Johnson and Johnson 2013 Annual Report Download - page 65

subsidiaries believe they have substantial defenses, it is not feasible to predict the ultimate outcome of litigation. The
Company has established product liability accruals in compliance with ASC 450-20 based on currently available
information, which in some cases may be limited. Changes to the accruals may be required in the future as additional
information becomes available.
The most significant of these cases include LEVAQUIN®, the ASR™ XL Acetabular System and DePuy ASR™ Hip
Resurfacing System, the PINNACLE®Acetabular Cup System, RISPERDAL®, pelvic meshes, DURAGESIC®/fentanyl
patches and TOPAMAX®. As of December 29, 2013, in the U.S. there were approximately 1,165 plaintiffs with direct
claims in pending lawsuits regarding injuries allegedly due to LEVAQUIN®, 12,340 with respect to the ASR™ XL
Acetabular System and DePuy ASR™ Hip Resurfacing System, 5,560 with respect to the PINNACLE®Acetabular Cup
System, 500 with respect to RISPERDAL®, 28,810 with respect to pelvic meshes, 22 with respect to DURAGESIC®/
fentanyl patches and 140 with respect to TOPAMAX®.
In August 2010, DePuy Orthopaedics, Inc. (DePuy) announced a worldwide voluntary recall of its ASR™ XL Acetabular
System and DePuy ASR™ Hip Resurfacing System used in hip replacement surgery. Claims for personal injury have been
made against DePuy and Johnson & Johnson, and the number of pending lawsuits continues to increase. Cases filed in
Federal courts in the United States have been organized as a multi-district litigation in the United States District Court for
the Northern District of Ohio. Litigation has also been filed in countries outside of the United States, primarily in the United
Kingdom, Canada and Australia. In November 2013, DePuy reached an agreement with a Court-appointed committee of
lawyers representing ASR™ Hip System plaintiffs to establish a program to settle claims with eligible ASR patients in the
United States who had surgery to replace their ASR hip, known as revision surgery, as of August 31, 2013. The U.S.
settlement is valued at approximately $2.5 billion, based on an estimate of 8,000 patients participating in the program. This
settlement program is expected to bring to a close significant ASR litigation activity in the U.S. However, many lawsuits in
the U.S. will remain; and the settlement program does not address litigation outside of the U.S. The Company continues to
receive information with respect to potential costs associated with this recall on a worldwide basis. Updates to existing
accruals associated with the ASR may be required in the future as additional information becomes available.
Claims for personal injury have also been made against DePuy and Johnson & Johnson relating to DePuy’s PINNACLE®
Acetabular Cup System used in hip replacement surgery. The number of pending product liability lawsuits continues to
increase, and the Company continues to receive information with respect to potential costs and the anticipated number of
cases. Cases filed in Federal courts in the United States have been organized as a multi-district litigation in the United
States District Court for the Northern District of Texas. The Company has established a product liability accrual in
anticipation of product liability litigation associated with DePuy’s PINNACLE®Acetabular Cup System. Changes to this
accrual may be required in the future as additional information becomes available.
Claims for personal injury have been made against Ethicon, Inc. (Ethicon) and Johnson & Johnson arising out of Ethicon’s
pelvic mesh devices used to treat stress urinary incontinence and pelvic organ prolapse. The number of pending product
liability lawsuits continues to increase, and the Company continues to receive information with respect to potential costs
and the anticipated number of cases. Cases filed in Federal courts in the United States have been organized as a multi-
district litigation in the United States District Court for the Southern District of West Virginia. In addition, class actions and
individual personal injury cases or claims have been commenced in Australia, Belgium, Canada, England, Israel, Italy, the
Netherlands, Scotland and Venezuela, seeking damages for alleged injury resulting from Ethicon’s pelvic mesh devices.
The Company has established a product liability accrual in anticipation of product liability litigation associated with
Ethicon’s pelvic mesh products. Changes to this accrual may be required in the future as additional information becomes
available.
INTELLECTUAL PROPERTY
Certain subsidiaries of Johnson & Johnson are subject, from time to time, to legal proceedings and claims related to
patent, trademark and other intellectual property matters arising out of their business. The most significant of these matters
are described below.
PATENT INFRINGEMENT
Certain subsidiaries of Johnson & Johnson are involved in lawsuits challenging the coverage and/or validity of the patents
on their products. Although these subsidiaries believe that they have substantial defenses to these challenges with respect
to all material patents, there can be no assurance as to the outcome of these matters, and a loss in any of these cases
could potentially adversely affect the ability of these subsidiaries to sell their products, or require the payment of past
damages and future royalties.
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