Yesterday the New Jersey Appellate Division reversed and remanded for new trial a $117 million verdict ($37 million in compensatory damages and $80 million in punitive damages) against Johnson & Johnson (J&J) and Imerys. As a brief background, Plaintiffs alleged in theStephen Lanzo III and Kendra Lanzo v. Cyprus Amax Minerals Co.matter that Mr. Lanzo developed mesothelioma due to exposure to asbestos from use of J&J Baby Powder and Shower-to-Shower. On April 23, 2018, a final judgment was entered, reflecting the jury’s allocation of 70% in compensatory damages and $55 million in punitive damages to J&J, and the remaining 30% in compensatory damages and $25 million in punitive damages to Imerys.
On appeal, J&J and Imerys argued that the trial court erred by admitting testimony from Plaintiffs’ experts, specifically James Webber and Jacqueline Moline, that non-asbestiform minerals (cleavage fragments) can cause mesothelioma. The trial court denied J&J’s motions to bar this testimony without conducting a Rule 104 hearing, as is required by In Re Accutane. The Appellate Division found that the trial court’s failure to perform its gatekeeping function and conduct a Rule 104 hearing to assess the methodology, reasoning, or data used by Webber and Moline to form their opinion called for a reversal of the jury verdict. Additionally, the impact of Webber and Moline’s testimony potentially could have caused the jury to infer that the distinction between asbestiform and non-asbestiform was irrelevant.
Next, the Appellate Division reviewed the trial court’s adverse inference instruction against Imerys. The trial court granted Plaintiffs’ motion seeking an adverse inference instruction as a sanction for spoliation of evidence based on Plaintiffs’ argument that Imerys failed to produce historic talc samples and TEM grids, and failed to retain certain talc samples. This ruling allowed the jury to infer that talc supplied by Imerys was contaminated with asbestos. The Appellate Division concluded that Imerys had a duty to preserve the talc samples and TEM grids, and that the trial court did not err in giving the jury an adverse inference instruction. However, the Appellate Division agreed with J&J that the adverse inference against Imerys was unduly prejudicial to J&J, and that the trial court should have severed the claims against J&J and Imerys.