Johnson and Johnson says it is pleased to put a legal dispute behind it after a Chinese court ordered it to pay compensation to a former distributor under an anti-monopoly law.
Thursday’s ruling said Johnson & Johnson was guilty of “vertical monopoly” for setting minimum prices its distributors charged for surgical sutures. It noted that J&J has stopped that practice but ordered it to pay 530,000 yuan ($85,000) to a Chinese distributor that said it lost potential sales due to the restriction.
“While we are disappointed with today’s ruling by the Higher People’s Court of Shanghai, we are pleased to have put this matter behind us and look forward to continuing to provide our high quality products and services to healthcare institutions and patients in China,” said J&J in a statement.
Lawyers said the ruling indicates Chinese authorities are stepping up anti-monopoly investigations.
The ruling was the first of its kind against a Fortune 500 company under China’s 5-year-old anti-monopoly law, according to lawyers and Chinese news reports.
Business groups welcomed the law in 2008 as a step toward making operating conditions clearer but have said since then it is enforced more actively against global companies than against their local rivals.
The case comes amid separate Chinese investigations of possible bribery, price-fixing and other misconduct by global suppliers of milk, pharmaceuticals and other products.