which is Johnson & Johnson’s second in this case, says the report “essentially reprinted Dr. Morrey’s testimony” from an earlier trial “in bullet-point format.” If he testifies, the motion cautions, Morrey should not be permitted to mention his own patient experiences without medical records nor give opinions that are not in his report—as happened in previous trials. Lanier countered in an Oct. 10 response: “Defendants are fully aware of the testimony Dr. Morrey intends to offer at trial—and they have known it for a very long time.”
An Oct. 15 motion for a jury instruction on the duty to warn to “correct plaintiffs’ counsel’s misrepresentation.” Specifically, the motion accuses Lanier of “insinuating to the jury several times” that Johnson & Johnson had a duty to warn patients when, under New York law, that duty was to surgeons.
An Oct. 15 motion for a jury instruction to “disregard plaintiffs’ counsel’s misleading questioning” of a defense witness regarding assets he held in a nonprofit foundation. Plaintiffs’ attorneys, in an Oct. 17 response, insist that an instruction isn’t necessary.
A Sept. 19 motion to reconsider consolidation of the six plaintiffs into a single trial. The motion is sealed, but Johnson & Johnson has repeatedly fought consolidated trials as leading to larger verdicts and prejudicing defendants. In an Oct. 10 response, plaintiffs’ attorneys called consolidated trials “standard operating procedure” in mass torts.
It’s unclear how Kinkeade could approach the motions and trial briefs. In the last trial, Johnson & Johnson’s lawyers filed a trial brief complaining that the plaintiffs would end up with more time than they would. But according to a Nov. 17 transcript, Kinkeade criticized defense counsel for causing its own delays by asking witnesses multiple questions just “to get to the point.”
“It’s just every time you file one of those, if it’s deserved I’ll take it, and I think I’ve done that in this trial,” he said, referring to trial briefs and motions. “You’ve got a very clean trial, regardless of the fact y’all have filed two motions for mistrial. So be it.”
In addition to Beisner, Johnson & Johnson’s team on the court papers includes Skadden’s Stephen Harburg, another Washington partner; Steven Quattlebaum of Quattlebaum, Grooms & Tull in Little Rock, Arkansas; and Tracie Renfroe, a Houston partner at King & Spalding.
On the plaintiffs’ team, Lanier is joined by Wayne Fisher of Fisher, Boyd, Johnson & Huguenard in Houston; Richard Arsenault of Neblett, Beard & Arsenault in Alexandria, Louisiana; and Jayne Conroy of Simmons Hanly Conroy in New York.
Amanda Bronstad
Amanda Bronstad is the ALM staff reporter covering class actions and mass torts nationwide. She is based in Los Angeles.
After a hard-fought, almost 5-year battle in federal court in Atlanta, Georgia and in California state court, we are pleased to announce a settlement program that will resolve a significant number of claims against Wright Medical. Wright Medical has agreed to settle approximately 1,300 claims of certain Wright Medical metal-on-metal hip implant patient-claimants whose hips were revised at least 150 days and no more than eight years post-implant. There are approximately 2,300 pending claims involving Wright Medical’s Conserve, Lineage, and Dynasty metal-on-metal hips. Plaintiffs’ Leadership Counsel’s retained financial analysts have been evaluating Wright Medical’s ability to settle these cases for years. Based on that analysis, we believe that Wright Medical was not in a position to and therefore could not agree to settle the remaining claims involving revisions occurring after eight years or other cases that it deemed not qualified at this time. During the negotiations with Wright Medical, it was made clear that claims for revised Wright metal-on-metal hips that are not included in this settlement will be part of subsequent settlement programs.
The Wright Conserve Multi-District Litigation (MDL) was consolidated in February 2012 in federal court in the Northern District of Georgia before the Hon. William S. Duffey, Jr., United States District Judge. Additionally, a Judicial Council Coordination Proceeding (JCCP) petition was approved in May 2012 before the Hon. Jane Johnson, Los Angeles Superior Court Judge, consolidating California state-court cases involving Wright Medical hip replacement and revision matters, including Wright Medical’s Conserve, Lineage, and Dynasty hip implants. The Hon. Diane M. Welsh (Ret.), led the extended settlement negotiations and tirelessly worked with the parties for several years to help facilitate the settlement.
Wright Medical’s hip and knee division (OrthoRecon) was sold in January 2014, and the successor corporation has a defense that it did not inherit the liability. Our financial analysts’ review further indicated that Wright Medical’s ability to fund this settlement depended largely on insurance coverage and a bond issue used, in part, to raise money for this settlement. Wright Medical has been engaged in litigation in Memphis with most of its insurance carriers and recently finalized an agreement with 3 of the carriers. It remains in litigation or coverage disputes with its remaining carriers. In light of our analysis of Wright Medical’s financial condition, this is a timely and meaningful settlement, offering $170,000 to claimants who had the monoblock Conserve Cup, the device with the most frequent failures, and $120,000 to those who had the metal-liner Dynasty and Lineage devices. An additional, but capped, limited fund is also available for claimants who suffered discrete and defined claims of extraordinary injury. More importantly, the settlement program calls for pre-qualification, without registration, coupled with a very simple administrative process for claimants not pursing extraordinary injury claims that will lead to expeditious payments expected to be largely complete by summer 2017. Counsel for eligible claimants will be notified of their pre-qualification by February 3, 2017.
Plaintiffs’ Leadership Counsel consists of Michael L. McGlamry of Pope McGlamry, P.C. in Atlanta, Georgia, mmcglamry@pmkm.com / 404-523-7706; Raymond P. Boucher of Boucher LLP in Woodland Hills, California, ray@boucher.la / 818-340-5400; Helen Zukin of Kiesel Law in Beverly Hills, California; Peter Burg of Burg Simpson in Englewood, Colorado; Christopher Yuhl of Yuhl Carr, LLP in Marina del Rey, California; Sean Jez of Fleming Nolen & Jez, L.L.P. in Houston, Texas; and Ellen Relkin of Weitz & Luxenberg, P.C. in New York, New York.
Written by Eric OliverDate created | Thursday, 03 November 2016 20:07
Amsterdam, Netherlands-based Wright Medical Group entered into a Master Settlement Agreement over litigation on its Hip Implant products.
Here's what you need to know.
1. Wright and the lawyers representing the plaintiffs agreed to settle 1,292 revision claims concerning its Conserve, Dynasty or Lineage hip implants
2. Wright will settle for up to $240 million with $180 million in cash and $60 million for insurance recoveries.
3. The settlement requires a 95 percent opt-in clause. Wright Medical will void the settlement if more than 5 percent of the plaintiffs opt out of it.
4. CEO Robert Palmisano said he was pleased to reach the settlement, and the company will now focus on "accelerating growth opportunities in its extremities and biologics markets."
5. Wright will "vigorously defend" any claims that were not settled. The company estimates there are 600 cases that will not be included in the settlement.
AMSTERDAM, The Netherlands, Nov. 02, 2016 (GLOBE NEWSWIRE) -- Wright Medical Group N.V. (NASDAQ:WMGI) today announced that on November 1, 2016, its wholly owned subsidiary Wright Medical Technology, Inc. (WMT) entered into a Master Settlement Agreement (MSA) with Court-appointed attorneys representing plaintiffs in the previously disclosed metal-on-metal hip multi-district litigation known as In Re: Wright Medical Technology, Inc., CONSERVE® Hip Implant Products Liability Litigation, MDL No. 2329 (MDL) and the consolidated proceeding pending in state court in California known as In re: Wright Hip System Cases, Judicial Council Coordination Proceeding No. 4710 (JCCP). In addition, on October 28, 2016, the Company entered into a Settlement Agreement with three of its insurance carriers (Three Settling Insurers).
Under the terms of the MSA, the parties agreed to settle 1,292 specifically identified CONSERVE, DYNASTY or LINEAGE revision claims which meet the eligibility requirements of the MSA and are either pending in the MDL or JCCP, or are subject to tolling agreements approved in the MDL or JCCP, for a total settlement amount of $240 million, of which approximately $180 million will be funded from cash on hand and $60 million will be funded from insurance recoveries.
Eligibility requirements of the MSA include that the claimant has a pending or tolled case in the MDL or JCCP, has undergone a revision surgery within eight years of the original implantation surgery, and that the claim has not been identified by WMT as having possible statute of limitation issues. Claimants who have had bilateral revision surgeries will be counted as two claims but only to the extent both claims separately satisfy all eligibility criteria.
The MSA includes a 95% opt-in requirement, meaning the MSA may be terminated by WMT prior to any settlement disbursement if claimants holding greater than 5% of eligible claims in the Final Settlement Pool elect to “opt-out” of the settlement. No funding of any individual plaintiff settlement will occur until the 95% opt-in requirement has been satisfied or waived.
Robert Palmisano, president and chief executive officer, commented, “We are very pleased to have reached this settlement agreement, in particular the population of claims that the settlement covers as well as the required 95% opt-in rate for those claims. With this clarity, we will continue to focus on accelerating growth opportunities in the extremities and biologics markets. This settlement addresses approximately 85% of the known U.S. revision claims that do not have potential statute of limitations issues and removes a great deal of the uncertainty that has been associated with this litigation.”
Wright will continue to vigorously defend metal-on-metal hip claims not settled pursuant to the MSA. As of September 25, 2016, the company estimates there were approximately 600 outstanding metal-on-metal hip revision claims that would not be included in the MSA settlement, including approximately 200 claims with an implant duration of more than eight years, approximately 300 claims subject to possible statute of limitations preclusion, approximately 30 claims pending in U.S. courts other than the MDL and JCCP, approximately 50 claims pending in non-U.S. courts, and approximately 20 claims that would be eligible for inclusion in the settlement but for the participation limitations contained in the MSA. The company also estimates that there were approximately 700 outstanding metal-on-metal hip non-revision claims as of September 25, 2016. These non-revision cases are excluded from the MSA.
The final MSA settlement amount (not to exceed $240 million), and the final number of claims settled under the MSA, will depend on, among other things, the number of claimants electing to participate in the settlement and the mix of products implanted in the settling claimant group. Claims which do not meet the eligibility requirements of the MSA, new claims, and claims which have opted-out of the settlement will not be settled under the MSA and the company will continue to defend these claims.
The company previously disclosed a loss range applicable to a substantial portion of revision cases of $150 million to $198 million and, in accordance with U.S. generally accepted accounting practices (US GAAP), recognized as a charge within discontinued operations in the second quarter of 2016 $150 million, the low end of the range of probable loss for these cases. During the third quarter of 2016, the company recorded charges of approximately $39 million to increase its accrual from the low end of its previous range of probable loss to the amounts in line with the final agreements and to record accruals for certain other revision cases. Please refer to the disclosures in the company’s third quarter 2016 quarterly report on Form 10-Q for a full discussion of our accruals and disclosures related to this matter.
WMT has agreed to escrow $150 million to secure its obligations under the MSA, and parent corporation Wright Medical Group N.V. has agreed to guaranty WMT’s obligations under the MSA.
The MSA will help bring to a close significant metal-on-metal litigation activity in the U.S. Some lawsuits, however, will remain and Wright will continue to defend against remaining claims and any future claims that could be filed. The ultimate cost to entirely resolve these matters will depend on many factors that are difficult to predict and may be materially different than the amounts accrued to date, including future revision claims and additional insurance recoveries. Further charges may need to be recorded in the future as additional information becomes available.
Internet Posting of Information
Wright routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.wright.com. The company encourages investors and potential investors to consult the Wright website regularly for important information about Wright.
About Wright Medical Group N.V.
Wright Medical Group N.V. is a global medical device company focused on extremities and biologics products. The company is committed to delivering innovative, value-added solutions improving quality of life for patients worldwide and is a recognized leader of surgical solutions for the upper extremities (shoulder, elbow, wrist and hand), lower extremities (foot and ankle) and biologics markets, three of the fastest growing segments in orthopaedics. For more information about Wright, visit www.wright.com.
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Sydney bus driver Joseph Pereira was a lead plaintiff in the case against Johnson & Johnson over faulty hip joints. Steven Siewert
by Marianna Papadakis
Mar 31 2016 at 4:40 PM Updated Mar 31 2016 at 4:40 PM
Pharmaceutical and medical devices giant Johnson & Johnson will pay $250 million for faulty hip replacements in the second-biggest class action settlement in Australia over the past decade.
The conditional agreement between Johnson & Johnson and its British subsidiary DePuy International and lawyers for 1700 Australians was lodged at a short hearing at Sydney's Federal Court on Thursday and must be approved by a judge.
The companies were sued by Shine Lawyers and Maurice Blackburn five years ago. There was a 17-week trial last year. The biggest class action settlement was $800 million for the Victorian bushfires cases.
The DePuy ASR resurfacing hip implant has led to a compensation package of $250 million from Johnson & Johnson. "
The DePuy ASR resurfacing hip implant has led to a compensation package of $250 million from Johnson & Johnson. Supplied
Johnson & Johnson withdrew the DePuy ASR hip implants from sale in Australia in December 2009 and issued a formal hazard alert for the products in August 2010.
Maurice Blackburn Lawyers senior associate Julian Schimmel said the settlement, following the court's approval, meant patients could be compensated if they had or still needed corrective surgery because of problems with hip implants.
PARTS 'DEFECTIVE'
The law firms alleged the ASR hip implants, which provided a total hip replacement, were defective, not fit for their purpose and not of merchantable quality.
Mr Schimmel said the case was settled on a "no admissions" basis.
Shine Lawyers partner Rebecca Jancauskas said a compensation scheme to distribute the money would be devised to ensure compensation paid to each group member reflected their individual circumstances and losses.
"We estimate there are still hundreds of Australians who are yet to have hip revision surgery and the settlement scheme will remain open for these people to access the compensation they are entitled to," Ms Jancauskas said.
A Johnson & Johnson spokeswoman said the company still used the ASR devices and they performed well in some patients.
"The respondents' priority is, and always has been, patient safety," the spokeswoman said. "Since the recall decision was made, the respondents have worked to provide patients and surgeons directly with the information and support they need.
"They have continued to focus on the care and wellbeing of all ASR patients, their family members and surgeons."
Johnson & Johnson is appealing a separate case in the United States concerning different Pinnacle metal-on-metal hip implants after the company was ordered by a Texas federal jury to pay about $US500 million ($650 million) to five plaintiffs who claimed they were injured by the devices.
