Johnson & Johnson ($JNJ) is facing more than 10,000 lawsuits over its ASR all-metal hip implant, and with the first one costing $8.3 million in damages, the drug and device giant could be on the line for billions.
A Los Angeles jury determined that J&J was negligent in its design of ASR, Bloomberg reports, but, in a coup for the company, declined to award additional punitive damages, which the plaintiff's attorney argued should have been around $179 million.
But J&J might not be so lucky next time. As the company knows from last year's fallout over Risperdal, punitive damages can have an exponential effect on jury awards, and J&J has already spent nearly $1 billion settling ASR suits since recalling the devices in 2010. Last fall, the company said it had increased its legal war chest by an undisclosed amount to prepare for an increase in filings.
J&J maintains that ASR was not defectively designed and that it followed the rules in obtaining FDA clearance before selling the device, claiming that the plaintiff's injuries were the result of unrelated health problems. The company plans to appeal the verdict and award, a spokeswoman told Bloomberg.
J&J is now fighting on two fronts, as the first lawsuits over the now-discontinued Gynecare Prolift come to trial. In the first verdict for the vaginal mesh implants, a New Jersey jury ordered the company to pay $11.2 million in total to a plaintiff who endured numerous repeat surgeries after her device failed. About 2,100 Prolift lawsuits remain to be adjudicated, and the final price tag in that litigation could well exceed $1 billion.