Johnson and Johnson 2012 Annual Report Download - page 74

Marketing and Sales Practices Litigation, for pretrial proceedings in the United States District Court for the Eastern District
of Pennsylvania. In January 2011, the plaintiffs in all of the cases except the Harvey case filed a Consolidated Amended Civil
Consumer Class Action Complaint (CAC) naming additional parties and claims. In July 2011, the Court granted a motion by
Johnson & Johnson to dismiss the CAC without prejudice, but permitted the plaintiffs to file an amended complaint within
thirty days of the dismissal order. In August 2011, the plaintiffs filed a Second Amended Civil Consumer Class Action
Complaint (SAC). In July 2012, the Court granted Johnson & Johnson’s motion to dismiss the SAC with prejudice.
Separately, in September 2011, Johnson & Johnson, Johnson & Johnson Inc. and McNeil Consumer Healthcare Division of
Johnson & Johnson Inc. received a Notice of Civil Claim filed by Nick Field in the Supreme Court of British Columbia,
Canada (the BC Civil Claim). The BC Civil Claim is a putative class action brought on behalf of persons who reside in
British Columbia and who purchased during the period between September 20, 2001 and the present one or more
various McNeil infants’ or children’s over-the-counter medicines that were manufactured at the Fort Washington facility.
The BC Civil Claim alleges that the defendants violated the BC Business Practices and Consumer Protection Act, and
other Canadian statutes and common laws, by selling medicines that were allegedly not safe and/or effective or did not
comply with Canadian Good Manufacturing Practices. The BC plaintiff served their affidavits in support of class
certification in April 2012. The defendants responding affidavits were served in June 2012. The date for hearing of the
certification application has not yet been scheduled.
In September 2010, a shareholder, Ronald Monk, filed a lawsuit in the United States District Court for the District of New
Jersey seeking class certification and alleging that Johnson & Johnson and certain individuals, including executive officers
and employees of Johnson & Johnson, failed to disclose that a number of manufacturing facilities failed to maintain current
good manufacturing practices, and that as a result, the price of the Company’s stock declined significantly. Plaintiff seeks
to pursue remedies under the Securities Exchange Act of 1934 to recover his alleged economic losses. In December
2011, a motion by Johnson & Johnson to dismiss was granted in part and denied in part. Plaintiff moved the Court to
reconsider part of the December 2011 ruling. Defendants filed answers to the remaining claims of the Amended
Complaint in February 2012 and the case is proceeding to discovery. In May 2012, the Court denied Plaintiff’s motion for
reconsideration. In September 2012, Plaintiff filed a Second Amended Complaint and Johnson & Johnson has moved to
dismiss Plaintiff’s Second Amended Complaint in part.
In April 2011, OMJ Pharmaceuticals, Inc. (OMJ PR) filed a lawsuit against the United States in United States District Court
for the District of Puerto Rico alleging overpayment of federal income taxes for the tax years ended November 30, 1999
and November 30, 2000. OMJ PR alleges that the Internal Revenue Service erroneously calculated OMJ PR’s tax credits
under Section 936 of the Tax Code. OMJ PR filed a motion for summary judgment, and the United States filed a cross
motion for summary judgment. In October 2012, the Court granted the United States’ motion for summary judgment and
denied OMJ PR’s motion for summary judgment. OMJ PR appealed this decision. If OMJ PR loses this lawsuit, it may face
liability for subsequent tax years.
In August 2011, an arbitration panel ruled that Mitsubishi Tanabe Pharma Corporation (Tanabe), Janssen Biotech, Inc.‘s
(JBI’s) distributor of REMICADE®in Japan, could seek to modify the proportion of net sales revenue that Tanabe must
remit to JBI in exchange for distribution rights and commercial supply of REMICADE®(the Supply Price). Tanabe
commenced the arbitration against Centocor Ortho Biotech, Inc. (now JBI) in 2009 pursuant to the parties’ distribution
agreement, which grants Tanabe the right to distribute REMICADE®in Japan and certain other parts of Asia. JBI has
counterclaimed for an increase in the Supply Price. A hearing was held in November 2011 to determine the appropriate
split of revenue and the parties are awaiting a decision.
Johnson & Johnson or its subsidiaries are also parties to a number of proceedings brought under the Comprehensive
Environmental Response, Compensation, and Liability Act, commonly known as Superfund, and comparable state, local or
foreign laws in which the primary relief sought is the cost of past and/or future remediation.
SHAREHOLDER DERIVATIVE ACTIONS
Starting in April 2010, a number of shareholder derivative lawsuits were filed in the United States District Court for the
District of New Jersey against certain current and former directors and officers of Johnson & Johnson. Johnson & Johnson
is named as a nominal defendant. These actions were consolidated in August 2010 into one lawsuit: In re Johnson &
Johnson Derivative Litigation. Additionally, in September 2010, another shareholder derivative lawsuit was filed by Michael
Wolin in New Jersey Superior Court against certain current and former directors and officers of Johnson & Johnson.
Johnson & Johnson is named as a nominal defendant in this action as well. The parties to this action have stipulated that it
shall be stayed until the In re Johnson & Johnson Derivative Litigation is completely resolved.
66 •Johnson & Johnson 2012 Annual Report