St. Jude Medical ($STJ) will have to confront claims that it failed to warn patients about potential problems with its now-recalled Riata ICD leads. U.S. District Judge James Selna in California is allowing 5 product liability lawsuits filed against the Minnesota-based medical devices company to move forward, despite St. Jude's attempt to have the failure-to-warn claims dismissed.
Riata was recalled in 2011 after St. Jude reported that the failure rate of the defibrillator leads was higher than previously disclosed. Since then, lawsuits against the company have been piling up, most of them claiming Riata was poorly designed, leading to dangerous shocks and device breakdowns.
Selna had previously allowed claims against St. Jude for negligence and manufacturing defects, but had found failure-to-warn claims deficient, according to Mass Device. Not this time. Selna also denied other motions, according to The Legal Examiner, including an effort by St. Jude to have these same 5 suits dismissed on the grounds that the plaintiffs failed to show a link between Riata and their injuries.
Riata has been a drag on an otherwise impressive turnaround effort by St. Jude. On January 22, the company reported that its fourth-quarter sales jumped 4% to 1.4 billion and earnings were up 8% to $294 million. CEO Daniel Starks told investors the company's strong growth would continue this year, with sales for the full year expected to be at least $5.6 billion--up slightly from last year's sales of $5.5 billion--driven largely by the strong performance of its cardiac rhythm management unit.
Rumors had been swirling that St. Jude's Durata ICD leads might also come under question over safety concerns. But the company went out of its way last year to demonstrate Durata's durability, calming fears of a recall.