If you’ve been watching our videos, you know that the $500 million verdict was made up of two elements. The first: $140 million are compensatory damages (damages that are designed to compensate the individual plaintiffs for their injuries). This includes pain and suffering, economic losses, medical bills, etc. The second: $360 million in punitive damages (damages designed to punish the defendants for intentional conduct. In this case, the jury found that what DePuy and Johnson & Johnson did with these hips was intentional or reckless, and that is why they awarded punitive damages. It is to try and deter these companies from engaging in similar conduct in the future.
Unfortunately, the judgments today reflected the fact that under Texas law punitive damages are capped. There is a complicated formula that caps them. But at the end of the day, the total punitive damage award was reduced from $360 million to only $10 million. In the context of a company like Johnson & Johnson and DePuy, a $10 million punitive damage award is not much.
Johnson & Johnson and DePuy have $68 billion in assets. This is testimony that came out during trial. If you think about how much money you need to award a plaintiff to punish someone who has $68 billion that is difficult to assess. However, if you think about it in the sense for someone who is walking around on the street that has $68,000 in the bank, how much money do you think it would take to punish that person to get them to realize they had done something wrong and alter their behavior? If you think about somebody with $68,000, the punitive damage would be just $100. This is the equivalent of a $10 million punitive damage verdict against Johnson & Johnson.
This case illustrates how caps on any type of damages, and especially punitive damages, really can result in an injustice and allow corporations and large businesses to get away with conduct that normal people would never get away with. This situation is a good example of when those laws go wrong. The upcoming case is in September with seven individual plaintiffs. All these plaintiffs reside in California. Therefore, California law will apply and there will be no caps on punitive damages.
Stay tuned. When this trial starts, we will provide current updates. We will also be providing updates on the appeal of the current judgments that came out today. DePuy has appealed these judgments.