AAJ News Brief

Shareholder urging mandatory arbitration seeks to block J&J’s annual meeting.

In an analysis piece for Reuters (3/27), Alison Frankel writes, “There has been a significant escalation in the fight over whether corporations can require shareholders to arbitrate claims against the company.” According to Frankel, “A Johnson & Johnson shareholder pushing for mandatory arbitration moved Tuesday to enjoin J&J’s April 25 annual meeting, arguing that the company must allow investors to vote on a proposal that would require them to arbitrate their disputes with J&J.” The preliminary injunction motion, filed in federal court in Trenton, New Jersey, “will be, to the best of my knowledge, the first courtroom test of the legality of mandatory shareholder arbitration.” The motion, “which follows a March 1 lawsuit against the company, was filed by the Doris Behr 2012 Irrevocable Trust,” which “wants the court to compel J&J to allow shareholders to vote on a proposed bylaw precluding securities class actions and directing investors to resolve claims in individual proceedings before the American Arbitration Association.” Frankel adds, “After the trust sued, the American Association of Justice” and other groups “issued statements warning that the mandatory arbitration provisions the Behr trust is advocating will make it easier for corporations to defraud investors. ‘We will continue to oppose this effort and any others that aim to shield unscrupulous corporations from accountability by hiding behind forced arbitration clauses,’ the AAJ statement said.”

Experts warn of “catastrophic injuries” as trampoline parks grow in popularity.

KWCH-TV Wichita, KS (3/29, KWCH, 117K) reports from New York, “Over the past several years, trampoline parks have grown into a billion-dollar industry,” but “with that growth comes a downside.” CBS News “confirms in the last seven years, at least six people have died from injuries at trampoline parks. ‘That number could be even higher because many of those injured are often forced into arbitration and sign confidentiality agreements that stop them from speaking out,’ CBS News’ Meg Oliver reports.” KWCH-TV adds, “CBS News reports that state lawmakers in Utah recently passed a new law to try to make trampoline parks safer, joining ‘at least seven other states requiring more oversight from insurance companies and annual inspections.’”

Crash investigators believe MCAS was major factor in fatal Boeing 737 Max crashes.

In coverage of the latest updates from the international investigation into the fatal Ethiopian Airlines Flight 302 crash and the global grounding of Boeing’s 737 Max jets, ABC World News Tonight broadcast that investigators have uncovered a “connection linking the” Ethiopian Airlines crash and an earlier fatal crash aboard Lion Air Flight 610. In both crashes, the “pilots fought an automated safety system,” MCAS, that kept forcing the nose of the plane down as an anti-stall feature. Although the MCAS system “had been the subject of bulletins and directives,” in the wake of the grounding of all 737 Max aircraft, Boeing has been preparing a software update that “will make MCAS harder to misfire and easier for pilots to recover.” Tested by American Airlines pilots, the new “software update is expected to be approved by the FAA next week.”

        The New York Times (3/29, A1, Glanz, Kaplan, Nicas, 17.3M) reports in a front-page story that “data from a vane-like device, called the angle-of-attack sensor, incorrectly activated the computer-controlled system, according to several people who have been briefed on the contents of the black box in Ethiopia.” The Times reports that in the wake of the global grounding of the 737 Max planes, Boeing faces investigations into how the aircraft were developed, “while the Transportation Department’s inspector general is looking into the certification process” and “has issued a subpoena to at least one former Boeing engineer for documents related to the 737 Max, according to a person familiar with the investigation.” Boeing vice president of engineering Mike Sinnett, however, maintained on Wednesday that “The 737 is a safe airplane.”

        The Wall Street Journal (3/29, A1, Stevis-Gridneff, Kassa, Subscription Publication, 7.06M) reports in a front-page story that a top-level briefing to FAA officials on Thursday presented the best evidence to date that the MCAS system may have caused the two fatal 737 Max crashes in the last five months.

Nestle accused of selling groundwater as Poland Spring.

The New York Daily News (4/1, Braine, 2.22M) reports Nestlé “stood by its spring water designation for its signature bottled beverage even as a judge ruled that a lawsuit could proceed accusing the company of selling groundwater labeled Poland Spring.” According to a suit filed by consumers in eight states, “‘not one drop’ of Poland Spring water actually comes from a spring...especially since the spring of the same name in Maine dried up 50 years ago.”

Annapolis, Maryland sues opioid industry.

The Baltimore Sun (3/29, Ohl, 776K). “The City of Annapolis filed a lawsuit seeking $400 million from pharmaceutical companies and local prescribers implicated in the opioid epidemic – and has retained a firm with ties to Mayor Gavin Buckley to litigate the case. Filed Feb. 26 by local attorney F. Joseph Gormley, the lawsuit names some of the country’s biggest pharmaceutical companies as participating in a campaign to obscure the dangers of opioids, while continuing to promote the drugs as safe or necessary.”

        Prince William County, Virginia files lawsuit against opioid manufacturers, distributors. Inside NoVa (VA) (3/29). “Prince William County is the latest local governments to file a lawsuit against companies making money off opioids. The county filed a lawsuit March 27 against 15 opioid manufacturers, distributors and pharmacy businesses. The move followed a $270 million settlement reached Tuesday in a case brought by the state of Oklahoma against Purdue Pharma over its marketing of OxyContin.”

        New York’s opioid lawsuit targets eight Sackler family members. The Wall Street Journal (3/29, Randazzo, Hopkins, Subscription Publication, 7.06M) reported it has reviewed portions of an amended lawsuit that seeks to hold eight members of the Sackler family, which owns the OxyContin (oxycodone hydrochloride) manufacturing firm Purdue Pharma, and other defendants accountable for contributing to opioid crisis-related problems in New York. Among other things, the lawsuit alleges that Richard Sackler sent emails which appeared to show a lack of empathy for people with a substance use disorder. The Journal added that drug makers, Purdue included, are subject to more than 1,600 lawsuits across the country.

DOJ moves to dismiss Gilead whistleblower lawsuit over HIV drugs.

Reuters (3/29, Raymond) reported that the US Justice Department (DOJ) on Thursday “moved to dismiss a closely watched whistleblower lawsuit accusing Gilead Sciences Inc of covertly arranging to have key ingredients for HIV medications made at a Chinese facility that had quality control issues.”

        Bloomberg Law (3/29, Seiden, Subscription Publication) reported that the DOJ said that terminating the claims would save “scarce” government resources.

        Law360 (3/29, Subscription Publication, 7K) provided additional coverage.

Plaintiffs allege California women’s health center secretly recorded more than 1,800 patients.

The Hill (3/31, Daugherty, 3.85M) reports, “A lawsuit filed in California alleges a women’s health center secretly recorded appointments of more than 1,800 patients using hidden cameras.” The health center claims the secret recordings were part of an investigation “into whether an employee was stealing the anesthesia drug propofol from drug carts in the operating rooms,” according to a local news outlet.

Arizona man is latest person to die from exploding Takata airbags.

The AP (3/29, Krisher) reports that 55-year-old Arizona resident Armando Ortega became “the 16th [fatality] in the U.S. caused by the air bags” recalled by Takata Corp., “which can explode with too much force and hurl shrapnel into drivers and passengers.” Worldwide, “at least 24” people have been killed. The AP (3/29) also reports with a list of the deaths from Takata airbags since May 2009.

        Reuters (3/29, Shepardson) reports Honda confirmed the death was due to an exploding Takata airbag inflator “after a joint inspection Friday with the National Highway Traffic Safety Administration.” Ortega died in June 2018 “after the crash of a 2002 Honda Civic in Buckeye, Arizona.”

        Outlets reporting with similar coverage include the Detroit Bureau (3/29), Roadshow (3/29, Hyatt, 2.63M), Automotive News (3/29, 187K), and Cars (3/29, 1.43M).

Hawaii bill would ban flavored e-cigarette liquids, flavored tobacco products.

The AP (3/29, McAvoy) reported that Hawaii “is contemplating a new nicotine crackdown: outlawing flavored electronic cigarette liquids and flavored tobacco to combat a spike in teenage vaping.” A bill before the state Legislature specifically “would ban flavored e-cigarette liquids such as Maui Mango and Cookie Monsta, along with cloves and other flavored tobacco products, but it would exempt menthol cigarettes and vaping liquids.”

        On its website, CNN (3/29, Prior, 86.01M) reported that “the Hawaii Public Health Institute submitted a list of 120 organizations supporting the legislation,” including the Hawaii chapter of the American Academy of Pediatrics. CNN added that Food and Drug Administration Commissioner Scott Gottlieb “announced federal-level plans aimed at preventing a new generation from getting addicted to nicotine” last November, saying that the agency aimed to “combat youth access and appeal with a policy framework that firmly and directly addresses the core of the epidemic – flavors.”

        Percentage of people who think e-cigarettes equally, more harmful than cigarettes increasing, study suggests. U.S. News & World Report (3/29, Newman, 2.54M) said “the shares of U.S. adults who perceive e-cigarettes to be as harmful as or more harmful than traditional cigarettes have notably increased in recent years, a new study finds, raising concern some smokers may be deterred from switching to electronic devices that in the short term appear to be a healthier option.” For the study, researchers “analyzed data from two large, nationally representative surveys that dealt with attitudes and perceptions surrounding e-cigarette products.” Researchers “found that the proportion of adults in the U.S. who perceived e-cigarettes as less harmful than cigarettes declined – from 39.4 percent in 2012 to 33.9 percent in 2017 in one, and from 50.7 percent in 2012 to 34.5 percent in 2017 in the other.”

        MD Magazine (3/29, Kaltwasser) reported that the study suggests “the percentage of people who believe e-cigarettes are equally harmful to cigarettes increased substantially (from 11.5% to 36.4% in TPRPS [Tobacco Products and Risk Perceptions Surveys]), as did the number of people who believe e-cigarettes are more harmful than cigarettes (from 2.8% to 9.9% in HINTS [Health Information National Trends Surveys]).” Although “e-cigarettes have not been around long enough for scientists to fully understand the long-term health impacts of e-cigarette use, many public health agencies – including the Centers for Disease Control and Prevention – generally say e-cigarettes are somewhat less dangerous than cigarettes, even though they are still bad for the smoker’s health.” The findings were published in JAMA Network Open.

        HealthDay (3/29, Reinberg, 23K) also reported on the study.

At least 20 Kentuckians sickened by E. coli from unknown source.

The Louisville (KY) Courier-Journal (3/29, Trautmann, 388K) reported that “at least 20 Kentuckians have been sickened” by “a strain of E. coli bacteria, but the source of the outbreak hasn’t been identified, the Kentucky Department for Public Health announced Friday.” Public health officials “suspect that some sort of food distribution is likely to blame for the sometimes life-threatening bacteria.” So far, “no deaths linked to the outbreak have been reported but six people have been hospitalized.”

Volkswagen recalls more than 56,000 cars, SUVs over rear coil springs.

The AP (3/29) reported that Volkswagen will recall “over 56,000 cars and SUVs in the U.S. because the rear coil springs can break without warning and cause people to lose control of their vehicles.” The AP added that according to documents posted by the National Highway Traffic Safety Administration on Thursday, “the recall covers certain 2015 through 2019 Golf hatchbacks, the 2017 through 2019 Golf Sportwagen, the 2019 Jetta sedan and 2018 and 2019 Tiguan SUV.”

Hyundai to recall 20,000 Veloster cars over engine problem.

The AP (3/29, Krisher) reported “Hyundai has found a new problem that can cause its car engines to fail or catch fire, issuing yet another recall to fix problems that have affected more than 6 million vehicles during the past 3 ½ years.” The AP said Hyundai “is recalling about 20,000 Veloster cars in the U.S. and Canada” from the 2013 model year with 1.6-liter engines “because fuel can prematurely ignite in the cylinders around the pistons,” which “can cause excessive pressure and damage the engine, causing vehicles to stall and in some cases catch fire, according to Hyundai documents posted Friday by the U.S. National Highway Traffic Safety Administration.” According to the AP, this problem is “different...from what has caused the rest of the recalls since 2015 from Hyundai and its affiliated automaker Kia, which have been plagued by engine failures and fires across the U.S.”

Mulvaney: Mueller meant for Barr to rule on obstruction.

Politico (3/31, Forgey, 3.05M) reports Acting Chief of Staff Mulvaney “claimed Sunday that special counsel Robert Mueller intended for Attorney General William Barr to determine whether President Donald Trump obstructed justice in the FBI’s investigation into Russian election interference.”

        On ABC’s This Week, Mulvaney said, “From the very beginning, we have said that Mr. Barr gets to handle it. That’s how the law works. Mr. Barr made it clear that he’s going to release it to Congress before he shows it to us. That’s his decision. We’ll let the system work. Keep in mind, this is an extremely thorough report. It took two years, hundreds of people, thousands of subpoenas. It worked the way it was supposed to work. We don’t think it should have taken place in first place, but since it did, we’re glad it’s as thorough as it was. It said there was no collusion or obstruction. We’re happy that it’s over.”

        Cohen disputed Russian links, other conspiracies during House testimony. The Washington Times (3/31, Scarborough, 677K) reports the President’s former lawyer, Michael Cohen, is “unique in the number of conspiracies imprinted on him by Democrats. The tales are not confined to his legendary secret trip to Prague for which no public evidence has emerged and for which he has denied repeatedly at the risk of perjury.” The Times says they also include secret trips to Prague, “his father-in-law is a rich Russian land developer,” a “secret computer server tied directly to Russian oligarch bankers,” and “a Trump love child.” The Times notes that in a 2017 interview, Cohen said, “This whole thing is just nonsense.” During his closed House hearing that year, he said, Democrats, among other things, “accused him of owning multiple passports and implied that he used one of them to enter Prague.”

        Democrats demand release of full Mueller report before mid-April. USA Today (3/31, Jansen, 15.2M) reports Barr is “reviewing Mueller’s final report and said he hopes to reveal much of it by mid-April. House Democrats want it sooner. They signaled that their biggest fight won’t be over how quickly they can read the report but whether they get access to some of the evidence Mueller gathered that did not lead to criminal charges.”

Judge weighs whether advancing NSA suit will harm national security.

Courthouse News (3/29, Iovino) reported US District Judge Jeffry White “signaled Friday that he may end more than a decade of litigation over the government’s mass surveillance program because advancing the lawsuit could threaten national security.” White said, “The court is concerned that it has reached the point that further litigation poses a not insignificant risk of disclosure of national security information and resulting grave harm to national security.”

 • Boeing faces lawsuit on behalf of crash victim.
 • Judge says some claims in Bayer Essure contraceptive lawsuit are barred by statute of limitations.
 • Volkswagen recalling 56,000 cars, SUVs over issue with rear coil springs.
 • Democrats blast Barr after revelation that Mueller’s report is more than 300 pages.