Supreme Court Upholds California’s $302M Penalty Against J&J

The Supreme Court denied Johnson & Johnson's appeal of a ruling requiring the company to pay California $302 million in penalties for deceptive marketing of pelvic mesh implants, which can cause serious vaginal pain and physical damage.

Source: San Francisco Chronicle | Published on February 24, 2023

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The Supreme Court denied Johnson & Johnson’s appeal of a ruling requiring the company to pay California $302 million in penalties for deceptive marketing of pelvic mesh implants, which can cause serious vaginal pain and physical damage.

Pelvic mesh is surgically implanted in women to treat two conditions. The first is stress urinary incontinence, or bladder leakage while coughing, sneezing, or exercising. The other is organ prolapse, which occurs when pelvic organs collapse into the vagina, causing pain and pressure during urinary and bowel movements as well as sexual intercourse.

In the late 1990s, Johnson & Johnson’s Ethicon subsidiary began selling pelvic mesh. According to the state’s lawsuit, the company rejected recommendations from its own doctors in 2005 to warn consumers that the devices could cause vaginal harm when used to treat organ prolapse.

Ethicon later added language to its advertising and doctor and patient advisories stating that the mesh could cause “transitory” damage. According to a state appeals court, the company refused to change that language after the US Food and Drug Administration expanded previous warnings in 2011 to say that complications in treating organ prolapse were not uncommon and were cause for “grave concern.”

According to the court, the Johnson & Johnson subsidiary instead paid consultants to write a public rebuttal to the FDA’s warning. After receiving an additional FDA warning in 2012, Ethicon halted the majority of its sales of organ prolapse mesh. In 2019, the FDA prohibited all sales for organ prolapse, but the product can still be used for stress urinary incontinence.

Johnson & Johnson previously paid $117 million to settle pelvic mesh lawsuits filed by 41 other states and the District of Columbia, and other manufacturers have also paid significant sums. The Fourth District Court of Appeal in San Diego upheld the $302 million penalty in April, saying there was ample evidence that Ethicon had knowingly deceived doctors and patients.

The instructions in each package “falsified or omitted the full range, severity, duration, and cause of complications associated with Ethicon’s pelvic mesh products, as well as the potential irreversibility and catastrophic consequences,” according to Presiding Justice Judith McConnell in the 3-0 ruling.

McConnell rejected the company’s claim that the fine was excessive, claiming that it amounted to less than 1% of Johnson & Johnson’s $70.4 billion net worth. The ruling upheld the majority of the penalties imposed by a San Diego County judge following a non-jury trial.

After the state Supreme Court denied review of the case, the company filed an appeal with the United States Supreme Court, claiming that California was misusing a broad consumer law to penalize the company for every communication it sent to the state, the vast majority of which never reached consumers.

“Left unchecked, the possibility of enormous civil penalties can reduce venture financing and capital investment, particularly in the life sciences sector, stifling the development of new medical technologies,” attorney Joshua Rosenkranz wrote in a November filing requesting the court to review and overturn the state ruling.

However, the justices denied review without comment on Tuesday.

“For years, Johnson & Johnson has refused to accept responsibility for misinforming patients and doctors about the risks of a permanent and irreversible implant,” state Attorney General Rob Bonta said. “Those victims can rest easier today, knowing that the $302 million judgment we obtained against the company is final.”