June 24, 2017

Goldman Named in Suit Over Aluminum Supply

Goldman on Wednesday tried to defuse complaints about waiting times and high prices at its metals warehouses across the world by offering immediate access to aluminum for end users holding metal at its Metro International Trade Services unit.

Banks that own commodity assets and trade raw materials have drawn increasing criticism in recent weeks, with federal regulators in the United States taking a look at the metals warehousing industry. Britain’s financial watchdog is also investigating the London Metal Exchange’s warehousing system.

The lawsuit outlines “anticompetitive and monopolistic behavior in the warehousing market in connection with aluminum prices,” Hong Kong Exchanges said in a statement on Sunday.

The lead plaintiff in the lawsuit, filed on Thursday in Federal District Court in Michigan, is Superior Extrusion, an end user of aluminum.

“L.M.E. management’s initial assessment is that the suit is without merit and L.M.E. will contest it vigorously,” Hong Kong Exchanges said in a statement.

Customers and American lawmakers have accused Goldman and other warehouse owners of artificially inflating waiting times to increase rents for warehouse owners and lift metal prices.

“We believe this suit is without merit and we intend to vigorously contest it,” a Goldman Sachs spokesman said. “I would also note that aluminum prices are down 40 percent from their peak in 2006,” he said.

London Metal Exchange aluminum for three-month delivery settled on Friday at $1,809 a ton.

Warehouse owners and the departing chief executive of the London market, Martin Abbott, have contended that complaints over long lines are unjustified, arguing there is no shortage of metal.

Article source: http://www.nytimes.com/2013/08/05/business/global/goldman-named-in-suit-over-aluminum-supply.html?partner=rss&emc=rss

Johnson & Johnson Ordered to Pay $8.3 Million in Hip Implant Case

The 12-member panel, however, declined to issue punitive damages, saying the company’s DePuy orthopedics unit, which made and marketed the all-metal device, did not act with fraud or malice. The implant, known as the Articular Surface Replacement, or A.S.R., was recalled in mid-2010.

In a statement, the company described the verdict as “mixed” and said that it planned to appeal the damage award. It disputed the finding by the jury that the A.S.R. was defectively designed.

It was impossible to say what the verdict, which came in a Los Angeles state court, would mean for other A.S.R.-related cases. A trial on a second lawsuit is scheduled to begin Monday in Chicago, with other cases expected to proceed later this year.

In its decision, the panel ordered Johnson Johnson to pay the case’s plaintiff, a retired Montana prison guard, Loren Kransky, $338,000 to cover his medical expenses. It also ordered him to be paid $8 million to cover his pain and emotional suffering.

Some lawyers and industry analysts have estimated that the suits ultimately would cost Johnson Johnson billions of dollars to resolve.

Thousands of the individual cases have been consolidated into a large proceeding in a Federal District Court in Ohio and a resolution of that action could provide a framework for settling the bulk of the cases and determining awards to patients.

The A.S.R. belonged to a class of once widely used hip replacements whose cup and ball components were both made of metal.

It was first sold by DePuy in 2003 outside the United States for use in an alternative hip replacement procedure called resurfacing. Two years later, DePuy started selling another version of the A.S.R. for use in the United States in standard hip replacements that used the same cup component as the resurfacing device.

However, the A.S.R.’s design caused the cup and ball to strike against each other as a patient moved, resulting in the shedding of metallic debris. That debris inflamed and damaged tissue and bone, causing pain and, in some cases, permanent injuries to patients.

Today, all-metal hips like the A.S.R. are rarely used by surgeons because most models suffered from similar problems. But data from orthopedic registries suggests that the A.S.R. was far worse than many competing products.

An internal Johnson Johnson document introduced at the Los Angeles trial estimated that close to 40 percent of patients who received an A.S.R. will need to undergo a second operation within five years of the first to have the implant removed and replaced. In a recent filing with the Securities and Exchange Commission, Johnson Johnson said that there are 10,750 A.S.R. lawsuits.

Traditional artificial hips, which are made of metal and plastic, are expected to last 15 years or more before needing to be replaced, and the normal replacement rate for early unexpected failures is about 5 percent after five years.

The lawsuit heard in Los Angeles was not originally scheduled to be the first over the A.S.R. but it was moved up because Mr. Kransky was found to have terminal cancer. Before the start of the Los Angeles trial, which began in late January, Mr. Kransky’s lawyers had not expected him to live through it.

Internal Johnson Johnson documents that became public during the trial indicated that company executives were told by surgeons, who were also paid consultants to the device maker, that the design of A.S.R. was flawed. In addition, some surgeons also urged the device maker to slow sales of the implant or stop them completely, records show.

In the case, evidence was also presented that showed that Johnson Johnson considered redesigning the A.S.R. to reduce its problems, but then abandoned the project because the implant’s sales did not justify the costs of the redesign. One of the DePuy executives involved in that decision was Andrew Ekdahl, who now heads Johnson Johnson’s orthopedics division.

Johnson Johnson executives like Mr. Ekdahl have said throughout the A.S.R. episode that they acted responsibly and moved to recall the device in 2010 when data from an orthopedic registry in Britain showed that its failure rate was higher than normal.

Before reaching its verdict Friday, the jury that heard Mr. Kransky’s case deliberated for more than five days. Mr. Kransky’s lawyers, citing what they described as the unethical behavior of DePuy executives in failing to warn doctors and patients of the device’s defects, asked jurors to punish Johnson Johnson by awarding their client $36 million to $144 million. Jurors declined to do so.

Nonetheless, lawyers representing Mr. Kransky hailed the verdict.

“This is a victory for Mr. Kransky and thousands of other badly damaged A.S.R. patients who have yet to get their day in court,” Brian Panish, one of Mr. Kransky’s lawyers, said in a statement. “Jurors across the country will return similar verdicts until J.J. takes full responsibility.”

A DePuy spokeswoman, Lorie Gawreluk, said in the company’s statement that it planned to appeal Friday’s verdict, contending that the A.S.R.’s design was not defective.

Article source: http://www.nytimes.com/2013/03/09/business/johnson-johnson-must-pay-in-first-hip-implant-case.html?partner=rss&emc=rss

DePuy Hid Data About Failed Hip Implant, Documents Show

The company had received complaints from doctors about the device, the Articular Surface Replacement, or A.S.R., even as it started marketing a version of it in the United States in 2005. The A.S.R.’s flaw caused it to shed large quantities of metallic debris after implantation, and the model failed an internal test in 2007 in which engineers compared its performance to that of another of the company’s hip implants, the documents show.

Still, executives in Johnson Johnson’s DePuy Orthopaedics unit kept selling the A.S.R. even as it was being abandoned by surgeons who worked as consultants to the company. DePuy executives discussed ways of fixing the defect, the records suggest, but they apparently never did so.

Plaintiffs’ lawyers introduced the documents on Friday in Los Angeles Superior Court during opening arguments in the first A.S.R.-related lawsuit to go to trial. The company faces more than 10,000 lawsuits in the United States in connection with the device. An estimated 93,000 patients worldwide received an A.S.R., about one-third of them in the United States.

DePuy executives insisted before the A.S.R.’s recall in mid-2010 that the implant was working well, despite years of complaints from doctors that it was failing early. In late 2009, the company announced plans to phase out the model but said it was doing so because of slowing sales, not safety concerns.

In opening arguments — followed remotely over the Courtroom View Network — a lawyer for DePuy, Alexander G. Calfo, reiterated those positions, telling jurors that DePuy had behaved ethically throughout the A.S.R. episode.

“The evidence will show that DePuy acted as an extremely responsible manufacturer,” Mr. Calfo said.

But a lawyer for Loren Kransky, the plaintiff in the case, painted a far different picture of DePuy’s behavior for jurors in his opening arguments.

The lawyer, Michael A. Kelly, also introduced a number of internal records that suggested that company executives’ concern for profits might have exceeded their worries about patients. For example, Mr. Kelly said, DePuy officials never told doctors that the A.S.R. had failed an internal performance test against another company hip.

“They did not report the data to American doctors,” Mr. Kelly said. “They changed the test and tested it against other things until they found one it could beat.”

The A.S.R. represents one of the biggest medical device failures in recent decades. According to DePuy’s internal estimates, it is projected to fail within five years in about 40 percent of patients who received one. That is eight times the failure rate of most orthopedic implants.

The A.S.R. belonged to a once-popular class of hip implants introduced about a decade ago in an attempt to address problems associated with hips made from traditional materials like metal and plastic. But surgeons have largely abandoned devices in that class because their components can grind together, releasing metallic debris that damages a patient’s tissue and bone.

DePuy sold two versions of the A.S.R., one used in an alternative hip replacement called resurfacing and one used in standard hip replacement. Only the version used in standard replacements was sold in the United States.

In 2003, DePuy began selling the resurfacing version of the A.S.R. outside the United States in an effort to catch up with a competing device known as the Birmingham hip. But by 2005, some doctors had begun telling DePuy that the A.S.R. was failing quickly after implantation, and company consultants soon stopped using it, records show.

Article source: http://www.nytimes.com/2013/01/26/business/johnson-johnson-hid-flaw-in-artificial-hip-documents-show.html?partner=rss&emc=rss

Judge Clears United Airlines in a 9/11 Collapse

A federal judge in Manhattan ruled Wednesday that United Airlines was not responsible for the collapse of a third World Trade Center building on Sept. 11, 2001.

The plaintiff in the case, Larry Silverstein, the leaseholder of the World Trade Center property, claimed that the collapse of 7 World Trade Center stemmed from airport security lapses that allowed hijackers to crash an American Airlines plane into the complex.

Judge Alvin K. Hellerstein granted a request by United and its parent, United Continental Holdings, to dismiss Mr. Silverstein’s claims. Tower 7 collapsed several hours after being pierced by debris from the crash of American Airlines Flight 11 into the nearby 1 World Trade Center. Two of the Flight 11 hijackers, Mohammed Atta and Abdulaziz Alomari, began their trip to New York at the Portland International Jetport, in Maine. They boarded a flight to Logan International Airport in Boston, from which they connected to the American Airlines plane.

Mr. Silverstein’s lawyers argued that because United was among the airlines that ran Portland’s only security checkpoint, it was legally responsible for the screening of all passengers and had missed a “clear chance” to prevent the hijacking.

But Judge Hellerstein of Federal District Court in Manhattan concluded that United could not have foreseen the events that led to the destruction of Tower 7.

“It was not within United’s range of apprehension that terrorists would slip through the security screening checkpoint, fly to Logan, proceed through another air carrier’s security screening and board that air carrier’s flight, hijack the flight and crash it into 1 World Trade Center, let alone that 1 World Trade Center would therefore collapse and cause Tower 7 to collapse,” Judge Hellerstein wrote.

In 2009, he dismissed claims against other airlines for damages caused by United Flight 175, which also hit the Twin Towers.

Bud Perrone, a spokesman for Silverstein Properties, said it was disappointed in Wednesday’s ruling, but would continue to pursue a negligence case over Flight 175.

Article source: http://www.nytimes.com/2012/11/22/business/judge-clears-united-airlines-in-a-9-11-collapse.html?partner=rss&emc=rss

Johnson & Johnson Settles Risperdal Claim in Texas

The lawsuit accuses the company of pushing Risperdal as “appropriate and safe to treat a broad range of symptoms in populations and disease states for which it had no F.D.A.-approved indication, including in the child and adolescent population.”

The settlement fully resolves all Risperdal-related claims in Texas, the company said. The agreement applies only to the state of Texas and does not involve other state or federal Risperdal litigation.

The deal settles claims brought by Texas in 2004 and involves allegations of Medicaid overpayments from 1994 to 2008, according to a statement from the company’s Janssen Pharmaceuticals unit.

“Johnson Johnson’s scheme to profit from the Medicaid program by overstating the safety and effectiveness of an expensive drug and improperly influencing officials ended up costing taxpayers millions of dollars,” Texas’s attorney general, Greg Abbott, said in a statement.

The settlement will be paid to the original plaintiff, his lawyers, the State of Texas and the federal government, which provides Medicaid reimbursements, the company said.

The complaint against Johnson Johnson and several of its units filed in federal court in Texas accused company representatives of targeting “every level of the Texas Medicaid Program with misrepresentations about the safety, superiority, efficacy, appropriate uses and cost effectiveness of Risperdal.”

Johnson Johnson had previously said it was in discussions with the federal government over its Risperdal inquiries. The company is in various stages of litigation with several other states.

Article source: http://feeds.nytimes.com/click.phdo?i=9c515277197791e6a8b3705e3c12209d

National Briefing | South: Louisiana: Payments for Gulf Spill Resume

Kenneth R. Feinberg, administrator of the $20 billion fund created to pay damages from the 2010 Gulf of Mexico oil spill, has reopened the cash window. Mr. Feinberg halted payments on Tuesday while seeking clarification from the federal judge overseeing litigation related to the disaster. Judge Carl J. Barbier recently ruled that 6 percent of settlements after Nov. 7 be put in escrow for certain plaintiff litigation expenses. On Wednesday, he issued a ruling stating that the payment only applies to new settlements, and that the 6 percent will be calculated from the net amount of the settlement after withholding for liens and other obligations, not from the gross amount.

Article source: http://feeds.nytimes.com/click.phdo?i=84f62de17d38a34b97a648c13d7ae308

Truck Dealers Win $2 Billion in Ford Suit

Ford said it would appeal the decision that it had violated agreements with about 3,100 dealerships from 1987 to 1998. The judge said Ford used “hidden discounts” and unpublished prices to increase its profits at the dealerships’ expense.

The ruling, by Judge Peter J. Corrigan, of the Cuyahoga County Common Pleas Court in Cleveland, said that Ford made the dealers pay a total of $800 million more than they should have for nearly 475,000 medium- and heavy-duty trucks, including tractor-trailers and bulldozers.

The damages include $1.2 billion in interest and were calculated based on the formula that was used by a jury in February to award $4.5 million to the lead plaintiff in the lawsuit, Westgate Ford in Youngstown, Ohio.

Judge Corrigan upheld the February ruling and added $6.7 million in interest to the jury’s award. “Ford’s breach of its obligation to sell Westgate trucks only at prices published to any dealer,” Judge Corrigan wrote in his ruling, shifted “any surplus in profit from Westgate to Ford.”

Ford, in a statement, said it was confident that the decision would be reversed on appeal and that the judge “committed significant legal errors.”

The company argued that the pricing program at issue in the lawsuit “caused no harm to our dealers. Rather, it brought significant benefit to the dealers.”

But experts hired by the plaintiffs to examine each transaction calculated that dealers paid an average of $1,650 more than the price that Ford should have charged them. In some cases, the dealers were overcharged by up to $15,000, while in others they paid less than the experts said they should have, said James A. Lowe, the plaintiffs’ lawyer.

The lawsuit, filed in 2002, said Ford set wholesale prices on the trucks that were higher than the prices buyers were willing to pay for them. Through a program known as Competitive Price Assistance, the dealers could request discounts from Ford so that they would be able to earn a profit, but each dealer was unaware of how much Ford was discounting the trucks to other dealers. As a result, the prices that dealers paid for identical trucks varied widely.

“The dealers who called to get these special discounts thought they were getting a deal, but they weren’t,” Mr. Lowe said. “No dealer knew what any other dealer was paying.”

Mr. Lowe said Ford’s dealer agreements required it to charge uniform wholesale prices and that the discretionary discounts prevented dealers from knowing what the actual prices were.

“It’s a very straightforward, simple case,” Mr. Lowe said. “Ford had written agreements to sell the trucks at certain prices. It clearly violated that promise.”

Ford sold its medium- and heavy-truck business in 1998.

According to the Web site of his firm, Mr. Lowe and two other lawyers previously won a $10.4 million verdict against Ford on behalf of a woman who became a quadriplegic after her Ford Explorer was struck from behind.

Ford, which earned a $6.6 billion profit in 2010, warned investors in its annual report earlier this year that it could face “substantial” damages if it lost the lawsuit and if the judge applied the formula from the February ruling.

Article source: http://feeds.nytimes.com/click.phdo?i=b316022028420039ab8fa1868a1ee441