Court Orders Johnson & Johnson To Compensate Auris Health Shareholders $1B

Johnson & Johnson JNJ has reportedly been ordered to pay $1 billion in damages to Auris Health shareholders for breaching a 2019 acquisition agreement, according to a ruling by Delaware’s Court of Chancery.

Vice Chancellor Lori Will’s decision came after a two-week trial, finding that Johnson & Johnson failed to support Auris’ iPlatform technology, which was critical for earning additional payments to Auris’ investors.

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The dispute centers around Johnson & Johnson’s failure to meet its commitments in the $3.4 billion acquisition of Auris Health, Reuters reports. Johnson & Johnson had promised up to $2.35 billion more if Auris achieved certain technological milestones.

However, the judge noted that Johnson & Johnson’s obligations were not met promptly, leading to a breach of contract.

The ruling described how Johnson & Johnson’s actions effectively forced Auris’ iPlatform technology to compete against its Verb device rather than support its advancement.

Johnson & Johnson argued that the ruling was based on a commercially unreasonable interpretation of their contract and expressed intention to appeal.

The company maintained that the missed milestones were due to technical issues with Auris’ devices. It asserted that the merger agreement allowed them to use Auris’ products to benefit their robotics program. Vice Chancellor Will, however, found these claims unsubstantiated in her ruling.

Price Action: JNJ stock is down 0.25% at $166.74 at the last check on Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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