$1.2 Billion Risperdal Lawsuit Verdict Reversed by Supreme Court

The Arkansas Supreme Court ruled in favor of drug maker Johnson & Johnson (J&J) regarding a $1.2 billion dollar Risperdal verdict stemming from lawsuits over the company’s marketing of the antipsychotic medication. Arkansas’s attorney general alleged J&J used deceptive marketing that made inflated claims of the drug’s effectiveness and minimized the diabetes risks associated with using the antipsychotic. The lower court agreed with the Attorney General and levied fines totaling $1.2 billion against J&J, which appealed the ruling.

Risperdal lawsuit verdict reversed

Bloomberg News now reports, “Arkansas’s highest court concluded today that state officials relied on the wrong law to challenge the Risperdal marketing campaign and that a judge erred in setting the $1.2 billion in fines for violations of the state’s Medicaid fraud statute.”

The state used a law governing healthcare facilities – the state’s Medicaid fraud statute – to convince the lower court judge of J&J’s Janssen division’s deceptive practices. However, the high court ruling stated, “Janssen is indisputably not a health-care facility applying for certification or recertification as described in the statute.”

Arkansas Attorney General Dustin McDaniel stated in an email, “We pursued this case based on the belief that the General Assembly intended to give the Attorney General’s Office the authority to pursue penalties against those that would enter our state and blatantly deceive the public. I am disappointed that the court viewed the law differently.”

In a separate ruling, the high court also threw out $181 million in attorney’s fees levied against J&J. Although the ruling had little to do with whether or not it engaged in deceptive marketing, Johnson & Johnson took the opportunity to claim “Janssen remains strongly committed to ethical business practices.”

Deceptive marketing of Risperdal

Since 2010, J&J has drawn much attention regarding its marketing practices. The United States Justice Department and 45 state attorneys general believe the pharmaceutical company advertised Risperdal as a treatment for elderly patients with dementia, which is the basis of many Risperdal lawsuits.

Although J&J claims it “remains strongly committed to ethical business practices,” previously the company agreed to settle criminal and civil inquiries concerning the sale of Risperdal and other medications by paying over $2.2 billion.

According to Bloomberg News, Johnson & Johnson “also agreed to have its Janssen unit plead guilty to misbranding Risperdal for uses that weren’t approved by federal regulators.”

In 2010, the Louisiana Supreme Court threw out a $258 million jury verdict against Johnson & Johnson for misleading the public about the safety of the drug.

In 2011, another verdict was handed down to J&J for deceptive marketing of Risperdal to doctors in the amount of $327 million. Johnson & Johnson appealed the ruling, which is still being considered by the South Carolina Supreme Court.

In 2012 during a Texas trial, J&J was hit with a $158 million Risperdal settlement over claims that Janssen used fraudulent marketing practices for Risperdal.

Most of the Risperdal lawsuits allege deceptive and/or fraudulent marketing practices. J&J has settled for billions of dollars regarding these allegations with various courts. Seemingly, there is not a disagreement among the plaintiffs or the defendants regarding the alleged marketing tactics. What remains to be seen is whether or not attorneys seeking to hold J&J accountable for their advertising techniques can find a legal theory that will hold up in the appellate courts.

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