Johnson & Johnson Class Action Lawsuit Filed Over Recalls

An investor class action lawsuit has been filed against Johnson & Johnson, alleging that the company tried to hide a Motrin recall by having consultants repurchase it off store shelves and made misleading statements before recalling more than 40 children medications earlier this year.. 

The Johnson & Johnson class action lawsuit was filed by investor Ronald Monk on September 21 in U.S. District Court in Newark, New Jersey. The complaint comes as the drug maker is under criminal investigation surrounding the “phantom” recall of Motrin, which some say appears to have been an illegal attempt by the company to avoid an official recall notice.

The lawsuit also accuses the company of making misleading statements before revealing that there were contamination problems at its plants in Pennsylvania and Puerto Rico, and points to the massive children’s medicine recall issued by McNeil Consumer Healthcare earlier this year. The complaint seeks class action status for all investors who purchased Johnson & Johnson shares between October 2008 and July 2010.

On April 30, a recall was announced for nearly 40 liquid children’s medications by Johnson & Johnson subsidiary, McNeil Consumer Healthcare, including infant Tylenol, Benadryl, and Motrin. The products were recalled due to particulate contamination and irregularities in potency and resulted in a warning letter from FDA regarding quality control issues at a Johnson & Johnson manufacturing plant in Ft. Washington, Pennsylvania.

The recall affected 136 million bottles of children’s medications, and resulted in the shutdown of the company’s Ft. Washington, Pennsylvania, plant, and the suspension of the production of all of McNeil’s children medications.

Congressional inquiries into the recall discovered documents that suggested that the company had tried to hide an earlier Motrin recall by sending consultants to stores to buy the product off shelves instead of having it pulled. Johnson & Johnson officials deny the allegations and say that the FDA was fully aware of the Motrin recall.