Santa Barbara, Calif.–After an eight-week trial and less than four hours of deliberation, a Santa Barbara Superior Court jury on August 30 rejected a $27 million lawsuit filed by Johnson & Johnson (NYSE: JNJ) against Santa Barbara-based Sientra, Inc. Sientra recently entered the breast implant business as a competitor of Johnson & Johnson’s Mentor Worldwide LLC, which sells breast implants under the Memory Gel® /Memory Shape® brand. Johnson & Johnson/Mentor had sued Sientra and its Executive Director of Sales Jeffrey Lewis for interference with prospective economic advantage, contract interference, breach of fiduciary duty and misappropriation of trade secrets. (Mentor Worldwide LLC v. Sientra, Inc., and Jeffrey Lewis, Santa Barbara Superior Court, Case No. 1402207.)
On March 9, 2012, Sientra received FDA approval to market and sell its portfolio of breast implants including the first anatomically shaped breast implant in the United States. Prior to Sientra’s FDA approval, only round implants were available, and only two companies were permitted to sell them in the United States: Mentor and Allergan, Inc. Sientra’s FDA approval broke this duopoly by introducing a third competitor.
Fifteen Mentor sales representatives chose to leave the company to join Sientra. Johnson & Johnson/Mentor immediately sued each of its former employees in 13 jurisdictions across the United States claiming the former employees did not have the right to enforce their “at-will” employment agreements and seek employment elsewhere. Johnson & Johnson/Mentor also accused the employees of taking proprietary customer lists and pricing information. All 15 cases either were dismissed or came out in favor of the former employees. Johnson & Johnson/Mentor then turned its sights on Sientra and filed a lawsuit against the company and Lewis.
“These baseless lawsuits against former employees and Sientra were nothing more than intimidation tactics to keep a competitor from bringing a superior product to market,” says A. Barry Cappello, managing partner of Cappello & Noël, LLP one of the two law firms representing Sientra at the Santa Barbara trial. “It saw Sientra as a clear threat to its dominance in a $500 million a year industry.” Proskauer Rose, LLP was co-counsel in the Sientra case and represented the company in the 15 employment cases.
“Unhappy Mentor employees left the company and Johnson & Johnson used their departures as an opening to try to crush Sientra,” says Leila J. Noël, partner with Cappello & Noël, LLP. “When that wasn’t successful, it went after Sientra. The Santa Barbara jury rejected all of its arguments across the board and found there was no liability on any of the causes of action alleged against Sientra or Mr. Lewis.”
With its latest legal loss, Johnson & Johnson/Mentor has not won a single lawsuit against Sientra or its employees since it began filing its lawsuits 18 months ago.
