Johnson & Johnson baby powder/credit: MailHamdi/Shutterstock.com

After a New Jersey jury handed it a $750 million punitive damages verdict in a suit alleging its baby powder caused four people to develop mesothelioma, Johnson & Johnson is seeking a new trial or a reduced verdict.

Counsel for the plaintiffs in court papers filed Monday defended their questioning of company CEO Alex Gorsky, calling its questions about his rate of pay relevant to his credibility and potential bias. That comes after Johnson & Johnson's lawyers, in motions filed in February for a new trial on punitive damages, for judgment notwithstanding the verdict, and for remittitur, took issue with the plaintiffs' subpoena of Gorsky at trial. Jurors, Johnson & Johnson said, were exposed to inflammatory and inadmissible evidence, yielding an award that "breaches the outer limit of constitutional propriety."

Superior Court Judge Ana Viscomi, in Middlesex County, is weighing the motions by Johnson & Johnson and opposition papers from lawyers for the four plaintiffs in the case.

The punitive damages verdict was returned Feb. 6 after Gorsky was called to testify for the company at trial. Much of the company's motion for a new punitive damages trial deals with Gorsky's testimony and the questions asked of him by the plaintiffs' lawyers.

The $750 million punitive damages was reduced to $186.5 million by Viscomi under a state law limiting punitive damages to five times the compensatory award—in this case, $37 million, awarded in September 2019 after another trial.

In its motion for a new punitives trial, Johnson & Johnson argued that the trial judge should not have allowed the plaintiffs' lawyers to admit evidence concerning the timing of Gorsky's sale of stock in November 2018, just after a reporter from Reuters contacted the company about an upcoming article accusing it of suppressing information about asbestos contamination in talc. Johnson & Johnson claims in court papers that the stock sale is not relevant, and that questions during trial about Gorsky's compensation were improper and were raised by the plaintiffs to inflate the punitive damages award.

"Inviting the jury to think about the $30 million a year that J&J pays Mr. Gorski and his $300 million in stock options introduced an arbitrary factor in the jury's consideration and assessment of punitive damages," Johnson & Johnson said in its brief, submitted by John Garde of McCarter & English in Newark and Allison Brown of Skadden, Arps, Slate, Meagher & Flom in New York.

Counsel for the plaintiffs disputed that claim, arguing in court papers that Gorsky's rate of pay was relevant to his credibility and bias.

"Immediately before admitting that he made a profit of $22,000,000 on the day J&J received the journalist's email, Mr. Gorsky claimed to have never seen nor have been made aware of the email from Reuters. The fact that Mr. Gorsky, for the first time ever, sold stock on that exact day out of the thousands of days over which the options were vested, strains credulity and gives the jury additional information to judge his veracity," said the plaintiffs' brief, submitted by Leah Kagan and Christopher Panatier of Simon Greenstone Panatier in Dallas, Moshe Maimon of Levy Konigsberg in New York and Christopher Placitella of Cohen, Placitella & Roth in Red Bank.

Johnson & Johnson also claimed in its motion for a new trial that the consolidation of four plaintiffs for the punitive damages phase "sacrificed fairness for efficiency." The "capacity for confusion and unfair prejudice" was confirmed by the jury's irrational assignment of identical punitive damages awards to each of the four plaintiffs, after they were awarded widely varying compensatory awards, Johnson & Johnson said in court papers.

In the compensatory damages phase, jurors awarded $7.25 million to Douglas Barden, $9.45 million to David Etheridge, $14.7 million to D'Angella McNeill, and $5.9 million to William Ronning.

In addition, the jury's rendering of identical punitive awards after multiple weeks of trial was tantamount to "throwing up its hands in the face of a torrent of evidence," Johnson & Johnson said in court papers.

But the plaintiffs, for their part, argued in court papers that combining the four cases for a punitive damages trial was appropriate and that Johnson & Johnson was seeking to relitigate objections that were raised and addressed at trial. In addition, the plaintiffs argued that any potential prejudice from combining cases for a punitive damages phase was addressed through voir dire and jury instructions.

Johnson & Johnson also argued that the Food and Drug Administration's statements regarding talc should foreclose the award of punitive damages. The company said judgment notwithstanding the verdict should be entered because the FDA has expressed that it does not consider talc use dangerous, even if cosmetic talc contains a small amount of asbestos.

But the plaintiffs responded that a "phantom regulation" of talc by the FDA cannot be claimed as precluding punitive damages because Johnson & Johnson's baby powder is considered a cosmetic product and, as such, is not regulated by the FDA.