Court File and Parties

COURT FILE NO.: CV-14-514396-00CP DATE: 2020/04/08

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

JANICE CAROL KOUYOUMJIAN, TERRENCE KOUYOUMJIAN, FRANCES FORSBERG and KIMBERLY DORAN Plaintiffs

• and -

JOHNSON & JOHNSON INC., JOHNSON & JOHNSON MEDICAL COMPANIES, JOHNSON & JOHNSON, ETHICON INC., ETHICON WOMEN’S HEALTH AND UROLOGY and GYNACARE Defendants

Counsel: Charles Wright, Daniel E.H. Bach and Stefani Cuberovic for the Plaintiffs Gordon McKee for the Defendants

Proceeding under the Class Proceedings Act, 1992

HEARD: In writing

REASONS FOR DECISION

PERELL, J.

1This is a motion pursuant to the Class Proceedings Act, 1992,¹ to discontinue this proposed class action because the Plaintiffs and the Defendants have entered into a settlement that settles the Plaintiffs’ claims and the claims of many but not all of the putative Class Members who are represented by putative Class Counsel.

2The settlement settles some but not all of the putative Class Members’ claims. The settlement, thus, is not comprehensive in the sense that not all putative Class Members are participants in the settlement, but the settlement does provides third party beneficiary benefits to these putative Class Members and a process for putative Class Members to participate in a settlement process or to bring their own individual claims.

3The action relates to pelvic mesh implants known as transvaginal mesh. This medical product is manufactured and sold by the Defendants, Johnson & Johnson Inc., Johnson & Johnson Medical Companies, Johnson & Johnson, Ethicon Inc., Ethicon Women’s Health and Urology, and Gynacare, a Division of Ethicon, Inc. The transvaginal mesh products are used to treat Pelvic Organ Prolapse and Stress Urinary Incontinence in women.

4This action was commenced on February 3, 2012. The Plaintiffs are Janice Kouyoumjian, Terrence Kouyoumjian, Frances Forsberg, and Kimberley Doran. Mr. Kouyoumjian’s and Ms. Doran’s claims are derivative claims pursuant to the Family Law Act,²

5The Plaintiffs allege that the Defendants were negligent in causing injuries and harm to the putative Class Members who were implanted with the Defendants’ transvaginal mesh products.

6Several law firms, including Siskinds LLP, represent the putative Class Members.

7As of September 1, 2019, putative Class Counsel are aware of 1,252 putative Class Members with pelvic mesh implant claims against the Defendants throughout Canada.

8The Defendants did not deliver a Statement of Defence, and in October 2014, the Plaintiffs served their certification record, following which the Defendants issued a Demand for Particulars and Amended Demand for Particulars. The Plaintiffs complied with these demands.

9More or less contemporaneously with the Plaintiffs’ action, there were two similar class actions involving pelvic mesh implants. One action was against Boston Scientific Ltd., Vester v Boston Scientific Ltd.,³ and the other was against Bard Canada, O’Brien v Bard Canada Inc.⁴

10In April 2015, the certification motion in the action against Bard was dismissed. The Plaintiffs were invited to initiate a different means to obtain access to justice including one or more consolidated actions or one or more proposed discrete products liability class actions or to develop some newly devised procedure for a mass claim.⁵

11Between July and September 2019, there were intensive ongoing settlement discussions between the Defendants and putative Class Counsel including numerous teleconferences and email discussions, lengthy settlement meetings in New York and Toronto. The negotiations involved in-house lawyers for Ethicon, U.S. settlement counsel, and Canadian counsel. Negotiations included a detailed consideration of individual claims to generate a global settlement amount.

12Meanwhile, the Boston Scientific certification motion was litigated in two phases beginning in 2015, and the action was certified as a class proceeding in February 2017.⁶

13After the Boston Scientific decision, in November 2017, the Plaintiffs served a supplementary certification record.

14The on-going negotiations eventually culminated in a settlement that involves a discontinuance of this action. Pursuant to the Class Proceedings Act, 1992, proposed class actions cannot be discontinued without court approval.

15Although technically speaking it may not be required under the Class Proceedings Act, putative Class Counsel are also seeking court approval of the payment of their fee, which is an aspect of the Settlement Agreement. As part of the settlement, the Defendants have agreed to pay $1,085,000.00 in costs, inclusive of disbursements and applicable taxes, for putative Class Counsel’s fees and disbursements including the cost of the Notice of Discontinuance

16The major terms of the Settlement Agreement are as follows.

• The parties agree to discontinue the proposed class action.
• The parties agree to a global settlement amount to resolve the known claims of putative Class Members: (a) who were implanted with one or more historic pelvic mesh implant products or who were or are implanted with an Ethicon Gynecare TVT Product; (b) who had at least one surgery to remove, in whole or in part, the pelvic mesh implant; (c) who are represented by Plaintiffs’ Counsel; and, (d) who have executed releases of their claims.
• As at September 1, 2019, there were 693 Settled Claimants eligible to receive compensation. The Settlement Agreement addresses the claims of women who contacted putative Class Counsel, or lawyers known to Class counsel, over the 7 years the class action has been pending
• The Settlement Agreement contains detailed provisions to address the claims of further claimants who come forward and provide proof of product usage and injury within the Settlement Program Period.
• The Settlement Program Period will run for 120 days after the filing of the Order approving the discontinuance of the action or the date of the first Notice of Discontinuance, whichever is later.
• Subject to certain limitations, included in the Settlement are up to 50 putative Class Members for whom Counsel, as of September 1, 2019, did not have the required medical records demonstrating that these persons underwent an implant surgery involving the Defendants’ products.
  • These Claimants are individuals: (a) who were implanted with a pelvic mesh implant product (either a historical product, or a Ethicon Gynecare TVT Product) implanted before May 31, 2015; (b) who had a Revision Surgery; (c) who were identified by Class Counsel after September 1, 2019 and prior to the end of the Settlement Program Period; and (d) for whom Class Counsel, as of September 1, 2019, did not have knowledge of, or, for persons implanted with a Ethicon Gynecare TVT Product before May 31, 2015, did not have medical records demonstrating that the individuals had undergone a Revision Surgery.
  • The limitation periods for the Future Claimants’ claims included in the Settlement will be suspended from the date that Class Counsel notifies the Defendants of such Future Claimants during the Settlement Program Period until the date that the claims are resolved.
  • For the Included Future Claimants, the parties will make best efforts to achieve a resolution of these claims on a similar basis as the Settled Claimants’ claims, failing which the Included Future Claimants’ claims will be subject to arbitration. The limitation periods for the Included Future Claimants’ claims will be suspended from the date that Class Counsel notifies the Defendants of such Future Claimants during the Settlement Program Period until the date that the claims are resolved.
• During the Settlement Program Period, Ethicon will consider resolution of claims (not included within the initial total settlement amount), which would have otherwise been captured by the action and are compensable pursuant to the Settlement, provided notice is given to it within this time period by Class Counsel together with certain information about the implant.
• The Defendants have agreed that the limitation periods of any Future Claimants excluded from participation in the Settlement will be suspended from the date that Class Counsel notifies the Defendants of such Future Claimants during the Settlement Program Period until sixty days after the Defendants’ notice of election whether to include such individuals within the Settlement process.
• Notice is provided to other putative Class Members to provide them with an opportunity to participate in the claims resolution process within a specified time period.
• The Defendants agree that the claims of individuals who retained Class Counsel and who had a Ethicon Gynecare TVT Product implanted before May 31, 2015 but who the Defendants do not consider as having undergone a Revision Surgery (“Non-Revised Claimants”) are preserved until the 5th anniversary of the date of Settlement. The parties will make best efforts to resolve the claims of any Non-Revised Claimants that undergo Revision Surgery within this timeframe in a similar manner to the Future Claimants’ claims; however, arbitration is not available. The statute of limitations on such claims will begin on the date of the Revision Surgery or recommendation for Revision Surgery, whichever occurs first.
• The parties agree to extend the benefit of the Settlement process to the Non-Revised Claimants, if revised within 5 years, all of whom are third-party beneficiaries with access to rights and benefits under the Settlement.
• Siskinds will continue to represent known and future claimants with valid claims that are excluded from the Settlement, including those individuals that undergo Revision Surgery within the time period during which the Non-Revised Claimants’ claims are preserved. The Settlement does not bar such individual actions so long as they are filed within the applicable limitation period after the date of the Revision Surgery or recommendation for Revision Surgery.
• The total settlement amount will be delivered by the Defendants to putative Class Counsel upon receipt of a specified number of executed releases, the “claimant threshold”.
• The settlement funds will be allocated by putative Class Counsel to the Settled Claimants in proportion to the individual damages suffered. The distribution will be guided by the compensation and distribution protocol approved by this Court in Harper v American Systems Canada Inc.,⁷ including considering each Settled Claimant’s severity of injury and age.
• The Defendants shall pay costs of $1,085,000.00, all inclusive, for Counsel’s fees, disbursements and for the expense of the Notice of Discontinuance and the Publication Notice Plan. The costs of the dissemination of the Notice of Discontinuance and the Publication Notice Plan will be paid by Counsel.
• The discontinuance of the action will be effective 90 days after publication of the Notice of Discontinuance.
• The proposed Notice of Discontinuance is drafted: (a) to alert putative Class members of the fact of the Settlement and discontinuance of the action; (b) to inform putative Class Members how to obtain more information about the discontinuance; (c) to inform them of the recommencement of the running of the limitation period; and (d) to inform them of the process and deadline for making a claim for compensation during the Settlement Period.

17The Notice Plan provides that the Notice of Discontinuance will be disseminated on a national basis including newsprint publication in English and French, website publication, and directly by email or mail to all known and potential putative Class members.

18Under the Notice Plan the publication of the Notice of Discontinuance is to begin the earlier of within seven days from the date of this court’s Order or an Order of the Québec Court dismissing the proceeding styled Jo-Ann Marie Gallant & Dave Hughes v Johnson & Johnson et al, Quebec Court File No. 200-06-000153-125.

19Given the attention given in the media about the various transvaginal mess class action, there are not likely many putative Class Members who before the expiry of the Settlement Program Period, will not know about the Settlement or their rights to make a claim.

20Siskinds has docketed time that exceeds $1.5 million plus applicable taxes. The additional Counsel firms have docketed time of approximately $560,000.00, plus applicable taxes, for a total of over $2.0 million. Siskinds has incurred disbursements of approximately $65,800.00 and the additional Class Counsel have incurred disbursements of approximately $107,400.00, plus applicable taxes.

21Considerable work remains to be done by Counsel, including facilitating implementation of some of the Publication Notice Plan and responding to inquiries from putative Class Members and their lawyers regarding the Settlement.

22The proposed discontinuance of this action is modelled on the approved discontinuance in Naylor v Coloplast Canada Corporation,⁸ another national class action involving transvaginal mesh and its use to treat Pelvic Organ Prolapse and Stress Urinary Incontinence in women.

23As was the case in Naylor, putative Class Members who are not part of the Settlement Agreement may have an opportunity to participate in the settlement and they have the alternatives of individual actions, joinder of claims, or finding another Class Counsel to start a new class action. Putative Class Counsel are not precluded from representing such women individually and are prepared to do so.

24Section 29 of the Class Proceedings Act, 1992 requires court approval for the discontinuance, abandonment, or settlement of a class action. Section 29 states:

Discontinuance, abandonment and settlement

29. (1) A proceeding commenced under this Act and a proceeding certified as a class proceeding under this Act may be discontinued or abandoned only with the approval of the court, on such terms as the court considers appropriate.

Settlement without court approval not binding

(2) A settlement of a class proceeding is not binding unless approved by the court.

Effect of settlement

(3) A settlement of a class proceeding that is approved by the court binds all class members.

Notice: dismissal, discontinuance, abandonment or settlement

(4) In dismissing a proceeding for delay or in approving a discontinuance, abandonment or settlement, the court shall consider whether notice should be given under section 19 and whether any notice should include,

(a) an account of the conduct of the proceeding;

(b) a statement of the result of the proceeding; and

(c) a description of any plan for distributing settlement funds.

25A motion for discontinuance should be carefully scrutinized, and the court should consider, among other things: whether the proceeding was commenced for an improper purpose, whether, if necessary, there is a viable replacement party so that putative class members are not prejudiced, or whether the plaintiff or the defendant will be prejudiced.⁹

26The fundamental concern on a motion for court approval of a discontinuance is that the interests of putative Class Members will not be prejudiced or that any prejudice is mitigated.¹⁰ The test for approving a discontinuance is different from the test for approving a settlement. A discontinuance of a class action does not have to be beneficial or in the best interests of the putative class members; whereas, a settlement must, in all circumstances, be fair, reasonable, and in the best interests of the class.¹¹

27In the immediate case, I am satisfied that the Plaintiffs have met the test for a discontinuance. In the circumstances of the immediate case for those putative Class Members who have settled claims or who have the potential to participate in the scheme of the Settlement Agreement, this discontinuance is beneficial and not prejudicial. For the other putative Class Members, they are not prejudiced by the discontinuance.

28For the above reasons, I approve the Order attached as Schedule “A” to these Reasons for Decision.

29In the circumstances of the Covid-19 emergency, these Reasons for Decision are deemed to be an Order of the court that is operative and enforceable without any need for a signed or entered, formal, typed order.

30The parties may submit formal orders for signing and entry once the court re-opens; however, these Reasons for Decision are an effective and binding Order from the time of release.

Perell, J.

Released: April 8, 2020

SCHEDULE “A”

Court File No. 6256-12CP

ONTARIO SUPERIOR COURT OF JUSTICE

The Honourable Mr. Justice Perell

*day, the *th day of April, 2020

BETWEEN:

JANICE CAROL KOUYOUMJIAN, TERRENCE KOUYOUMJIAN, FRANCES FORSBERG and KIMBERLY DORAN Plaintiffs

• and -

JOHNSON & JOHNSON INC., JOHNSON & JOHNSON MEDICAL COMPANIES, JOHNSON & JOHNSON, ETHICON INC., ETHICON WOMEN’S HEALTH AND UROLOGY and GYNACARE Defendants

Proceeding under the Class Proceedings Act, 1992

ORDER

Schedule “A” - Order

THIS MOTION made by the Plaintiffs for an Order that the within action be discontinued was heard in writing at the Superior Court of Justice, Osgoode Hall, 130 Queen St W, Toronto, Ontario.

ON READING the materials filed by the Plaintiffs, the Defendants consenting to the motion:

1. THIS COURT ORDERS that the within proceeding be and hereby is discontinued, effective ninety (90) days after first publication of the Notice of Discontinuance attached as Schedule “A”, and that the Plaintiffs shall file a formal notice of discontinuance of this proceeding pursuant to the Rules of Civil Procedure on that day.

2. THIS COURT ORDERS that the Notice of Discontinuance, in the form of the attached Schedule “A”, is approved pursuant to section 19 and section 29 of the Class Proceedings Act, 1992, SO 1992, c 6 (“CPA”).

3. THIS COURT ORDERS that the Publication Notice Plan, in the form of the attached Schedule “B”, is approved pursuant to section 19 and section 29 of the CPA.

4. THIS COURT ORDERS that the Notice of Discontinuance shall be disseminated by the Plaintiffs in accordance with the Publication Notice Plan attached as Schedule “B”, with first publication occurring within seven (7) days from the date of this Order or an Order of the Québec Court dismissing the proceeding styled Jo-Ann Marie Gallant & Dave Hughes v Johnson & Johnson et al, Quebec Court File No. 200-06-000153-125, whichever occurs later, and the publication otherwise being completed as soon as practicable thereafter.

5. THIS COURT ORDERS that, unless provided by any agreements made to the contrary, any limitation period applicable to women in Canada who were implanted with the Defendants’ Pelvic Mesh Products (as defined in the Statement of Claim in this proceeding) and to people in Canada who, by reason of their relationship to a person implanted with the Defendants’ Pelvic Mesh Products, are entitled to make claims under the Family Law Act, RSO 1990, c F 3, s 61 or analogous legislation in other provinces or at common law shall remain suspended until the date ninety (90) days following the first publication of the Notice of Discontinuance.

6. THIS COURT ORDERS that the Defendants’ payment of costs to the Plaintiffs in the amount of $1,085,000.00, inclusive of disbursements and HST, is hereby approved.

Date: ________________________

Perell, J.

Schedule “A”

NOTICE OF DISCONTINUANCE OF JOHNSON & JOHNSON CLASS ACTION - TRANSVAGINAL MESH FOR STRESS URINARY INCONTINENCE AND PELVIC ORGAN PROLAPSE

Schedule “A” - Notice of Discontinuance

Please Read This Notice Carefully. It May Affect Your Legal Rights.

By Order of the Ontario Superior Court of Justice, all persons resident in Canada who have been implanted with an Ethicon transvaginal mesh ("TVM") product are advised that:

In October 2012, a proposed class proceeding was commenced in Ontario against Johnson & Johnson and related companies ("Ethicon") alleging that Ethicon's TVM products, intended to treat stress urinary incontinence ("SUI") or pelvic organ prolapse ("POP"), were negligently designed, manufactured, and distributed, and that inadequate warnings were given with respect to the risks inherent in their use. The plaintiffs allege that this resulted in increased complications as compared to other treatment options. Proposed class proceedings making similar allegations were also commenced in Alberta, Saskatchewan and Québec.

Ethicon denies these allegations.

Although Ethicon denies liability, the parties and their counsel have reached an agreement in principle to resolve all claims known to Claimants' Counsel listed below. Ethicon will continue to consider the settlement of individual claims of which it is given notice by Siskinds until [insert date] ("the settlement program period"). On this basis, Siskinds filed motion materials with the Ontario Superior Court of Justice to obtain approval of the discontinuance. The discontinuance was approved by the Court and it will be filed and take effect on [date to be inserted: XXX days after publication of the intention to discontinue].

The discontinuance relates to the Ethicon transvaginal mesh class action only. It does not relate to claims against various other manufacturers of TVM products. Orders to discontinue or dismiss the proposed class proceedings against Ethicon in Alberta, British Columbia, Saskatchewan and Québec have also been granted.

YOU SHOULD TAKE NOTICE THAT THE limitation period for bringing a claim, if there is any time left within it, will recommence when the notice of discontinuance is filed with the Ontario Superior Court of Justice on [date to be inserted: 90 days after publication of the intention to discontinue]. On the expiry of the limitation period a right to sue may be extinguished.

TAKE NOTICE THAT because the limitation period for bringing a claim will recommence with the filing of the notice of discontinuance , if you wish to pursue a court claim against Ethicon in relation to a TVM product, you will need to issue a Notice of Action or Statement of Claim, if you have not already done so, before [date to be inserted 90 days after publication of the intention to discontinue].

Siskinds will answer questions about the discontinuance, the recommencement of the running of the limitation period, or about pursuing a claim against Ethicon during the settlement program period at no charge. Please contact Claimants' Counsel at:

SISKINDS LLP 680 Waterloo Street P.O. Box 2520 London, ON N6A 3V8

Elizabeth deBoer Rachel Pardy (800) 461-6166 x 2367 (519) 672-2121 x 2367 elizabeth.deboer@siskinds.com rachel.pardy@siskinds.com

SISKINDS, DESMEULES sencrl Les Promenades du Vieux-Québec 43, rue De Buade, bur 320 Quebec, QC, GlR 4A2

Caroline Perrault Erika Provencher (418) 694-2009 caroline.perrault@siskindsdesmeules.com erika.provencher@siskindsdesmeules.com

ROCHON GENOVA LLP 121 Richmond Street West, Suite 900 Toronto, ON M5H 2Kl Joel Rochon (416) 548-9874 jrochon@rochongenova.com

MERCHANT LAW GROUP LLP 116 Albert Street, Suite 300 Ottawa, ON KIP 5G3 Evatt Merchant (613) 563-7777 emerchant@merchantlaw.com

It is recommended that you obtain legal advice from Claimants' Counsel or a lawyer of your choice. For updated information with respect to the discontinuance or about making a claim, please consult www.siskinds.com/transvaginal-mesh.

If you do not know what type of transvaginal mesh you were implanted with, you can retrieve your medical records, which will typically note the brand of mesh used. If you need help retrieving your records, Siskinds can assist.

PUBLICATION OF THIS NOTICE HAS BEEN AUTHORIZED BY THE ONTARIO SUPERIOR COURT OF JUSTICE

Schedule “B”

PUBLICATION NOTICE PLAN

Schedule “B” - Publication Notice Plan

(1) The Notice of Discontinuance will be sent by email or direct mail by Claimants' Counsel to any person who has contacted the firm, about the Class Action or who has registered to receive updates on Claimants' Counsel's website(s), or who may have an outstanding claim against the Defendant, including any person with transvaginal mesh from an unknown manufacturer. Where the person is located in Québec (or otherwise specifically requests), the Notice of Discontinuance will be sent in English and French;

(2) The Notice of Discontinuance will be posted by Claimants' Counsel, in English and French, on their website(s);

(3) The Notice of Discontinuance will be sent by email or direct mail by Claimants' Counsel to any Plaintiff Counsel representing transvaginal mesh claimants, within the knowledge of Claimants' Counsel;

(4) The Notice of Discontinuance will be published once, in English, in The Globe and Mail, national edition;

(5) The Notice of Discontinuance will be published once, in French, in Le Journal de Montréal and Le Journal de Québec;

(6) The Notice of Discontinuance will be provided by Claimants' Counsel to any person who requests it.

[31]

Footnotes

1. 1S.O. 1992, c.6.
2. 2R.S.O. 1990, c. F 3, s 61.
3. 3Court File No. CV-15-527310 CP.
4. 4Court File No. CV-15-523068CP.
5. 5O’Brien v Bard, 2015 ONSC 2470
6. 6Vester v. Boston Scientific Ltd, 2017 ONSC 2498.
7. 7Harper v American Medical Systems Canada Inc, 2019 ONSC 5723
8. 82016 ONSC 1294.
9. 9Logan v. Canada (Minister of Health), [2003] O.J. No. 418 (S.C.J.), aff’d (2004), 2004 CanLII 184 (ON CA), 71 O.R. (3d) 451 (C.A.).
10. 10Drywall Acoustic Lathing and Insulation Local 675 Pension Fund (Trustees of) v. SNC-Lavalin Group Inc, 2012 ONSC 5288; Frank v. Farlie, Turner & Co, LLC, 2011 ONSC 7137; Hudson v. Austin, 2010 ONSC 2789.
11. 11Frank v. Farlie, Turner & Co, LLC, 2011 ONSC 7137