Judge Approves $12M Caldera Pelvic Mesh Deal Despite Protests

By Emily CoxCaldera Pelvic Mesh Deal

Despite 36 objectors, a California federal judge approved Federal Insurance Company’s $12.25 million deal to resolve insurance claims, alleging that Caldera pelvic mesh implant injured more than 2,700 women.

Federal Insurance agreed to distribute $10.58 million among the 2,710 claimants and to pay $670,020 in attorney fees and costs. In return, the plaintiffs agreed to release Caldera and Federal Insurance from all future claims.

In his order, issued March 6, U.S. Judge Stephen V. Wilson pronounced the deal as fair, reasonable, adequate, and “consistent with due process.”

Caldera Pelvic Mesh Federal Interpleader Suit

Federal Insurance first launched its federal interpleader suit against Caldera and a class of claimants in January 2015 after Caldera started filing insurance claims to pay for damages awarded to plaintiffs over the pelvic mesh product designed to treat pelvic organ prolapse and stress urinary incontinence in women.

The plaintiffs claimed that Caldera knew or should have known that its transvaginal mesh devices were hazardous and dangerous. Consequently, they sought damages from Caldera, which turned around to file insurance claims to pay for these settlements.

According to Federal Insurance’s complaint, Caldera was depleting its $25 million policy by fighting these lawsuits in state court. The complaint also noted that it had already paid out more than $6.3 million in settlements with thousands more claims still pending. Federal Insurance requested the court to identify a class of claimants and stop them from pursuing future suits that would affect the insurance policy.

Caldera Pelvic Mesh Deal

In December 2015, the parties reached a $12.25 million lump sum deal with a $500,000 holdout to resolve pending claims and end its policy with Caldera. The deal stipulated that claimants could not opt out of the settlement.

But, three dozen women objected in June 2016. They wanted evidence that showed if the payout would be greater if Caldera liquidated. They requested an independent audit to make sure Caldera was offering the maximum amount possible to women injured by the pelvic mesh device.

Caldera and Federal Insurance argued an audit wasn’t necessary as Caldera had already produced financial records. The records indicated that the company was cash-poor, had no profit, and only had its insurance to settle the lawsuits. Furthermore, there was nothing that showed the liquidated value of the company would exceed the current settlement.

In July, Judge Wilson sided with the objectors and ordered Caldera to submit supportive evidence.

In September, Caldera filed an expert report. It showed any attempt to liquidate Caldera would result in a net loss. The company also filed another motion for final settlement approval. However, objectors challenged the deal and the export reports findings. At least, one objector requested exclusion from the deal.

However, Judge Wilson refused to excuse the objectors from the settlement. He found that the report sufficiently addressed concerns and approved this past Friday.

The deal is a victory, according to plaintiff attorneys. They said that since Caldera’s only real asset is its insurance policy, this was the only way that the claimants were going to get anything.

Transvaginal Mesh Lawsuits

In 2011, the FDA issued a warning after receiving almost 2,900 reports of problems with vaginal mesh products between January 2008 and December 2010. The FDA concluded that there was no evidence that transvaginal mesh provides any additional benefits when compared totraditional treatments.

In early 2012, the FDA sent a letter to several pelvic mesh manufacturers. The letter ordered that they conduct additional studies and trials to evaluate these products’ safety, and establish whether they pose an unreasonable risk of injury for women.

However, many of the manufacturers did not follow-through with the safety studies. Instead, they removed the products from the market.

Tens of thousands of women have filed pelvic mesh lawsuits against about half a dozen manufacturers. Thousands of cases have been settled out of court, and a number of cases have resulted in multi-million dollar jury verdicts for women who suffered permanent and debilitating injuries.

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