J&J Must Pay Millions Over Banker's Baby Powder Cancer Claim

(Bloomberg) -- Johnson & Johnson and a talc mining company must pay at least $37 million to an investment banker who blamed the companies’ products for causing him to develop a deadly cancer linked to asbestos.

Jurors in state court in New Brunswick, New Jersey concluded Thursday J&J and Imerys SA hid that their talc-based products, including J&J’s iconic baby powder, had been tainted by asbestos and helped cause Stephen Lanzo III’s disease. The jury will also weigh next week whether the companies’ mishandling of the talc warrants an award of punitive damages.

The verdict is the first time a jury has backed a consumer’s claims that the company’s baby powder causes mesothelioma, an often-fatal cancer linked to asbestos. About 6,600 women have sued the world’s largest health-care company blaming the powder for causing their ovarian cancers.

“While we are disappointed with this decision, the jury has further deliberations to conduct in this trial and we will reserve additional comment until the case is fully completed,” Carol Goodrich, a J&J spokeswoman, said in an email.

“Talc did not cause Mr. Lanzo’s cancer,’’ Gwen Myers, an Imerys spokeswoman, said in an email. “The evidence was clear that his asbestos exposure came from a different source such as the asbestos found in his childhood home or schools.’’ Imerys will appeal, she added.

Jury Award

Jurors in a court located less than a mile (1.6 kilometers) from J&J’s headquarters awarded Lanzo $30 million for his pain and suffering. The panel awarded Lanzo’s wife, Kendra, $7 million in damages as well. The seven-woman jury deliberated less than a day before holding the companies liable.

“J&J doesn’t want to lose any of these cases, but it really doesn’t want to lose in its home state,” Howard Erichson, a Fordham University law professor, said in an interview Thursday. “This will make New Jersey a more appealing forum for plaintiffs and will make mesothelioma patients take another look” at baby powder as the cause of their disease, Erichson added.

Under New Jersey law, jurors had to assess how much responsibility J&J and Imerys bore for Lanzo’s injuries. The panel found J&J liable for 70 percent of the damages and Imerys for 30 percent.

One verdict doesn’t indicate a trend or a crisis, but could be worrying for J&J, said David Logan, law professor at Roger Williams University in Bristol, Rhode Island. “This is going to take a toll on their reputation.’’ Asbestos, used as insulation in factories, shipyards and homes “was a really bad product and J&J shouldn’t have been within a thousand miles” of having it in its baby powder, he added.

J&J won the first case to go trial over mesothelioma claims tied to its baby powder when a California jury ruled in November that the product wasn’t responsible for causing a 61-year-old woman’s cancer. Colgate-Palmolive Co. agreed last year to settle a lawsuit claiming its talcum-powder products caused a Pennsylvania woman to develop mesothelioma.

During the more than two-month trial, Lanzo’s lawyers produced stacks of internal J&J and Imerys files that showed officials of both companies were worried that asbestos was tainting talc used in baby powder and other products as early as 1969.

A J&J research scientist noted in a 1969 confidential memo, introduced as evidence, that tests at that time found asbestos in talc used in the company’s baby powder. The scientist warned the health-care company should ready itself for litigation if the information became public.

Lanzo’s attorneys also accused Imerys officials of destroying talc samples that should have been turned over to the banker so they could be tested for asbestos. Lanzo argued the talc miner ditched potential evidence.

J&J’s and Imerys’s lawyers denied the company’s baby powder and former Shower-to-Shower product had ever contained asbestos. They argued that decades of testing found talc purchased from Imerys’s units was clear of the carcinogen. J&J sold Shower-to-Shower to Valeant Pharmaceuticals International Inc. in 2012.

The case is Lanzo v. Cyprus Amex Minerals Co., L00738516, Middlesex Superior Court (New Brunswick).

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