$3 Billion ASR Hip Settlement Rumored

Johnson & Johnson (J&J) is rumored to be considering a $3 billion settlement over the 11, 000 or so DePuy ASR hip implant lawsuits.

In January, Bloomberg reported that five people familiar with the talks had said J&J officials were willing to pay about $2 billion to resolve the cases. Lawyers for plaintiffs rejected that amount as too little, the people said.

Two state court juries have returned verdicts. One $8.3 million verdict in favor of a patient and one in favor of the company.

$1 Billion and Counting

Company spokesperson Lorie Gawreluk told Bloomberg in an email that the company has already spent almost $1 billion on medical costs and informing patients and surgeons about the ASR recall. The company has set aside an undisclosed amount for litigation, which it increased before June 30, she said.

“The company also continues to support ASR patients with a reimbursement program to address recall-related testing and treatment costs, ” she said. “Reports about a possible resolution of the litigation are premature and speculative, including any estimates of resolution amounts.”

Bloomberg reported on August 20, 2013, that lawyers for the company have discussed paying the $3 billion to settle the lawsuits and agreed to a roughly outlined “global settlement” with lawyers for the claimants. The math says that comes to roughly $300, 000 per case.

$3 Billion Dwarfs Sulzer’s $1 Billion

A $3 billion settlement would dwarf a 2001 accord Sulzer AG reached with patients who claimed that company’s hip and knee implants were defective. Sulzer agreed to pay $1 billion to resolve those suits, then the largest settlement involving hip implants.

The rumored settlement amount, according to anonymous Bloomberg sources, is far from finalized, and any agreement will be affected by the seven product liability cases currently on J&J’s legal docket. The cases are scheduled to go to trial between September and January.

Steven Skikos, a plaintiffs’ lawyer in the lawsuits, told Bloomberg his group is preparing for jury trials, which include the first case in federal court.

“With the trials rapidly approaching, and our continuing efforts to obtain more information and data about the patients, it’s easy to speculate about settlement, ” Skikos said in an e-mail. “However, any comment relating to settlement that does not come from the plaintiff’s leadership, the court, or from the company itself remains premature, uninformed and a dangerous guess.”

Bloomberg’s people say several obstacles to a final settlement still must be overcome. One includes the number of years that J&J may potentially have to pay future claims. Another is whether the settlement would include reimbursing Medicare for claims paid. A third is the amount of compensation for extreme medical cases, which include dual hip surgeries or cases where infection prompted long hospital stays.

Seven Trials Scheduled

Seven other trials have been scheduled and will help lawyers for both sides frame questions over liability and damages. The first is scheduled to begin September 9 in federal court in Cleveland. U.S. District Judge David Katz is overseeing that lawsuit by Ann McCracken, a resident of Rochester, New York.

Judge Katz is overseeing about 8, 000 federal cases consolidated before him for the pre-trial collection of evidence. About 2, 000 cases are pending in the California Judicial Council Coordinated Proceeding before Judge Richard Kramer in San Francisco.

Trials also are scheduled in state courts in San Francisco in October; in Hackensack, New Jersey, in October and January; in West Palm Beach, Florida, in November; in Chicago in December; and in Los Angeles in January.

The McCracken DePuy case is McCracken v. DePuy, 11-dp-20485, U.S. District Court, Northern District of Ohio (Toledo). The consolidated federal case is In re DePuy Orthopedics Inc., ASR Hip Implant Products Liability Litigation, 10-MD-2197, U.S. District Court, Northern District of Ohio (Toledo).