This week's $417 million verdict against Johnson & Johnson—over claims its baby powder containing talc caused ovarian cancer—was surely a bitter pill for general counsel Michael Ullmann and his legal department to swallow.
Ullmann, a J&J in-house counsel since 1989, will now have to help his company fend off 4,800 similar suits from emboldened plaintiffs across the country, according to litigation notes in J&J's latest financial filing with the U.S. Securities and Exchange Commission. And the number is likely to continue rising at a rapid clip following this massive verdict in the Los Angeles Superior Court.
New Brunswick, New Jersey-based Johnson & Johnson lost three baby powder cases in a row in Missouri before changing outside legal teams. It then won its fourth case on March 3 with a new defense team of Bart Williams and Manuel Cachan of the Los Angeles office of Proskauer Rose.
But the new team couldn't save Ullmann and J&J in the California case. So what does a general counsel do now?
Brackett Denniston III, the former general counsel at General Electric Co. until 2015 and now a senior counsel at Goodwin Procter in Boston, spoke in general about what a GC on the losing end of a big verdict could do.
"I sure had a few [losses]," Denniston acknowledged, adding that it's "the nature of what general counsel do" when they tackle risk.
First, he said, he would do a post-mortem to understand what went wrong in the case and how to reverse it. "Of the losing verdicts I had, and I had some beauts, only one survived an appeal. So appeals usually right the wrongs," he said.
At the same time, Denniston said, the GC has to think about internal and external communications. "Right away you've got to explain it to the CEO and to the board. And you've got to be an adult about it, be candid."
"Most boards and CEOs understand that in the world of litigation today, and investigations today, you are living in a perilous climate," the former GE general counsel continued. "So you can wake up one day like J&J did with a nearly $500 million verdict."
He added that a company also needs to address the public and the press in a thoughtful way. "Your point should not just be that we'll appeal, but also why you think it [the verdict] was wrong," he said.
It sounds like that is exactly what J&J is doing. Carol Goodrich, a J&J spokeswoman, declined a request for an interview with Ullmann, but said the company would appeal the verdict "because we are guided by the science, which supports the safety of Johnson's baby powder."
Goodrich noted that in April, the National Cancer Institute's Physician Data Query Editorial Board wrote, "The weight of evidence does not support an association between perineal talc exposure and an increased risk of ovarian cancer."
"Ovarian cancer is a devastating diagnosis and we deeply sympathize with the women and families impacted by this disease," Goodrich said. But based on the science, she added, "We will continue to defend the safety of Johnson's baby powder." The next trial is scheduled for Oct. 16 back in Missouri.
Litigation was not Ullmann's early field of expertise. He joined J&J 28 years ago as a mergers and acquisitions attorney, according to his company bio. He worked his way up to general counsel of the worldwide medical devices division at the company before being named J&J's corporate general counsel in 2012.
In March 2016, Ullmann spoke about an early talc case loss as part of a panel discussing "Global Concerns of a General Counsel" at Columbia Law School. His remarks were carried on the law school's website.
News of the $72 million verdict spread quickly through social media, Ullmann said in the article, so the company had to respond in "the court of public opinion" while waiting for an appeal.
Ullmann described how J&J cited studies showing no causal link between baby powder and cancer, and dispatched medial experts to validate its position in the media.
But even in such dark days of litigation losses, Ullmann found a silver lining. The business itself can have rewards, he said.
"I love knowing that everything I do is related to human health care," he added, advising students to "like what you do."